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Summary:

In an interview about the future of the media industry, Google’s head of news products Richard Gingras said that newspapers are like old-fashioned internet portals such as AOL and Yahoo, and that unless they can adapt to the web instead of fighting it they are doomed.

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Google has a somewhat tense relationship with the traditional newspaper industry, since publishers like News Corp.’s Rupert Murdoch still believe it is depriving them of revenue by “stealing” their content and aggregating it at Google News. So you might think that Google’s head of news products, Richard Gingras, would try to smooth over any ruffled feathers when talking about the future of news. He did the opposite in a recent talk at Harvard, however — comparing newspapers to old-fashioned internet portals like Yahoo, and suggesting that unless media companies can adapt to the Web rather than fighting it, they are likely doomed.

We weren’t at the Gingras event, which was hosted by the Nieman Foundation, but Matt Stempeck of MIT’s Center for Civic Media was there, and he live-blogged the entire thing on the Center’s website (his original notes are posted here). Although these are not direct quotes, we’ve taken the liberty of highlighting some of the comments that Gingras made on a number of important topics, from the tradeoff inherent in paywalls to the distraction of iPad apps and the dangers of innovating too slowly.

On how newspapers got to where they are:

We look back at the 40 golden years of newspaper profitability as if things had been structured that way forever. But these four decades were triggered by an earlier media disruption: television. The rise of television advertising caused a contraction in the newspaper business, where major metropolitan markets went from supporting 4-5 newspapers to 1-2 papers. The limited number of remaining companies allowed monopolitistic pricing. This wealth was created by disruption, and what disruption gives, it taketh away.

Gingras says that the previous dominance that newspapers enjoyed was due primarily to geography, and to some degree demographic targeting. Now, thanks to the Web, he says we are seeing “a disaggregation of content flows as well as advertising.” Like media theorist Clay Shirky, the Google executive argues that one of the big problems for newspapers is that they always depended on “cross-subsidization” of topics — so the classified ads and the lifestyle section paid for the foreign reporting. Now, he says “we have blogs focusing on these niches alone, with a much keener sense of commercialization.”

On whether journalism is better or worse:

The pace of technological change will not abate, and to think of our current time as a transition between two eras, rather than a continuum of change, is a mistake. There has been tremendous disruption in journalism, but there are upsides: everyone has a printing press, there are no gatekeepers [or at least new gatekeepers], and journalism can and will be better than in the past.

On the iPad as the savior of journalism:

[The iPad is] a fatal distraction for media companies. Too many publishers looked at the tablet as the road home to their magazine format, subscription model, and expensive full-page ads. The format of a single device does not change the fundamental ecosystem underneath it, and this shiny tablet has taken media companies’ eyes off of the ball.

Jason Pontin, publisher of MIT’s Technology Review, made a similar point in a recent post in which he described how unsatisfying the magazine’s apps were, and how he is giving up the “walled garden” approach and moving towards a Web-native model.

On how newspapers are like the old Web portals:

Gingras doesn’t believe the vertical model of a newspaper makes sense going forward. He compares the metropolitan newspapers’ all-things to all-people product to content portals for specific communities. This strategy doesn’t make sense given the possibilities. Yahoo!’s initial success was as a portal. But portals have disappeared online as consumers have learned to navigate the web on their own and found the niche sites they love.

On whether paywalls are the answer:

Some publishers say, “They bought it before, they’ll buy it again,” or “We need to get people back into the habit of paying for news.” But consumers never did pay the true costs. The Wall Street Journal pulls their paywall off because it publishes information that is perceived to have high value and is written for business audiences, whose subscriptions are paid for by their employers. News companies must disambiguate their content and business models and devolve from the generalist approach, which is hemmoraging both readers and revenue.

The whole interview is worth reading, because Gingras doesn’t just criticize newspapers and other traditional media for being old and slow — he has some concrete tips for how they can benefit from the disruption the Web has caused, including a suggestion that newspapers consider building on a single story or topic page, Wikipedia-style, instead of just publishing story after story on a subject with different URLs and different information (he provided some other thoughts at a recent Google-sponsored journalism event).

For Gingras, the bottom line is that if newspapers can’t adapt to changing market conditions and business models, they will become classic victims of author Clay Christensen’s “Innovator’s Dilemma.” As he put it:

When the net blossomed in the 90’s, why didn’t newspapers respond? Because classified ads were a cash-cow and CEOs were responsible to Wall Street, so few had the courage to see Craigslist as a threat and blow up their cash-cow. And that is the Innovator’s Dilemma. The giants won’t eat their young. The Ben Huh’s have the advantage of a very fresh slate.

Note: We’ll be discussing these kinds of media issues and more at paidContent 2012: At The Crossroads on May 23 in New York City. Register today.

Post and thumbnail images courtesy of Flickr users Zarko Drincic and dutchmassive

  1. “We need to get people back into the habit of paying for news.”

    Hey buddy, newspapers aren’t cigarettes.

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  2. Gregg Freishtat Saturday, May 12, 2012

    Well said. The online publishing industry reminds me of the record industry 10-15 years ago. When change accelerating and the music business started collapsing, the labels all looked backwards toward existing models that did not work online instead of forward to new models. They were banging the table asking “how can we sell more albums?” That, of course, was the wrong question. It should have been, “how can we monetize our great assets – bands and fans – in the new digital world.

    Publisher are right at this inflections point and asking the wrong questions. Its not “how can we get higher CPM’s, more traffic, and unique’s”. Its how do we profit from our strong brand and ability to create great content in a new digital world. Its not pay walls nor CPMs that will save the industry. Its innovation and getting good content into environments that are more profitable than “digital newspapers”.

    Technologies and platforms are being created and launched and if the publishers don’t do it, someone will do it for them — (think Itunes for the music analogy).

    We are working these new platforms and models at Scribit.

    Gregg Freishtat
    CEO, Scribit.com

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    1. Unless you have real people reporting real content that people wants – and the reporters making a real wage – your scribit thingy will be just another dud blog fad thingy.

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      1. I agree with Joe. Without real reporters getting paid to do the grunt work (which then 1000 bloggers take and spin their own ideas on) your business model (and the “everyone has a printing press” idea) will hit a null state. Just because everyone has the tools to do something doesn’t mean they can or will.

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    2. Ross Longbottom Monday, May 14, 2012

      I think you are correct. As a copy editor with a daily newspaper, I have been saying for some time, let the 18-year-olds have their blogs. Intelligent people will come back to the experts in some form or another — and they are. Our circulation is going up and our website hits are going up. We are the pros, we have the resources for impartial examination of events, we actually have degrees in journalism! Wow! We know what we are doing. We can spell! But, as you rightly state, we have to offer our product, or expertise in various methods. Certainly in print, but also in any other form that emerges. And the question arises again, if you are going to live blog the whole thing, why not just broadcast it? So newspapers have evolved into live TV coverage. That’s not new. Hence, full circle. Answer: Newspapers will follow-up, ask questions you cannot ask live, they will consider, ruminate, ask opposing opinion, expert opinion, man-on-the-street opinion etc., etc., and do it without commentary or prejudice. That won’t change, but we now have to report during and after, and in written and video form. Regards, Ross Longbottom, copy editor, The Hamilton Spectator, Ontario, Canada.

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  3. “he has some concrete tips for how they can benefit from the disruption the web has caused, including a suggestion that newspapers consider building on a single story or topic page, Wikipedia-style, instead of just publishing story after story on a subject with different URLs and different information ”

    I don’t know if that will work,seems like a self serving [Google] argument. How do I find/browse the uris? … Google.
    Information is data in context, which is very personal and I might know about a story already or parts of it [past, present] and might only be interested in the differential prediction/opinion for the context from that writer. Means structure/organization of Information display is more important than URI.

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  4. Earl J. Wilkinson Saturday, May 12, 2012

    Earlier in the week, this is what Richard Gingras said to a global newspaper audience in Los Angeles: http://bit.ly/Jc5kpm.

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  5. People never bought news for the news? What about the 500k people who are buying the NYT paywall? And 50K in Dallas? And of the paywalls have shown NO SIGN of slowing down in the last couple of quarters? These people aren’t buying inserts, folks. And please tell me what international blog is doing original primary reporting? It is in Google’s interest to maximize traffic throughput on the internet. It is against their interest to have people idling on particular sites. They will talk snidely about paywalls for now, but as they go up and up and up all over the place, and are successful, as they generally are, Google’s concern will increase.

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    1. Stephen is right. Many people need news and they’ll pay if the price is right. Heck, people pay $100++ for a day at Disney World. They’ll pay $2/day for something that affects their life. One CEO I know who says he personally spends $30,000 on subscriptions to news said that ignorance is much more expensive than a subscription.

      This is just the typical Google blather about how we should do all of the work because it’s cool while they get to keep all of the money from the ads.

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  6. All World Dance Sunday, May 13, 2012

    If you’re going to put “stealing” in quotes might as well put “aggregating” in quotes as well. I just can’t see posting a headline with a link, a source and a single opening sentence (often a sentence fragment) as a form of content aggregation. It’s much more a free reference service that highlights and drives traffic to the sources than a collection of news items.

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  7. What aweird thing to say considering Yahoo pretty much DESTROYS Google in every internet service other than search and advertising.

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  8. Didn’t Richard Gingras run Salon which as far as I can tell, never made any money ever? And Goodmail? They went under too. How is this guy an expert on anything new media.

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    1. Ross Longbottom Wednesday, May 16, 2012

      I didn’t know that. Good point friend! See my comment above as a newspaper copy editor
      with 30 years experience.

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  9. alexschmidt Monday, May 14, 2012

    okay, the iPad is a distraction — fair enough. i don’t disagree. but at least give credit where it’s due. creating the App WAS an innovation for paper magazines, or on-air outlets. now Gingras’s suggestion is to build a single story page wikipedia-like style. will he take the blame when that particular idea is shown to be a distraction too? i’m a little tired of all the shouting for innovation. yes, it has to happen. but it’s damn hard to come up with the idea that’ll solve this huge problem.

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  10. RethinkThePink Monday, May 14, 2012

    Except that newspapers produce original content, which is then stolen by portals like Google and Yahoo.

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    1. Ross Longbottom Wednesday, May 16, 2012

      Exactly my friend. We’re in a tough spot. See my comment above if you want a little more from an old newspaper man such as myself.

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