Murdoch, et al to Google: "We don't want you here"

Over the last few weeks, the idea of banning Google from crawling newspaper web sites has gathered steam.  It started with Rupert Murdoch who suggested that News Corp web sites would be blocked from Google's index.  Now MediaNews Group and A.H. Belo (which collectively control 11 of the top 100 newspapers in the US & other major media properties) are considering the same move, with rumblings that many more may follow suit.

At issue is a fundamental question that industry observers have asked for many years -- "is the traffic provided by Google a net positive or net negative for the newspaper business?"

But the question behind the question is more about monetization.  Should Google provide a free index of available news for given search terms... and should Google benefit on the backs of content and news providers?

Local newspaper and television web sites provide a service to the local community -- journalism that informs the community and provides a necessary check on government and other local authorities.

Similarly, Google aggregates news for the convenience of consumers.  It also provides local news outlets with traffic and exposure to people all over the world.  This traffic can be great for raw page view numbers and other metrics, but it's conversely also difficult for a local media outlet to monetize.  If a significant portion of traffic for a newspaper web site comes from other parts of the country or the world, it is bringing a wealth of people to the web site but very few of them are likely to respond to a local advertisement.

Therefore, it is good for reach but it also dilutes the advertising product that is intended for the local audience.  The numbers are there, but the performance of the advertising suffers, and local online ads are thus that much harder to sell.

I am personally torn on this one -- I see both sides of the argument.  I'm sure I'll comment more on this as time progresses.  But this move does tell us a few things today:

1. Newspapers want to take back control and ownership of their content.  Google is the first target, because they are generating obvious economic value from indexing news site content likely at the expense of newspapers.
2. Inclusion in search results has reduced newspaper and television web sites to dumb content machines, and leadership at major media outlets has taken notice.
3. Continued commoditization of newspaper content can't work long term for the media business.
4. New technologies, if not properly utilized and harnessed, will present a real threat to the media business.  Therefore, it is the job of big media to figure out where to limit new technologies and where to partner.

We've all heard the saying "if you can't beat 'em, join 'em."  I'm not saying this strategy can't work, but it's certainly a possibility that as a result, the news business will ultimately think opportunistically about working with Google.  This move is a first step towards one of two conclusions -- success or partnership.  Who knows where this is headed.