Content is king, but will it always be free?

December 15, 2009

In case you have had your head turned in recent weeks by the denouement to X Factor, Rupert Murdoch’s news empire and Google are engaged in a media scrimmage over the future of online content, specifically, over Murdoch’s desire to turn a profit out of his journalism posted on the web. The media boss says he would like to put his news behind paywalls, but this strategy is being undermined by search engines that provide free access to news, including content from his paid for titles.

It is not an edifying spectacle; Robert Thomson the editor of the Wall Street Journal set the tone for the debate when he described companies that aggregate news without paying for it as “parasites or tech tapeworms in the intestines of the internet.” He has also accused aggregators of encouraging “promiscuity” by undermining readership loyalties. I had never considered myself the web equivalent of Tiger Woods stalking search engines for shapely headlines, but it is a thorny issue and one that divides opinion.

Top Gear presenter Jeremy Clarkson, wrote recently about the benefits of the internet –looking up where the actor James Garner was born, ordering Sunday lunch and watching funny clips on YouTube (his list not mine) – but also acknowledged its dangers: “The fact is this, if something can be digitised, it can be stolen.”

And theft is the nub of Murdoch’s accusation. Other companies, he says, are piggybacking on his content to generate advertising revenues for themselves – income which by rights should swell the News Corp balance sheet.

Technology writer Ian Betteridge says that the traditional publishing model – creating words and pictures into branded products and charging people to see them, then gathering audiences together into coherent niches which advertisers can sell to – has been broken apart by the internet which atomizes audiences and breaks down brand loyalties.

“Why is he (Murdoch) circling like a shark around Google? Because he sees Google differently to (almost) everyone else,” says Ian. “He looks at Google’s search results and he sees content next to ads – and it’s (in part) his content. Content and ads are what publishers do, and that means that Google, to Murdoch, is a publisher. The veneer of being a technology company is just that – a veneer.”

“And if Google is a publisher that means it’s a competitor to News Corp.”

Google recently blinked first in the stand-off by announcing plans to restrict users to five searches per day on a paid site, any more and they will be required to subscribe to the site. It is unlikely that this move will be enough to satisfy Murdoch who is refusing to brook compromise and is apparently courting Microsoft to put his content exclusively on its search engine bing.

There is a great deal of speculation about where this debate is going and the likely endgame for Murdoch. Ian says: “In any media revolution, the first people who make money are the geeks. The second wave, the ones who make the ‘serious’ money, are the businessmen who understand how to turn the stuff that the geeks did for fun into big cash. We’re moving into that phase now.”

And as for Murdoch, well, you underestimate him at your own risk.