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Summary:

At this point, I don’t even need to put in snark anywhere, not even in the headline. It is way too easy: All that’s needed is for newspaper…

INM CEO Gavin O'Reilly

At this point, I don’t even need to put in snark anywhere, not even in the headline. It is way too easy: All that’s needed is for newspaper industry representatives to talk. And talk they did all these four days at the World Newspaper Congress in Hyderabad. All you have to do is listen. Or in this case, read. And, really, just pity.

Read this unbelievable press release first, and then the closing speech (pasted below) today by Gavin O

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  1. I admit this is a flippant comment to a weighty post, but originally I thought the headline was "Word Press Delusion" and I was interested to learn what Automattic and Word Press's delusion was.

    The World Press is far less interesting to me than Word Press. Word Press is more valuable at this point! :)

  2. Copyright works well for physical atoms, because they have an intrinsic cost to them. Which is on the decline according to Chris Anderson from wired. But digital distribution has a near zero marginal cost and therefor is reaching a cost of zero, and nothing any publisher or content provider can do will stop that. What they can do is find other sources of income and work with google to translate that into $$$. Maybe dispaly only headlines and a short blurb and have users pay for the extended story. Or have a video add to users who dont mind watching it that allows for free viewing of content. If the user is willing to spend time or money on your product you should make it as easy as possible for them to find it. The world is changing faster than we all can see, stop planing for tomorrow and start planning for for the day after that.

  3. My God! "tired" discussion of fair use? Now journalists are against fair use?? "Why should newspapers follow Google's business model?" You don't have to! De-index your site. But it's either play by Google's rules or don't play with them. It's quite simple. Google doesn't need to play by newspapers' rules because its revenue is overwhelmingly not from newspapers. Anyway, I don't need to preach to the choir. Clearly, this guy is probably among the same people who rejected online ads 10 years ago because they'd hurt their "core" business of print. There needs to be a mass buyout of senior management at these newspapers and replacement by Web savvy executives. They'll never get ahead by bemoaning what was lost; they have to embrace what is.

  4. Like JB's comment about "revenue is overwhelmingly not from newspapers", I have to quibble with the notion that Google is using newspaper company to earn money. What they are using is consumer intent and pointing the direction to the content the user wants. In other words, they're making money off the traffic before the content is consumed. Whether or not their is a paywall to access or to read is then up to the publisher. They're not violating copyright by simply pointing the way.

  5. Robert H. Heath Friday, December 4, 2009

    If the only problem newspapers face is bloggers or aggregators who post their stories (substantially) in their entirety and steal their traffic, Mr. O'Reilly might have a point. But this is probably the 19th out of the 20 biggest challenges newspapers face. Newspapers have lost their distribution monopoly, their advantage in bundling content (theirs and others) and the attractive economics therefrom. But that's not the fault of Google, nor does it have anything to do with copyright. It's simple technological and economic progress.

    I am forced to quote myself.

    "Like the music industry before it, [this] view of the newspaper industry confuses the surplus economics arising from bundling and distribution monopolies for the natural economics of their copyrighted content. Copyright does indeed confer a monopoly right to a particular form of expression, but in no way guarantees that consumers will pay handsomely for it, if at all. The music industry has spent the past ten years battling piracy when the larger economic problem has been the unbundling of the album format. It turns out that customers prefer to pay $1.29 for one song they really want rather than $14.99 for the twelve songs the label bundled on a CD album. Losing the additional $13.70 per transaction really hits the music label's revenue line. A twelve-year old kid downloading thousands of songs he can't otherwise afford does not."

    The full post is available at http://roberthheath.blogspot.com/2009/07/clueless-in-chicago-unraveling.html

  6. the cost of content is not primarily about distribution. People have to be paid to research, gather, analyse and interpret, compose, edit, proof and composite content before it gets to distribution. There is a huge overhead to the business of news.

    The idea that blogs can replace hard news is risible. Most blogs are commentary on gathered news, or rumour passed off as fact.

    Blogs are an important aspect of the analysis of news, but if they replace news that's worrying for democratic societies.

    One of the most well-founded concerns in relation to the decline in journalism is local newspapers which have traditional investigated local scandals and maladministration.

  7. oh dear. this is just embarrassing. no wonder the Independent are going out of business …

    "…why should I just be forced to accept Google’s business model of site referral as the only online model?…"

    umm … you're not, Mr O'Reilly. Just come up with a new business model and away you go(!)
    http://tinyurl.com/yjj2yd5

  8. gus,

    What content the newspaper spend days researching? Tiger Woods? The White House crashers?

    Is this stuff the people want? No. This is stuff the people like to hear. Google gives people the information they want in the 21st century.

  9. Robert H. Heath Friday, December 4, 2009

    gus –

    I'm not suggesting that newsgathering is inexpensive. Or that bloggers will replace reporters.

    But many in the industry seem to be tripping over the fallacy that if something is expensive to produce, there must be a profit-making market for that product. If that were true, there would be a vibrant market for diamond-encrusted buggy whips.

    It's easy to stumble on this fallacy in the present instance because one thinks, "There once was a profitable business here, so there must be market value in what we produce — how do we get that revenue back?"

    But clear-headed review of newspapers sources of historical revenue shows that only a small portion has historically come from subscribers paying for home-grown content. Most newspapers have enjoyed a near-monopoly on the regional distribution of news <span style="font-style:italic;">and other people's content, like classified ads.</span> That monopoly no longer exists and profits have disappeared accordingly.

  10. His argument is banale.

    We also know that copyright terms are generally too long — and that there is a sub-optimal tradeoff between the temporary monopoly and the incentive. See this paper: http://www.rufuspollock.org/economics/papers/optimal_copyright.pdf for example.

    a

  11. Miles Galliford Friday, December 4, 2009

    Internet entrepreneurs around the world should be celebrating the position being taken by the newspapers.

    Whilst they waste their time and energy waging a pointless battle with Google, the market is wide open for new online publishers to make a land grab. Own a niche today and even the media giants will have trouble dislodging you in future. Just look at sector leading sites like the HufPost, eConsultancy and MarketingSherpa.

    Make hay whilst the sun shines!

  12. I might be missing something here, but Google don’t publish newspapers content, they just point at it?

  13. this is about the loss of advertising and quality. tradional papers have very little news, mostly its rehashed items that were already broken on TV and were feeds from press agencies. what newspapers did do is fluff this up with sports results, opinions, comics, horoscopes, classifieds etc and sell that to an advertiser based on an estimated readership model.

    on-line they cannot do this. people only look at the “news” and not at everything else, and thus the advertising revenues they receive seem too low.

    when newspapers have benefited from imprefect information (i.e. how many people actually saw this ad). their model of selling advertising that never worked is coming to an end.

    there will be a media boom, they might just not be part of it

  14. The Google/newspaper fight is not really about paying for content. It is about advertising revenue. Newspapers understood advertising in physical media. They didn't get to understand advertising on the web in time and have lost their revenue to Google.

    The newspapers didn't revise their cost models post-internet. They didn't revise their content aggregation either (as Miles Galliford has pointed out) – the Edsel model of demographics.

    Anyway, Google has respected paywalls in academic journals all along. This is not news.

    They didn't

  15. I worked at the Nobel company that sells and distributes water purification plants. Many people are fooled because despite the large financial investmen without clean water. People are inappropriately placed equipment and they are deceived. I have evidence of this because I worked for a Nobel company.

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