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Last month Media tycoon Rupert Murdoch, founder of News Corp which owns titles such as The Wall Street Journal, The Times and The Sun, announced plans to block Google from searching the company’s websites as he believes companies such as Google and Microsoft are “stealing” his stories for their own benefit.

Darren Farnden, Head of Marketing

Darren Farnden, Head of Marketing

In his interview with Sky News Australia he stated “The people who simply just pick up everything and run with it – steal our stories, we say they steal our stories – they just take them. That’s Google, that’s Microsoft, that’s Ask.com, a whole lot of people … they shouldn’t have had it free all the time, and I think we’ve been asleep.”

He continued “There’s a doctrine called fair use which we believe could be challenged in the courts and barred altogether — but, you know, it’s OK. We’re getting a lot of advertising revenue, so we’ll take that slowly.”

But it’s not as one sided as Murdoch would have us believe. News Corp also benefits from its involvement with Google. Google is reported to deliver 100,000 clicks a minute to News Corps’ websites, that’s a lot of traffic to simply dismiss. Murdoch responded to this by questioning the quality of the traffic delivered by Google, stating that Google does not deliver loyal customers that would be willing to pay for his stories. “What’s the point of having someone come occasionally who likes a headline they see on Google?” he asked. “There’s not enough advertising in the world to make all the websites profitable. We’d rather have fewer people come to our website, but paying. Customers are very happy to pay for it when they buy a newspaper.”

And there lies the real issue. Yet again we find a traditional industry struggling to embrace the opportunities the Internet can deliver because it wrongly presumes that existing business models will simply work when re-used in a new distribution channel. Just because someone is willing to pay for a printed newspaper in a retail outlet does not mean they will be willing to pay a subscription to read the same stories online when they are available for free from other sources. It’s the entertainment industry versus ISPs argument all over again!

If embraced correctly, the Internet opens up a number of new opportunities to media companies such as News Corp. Alliances with search engines and news aggregators such as Google brings their stories to wider reaching audiences, spreading awareness of their brand further and often to readers who would not have otherwise visited their sites. However News Corp has opted to dismiss the hundreds of thousands of visitors delivered by Google, choosing instead to focus only on those customers loyal enough to pay to read its stories.

Additionally, at a time when advertising rates and marketing spend on print advertising are falling online sources provide valuable opportunities. Many marketers shy away from traditional print advertising because of low ROI which is often difficult to accurately calculate. Online advertising however is arguably much easier to track and often provides higher ROI. Whilst News Corp may not value the 100,000 per minute additional site visitors, I’m not so sure their advertising partners would be so quick to dismiss the potential high volume of interest amongst this immense amount of traffic. I wonder if Mr Murdoch has asked them.

So what have Google said about it all?

Google basically said what everyone else was thinking – if you don’t want us to crawl your sites why don’t you just tell us not to, which is a simple technical operation. “If publishers want their content to be removed from Google News specifically, all they need to do is tell us and we’ll remove them as a source”.

Despite his latest claims, Murdoch does not seem to be in any hurry to implement these changes stating that they will implement the changes to stop Google accessing their websites when they complete their move towards subscription based readership across all of their websites. This was originally expected to be completed by June 2010 but delays have since been announced.

Could this really impact Google?

In simple terms, no. Whilst News Corp’s power as a leading media company should not be underestimated, it alone will not change anything in the way the Internet, Google or any other search engine works. By removing itself from Google’s news aggregators it is simply denying itself further coverage and traffic. Google has plenty of other media companies that it can go to for the latest headlines and stories that are more than happy to take its traffic.

The only way News Corp could have any detrimental effect and shift the power is if it managed to get all media companies to follow suit, making it impossible for Google to access the latest news stories. I think that may be out of even News Corp’s reach though, especially when it has been reported that Google is already working with a number of media companies to implement a system of micro-payments for access to various types of content. Instead of joining forces with Google and benefitting from revenues generated by Google users, Murdoch appears to want to go it alone.

Several articles covering this story have suggested News Corp could try to join forces with an alternative search engine, such as Bing, in an exclusive contract. This would mean all News Corp stories would only be available from Bing, giving users a reason to use Bing over Google. But such a deal is highly unlikely to be struck. Again this would only really have any power if it meant all media companies’ content moved solely to Bing which is even more unlikely.

So what’s Entanet’s opinion?

Personally I think News Corp is shooting itself in the foot. I understand it favouring quality over quantity and its protectiveness over content. However, to presume readers will be loyally prepared to pay a subscription to read its stories, despite the fact that the same stories will be available elsewhere for free, is flawed.

Once again I believe this argument comes down to a traditional industry struggling to understand the true benefits the Internet can bring if it is prepared to change its traditional distribution models. Instead of blocking Google, why not embrace the additional traffic it delivers and take full advantage of the advertising opportunities it provides.

At the end of the day it’s highly unlikely that News Corp is going to manage to convince all media companies to follow suit and block Google, which means that Google will not be impacted by this activity. The only result will be a decline in traffic to News Corp websites.

Update: 3rd December 2009

Following Murdoch’s outburst, Google has responded by slightly amending its existing ‘First Click Free’ system to only allow Google users 5 free views per day of any subscription based news website such as the WSJ. The 6th view will result in a subscription or registration notice. Whilst Google appears to be making a concession for news providers after the Murdoch argument erupted, this ‘amend’ is not particularly groundbreaking and is possibly nothing more than Google attempting to calm the waters. This service has technically been available to news providers for some time.

Have your say!

What do you think? Will Murdoch’s boycott affect Google or will it just hurt News Corp? Would you pay to read articles on The Times’ or The Sun’s websites? Let us know what you think about this latest issue by leaving us a comment below.

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