Rupert Murdoch: Right and Wrong

Rupert Murdoch riled up the internet this week by suggesting that Google is stealing the work of his News Corp. newspapers. Of course, he's wrong. The mass-psychosis about Google ripping off newspapers is a relatively recent phenomenon, driven by the simple fact that Google is making money hand over foot while newspapers are bleeding cash. All Google is doing with its Google News service is providing links to freely accessible articles, accompanied by very brief excerpts.  If that's stealing, so is Itunes posting album cover art and 30 second snippets of songs.  News execs should focus their energies on finding real solutions to their financial woes instead of attacking Google for no good reason.

Uncle Rupert did have some prescient comments, though.  He said that printed newspapers will be around for at least another 20 years, if not more.  I agree that there's no reason to stop printing newspapers as long as people still want to read them (read: as long as baby boomers are still alive).  Print advertising will remain profitable.

However, Murdoch acknowledged that newspapers stand little chance of ultimately surviving in their present form if they have to rely solely on the current web advertising paradigm.

"There's not enough advertising in the world to go around and make every [newspaper] web site profitable," he said.  Indeed, the vast expanse of the internet has created an overabundance of advertising space.  The supply-and-demand fundamentals point to display advertising being a game of scale -- a game that newspapers, especially local newspapers, won't be able to win.