All the Chairman’s Woes—News Corp shuns Google, demands loyal subscribers
This was a case in which two reporters risked everything to get to the bottom of something that seemed wrong—a small event in the grand scheme of things, but one that piqued their curiosity. They asked questions, dug into files and records that were tough to come by in those pre-internet days, made cold calls for facts and took risky midnight meetings in order to get at what they suspected was a bigger story. They persisted despite the skepticism of their superiors, the inevitable “no comments,” the dissembling from the Nixon White House, and the threats of bodily harm they received along the way.
I have to wonder. Would any of that still happen today?
It’s rare to see that level of reporting in the present time. In fact, there is a growing controversy over the state of journalism today, and many observers question whether or not it can survive the internet juggernaut.
Clearly there are issues with the business model for traditional print media as the audience moves online. But to me, the battleground seems oddly drawn.
By way of example, consider that News Corp. chairman Rupert Murdoch recently declared war on internet powerhouse Google, saying that his company may pull properties such as the Wall Street Journal (WSJ) and FOX News from the Google engine. Doing so would mean that News Corp. content would not appear in Google search results.
The controversy erupted over Murdoch’s view that for Google to employ the “fair-use doctrine”—which allows limited use of copyrighted materials for purposes such as search results and documentary filmmaking—was inherently unfair. Murdoch suggested in a recent interview with David Speers of Sky News Australia that Google is making money at News Corp’s expense. The Chairman went on to say that he is only interested in loyal readers who are willing to pay, and that if someone comes to a News Corp property through search, he’d rather do without them.
Wow. As one of those occasional search customers, I have to say this doesn’t make me feel very welcome.
It also makes me think that the smart and powerful Mr. Murdoch may have deluded himself into thinking he can turn back the clock. This isn’t 1976, or even 1986. We no longer go to our front doorsteps in the morning to get our subscription newspapers, read them over breakfast, and then assume we’re current on the news until the evening broadcast. Those days are over.
It seems to me that consumers are already paying a price for free online content. We are blasted by ads that jump and flash and twirl; ads that take over the screen and are impossible to close. And one of the reasons we all went online in the first place wasn’t just the immediacy—though admittedly that was the big draw—but was also the constant rise in price of a daily newspaper that was already chock full of ads. Personally, I think consumers will respond to online media pay walls by saying enough is enough. If media companies can’t earn sufficient revenues from ad sales, then shame on them for letting advertisers pay too little to reach the online audience.
Coming back to the News Corp example, we should note that the Wall Street Journal already has a pay wall, which Murdoch described as “not right to the ceiling.” Users are presented with the headline and first paragraph of a story along with a paid subscription form. I have bumped into this wall quite often, and until recently didn’t understand why it seemed to appear and disappear like the Cheshire Cat.
Now I know that the pay wall comes up only after multiple searches, or with a click onto any WSJ article other than the first one found through a Google search. Mystery solved! If the first article is discovered through a Google search query, it is fully displayed. This is the rub for Murdoch, who in the Sky News interview accused Google of “stealing stories.”
But to my mind, both Google and the many ad-supported blogs and aggregator sites working any given industry provide an important service for researchers. I, for one, am willing to look at search ads and display ads in order to get to the information I need as long as they're not overly intrusive.
What I’m not willing to do is individually subscribe to 100 different publications in the hope that they’ll cover what I need at any given moment. Nor do I particularly want to stop my workflow to pay a fee each time I want to read something, although micropayments for online content do seem to be in the cards.
So here is my question: If print media companies really can’t make ends meet with online ad sales, why couldn’t they dump the ad model and come up with something as simple as my Netflix subscription? In other words, be willing to put their content onto one or more aggregator sites where consumers could pay a single subscription fee and have access to the work of however many publishers have joined?
Apparently, subscription solutions are in the works, but it remains to be seen whether they will be viable.
For the moment, I understand the frustration of the 20th Century media barons, but I think they’re being a touch unreasonable in picking a battle with Google—and by extension with consumers. Yes, Google is the giant that competitors are now gunning for. But at its heart are savvy entrepreneurs who figured out a way to make money by showing people how to find information. Wouldn’t any one of the traditional media providers have done exactly the same if they’d thought of it first? (And if they’d had the engineering savvy to develop all of those smart algorithms?)
If Murdoch’s threat comes to pass, News Corp will take its content out of Google’s search parameters. Will I subscribe to the WSJ or FOX News as a result? Not a chance. Search is my compass and will be until something better comes along. And it’s not as though consumers like me have no alternatives. The other day I smacked into the WSJ pay wall while on a job, searched Google again and found the article I was looking for on Reuters—with nearly identical wording straight from the PR company’s press release.
Please. If that’s premium reporting, I’d rather pay for the newswire subscription directly.
Still, I hope established media providers and the advertising community get it together soon, if for nothing else than to keep the spirit of investigative journalism alive. While I have faith in vast numbers of empowered citizen journalists and bloggers, it’s also comforting to know that trained reporters and experienced newspaper executives have your back in the case of a national scandal.
So thank you Bob Woodward, Carl Bernstein, Ben Bradlee, and those who supported you. May your names be long remembered.
Crowd control
As a child in the late 1960’s, I once read a science fiction story that has since come back at random times to haunt me. It did so today while I was thinking about the isolating nature of the modern work experience.
The story involves a dystopian reality in which people live their lives indoors at home. (Think To Kill a Mockingbird’s Boo Radley, but with everyone doing it.) People are too frightened of the supposed violence and chaos in the streets to go outside.
Technology allows the isolated populace to be “informed,” and to remotely order and receive everything they need to survive.
Hmmm…. Doesn’t this sound a touch familiar? Substituting online ordering and delivery for the fictional vending apparatus, the rest isn’t far from what we can experience today. The feeling that we may have already created the constructs of such an existence made me wonder. How easy would it be for modern city dwellers to fall into such isolation on a grand scale?
I suppose you could argue that the technology is in place to enable it. Big screens have sprouted everywhere; broadcast and cable channels run day and night without stopping; we have a technology-fueled ability to buy without stirring from one screen or the other.
So some of the factors are in place. But the possibility of having nothing to consume but the droning broadcasts of officialdom imagined in Nineteen Eighty-Four or Fahrenheit 451…?
I'd have to say slim to none. Today, Big Brother would be lucky to get a word in edgewise.
Forget controlling the crowd. Traditional media is trying to maintain a place in it.
Yes there is chaos in the streets, but it isn’t the kind of violent mayhem that my long-ago science fiction writer imagined. This is the clamor of creativity, of finding and sharing the small stuff, of compiling our own blog posts, playlists, tweets, program selections, friend news feeds, editorial pages and mainstream news; it is the unstructured babble and hawking by millions; the critical independent thinking of a few.
It’s the audience taking control and throwing the hammer into the screen, the clever and resourceful individual who doesn’t have to destroy Big Brother’s voice but muffles it all the same because there are millions just like her splitting audiences into tiny fragments. The one who can cross-check something that sounds like news with an array of independent sources, watchers, contributors, and curators and decide for herself what’s true.
Maybe we’ve reached a milestone. A moment to put aside our fears about monetization and celebrate the liberating power of independently produced media. I’m as worried about making a living as the next person, but I say bravo to anyone willing to grab a camera or notebook and contribute his own view of what’s happening in the streets. (Extra kudos for those who have found a way to fund it.)
Photos courtesy of the LA Times and Signet Books
Take the money and run—news and entertainment’s battle to reclaim online ad revenues
Escalating tensions between content owners and third-party search and aggregation providers suggest that an all-out shooting war over ad revenues is about to erupt.
Railing against what he called, “free-riders and pirates,” Mr. Curley cited the following issues for news media providers:
"Random distribution of traffic by aggregators such as search engines directs audience and revenue away from those who invest in original news reports but assures the aggregators and their ad networks of a stream of revenue based on aggregation and indexing of published news content.
Crowd-sourcing web services such as Wikipedia, YouTube and Facebook have become preferred consumer destinations for breaking news, displacing Web sites of traditional news publishers".
AP’s purportedly game-changing “Protect, Point, and Pay” strategy—a new rights tracking and management system—leaves one to wonder just how it would be implemented and who would stand to lose if it is successful in addressing AP’s concerns.
Zachary Seward, of Nieman Journalism Lab suggests that the main target of AP’s frustration was Google. According to Mr. Seward, AP is hoping to take advantage of the ongoing battles between Google and Microsoft to negotiate better terms in the next round of contracts for the press association’s content. Citing ad hoc remarks Mr. Curley made in Hong Kong a few days earlier, Mr. Seward theorized that, “If Microsoft and the AP come to terms, it could have huge implications for consumers… ”. AP has already been experimenting with Yahoo for an alternative search partnership that the AP calls “News Registry.”
Changing business models are clearly the number one issue for content providers. All forms of media production require talent, time, and boatloads of cash. In the old-media heyday, advertising—and in some cases subscriber fees—comprised the main revenue base. But in a more fragmented digital world, it isn’t clear how the true cost of media, whether for news or entertainment, will be borne.
©2009 STORIA Inc. — San Francisco
Those outside the industry shrug and say get over it—if print is dead then switch to online. If TV audiences are zipping their way through ads or prefer to hang out online, then go there. Who cares about the medium?
But to media providers, it is a big deal. Online advertising, while growing quickly, is still a weaker source of revenue than print (and far weaker than TV). This is in part because the audiences are so fragmented, and media is still priced according to rules established for traditional distribution methods. Measurements for online media viewing haven’t kept pace with the speed at which the audience is moving in that direction. Until viewing measurements are more accurate, advertisers are less convinced of the impression value of ads that are seen online but not clicked.
So where do search companies factor in? Mr. Curley summed up their power nicely when he spoke about internet users: “Even before they [users] started paying more attention to each other than to Web sites,” he acknowledged in his Beijing speech, “…users had adopted search as their online compass for everything, including news.”
The scenario he describes affects how money changes hands in the internet age. If users go straight to branded media outlets, advertising dollars remain with that media outlet, just as in the old days with a printed newspaper or TV broadcast channel. In that instance, the content provider may be hurt still by lower online ad pricing, but doesn’t have to share its ad revenues with anybody else. If, however, the user gets to a piece of media via search, those advertising dollars—or a significant percentage of them—may go instead to the search engine company that brought the user to the media.
Search engine companies would argue that they provide an important step in the media consumption value chain, and that their fortunes are earned from a real service, not piracy. The internet is a vast and increasingly crowded landscape. Users value aggregation and filtering to find an array of content that interests them.
Tom Wilde, the CEO of search and publishing platform, EveryZing, likens internet-based TV to atomic particles, too small to allow users to easily find video content and thus to attract advertisers. His company is working to enlarge those particles with a new universal search engine designed to do a better job of gathering online audiences. Fox News and Fox Business Networks, among other media outlets, have signed on to power search on their sites to help enhance online ad opportunities.
Meanwhile, the frustrated Mr. Curley admits that the digital audience “seems to be having fun,” and acknowledges that, “From all visible signs, it’s [the other side of the digital bridge] not a place where a news organization can survive by just doing business as usual, creating and marketing content.”
He’s right about one thing. The digital audience is having fun. Users are able to talk to friends and relatives via Skype, follow a steady stream of data on Twitter, get homework help on Wikipedia, and find what they’re looking for on Craigslist—all without paying a penny or having to view a single display ad.
No wonder consumers are enjoying this part of the ride; to them, it’s free. The issue for content providers remains the same: somewhere, at some point, revenues need to get back into their hands so they can stay in business.
The Beautiful and (not exactly) Damned—A new jazz age finds its power
As we attempt to recover from the current Great Recession, it’s interesting to look back at Fitzgerald’s descriptions of the youth of his time. A sort of déjà vu all over again, as Americans like to say.
French 1920's flappers
And why not? After all, it was this lifestyle that characterized the boom period during which the youngest Gen Ys entered existence. Nothing so far, not even the September 08 bust, has dampened its hold over the young.
The result: exactly what one would expect, a brand-aware, media-hungry generation looking for its place in the world and ready to call the shots. Accustomed to being marketed to, it is a demographic that sees life as imitating art—commercial art. They want what is beautiful, immediate, accessible, and fun. Especially if it’s free.
Often, that means media, something Gen Y expects to consume a great deal of and pay very little for, at least in terms of cash out of pocket. Technology is its weapon of choice, and in the great symbiotic trench wars of technology and content, techno-enabled free downloads gain ground one day, ad-supported / paid content delivery the next. What’s left is a muddy, treeless no-man’s land, over which content providers, advertisers, and information deliverers scratch their heads and look for peace.
While content providers are edgy and stymied over how to make money, brands are worried about how to track and influence this swirling, mobile, generational mass. To continue their ability to whisper, ever so softly, a reminder of how much our youth adores—and can always find money for—the branded objects that define them.
Whatever lifelong brand loyalty means these days. It could be shorter than The Short Happy Life of Francis Macomber. But that’s another story. And another author from the 20th century jazz age….whose work may be read on a Kindle someday by a Gen Y Millennial because Google put it out in the cloud—for free.