Tuesday, November 17, 2009

What's Murdoch Really Got On Google?

You might have seen last week Murdoch grumpily threatening to withdraw News Corp content from Google search results, in an effort to 'protect' his IP. Since then there's been debate in the trades and business media on the merits of this. Amazingly, some folks seem to think Murdoch has a point.

Now, maybe Murdoch means what he says. Or maybe he's posturing. Either way, I honestly wonder if he's losing it.

Does Murdoch mean what he says?

Well then, to see Google (or any similar tool) as parasite of content is missing the point. Rather, Google is the virtual 'mall' through which content can be merchandized. Estimates of NC online traffic coming from search vary between 17% and 25%.

Not only does this translate into millions in advertising dollars, but it is also an opportunity to merchandize content worth paying for. Perhaps this content needs to be sold in smaller chunks - eg. one article at a time - but it can reach a far, far larger audience than has ever paid for a newspaper.

Or is he posturing?

Smarter commentators, such as Henry Blodget, have suggested that this is a classic Murdoch 'posture' to get Google to pay News Corp for the privilege of distributing its content.

Again, is Murdoch smoking something? Google (Yahoo!, Bing etc...), are the new mediators of online content. They have successfully disrupted the media marketplace and changed consumer behavior. That's a simple fact. As such, News Corp needs Google far more than Google needs News Corp.

Making NewsCorp content inaccessible from Google is the
21st Century equivalent to withdrawing it from newsstands. (Perhaps on the basis that the newstands are 'stealing' the daily headlines by freely displaying them?) If NewsCorp was to therefore make the WSJ or the London Times was available only through mail subscription, would that sound sensible? No, it would not. Many readers would still go to the newstands and buy a competing news brand instead.

As this article by Abbey Klassen and Nat Ives says, 'it's about the pay walls'. What Newscorp needs to do is correctly calibrate the content that is freely available (the shop window) with the content that people will pay for (the goods for sale inside). This is a 'micropayment strategy'.

Not everyone believes a micropayment strategy would work. I kinda hope it will though. Because it would ultimately create a freer, unbundled, consumer marketplace for content. Which would likely improve the value of content available, and reverse the 'dumbing down' in broadsheet media that we've seen over the last 20 years.

But it would
also reduce News Corp's control over the value chain of the News business. Which is possibly why they are rejecting a micropayment strategy and instead mooting 24
-hour subscriptions for online content. Subscriptions, by indiscriminately lumping together content that is desired with a bunch of other undesired content, is are a poorer reflection of both media consumption and the intrinsic value of the content.


But I won't get too depressed yet - this saga is far from over.

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