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The impact of online news aggregators

Dean Baquet

Former editor, Los Angeles Times

Dean Baquet

Part of the problem has been that your product, the information you gather, and one of the life streams for the paper economically, classified ads, have moved to the Web, ... where it's now free. ... In fact, people can get it and companies can make money off of it ... without paying you.

Right, [like] Google and Yahoo!.

Right. Do you feel like you're being ripped off?

You know, no. I guess if I felt surer [of the] newspaper as a business, I would feel ripped off, but I don't know how you can traffic in public information the way we do and get upset when people profit from the information you disseminate. I mean, my job is to find stuff out.

So this is what I meant when I said the view of my role is different than the view of the owner of a company. My role is to find stuff out and to disseminate it as widely as possible, so it's hard for me to get upset at the Googles and Yahoo!s of the world. ...

So you don't get upset, even though they're, in a sense, taking your material and making your newspaper, your physical newspaper, somewhat obsolete?

Well, I'm not convinced they're making the physical newspaper obsolete. ...

Isn't your circulation declining?

Yeah, but I think there're a lot of reasons why, and I don't think I can blame all that on Google and Yahoo!. [One] of the reasons why circulation is declining is because some of the people who want to read the L.A. Times read it online now. I'm more excited about the prospects of the Web than I am nervous about the Googles and Yahoo!s.

The reality is, I have something like 1 million new readers on the Web that I didn't have before. The reality is I have a paper that has always struggled for national recognition. I've got a newspaper, the L.A. Times, that has been competing with The New York Times and The Washington Post for [a] generation, but because we're not nationally circulated, people don't know how good we are. Suddenly, though, on the Web, they can find out. I can have readers anywhere in the world now, and that's worth the trade-off to me. ... But again, if I was running the business side of a newspaper, I might feel the opposite.

The people you say you're not upset with -- the Internet people who repurpose your material -- say you're a dinosaur; you're the old, mainstream media, and you just don't like the idea that your economic model is quickly disappearing.

[I want to] say a couple things. First off, if we disappeared tomorrow, most of the people who call us dinosaurs would disappear, too. All the bloggers who exist to comment on us, the Googles and Yahoo!s who don't really have many of their own journalists but who rely on what we cover in the Middle East, who rely on what we write about in California and the nation and Washington, they wouldn't exist if we didn't exist.

Our economic model is obviously threatened. But ... there will always be a need for journalism. There will always be a need for coverage, and not just commentary. There will always be a need for institutions that have the wherewithal to have bureaus around the world and around the country, and big capital bureaus. There will always be the need for those kinds of institutions.

I think the people that call us dinosaurs don't understand what the world would look like if we weren't around. Their world would be very different if we weren't around. They rely on us. If we disappeared tomorrow, they might have to reinvent something that looks like us. …

You don't think they get their information from the radio, from television, which I know newspapers used to be very upset that television [in a sense] repurposed their information.

... It would be a great exercise to follow the flow of a fact that appears in Google, Yahoo! or on the radio, or on local television. I think you would trace it back to a newspaper. I think the reality is, when I drive in in the morning, and I listen to the radio, I'm listening to the front page of my newspaper and The New York Times. Those institutions that traffic in what newspapers come up with couldn't survive without newspapers.

... I say all that not to make the case that I should be comfortable. I say all that to make the case that what we do is vital and absolutely necessary, and we have to exist. I just think that economically, and for the civic life of the country, there is always going to be a desperate need for journalism. I believe that. …

But your circulation's going down.

Circulation of the actual newspaper. But if you add the readership of the paper to the readership of online, it's probably greater than it's ever been in the life of the L.A. Times.

But online it's free.

That's an economic issue, I agree. But in terms of what I do, in terms of what I find out, in terms of what I contribute to society, as a newspaper man, I've got more success that I've ever had. ...

 
Rob Curley

VP, Washington Post.Newsweek Interactive

Rob Curley

... There's talk that the Associated Press may rebel against the use of its content on Google. Its members are getting a little uptight.

If you're going to publish on the Internet, you have to play by the rules of the Internet. But I don't think that that's bad.

At washingtonpost.com, we make more money if we have more page views. That's the way it works. Our advertisers pay for how many eyeballs we can get in. So to me, the idea that Google would link to our stories and give us more traffic, I want to thank them, not shut them down. For me, that's just how the Internet works. That to me seems like you would really want Google to link to you. You wouldn't be angry that they were linking to you.

But if you create the content, as in the case of The Washington Post, and people are using it and tracing it in some fashion, don't you want to get paid for that?

If Google sends traffic to me?

No, if they use your headlines, your lead paragraphs -- Google News.

I don't have a problem with that at all. But on the other hand, I should note I'm not a newspaper owner either.

 
Lauren Rich Fine

Managing director, Merrill Lynch

Lauren Rich Fine

What do you think about something like Google News and the finances of it? Because ... you go to Google News, there's a lot of news there; they didn't report any of it. ...

It serves a purpose. It ultimately could be damaging to the newspaper industry, and I like everything I'm seeing over the last few months of newspapers trying to claw back their rights. ... You're starting to see AP [Associated Press] getting involved in the fray in terms of making sure people are getting paid for their content, which ultimately they really should. ... Do I subscribe to Google alerts? Of course I do, because I have some very focused, specific interests professionally, and the fact that they're bringing in these articles that I might not have otherwise seen is great.

In most media companies there aren't two revenue streams; there's one: It's advertising. Newspapers are one of the few that get two revenue streams: circulation and advertising. In theory, over time they should be willing to forgo some of the circulation if they can maintain or expand the advertising side. Google could end up being a boon for them as well. ...

 
David Hiller

Publisher, Los Angeles Times

David Hiller

Have Google, Yahoo! transformed the news industry?

Well, they have to some extent. I think one of the --

Should they buy the L.A. Times?

They could stand in line. There's a lot of interest. I do think of the places where newspapers as an industry haven't played our cards right is letting all our content get out for free on the Internet and get reaggregated by Google and Yahoo! and present their own Google News and Yahoo! News, the core of which is all the news that we've produced. I bet they can't believe their good fortune that newspapers have let that happen.

One of the things where we can continue to make some progress is to retake that role as an aggregator of news, and that newspapers working together and doing those things and creating sites and aggregations of the news that we and only we produce is a way to take back some of that value from Google and Yahoo!.

But Tribune companies belong to the [Associated Press], and you sell to Yahoo!.

Yeah, I think that's a mistake.

Google says what they do is fair use and they drive people to your site.

Well, some of that is. You do get into some distinctions that may sound legal. I think some of what they do is both fair use, where they use headlines and maybe a couple of lines -- and [like] Google does -- drive people to the newspaper Web sites. I think that's good and healthy and beneficial to newspapers. Where I think you go off the track is some of what the AP is doing, which is basically selling whole stories, summaries, basically giving the whole kit and caboodle to Yahoo! and letting Yahoo! build the audience and get the advertising revenue from it. I think that's a mistake.

I understand that some members of the board are starting to object.

Sure. Yes, and should, and I think it ought to be changed.

Mr. Broad said he would force them to pay for their content.

Well, then Mr. Broad and I see eye to eye on something.

 
Jeff Jarvis

Blogger, BuzzMachine

Jeff Jarvis

Your business partner, Craig Newmark [of craigslist], says you're developing some software that will help people look at reliability in terms of information with you.

Craig Newmark invested in a company called Daylife, which is our partner, and it will help people find the news that they trust. ... The standards, in the end, are not set by us. The standards are set by the people who judge us. ... Now, that still means that you can learn better ways to do things -- absolutely; I don't question that -- but it's not as if that then becomes the sole precinct of the professional class. ...

My 14-year-old son is a huge fan of Digg.com, where the audience votes up the stories to make the front page. I had him come into the faculty of the City University of New York with their School of Journalism to show Digg, and the faculty got concerned -- what if a bad story gets up there? He very calmly pointed [at] a pull-down menu and said: "See, I pulled this down, and it says that this is lame. I click on that, and it's gone." ...

Google and the free Wild West of the Internet -- being able to just freely get information -- may be a passing phenomenon, because there are newspaper organizations both here in the United States and particularly overseas, where the laws are different, who are saying, "You're going to have to start paying."

I've seen the few publishers, especially in Europe, who object to the idea of being linked to by Google and search engines. They're fools. That's like saying to the newsstand owner: "You shouldn't make a penny off selling my newspaper. Stop." Google is the newsstand of the future. You're only going to be found via the link and a search engine, and most publishers I see know that. …

 
Larry Kramer

Former head, CBS Digital Media

Larry Kramer

We hear from members of the Associated Press, the new publisher of the Los Angeles Times, Eli Broad, who may buy the Los Angeles Times, that they have to start really charging Google or other sites that aggregate this information for their information. They can't give it away for free anymore.

Yeah, it's a fine line. ... In the case of a search engine, if it's just the headline, they can make an argument that they're bringing you a reader, that somebody's going to read beyond that headline and click and go to your site, and we make the money on that and we do all that. ... If you believe that the way the Web is used is search, then you want to be in a situation where search brings you a customer.

Yeah, but Yahoo! is beginning to get into news. It's now paying some money to AP and others, and Google is paying some money as well; they're starting to.

Right. And again, it depends on where are you putting it. Yahoo!, when they pay for information, they put it on their site, and the reason they do that, pay for it, is because they'll monetize it with advertising. When we had a relationship with Yahoo! in the early days of MarketWatch, they just ran our headlines, and if people wanted that story, they clicked on the headline and came to us. Now, you could argue that that's not a very valuable user to us because you only have them for that one page and then they go back to Yahoo!, but one of our goals, as a Web organization, was to put things on that page that got them to go further into MarketWatch. ...

Now, when you're talking about Yahoo! doing its own content to the extent that they become your competitor, you may want to worry about that. Then you may want to say, you know what? Their news site is too good now, and it's got too much of their own content, and they're not driving people to us.

Do you see a conflict coming ... where content providers are going to say to Google and others, "Hey, pay me, or we'll go elsewhere"?

Oh, I think that exists now. Look, the fact is, content costs money to produce, so somebody needs to pay for that. ... That doesn't mean Google can't make some money along the way.

I look at Google. In some ways, in their AdSense product, where they put ads on everybody else's sites, they're performing the same function as an ad agency. So instead of me paying 15 percent to an ad agency, ... I'm giving Google off the top 15 percent for money that they're bringing us, or whatever the percentage is. I'm still making the same percentage of money on that ad that I made before. What do I care if it goes to a company that's building an efficient auction system for that ad versus whether I'm paying it to an agency who convinced Coca-Cola to buy that ad on my site?

So that's what Google's deal with newspapers is?

With Web sites, that's AdSense, and it is similar to what they're trying to do with newspapers and with radio stations -- Yahoo!'s with newspapers, Google with radio stations. Google wants to sell advertising on every platform, using their auction system, which they argue is a more efficient way of selling advertising, any form of advertising -- outdoor billboards, newspapers and who knows? We as a media company, any media company, should look at that. If it is more efficient, then why wouldn't we want to do that?

The case of actual content, we allow them to search our content. We allow them to pull headlines out because it drives traffic to our sites, and that's how we make money on our sites. We make money with advertising on our sites.

Now, if the world goes in such a way that people only read headlines and they stop going to stories, then I'm quite sure our viewpoint of what we would allow them to put up on their site will change. ...

 
Scott Moore

VP content operations, Yahoo!

Scott Moore

Google did not have a license for the content that they were publishing on their servers. What they were doing is using their search technology to go and scrape content off of AFP's Web site and then display it on a Google page. Now, their argument -- Google's argument -- was: "We're linking back to your site, so we're effectively giving you free promotion and marketing." But the AFP said: "Yes, but if you are displaying ads or even if you're not displaying ads in France, you can't use our content. It's our content; you don't have a license for it. We're going to sue you because you're violating our copyright."

That's not what Yahoo! does in Yahoo! News at all. Now, we do have search technology that does go out and crawl the Web and shows you those links. That's a very well-established practice. The AFP -- you know, in France, the copyright laws are a little bit different than it is in the U.S., but that's because the reason that they filed the lawsuit and pursued that is because they didn't have the license agreement with Google.

Now Google has gone out and done a licensing agreement with the Associated Press. They may have done it with others, too. I think they realized that they had some liability there that they had to deal with.

In some newsrooms, there's a misconception that these sites like Yahoo! or Google are simply taking down material and using it and making a fortune while we [newspapers] go down the drain.

That would be a total misconception if anybody had that in their minds. ...

 
Craig Newmark

Founder, craigslist

Craig Newmark

What is this development with Jeff Jarvis?

Well, Jeff Jarvis is one of the people I trust for advice on media, and he, with [Upendra Shardanand] and a lot of other people, are working on a news aggregator [Daylife.com] which can help people collect news and can figure out what stories are really about, and then hopefully, as this evolves, help us find out versions of stories that are more trustworthy. ...

News aggregator is like Google aggregates a list when you do a search for stories?

Yeah. If you look at news.google.com, it brings together stories on similar subjects from a lot of different sources, and sometimes gives us a perspective on news that we wouldn't have otherwise. Daylife should do that and more.

Daylife will read them or assess them?

Well, it will take a look at what the story is about and maybe even be able to extract a few lines from the story, capturing the gist of the story.

Hopefully it's got a lead that will let the computer figure it out?

[It's] primarily computer-based, but I'm hoping that they'll be able to bring people into the equation, because sometimes you just need a human's touch on something. People are good at sniffing out when a story isn't exactly straight with people.

Is this to solve the problem that the Web is known for quantity of information but not qualitatively letting you know how good the information is?

That's part of what Daylife is about, and you're right: There's a lot of stuff on there, maybe many versions of the same story. How do we figure out what's really going on? I'm hoping Daylife starts with helping with that, and then gets better over time. ...

... Motive for this?

Well, from my perspective, it's to help people figure out what's going on in the world and to help us figure out what versions of stories are the most trustworthy. That kind of thing takes a while to get to, but Upendra is an expert on collaborative filtering, utilizing and -- forgive the cliché -- the wisdom of crowds, which running craigslist I see really does work, as long as you have some protections against panic or mob rule. ...

Wisdom of crowds? ...

Well, democracy is based on the idea that when you've got a lot of people together, making decisions together, you can get better results than often so-called experts. There's a lot of experimental psychology on this [that] shows that this really does work. The book The Wisdom of Crowds [by New Yorker writer James Surowiecki] has some of this articulated more anecdotally than scientifically. ... If this sounds like I'm talking about democracy from a political perspective, that's it. Democratic mechanisms have their flaws. The problem is that democracy works better than any other system we've found. ...

[Berkshire Hathaway chair and billionaire investor] Warren Buffett said it's not clear, if the Internet had been invented first, that we would have newspapers today.

Newspapers used to be produced using the precursor to the Internet, the printing press, and I think we're going to see a smoother evolution of papers onto the Net than a lot of people are worried about. There are some promising technologies like scrollable displays that could just be pulled out of your cell phone. I think newspapers will survive and do really well, just not on paper.

A lot of people, myself included, are excited about blogging and stuff like that, citizen journalism, but I do remind people that no matter how excited we are, there's no substitute for professional writing, no substitute for professional editing, and no substitute for professional fact checking. The problem is that with blogging, the model is publish first, maybe fact check later. In newspapers, the model is you fact check first and then publish. But those models are merging. ...

The Internet is a cacophony of voices, and over time, there are more professional voices?

Let's say that, OK, on the Net we do have news commentators and news reporters, and out of that confusion, we are beginning to see the emergence of voices who speak truth to power and who are trustworthy and who back up what they're saying. It's a slow process, but it's being accelerated as new ways of delivering news come online. There's Digg.com emerging, as is Daylife.com. We're going to see a lot more. The idea is we need help figuring out what's going on, and we need help figuring out what voices we should listen to. ...

 

Eric Schmidt

There's no question that we depend critically upon reporters reporting new facts, new stories, new ideas. Almost all interesting news seems to start from a reporter on a beat in a country uncovering something or reporting their observations about what they're seeing.

So from our perspective, the question is, how does the newspaper get paid for that? The Google model is a targeted advertising model, so anything that we can do where we can put advertising near or adjacent or somewhere in the area of the news should generate revenue that eventually goes back to that newspaper.

One of the things that Google News does is we send a lot of traffic to the Web sites of those papers, so it gives them an opportunity to, what we say, monetize those eyeballs: Literally go and take that viewer and say, "Hey, you were interested in this story on Rwanda; aren't you also interested in this story in England, and wouldn't you like to buy this product here in New Jersey?"

By monetize, you mean make money for?

Make money for it, in the same sense that today a traditional newspaper makes 25 cents from a subscription, and then they also make advertising revenue that they get from large purchases around pages and so forth and so on.

But you also have on Google your own ads and classified ads.

One of the unintended negative consequences of online advertising has been the loss of value in traditional classifieds. It's simply quicker, simply easier for an end user who's online, on a broadband connection, to look things up and to figure out what they want to buy. It's true for many companies. And it's really affected the economics of newspapers. This was a surprise to us. We figured people would use both.

No one has yet figured out a way to fill up all that money with a different source to help pay for the newspapers.

An unintended consequence that's happened to your content provider.

Right. And Google, although we've been part of the problem from their perspective, needs to be part of the solution. We've recently announced a trial with more than 50 newspapers where we're using our ad network to aggregate advertising from all around the country and feed it into their advertising systems so it augments their advertising sales force.

You bought YouTube, and with it an impending lawsuit. You also have a lawsuit from Agence France-Presse. Should you be paying more for the use of content?

In looking at all of these copyright issues, we're now convinced that these lawsuits are really lawsuits in lieu of a business negotiation.

We agree, and everybody else agrees, that copyright material should be subject to proper copyright protections in the countries in which copyright laws exist. The issue is on the margin. We believe fair use does apply to the way we're operating.

So what happens is, in place of a business negotiation, we get sued. Hopefully, in each of these cases, we'll be able to come to proper business terms and a proper license for the use of whatever content we're using.

Fair use?

There's a long history in the United States with something called fair use. And although the precise measurements are not available, most people agree that as long as the use is not a direct copy of the primary use, it's permitted within certain frameworks. Indeed, there's a test in copyright law as to exactly what those exceptions are.

So that allows you to rank things without revealing the whole content in the story?

An example would be that we are producing the world's largest digital library index. Think of it as the world's largest card catalog. In order to do that, we take very small amounts of a book and we use that to create an index of the book. The creation of that index, in our opinion, is a fair use. Others disagree and have sued us.

[Billionaire philanthropist] Eli Broad said he thinks newspapers should charge search companies to use their content.

He is welcome to make that proposal to us. We might find that it's better to use somebody else's content. He might find that the loss of the traffic that we send to him is a bigger cost than whatever revenue he would get by directly charging us. We have an enormous number of people who come through Google every day. We take them right to the content source; we take them right to his newspapers. And we think that's a strong advantage in our partnerships with the newspapers.

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posted feb. 13, 2007; last updated feb. 27, 2007

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