AP and News Corp.: Wrong About Google

Asking Web companies to pay up for content won't fix a business model that Old Media should have remedied a long time ago

I'd like to open this column with an apology to the Internet on behalf of reasonable members of the traditional media.

Internet: It is not your fault that our business models are slowly dying, that we resisted the Web for so long, and that we then did a mediocre job of adapting our products to it. Your large portals and search engines like Google (GOOG) and Yahoo! (YHOO), aggregation services like Techmeme and Digg, and your countless blogs have been very kind in sending us so much traffic at no charge over the years. We know well that traffic is currency online. That's why we spend so much time squeezing any remotely relevant ticker into a story, appending "Digg this" buttons to pages, and doing whatever we can to optimize our stories to get the most search traffic possible.

You've done your part to help save us, Internet, and we appreciate it. You've given us an immediacy and two-way connection with readers we wouldn't have had otherwise. We can now measure which stories resonate with readers the most—no expensive surveys and focus groups necessary! You've even made all those ridiculously high costs of paper and printing obsolete. It's not your fault we haven't yet found a way to monetize it or the gumption to cut our costly print operations sufficiently to make new business models viable.

Of course, if you've read the headlines this month, you understand why I'm writing this note. A once proud, robust industry that should be concerning itself with speaking truth to power is spending much of its time whining. Old Media has largely failed to join the ranks of companies profiting from the Web. Instead, it's trying to browbeat those companies into subsidizing its own money-losing operations.

Policing the Web

Consider the latest chapter of the Associated Press' bizarre anti-Internet saga. The news organization now says it will police the Web for what it calls "misappropriation" of news content, in hopes of forcing sites that link to news stories to share revenue with creators of that content. Details are still unclear. In an interview with BusinessWeek, Tom Curley, the chief executive officer of AP, elaborated on the AP's plan to build its own news aggregation pages, creating something of an alternative to Google. Good luck with that.

The AP's rant followed News Corp. (NWS) CEO Rupert Murdoch telling Forbes that Google should have to start paying for linking to News Corp. content. What's next? Charging Twitter for the privilege of all those editors and reporters who try to drum up interest in their articles via Tweets? Forbes called Murdoch's anger "understandable." Really? Then please explain it to me. From where I stand, traditional media has only itself to be angry with.

That'll Show 'Em

Old Media's indignation is akin to a parent who tries to punish a kid by taking away the Glenn Miller records. Let's be honest: The traditional media is threatening to cut off access to an asset that's declining in value, and in many cases, no longer brings in profits. Think about that. What exactly is the "or else" here? Or else, we won't take your free traffic, and we'll just watch our subscriber rolls dwindle and ad revenue shrink all alone?

The fact is, wire services like the AP simply don't add as much value on the Web as they do in print. And we're headed to a largely nonprint world. How many 20-year-olds do you know who complain of inky fingers after reading the news?

The Web doesn't have column inches to fill daily. And there are plenty of other news sources online. Heard of Reuters (TRI) and Bloomberg? If you're interested in tech the way I am, there's no end of business pubs and blogs. And even if no one covers a story, it's not hard to find direct source material, be it a speech, SEC filing, or press release.

To be sure, there are fabulous reporters at the Associated Press who dig out original stories through dogged reporting. But ultimately members pay for the service mainly to fill a news void left by increasingly smaller editorial staffs. And don't forget that many of the sites that help drive traffic to the AP—from Google to Huffington Post—are actually paying members.

April Fool?

So why doesn't the AP get this? Where has AP Chairman Dean Singleton been for the past decade as scores of newspapers went under, print subscriptions plummeted, and traffic to blogs and other online media soared? He told PaidContent: "I think print's going to be important for a long time…, Print is still the meat. Online's the salt and pepper." I had to check the dateline to make sure this wasn't one of those April Fool's gags the blogs love so much. I'm from the traditional press, and I don't read anything in paper form anymore.

But if news outlets really want to cut Google off—if Google really is getting all this value it's not paying for—then they ought to take the approach proffered by blogger Danny Sullivan. Embed in stories a line of code that would prevent Google from aggregating content. Done. You've got your valuable content back all to yourself, and you don't have to burden your servers with all those extra readers.

It's not just that Old Media is wrong, it's that they've played this sad hand so badly. They spent years nakedly trying to get more and more traffic from search, portals, and aggregators, and now they suddenly strike a victim pose once they realized their business models are broken beyond repair.

Worse, traditional media waited until blogs became recognized as credible sources of news that matters. I'm not saying there aren't distinctions between mainstream press and blogs. There's a reason I still do a column for BusinessWeek. Editors add value, and traditional media hew to established practices around reporting and sourcing that give their material a layer of credibility many blogs lack.

Embarrassed for Journalism

Still, readers are increasingly ignoring those distinctions, and when your audience doesn't put a value on them, that erodes the ability to charge a premium. As Google CEO Eric Schmidt told a group of newspaper publishers on Apr. 7, "I would encourage everybody, think in terms of what your reader wants. These are ultimately consumer businesses, and if you piss off enough of them, you will not have any more."

There's always been a lot of pride associated with the Old Media world. There had to be—we didn't make much money, we worked long hours, we had to ask uncomfortable questions and report things people didn't want reported. And then there's that endless stream of deadlines. But this week is the first time I can think of that I'm embarrassed for my profession. Once you're reduced to legal threats and whining, you're one step away from admitting total defeat. Just ask the music industry. What's next, suing our own readers for clicking on Google links?

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