Rupert Murdoch doesn’t understand the internet

How the world’s most powerful media magnate doesn’t understand media anymore.

“We’re going to stop people like Google, or Microsoft, or whoever from taking our stories for nothing… I think they ought to stop it. The newspapers ought to stand up and let them do their own reporting or whatever.”

So said Rupert Murdoch, speaking at the National Press Club in Washington. He seems outraged that Google News lets people click on links that take them to sites owned by his papers! Am I missing something here? As far as I know you can’t read the full article on Google News, only a headline and brief snippet. The link to the original publisher is free advertising for the publisher!

In case you think I’m being harsh, or taking him out of context, here’s Murdoch’s exact words taken from a transcript provided by The Independent: “By that I mean that, if you go to Google News and you see stories where it says Wall Street Journal and you click on it, you suddenly get the page or the story as in the WSJ and it’s for free. And they take it for nothing, it’s free… We’ll be very happy if they just publish our headline, and a sentence or two, followed by a subscription form, of course. And that will bring you so-called traffic to your site.” I feel a little sorry for Murdoch. He’s clearly had someone explain in the briefest of terms how Google News works, but nobody’s actually pointed out how it works in his favour.

That he doesn’t ‘get’ the internet was further proven when he commented on the iPad:

“You know I got a glimpse of the future this last weekend with the Apple iPad. It is a wonderful thing … it has brought together all forms of media, music, books, newspapers, whatever… It may be the saving of newspapers. It cuts costs – costs of paper, ink, printing, trucks.”

But if you don’t have paper, ink, printing, trucks… you’ve essentially got a website, right? This is where the Murdoch View of the future crumbles. As Media Watch host Jonathon Holmes observed on The Drum, Murdoch “despite the power and the profits of News Corp’s book-publishing, magazine, television and film production arms, is still a newspaper man”. He still views the world of media as a newspaper magnate would. Wanting to box all his news into one closed off marketable product. The iPad has a Wall Street Journal app – a closed environment – that you pay US$3.99 a week for. The Times Online website has a Pay Wall – a closed environment – that you pay £1 a day or £2 a week for access to.

The media industry is at a crossroads. And companies that go down the Murdoch road of pay walls and closed environments will learn what the music industry kinda learnt the hard way: if you don’t adapt to the internet it will destroy you. For years the music industry thought it could fight the internet’s hippy-like culture of freedom and openness. File sharing sites like Napster and Kazaa took the music Goliaths by surprise and they fought back. Murdoch sees content aggregators like Google and Yahoo as enemies, when it should embrace them as friends. A fascinating study by the Pew Research Group reported that only 7% of people surveyed would be likely to pay for access to a particular news site. “The vast majority of online news consumers,” the report states, “seem willing to browse for news from many sites, do not have a favorite online news source, and even if they do, are not willing to pay for that site’s content”. You can go the way of the music industry, Rupert, and try to force people to pay for your content, or you can go the way of the Huffington Post and Politico – two young, internet savvy media organisations that are making significant growth at a time when news giants are in decline.

Would you or do you pay for news content?