January 29, 2010 at 12:50Google Top Manager: We are here to help newspapers
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“IPads may help newspapers and traditional paper publishers, but only a major evolutionary change will save them,” said Google’s chief economist Hal Varian in a conversation with students at the University of Berkeley’s journalism department.
“Perhaps the future of the news lies in the development of this type of device,” Varian said. - “It is very likely that people will use tablets during leisure hours, as you know, this is very attractive for publishers.”
But given the difficult relationship the music industry has with iTunes, which has taken control of packaging and pricing from it, maybe publishers should think about it before jumping into bed with Apple?
“We know there will be obvious competency with other devices like the Kindle,” he said. “And of course, the web is not going anywhere. I think you should not consider the tablet as the only and last distribution channel. " Varian said he studied data from the Newspaper Association of America, the Pew Research Center, and other sources on news, advertising revenue, and print runs. His conclusion: digital distribution will be a boon for newspaper publishers only if they fundamentally redefine their ideas about the product and the delivery methods to the end user.
Distribution cost
Distribution of a regular print newspaper accounts for 53% of the costs; this cost is destroyed due to the transition to digital distribution. Compare this amount with 35%, which is what the top manager from Google called the main function - news gathering, editing, management.
The problem is that the audience has been declining all this time. Newspaper runs have fallen since 1990 and have literally collapsed over the past five years. As for the Internet, according to the Pew Center, only 39% of respondents said they spent time searching for news.
Newer devices like the iPad have a chance to win more readers and increase their consumption time. “The good news is that online information can get people where they could not before — at their workplace.” - says Varian. “The bad news is that they don’t have time to read it.”
But what’s even worse is that the analysis of search queries shows that readers don’t visit news sites for the content that advertisers loved in the print era, for example, on topics such as home and garden, travel and auto-motivation, which deprives publishers of money flow in an offline world. Instead, they go to Amazon, Bing Travel, and Edmunds.com.
“The verticals that attract traffic are sports, weather, breaking news, and money on travel and shopping,” says Varian. “Pure News is a unique product produced by newspapers, but it is very difficult to monetize.”
Today, he says, online advertising only accounts for 5% of newspaper ad revenue.
Use data for growth
“Google wants to help publishers use web technology for growth,” says Varian. “I think newspapers could better exploit the available data. They need contextual targeting and measuring advertising performance. ”
Varian said Google is advising some publishers on the Google News registry about ad targeting and user engagement. But not all representatives of the newspaper world see a friend in the search giant. Last spring, the boss of News Corp. Rupert Murdoch accused the company of copyright infringement by showing short excerpts from the text of the news and selling advertising at the same time. And last week, digital marketing company Outsell said 44% of Google News users don’t go to the sites of the original content providers at all.
Varian rejected the Outsell statement, saying the study’s structure was “not very impressive,” and Google spokesman replied that Google sends more than 4 billion visitors to publisher sites around the world every month. “This is a symbiotic relationship,” Varian said. “We, as a search engine, are interested so that our users can find good content.”
Paid access will not work.
Varian's list of recommendations does not include paid access, such as what the New York Times introduces. “He's too easy to get around,” he says.
Instead, publishers should pay attention to platforms such as the iPad, so that readers spend their non-working time on their sites. “The problem is how do we turn newspaper reading into a form of relaxation again?” "We know that reading news is important for our users, but they just do not spend much time on it."
“Perhaps the future of the news lies in the development of this type of device,” Varian said. - “It is very likely that people will use tablets during leisure hours, as you know, this is very attractive for publishers.”
But given the difficult relationship the music industry has with iTunes, which has taken control of packaging and pricing from it, maybe publishers should think about it before jumping into bed with Apple?
“We know there will be obvious competency with other devices like the Kindle,” he said. “And of course, the web is not going anywhere. I think you should not consider the tablet as the only and last distribution channel. " Varian said he studied data from the Newspaper Association of America, the Pew Research Center, and other sources on news, advertising revenue, and print runs. His conclusion: digital distribution will be a boon for newspaper publishers only if they fundamentally redefine their ideas about the product and the delivery methods to the end user.
Distribution cost
Distribution of a regular print newspaper accounts for 53% of the costs; this cost is destroyed due to the transition to digital distribution. Compare this amount with 35%, which is what the top manager from Google called the main function - news gathering, editing, management.
The problem is that the audience has been declining all this time. Newspaper runs have fallen since 1990 and have literally collapsed over the past five years. As for the Internet, according to the Pew Center, only 39% of respondents said they spent time searching for news.
Newer devices like the iPad have a chance to win more readers and increase their consumption time. “The good news is that online information can get people where they could not before — at their workplace.” - says Varian. “The bad news is that they don’t have time to read it.”
But what’s even worse is that the analysis of search queries shows that readers don’t visit news sites for the content that advertisers loved in the print era, for example, on topics such as home and garden, travel and auto-motivation, which deprives publishers of money flow in an offline world. Instead, they go to Amazon, Bing Travel, and Edmunds.com.
“The verticals that attract traffic are sports, weather, breaking news, and money on travel and shopping,” says Varian. “Pure News is a unique product produced by newspapers, but it is very difficult to monetize.”
Today, he says, online advertising only accounts for 5% of newspaper ad revenue.
Use data for growth
“Google wants to help publishers use web technology for growth,” says Varian. “I think newspapers could better exploit the available data. They need contextual targeting and measuring advertising performance. ”
Varian said Google is advising some publishers on the Google News registry about ad targeting and user engagement. But not all representatives of the newspaper world see a friend in the search giant. Last spring, the boss of News Corp. Rupert Murdoch accused the company of copyright infringement by showing short excerpts from the text of the news and selling advertising at the same time. And last week, digital marketing company Outsell said 44% of Google News users don’t go to the sites of the original content providers at all.
Varian rejected the Outsell statement, saying the study’s structure was “not very impressive,” and Google spokesman replied that Google sends more than 4 billion visitors to publisher sites around the world every month. “This is a symbiotic relationship,” Varian said. “We, as a search engine, are interested so that our users can find good content.”
Paid access will not work.
Varian's list of recommendations does not include paid access, such as what the New York Times introduces. “He's too easy to get around,” he says.
Instead, publishers should pay attention to platforms such as the iPad, so that readers spend their non-working time on their sites. “The problem is how do we turn newspaper reading into a form of relaxation again?” "We know that reading news is important for our users, but they just do not spend much time on it."