Why Don't Newspapers Realize That Google's Handing Them Quality Leads
from the not-paying-indeed dept
A bunch of folks have been sending in Scott Rosenberg's wonderful response to those who keep incorrectly claiming that Google is somehow to blame for the decline of news, and should "pay" newspapers. The whole thing is worth reading, but there's one key message towards the beginning: Google is providing newspapers with "qualified leads," normally considered the most valuable type of leads in any sales operation. These are people who actually want what a newspaper is offering... and rather than thank Google for sending them such qualified leads (and figuring out ways to provide enough extra value to have anyone want to pay, the newspapers are whining and complaining about this process.
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Filed Under: google, journalism, leads, newspapers
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Google news drives $100 million dollars a year in revenues for Google, and that's before they got the gumption to start putting ads right on the news results.
Compared to their $21 billion in revenues last year, I guess it's a sliver or a big pimple. But $100M is still $100M.
It's specious to call anonymous visitors from Google News "qualified leads." The only thing the newspapers know about this traffic is that they clicked on a story link in Google News. Wow, that certainly tells you a tremendous amount about those users. Google, of course, knows a tremendous amount more (or could, anyway) - who the person is (if they have Gmail), what they search for on the Web, etc. But they're not sharing that information with the papers. Google is keeping the Glengarry leads all to itself.
To imply that Google is giving away this traffic "for free" is also technically true but disingenuous. Google is making $100M a year (or more) aggregating content that is paid for and provided by the newspapers. It's at best an odd sort of quid-pro-quo.
Once again, the Techdirt article takes beats on the newspapers for whining and complaining. There are 700-1400 newspapers in the United States, and the Internet is getting rid of the need for all but perhaps a dozen of them. What conceivable new business model will sustain the newspaper industry at even a tenth of the size it's at now? If the Seattle P-I is any indicator, one of the best things a newspaper can do to survive is to lay off 80% of its staff.
It looks like we're either going to see a huge (>80%) loss in the number of newspapers, or a huge (>80%) loss in the size of newspapers, or maybe both, even with the advent of new business models. I note that Nicholas Carr has come to a similar conclusion independently.
I understand why, for example, consumers might benefit from and be happy about this. But there is no joy to be had if you're a newspaper, especially a small one. And by small, I mean outside the top 10, or maybe the top 5. These papers are like people with terminal illnesses. The drugs aren't working, they're just keeping them alive slightly longer, at the cost of making them sicker at the same time.
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I've never understood this American attitude. Does this mean you want to live in a Communist Country where jobs are protected by the Government or do you want to live in a Capitalist society where the smart are rewarded through innovation leading to creative destruction and more jobs in the long run?
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Would you share information with companies that are thinking of suing you?
What proof do you have that smaller papers "are like people with terminal illnesses"? All I hear and read about is large newspapers folding. Based on my experience, smaller newspapers have been much better at figuring out the internet than the large newspapers.
The internet is most definitely not getting rid of the need for newspapers. It is getting rid of the hardcopy version. Since my local newspaper decided to post their daily edition completely online, I've been reading it more.
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Interesting perspective, and this may actually hold water, if I didn't actually partake in a Seattle PI fact-finding and market research roundtable on blogging, and the future of news back about this time last year. Many of the things discussed are spot on with what Mike has been discussing over the past 5 years. So I left, as others did, knowing what the PI knew: the inevitable was coming. I imagine management didn't or couldn't stand behind it.
Many things were discussed, but the very simple concept of converting a web customer into a print or subscription customer, while using Google as your promotional tool was one of the key points.
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Tip to whining newspapers
User-agent: *
Disallow: /
Enjoy your new found "power" and good luck!
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@AC1
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You misunderstand. I'm not arguing for preservation of the existing newspaper industry. I'm arguing that it's disingenuous to pretend that the newspaper industry can survive this at all - new business models or not.
Whatever will come after the creative destruction - and something surely will - will not be a newspaper industry. It will likely not even be constituted of the parts of the old newspaper industry. The people who will succeed in the aftermath will probably not even be in, or come from, the same business. They'll probably be people like those at Google.
Sending a message that the newspapers should "thank Google for sending them such qualified leads (and figur[e] out ways to provide enough extra value to have anyone want to pay)" is mostly useless. To complain that "the newspapers are whining and complaining about this process" is just sort of mean.
The message to send them is something akin to "it's been a good run, but it's over." If you want to add "please die quietly, with some dignity" I suppose that's your prerogative.
Some part of the newspaper industry will make it through the transition in a radically different form. Some people will be able to make the quantum leap and take what they learned in the "newspaper business" and transfer it into whatever business comes after newspapers (what we will call it depends on how it ends up looking, and I'm not sure what that is). To borrow a tired analogy, I assume that some tiny part of the buggy industry could still be found in the substantially transformed "transportation business" after the advent of the automobile.
The 10% or less of the newspaper business that survives the transition won't be in the newspaper business anymore. They'll be in something else - the aggregation business, the content creation business, the online-community-based-on-information-delivery business, whatever. The other 90%, well who knows what will happen to them? What is happening is that a long-standing way of life is ending, and that is going to be harmful.
If history is a guide, the benefits (on a broad, aggregated scale) will outweigh the harms (again, on a broad, aggregated scale), but it's sure hard not to sympathize with individuals that ended up in the "harm" category. I don't know about you, but I couldn't drive into Flint, Michigan and tell the residents that you're terribly sorry about the economic devastation that's crippled the entire city for two decades, but it's OK - my Toyota Camry is cheaper, nicer, and more reliable than ever.
Yes, things will get better, on average, eventually. But in the meantime, for many individuals and localities (not just geographic, but also professional localities), there is just going to be devastation. If there is to be creative destruction, let's be honest about both the creativity and the destruction.
Everyone in the newspaper business is going to experience destruction. It seems to me that most of these new business models show how to get something even better than the newspaper business with something like 10% of the people. And that's great, and we should support that.
But am I totally off-base here, or are we really looking at a scenario where the other 90% of the industry is going to become irrelevant overnight? What are the costs of that happening? I understand that we can't, and probably shouldn't, try to stop it, or somehow artificially reverse it. But is the best thing to do to ignore it, or make fun of it?
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Convergence Strategy
Let me explain ... I reside in Toronto, my fave hockey team is the Flames, they played last night in Calgary ... before the game was 1/2 over, local morning papers were on the press ... in this morning's sports section, not a peep ... it's like the game didn't happen. Tomorrow the story will appear in print (why bother)... after some searching of the paper's website, found a single wire story... it was posted at 4:30AM ... I know my paper is related to a major Calgary daily ... where is the local flavor to the story? My initial point was the time I spent searching was a waste of time ... but seems the newspaper is treating web space like newsprint space ... all they did was scrape the wire feed, pasted it, and probably thought ... damn we're good! Post game interviews, video highlights, crowd reactions or whatever ... simple to do. About the searching, can be eliminated with our keyword link system ... simply tag the story with a keyword that is entered at the newspapers homepage and voila! The Flames story page opens directly ... no searching, hassles, time wasting or distractions ... we provide an optional ad message that can be displayed for a few seconds while page is being fetched ... hmm, what is the demographic of someone following the keyword link and what advertiser would like to get a message to that audience? Geez, did the paper just earn some additional revenue with a simple convergence strategy?
How about Micro news, issue seems to pop up from time to time ... a convergence strategy could score a ton of revenue. Print still caries a panache ... but the major dailies aren't covering neighborhood cat shows. Our premise is simple, readers are invited to submit stories, videos or pictures of local interest for publication. Not the whole story makes it to print ... just a teaser line with a keyword link to the full report on newspaper's website. Chances are The Toronto Star or Calgary Herald are not going to cover little Johnny's house league peewee hockey game. But it is newsworthy to Johnny, his parents, grandparents, teachers, friends and team mates. Who won the grade 6 local spelling bee? The grade 4 school science fair? Proud moms and pops are snapping digital pics like no tomorrow. Micro news provides an outlet for newspapers to bond with readers. Think advertisers might be interested in being associated?
To get readers to "think link" we even have a couple of games created ... "The Great Digital Race" ... travel the world digitally from your computer looking for keyword clues that get entered to continue the journey ... send players to a new product being introduced ... make the next keyword part of the product information, while playing a game, the ad is working.
We have hundreds of suggestions on enhancing revenues with a simple convergence strategy ... do publishers think this interweb thingy is going to disappear?
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