So what's the big deal with Google in Belgium?

Google lost its case (SearchEnglineLand) to Copiepress in Belgium. Simon Waldman calls it only a small earthquake. Mathew Ingram says he just doesn't get the whole thing and calls the Copiepress move "stupid, stupid, stupid". Ars Technica says that "everyone except Google loses".

I think this is a big deal, and on balance a win for the Belgian press, and I'll try to explain why.

First, if you haven't read it before pop over to Terry Heaton's blog and read his Mr and Mrs Media allegory. See how before the web newspapers were Mrs Media? See how they have let Google become Mrs Media, taking on instead the role of Mr Media for themselves? OK.

It doesn't end there.   

As news has moved online, newspapers (and other content originators) have found themselves bumped down the value chain, from the position of Mrs Media to the position of Mr Media. The position in the value chain that used to be occupied by newspapers or local TV stations has been taken by search and aggregation platforms - Google News, Yahoo!, Live, Netvibes, Bloglines - that are now the first point of contact for many news consumers. (See, if you haven't, Jonathan Dube's stats on the most popular online news destinations for the evidence.)

This creates commercial problems for newspapers, because the value of newspapers isn't, and never has been, a function of the content they create. It has always been a function of owning the relationship with the reader.

How can we prove this? Easily. Vin Crosbie shows, for example, that (US) print newspapers make between 20 and 100 times more revenue per reader than their accompanying websites. That moving the content of newspapers online has not moved the value of those newspapers with it is an elementary disproof of the fallacy that newspaper content is the source of newspaper value. Vin again, writing in OJR a couple of years earlier

"The core connection between a newspaper and its readers isn't its newsprint, its local or national news, editorials, columnists, opinions, cartoons or its classified or display ads. No, a newspaper's routine - automatic and intact daily delivery of everything that the reader should want to know on that day - is the core connection."

As newspapers moved online, they moved the wrong aspect of themselves online - the content, not the "intact daily delivery" that made them the gateway between reader and advertiser. This strategic mishap allowed Google (and other aggregators, but really it always comes back to Google) to push them down the value chain, so that Google (etc) became instead the source of "automatic and intact daily delivery of everything that the reader should want to know on that day".

Now, Copiepress suing Google isn't really the right solution, but at least it's a thoughtful alternative to the model we have now in which Google acts as the distribution gateway directing traffic back to newspaper sites. Monetising readers back at a central site - or exchanging long-term consumer relationships for short-term traffic - is already leaving most of the value on Google's side of the table, and is doomed to become a diminishingly effective strategy itself as the web widgetises and page views become less relevant.

Why does literally just forking over market power to aggregators look like a good idea to news producers? Perhaps because so much media has exploded in the digital revolution, newspapers have drawn the lesson that they must explode too. Digital has exploded music, so that where people used to buy CDs they buy single tracks from iTunes. P2P has exploded films and TV, so that film companies are distributing film and TV content either with unskippable, embedded ads or on a paid-content model. The crucial difference here, though, is that the fragments of media that are sold by music, film and TV companies via aggregation partnerships contain inherent commercial upsides embedded within the packets themselves - the unskippable ad or the iTunes charge. News articles on Yahoo! news or Moreover or Google News or Topix contain no such inherent commercial upside for the content originator. The analogy with the explosion of film, music and TV breaks down when looked at from a commercial or strategic angle. An EMI song song on iTunes makes money for EMI. A New York Times article read on Google News does not provide a comparable return for the New York Times. 

For an equivalent to the explosion in entertainment media, news content needs some inherent commercial upside embedded within every packet. That is, I hypothesise, what Copiepresse was going for in its case against Google. Again, it's not the ideal solution. I don't know what is. Perhaps a universal, seamless, content nonopayment system. Perhaps tiny ads in every article. (Didn't laugh there? Then I'm not entirely joking.) A viable solution will clearly require a concerted and united effort on the part of news publishers. With the possible exception of ACAP, which has its own issues, the Copiepress case is the most forthright attempt I've seen so far along those lines to acknowledge that the status quo is broken. In the event, the move hasn't radically redrawn the strategic balance between the creators of news content packets and the new gateways to that news. But it was a good try, an acknowledgment at least of the problem, and a hint to the direction in which a solution might ultimately be found.

Comments

[Terry Heaton]

Excellent and spot-on analysis. Even now, local media companies are circling the wagons and centralizing resources, the exact opposite of what they should be doing for long-term survival.

[mike]

"A New York Times article read on Google News does not provide a comparable return for the New York Times."

have you ever used Google News? this sentence makes no sense -- you can't read an NYT article on Google News. Google News provides a link to the NYT, and you read their articles on their site, with their ads.

[Chris Tolles]

Neither Google news nor Topix provides full articles for the majority of the news articles in their index, instead directing the user to the news site for anyone wishes to read the article -- in fact providing the news site an incremental reader, and inherent value.

I think your analysis needs to account for this -- Topix as well as Google provide opt outs for any publication - it's not clear that the value provided by the aggregators is not pretty important in this age where no one under 30 actually is aware of the newspaper in their area.

You'll note who invested in Topix in 2005 for example...

If a newspaper is getting such a bad bargain, it could easily opt out...so why don't they?

Chris Tolles
VP Marketing
Topix.net

[Seamus]

Terry

Thanks!

Mike

Agreed, you can't read a full article on Google News (though incidentally on Yahoo News, by far the most popular news aggregation site, you very often can). On Google News, agreed, you can't get the full text so you can't get the full depth of analysis. But you can use it to find out what the news is, and that changes your relationship with your news provider. From there, rather than navigate to "your" newspaper to get the full story, you simply click on whichever link happens to be at the top of the Google News page. The aggregator rather than the originator therefore becomes the first port of call for newsgathering, and the relationship moves from the newspaper to Google (etc). This isn't to say people won't read newspapers online because it's all on Google already: - clearly they do and they will. It's about the value-chain and the relationship and that, as I note above, the newspaper's traditional value is a function of that relationship, not the content per se.

Chris

Surprised you didn't mention the Topix Publisher Platform which, but for a realisation I'd gone on far too long already, I'd have liked to bring into my analysis myself. Your Publisher Platform is one of the most interesting solutions in this model, and by sharing revenues with publishers for full text articles resolves a lot of the "how to monetise every packet of news in a distributed environment" questions.

Re directing people back to the central site...yes, you and Google and Yahoo! etc all do this. My point was not really that aggregators have done something consciously invidious but that the way search has become the gateway to content on the web has pushed content originators down the value chain.

Re "why don't the newspapers opt out?" - some have. Yomiuri in Japan, AFP in France, Copiepress in Belgium otright blocked Google News. Some people such as Steve Yelvington at Morris Digital have taken a more thoughtful, nuanced approach and blocked Google News from spidering wire stories from Morris news sites. ACAP indicates a growing understanding that robots.txt (or any simple on/off, opt-in/opt-out switch) is too blunt a tool for managing the originator/aggregator relationship and that something more flexible might be worth a try. But again, all credit to Topix for taking an initiative in that respect with the Publisher Platform.

Thanks for commenting.

[Alex]

I came to know that everything is set to Google in the United State, and a hearing was held in Belgium on September 5 when the ruling came out last on Sept 15. But Google has not taken part in the hearings by saying that it is still investigating.