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Google Hosting News: This Is A Big Deal, Announced Quietly

By - September 03, 2007

Google is making a very clear decision to license and host news content. In other words, to make money from it, like Yahoo does. This is counter to Google’s long standing tradition of being “switchboard” to traffic when it comes to content, and it has very significant implications if carried forward to other areas of Google’s operations. Is Google becoming a true Publisher? There’s really no other way to look at it. With licensed and hosted news content, Google can keep eyeballs on Google’s own servers, and it gets to keep the advertising margin as well. So far, no word on when ads are coming, but this augurs it:

Josh Cohen, business product manager of Google News, said his company would consider eventually running advertising alongside the agencies’ articles.

Notably, Google’s own version of the news wire story will take precedence over those running in other news outlets. In other words, Google keeps the traffic. Google explains it as dealing with a duplication problem here, but, come on now…if I were running a newspaper, I’d be livid. I pay the wire services so that I can get the eyeballs. Now Google is paying them, presumably (no comment on this in the coverage), and the inevitable result is that the newspaper outlets will lose traffic to Google’s direct relationship with the wire services.

It’s interesting that this news was broken on a Friday, before Labor Day. In other words, the deadest day in the news business. Yup, Google knows how to play the news, don’t it?!

Tim muses on this, as does Matthew Ingram, who points to a lot of other thoughtful coverage.


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8 thoughts on “Google Hosting News: This Is A Big Deal, Announced Quietly

  1. There is one important point…
    No one is forcing the wire services to sell to Google
    They can weigh the pros and cons and do what is ultimately in the best interest of their businesses.

    They made a decision to sell to Yahoo, so Google should not be held to a different standard.

    On Google news, the wire service summaries usually link to their partner sites NOT to the wire services themselves – and there are optional duplicate articles that are hidden by default.

  2. JG says:

    SEW: The one important point you mention is beside the point. No matter what decision the wire services are making about who they do and do not sell to, the point is that Google is buying.

    To mirror your statement: No one is forcing Google to buy from the wire services.

    And the corollary is not only is Google making the decision, themselves, to buy, but they are violating their own principles by doing so.

    Philipp Lenssen commented on this a few days ago, when he republished a snippet of Google’s 2004 Playboy interview. Visit his blog (http://blogoscoped.com/archive/2007-09-01-n41.html), but I’ll quote the relevant paragraph here:

    Larry Page: That’s the problem. Most portals show their own content above content elsewhere on the web. We feel that’s a conflict of interest, analogous to taking money for search results. [snip] Google conscientiously tries to stay away from that. We want to get you out of Google and to the right place as fast as possible. It’s a very different model.

    So Google believes, by Page’s own words, that what they are doing now by hosting their own content is akin taking money for SERPs.

    (Or if Google does not believe this, then they have engaged in some fairly heavy justification and rationalization. I, for one, would be interested in hearing the arguments that they went through, internally, before arriving at this decision.)

    And, at the risk of engaging in a slippery slope logical fallacy, if they have violated this principle, what principle comes next? Accepting money for SERPs? Loss of user privacy? Banner ads on YouTube videos? Whoops! ;)

  3. AGronowski says:

    “No one is forcing Google to buy from the wire services.” Oh? You don’t remember AFP, a wire service, filing suit against Google for linking to AFP stories on other newspapers? Y’all seem to have conveniently forgotten that small fact. Can anyone be certain that Google was not threatened by AP for doing this same thing, and licensing being the inevitable result?

  4. Rocky says:

    The Google News experience for the wire service stories is way better than that offered from news sites, including the custom-skinned versions AP offers to its members.

    While newspaper Web sites are full of obstacles such as popup ads and registration requirements, Google News is clean and load fasts.

    I created a screencast that shows the same news story displayed on three news sites + Google News:
    http://blog.agrawals.org/2007/09/03/comparing-google-news-to-other-news-outlets/

  5. JG says:

    “No one is forcing Google to buy from the wire services.” Oh? You don’t remember AFP, a wire service, filing suit against Google for linking to AFP stories on other newspapers? Y’all seem to have conveniently forgotten that small fact.

    Of course I remember the lawsuits. But again, no one is forcing Google to offer the Google News service. It is only because Google wants to persist in this space that it has to make an ethical choice: (1) License the content and give proper intellectual property credit where credit is due, but abandon its “non-portal” principles to do so, or else (2) stop trying to offer Google News, but stick by its principles.

    So while the news wires may be (quite within their rights) forcing Google to make a choice, they are not (like I said) forcing Google to buy from them. Google could have made a different choice. It didn’t. It is a tough choice, and I see pros and cons on each side, and no doubt many people agree with the choice that was made. All that I am saying is that let’s not forget that principles were compromised in that choice.

  6. Kamal Jain says:

    I have been predicting such things in various talks. Advertisment is the price charged by us for accessing the news content. Google is selling us the news below its own cost (no ads). I am worried that it may have a negative effect on other news-site. Google has other cash-flow streams, but other news-site may not. Overtime it will help Google to get more of the audience of other news-site. Some percentage would be good for the audience because Google may add more interactive functionalities to its news-site thereby forcing other news-site to think out-of-the-box too. But too much audience shift may bring iTunes effect where Google may start dictating the terms. News is an essential service for me and personally, I do not want a channel’s domination in this business. I do not count the paper distribution because I do not read news on paper, and I believe many others either.

  7. Why is it that the paradigm always seems lately to lead, at least temporarily, to the Walmart model? Fear of loss v.s bright, new ideas? Google has so much, and represents so much, that sooner or later they will either choose service or success, elect to use their immense power (yes, I said it) to consider all the ramifications of their strategies. It’s the triple bottom line that Ray Anderson of Interface has chosen to follow and Google could thoughtfully emulate. As the Chinese proverb goes…”If we are not careful, we will end up where we are headed”.

    I certainly admire Google for what it provides me in my daily life, however like all things the hidden costs must be weighed when considering the benefits. Walmart has not been particularly wise in this respect by crushing small businesses in their path and turning small towns into Walburgs. The rush to conquer China’s search market has left several Chinese investigative reporters in jail (Li Zhi and Shi Tao) simply because Yahoo and Google both want to be in the control booth with China’s powers that be and have to pay too high a cost to do so. Sure, there’s always the argument that “if we don’t, someone else will”, however that’s a tired, failed outlook now. Social responsibility needs to be an integral part of these juggernauts’ planning or they too will fail.