'Google stole my lunch money'

2009-05-15 10:50

Alistair Fairweather

It's finally happening - newspapers are beginning to die. We've been predicting it for years - since the first dot-com boom in fact - but now it's here. And, of course, publishers are a little grumpy about the situation.

I'm not talking about our local papers - although few of them are exactly rolling in cash - I'm talking about papers in the USA.

Take the Rocky Mountain News, a 150-year-old stalwart with a daily circulation of over 250 000 copies that shut its doors forever in February. To put those circulation figures into perspective, that's higher than any daily paper in South Africa, except one (the gargantuan Daily Sun).

And this sad tale is not exceptional. The equally venerable Seattle Post-Intelligencer (120 000 copies daily) stopped printing in March and went exclusively online.

They at least survived with an online edition - a half a dozen other mid-sized dailies have disappeared completely in the last six months. And history is sure to repeat itself in our local markets, when broadband finally becomes cheap enough.

Satan of search

You would think this would lead to some serious navel gazing about their business model, but no, newspaper publishers have opted to go on the offensive. Their enemy? That great Satan of search - Google.

Robert Thomson, editor of The Wall Street Journal, called Google News (and other news aggregators) "tapeworms in the intestines of the internet". His boss, irascible media billionaire Rupert Murdoch, accused them of stealing copyrighted material.

On the face of it they have a point: Google News uses their content without paying them. But a brief look at the service reveals some sticky facts that publishers conveniently gloss over. Google only uses the briefest of summaries in their service, and always links to the source for the full story. So Google are, in effect, generating leads for these news sites.

In fact Google's algorithms, forged in the white hot competition of the search market, actually find relationships between stories that publishers cannot and dramatically increase both the surface area of a newspaper's online exposure and the richness of online news in general.

Because they are independent of the content Google can offer the most balanced and unbiased picture - simply by showing you all the angles.

Another thing the publishers fail to mention: Google will happily exclude them from their news service, they need only ask. But of course that's not what they really want. What they want is for Google to cut them a big cheque to make up for being such a selfish meanie.

Jim Spanfeller, CEO of Forbes.com, takes it even further, huffing and puffing that "Google makes roughly $60m a year directing folks to our site". Oh, I'm sorry Jim, I suppose you're right, Google should send you all those visitors for free. It doesn't cost them anything to run their little search engine after all.

What's frustrating about this so-called debate is that no one doubts the value of news organisations. We need trusted institutions of courageous and thoughtful people that filter and make sense of the world's information. At heart that's what newspapers really are - the people and the culture, not the paper.

Wasting energy

The problem is that the physical paper is how newspapers have been making their money for hundreds of years, and so they're rather attached to it.

But by clinging to it, and by wasting their energy attacking new technologies, they are repeating the mistakes of the global music industry, whose business model is now firmly in the toilet. Do they really want to start suing individual customers for using their stuff for free? Because that's where their logic is heading.

This is not a moral battle, no matter how much the newspapers want it to be. Google aren't evil any more than one organism is evil for displacing another organism from its habitat. They simply have a better business model, and better technology. Giant, expensive, smelly printing presses used to be the way to make money - but it's not the 19th century anymore.

If newspapers are serious about surviving, they need to embrace the new technology and learn to make it work for them instead of against them. This will be painful, and will inevitably result in job losses, leaner teams and smaller profits (at least at first). And they need to act soon - as some already are - because delaying the pain will only increase it.

Send your comments to Alistair.

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