I’ve worked closely with many in the news industry (five years in the online news business) and you’re absolutely right. It comes down to a short vs long decision.

In the short-term, some news sites get 20-30% of traffic from aggregators like Google News and are happy to take it. But long term they’re training users to go to Google for their news needs.

Now consider an alternate universe where the following happened: New York Times, WSJ, Wash Post, Time-Warner, and the rest get together and build a shared archive that’s searchable from any of the participating websites. They would share the revenues from the search ads and any other monetization, except for sale of content, which would go to the original content provider, when users buy an article.

In the alternate universe, the news sites would make money from search and would build mindshare as a starting point for research. But in the real universe, these benefits now go to Google. Yes, the news sites may sell a few more one-shot article pageviews, but their positioning has been downgraded once again, because they would rather work with their strategic (long-term) competitor than with their tactical (day-to-day) competitors.

Good job, Google. Bad job, NYT, WSJ, etc.

Will this approach prevail – where Google helps distribute major outlet stories? Or Newsvine’s extensive user input and stories? Can individual papers survive as online efficiencies bring the cost to produce good, eyewitness expert stories to near zero?