Google News adds ads - but what does this mean for newspapers?

Posted by Helena Deards on March 3, 2009 at 11:52 AM

Google has this week announced plans to place ads on its Google News site, which aggregates stories from more than 4,500 English-language news sources worldwide and places links to their articles on the Google News home page. The ads will only be seen by US users, and mark the first time that Google News has contained any advertising since its launch in 2002.

The revelation may not be well received by all in the newspaper and online news industry. Many publishers have taken issue with Google's use of their articles in what is seen by some as a type of rival news site, although many have accepted it due to the large volumes of traffic it drives to their sites. However, Google News' intended use of advertising alongside other publications' headlines and summaries will essentially mean the company profits from other people's content.

In the past, Google CEO Eric Schmidt has been outspoken about his desire to save the ailing newspaper industry, and his belief that its demise would be present "a real tragedy". Head of Google UK Matt Brittin later spoke along the same lines, voicing his belief that a change in consumer behaviour is to blame for newspapers' woes, not Google. William Echikson, Google's Senior Manager for Communications has now joined the chorus, asserting that the Internet and the lack of a profitable business model are responsible for problems in printed media - not Google. In an interview with New Europe, Echikson was keen to explain Google's role as a "platform, not a media company", and that it aims to "help others express themselves".

Such vocal reassurances of loyalty and denials of blame from Google contrast with their latest move towards advertising on the Google News site. Publishers may now wonder why, if Google News is just a "platform" to help news sites, advertising is a necessary part of it. It will be interesting to see how publishers respond to this use of their content - Reuters for one has expressed worry at the move which "places Google News in a position to compete with news publishers, giving us cause for concern". At the heart of the issue is undeniably the shift in consumer habits towards digital media as well as the enormous amount of online news competition, which have effectively usurped the traditional newspaper business model. But Google's actions could be seen as more part of the problem than the solution.

Source: New York Times, New Europe, Biz Report