Google has a somewhat tense relationship with the traditional newspaper industry, since publishers like News Corp.’s Rupert Murdoch still believe it is depriving them of revenue by “stealing” their content and aggregating it at Google News. So you might think that Google’s head of news products, Richard Gingras, would try to smooth over any ruffled feathers when talking about the future of news. He did the opposite in a recent talk at Harvard, however — comparing newspapers to old-fashioned internet portals like Yahoo, and suggesting that unless media companies can adapt to the web rather than fighting it, they are likely doomed.
We weren’t at the Gingras event, which was hosted by the Nieman Foundation, but Matt Stempeck of MIT’s Center for Civic Media was there, and he live-blogged the entire thing on the Center’s website (his original notes are posted here). Although these are not direct quotes, we’ve taken the liberty of highlighting some of the comments that Gingras made on a number of important topics, from the tradeoff inherent in paywalls to the distraction of iPad apps and the dangers of innovating too slowly.
On how newspapers got to where they are:
We look back at the 40 golden years of newspaper profitability as if things had been structured that way forever. But these four decades were triggered by an earlier media disruption: television. The rise of television advertising caused a contraction in the newspaper business, where major metropolitan markets went from supporting 4-5 newspapers to 1-2 papers. The limited number of remaining companies allowed monopolitistic pricing. This wealth was created by disruption, and what disruption gives, it taketh away.
Gingras says that the previous dominance that newspapers enjoyed was due primarily to geography, and to some degree demographic targeting. Now, thanks to the web, he says we are seeing “a disaggregation of content flows as well as advertising.” Like media theorist Clay Shirky, the Google executive argues that one of the big problems for newspapers is that they always depended on “cross-subsidization” of topics — so the classified ads and the lifestyle section paid for the foreign reporting. Now, he says “we have blogs focusing on these niches alone, with a much keener sense of commercialization.”
On whether journalism is better or worse:
The pace of technological change will not abate, and to think of our current time as a transition between two eras, rather than a continuum of change, is a mistake. There has been tremendous disruption in journalism, but there are upsides: everyone has a printing press, there are no gatekeepers [or at least new gatekeepers], and journalism can and will be better than in the past.
On the iPad as the savior of journalism:
[The iPad is] a fatal distraction for media companies. Too many publishers looked at the tablet as the road home to their magazine format, subscription model, and expensive full-page ads. The format of a single device does not change the fundamental ecosystem underneath it, and this shiny tablet has taken media companies’ eyes off of the ball.
Jason Pontin, publisher of MIT’s Technology Review, made a similar point in a recent post in which he described how unsatisfying the magazine’s apps were, and how he is giving up the “walled garden” approach and moving towards a web-native model.
On how newspapers are like the old web portals:
Gingras doesn’t believe the vertical model of a newspaper makes sense going forward. He compares the metropolitan newspapers’ all-things to all-people product to content portals for specific communities. This strategy doesn’t make sense given the possibilities. Yahoo!’s initial success was as a portal. But portals have disappeared online as consumers have learned to navigate the web on their own and found the niche sites they love.
On whether paywalls are the answer:
Some publishers say, “They bought it before, they’ll buy it again,” or “We need to get people back into the habit of paying for news.” But consumers never did pay the true costs. The Wall Street Journal pulls their paywall off because it publishes information that is perceived to have high value and is written for business audiences, whose subscriptions are paid for by their employers. News companies must disambiguate their content and business models and devolve from the generalist approach, which is hemmoraging both readers and revenue.
The whole interview is worth reading, because Gingras doesn’t just criticize newspapers and other traditional media for being old and slow — he has some concrete tips for how they can benefit from the disruption the web has caused, including a suggestion that newspapers consider building on a single story or topic page, Wikipedia-style, instead of just publishing story after story on a subject with different URLs and different information (he provided some other thoughts at a recent Google-sponsored journalism event).
For Gingras, the bottom line is that if newspapers can’t adapt to changing market conditions and business models, they will become classic victims of author Clay Christensen’s “Innovator’s Dilemma.” As he put it:
When the net blossomed in the 90′s, why didn’t newspapers respond? Because classified ads were a cash-cow and CEOs were responsible to Wall Street, so few had the courage to see Craigslist as a threat and blow up their cash-cow. And that is the Innovator’s Dilemma. The giants won’t eat their young. The Ben Huh’s have the advantage of a very fresh slate.
Note: We’ll be discussing these kinds of media issues and more at paidContent 2012: At The Crossroads on May 23 in New York City. Register today.
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