Rupert Murdoch Won’t Jump Until Everyone Does
7 May
Rupert Murdoch, a powerful force in media. He went on capitol hill this week to talk about the future of journalism. What I learned after watching the proceedings on CNN.com, he still just doesn’t get it. Though he is a major investor in the Internet, he really doesn’t under the transition we are in the midst of. This new thing being quickly branded as the ‘interactive’ web vs. the old ‘read-only’ web from the 1990′s.
Rupert Murdoch felt it was a good idea to attack Google on capitol hill by saying, “Should we be allowing Google to steal all our copyrights? Thanks, but no thanks” said Murdoch.
Some have suggested to ease on looking at Murdoch as a ‘media dinosaur’, I would have to disagree. Someone else’s biography of Murdoch will not change my opinion on his business decisions and statements on important stages.
Google is the aggregator for news, I mean Google runs the world right? With the newspaper industry fallinginto bankruptcy literally everyday, Murdoch is looking to latch onto the pockets of a giant and slap their hands until they give up some of their grip or money. I doubt Google will do either!
Murdoch should know that he can easily stop Google crawlers from indexing his newspapers webpages, it is a simple line of text in his robots.txt file instructing Google not to index the page. Sounds so simple right? Not so fast.
If Murdoch were to stop having Google index his newspapers, suddenly the Wall Street Journal disappears but his competition is still readily indexing with Google. Therefore, that percentage of the demographic that uses Google News (and it is quite large) will just click through to his competitors. Readers don’t care about who they get it from, they want it now and they want content that is easy to find.
That is why Murdoch won’t do anything until he can get the entire industry to follow. The common ‘one goes against, he fails. One gets everyone to go against they prevail’ kind of perspective.
It comes down to this Rupert. You need to deliver to the expectations of consumers. Downward spiralling reporting and absolutely rigid non-conformity to trends in the industry and now you want to complain. What were you doing five years ago? Consumers will not pay for dribble, especially since you can find it through out millions of pages on the Internet. The newspaper’s in this country need to radically restructure under new business models or force certain death in the long-run.
And yes, that includes restructuring their content and methods of delivery!
Evaluate, re-structure or face certain death! (cheesy accent)
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“Therefore, that percentage of the demographic that uses Google News (and it is quite large) will just click through to his competitors”
But the point that you’re missing is that under some business models this doesn’t matter one iota. In fact, it can be *great* if your rivals take that traffic.
Traffic is a direct cost, but brings you no direct revenue unless you’re selling content. If you rely on advertising, it is only an opportunity for revenue, not revenue on its own.
If the traffic that Google sends is low-value traffic, ie it either doesn’t click on your ads or isn’t a valuable audience for selling CPM ads, then it will cost you more money than you’ll make from it.
So is this the case with traffic from Google to, say, the NYT? I don’t know – and without some deep analysis of the traffic and its behaviour, you can’t tell. Murdoch has that data. Neither you nor I do.
Chasing after traffic without being able to monetize it is a charter to lose money. The point may be about to come when it makes perfect business sense for some publications to say “thanks, but no thanks” to Google.
You make some good points Ian, however I have a question for you.
Even if your business model were focused on CPM advertising, how would you attract new or ‘potential’ customers via the Internet while narrowing your e-marketing strategy towards a very small chunk of your demographic.
Actually costs of the bytes and packets being sent is minimal overall and getting cheaper by the month.