A Few Coherent Thoughts on Murdoch Blocking Google

Yesterday Rupert Murdoch, Chairman of News Corp, said that he was going to have Google blocked from all New Corp. websites.  That means something

From EditorandPublisher.com:

The Chairman of News Corp. said in an interview with Sky News Australia (reported here in MediaWeek U.K.) that once the newspapers get their paywalls, News Corp. plans to pull its content from the likes of Google and others.

Murdoch said: “We’d rather have fewer people come to the Web site and pay. Consumers shouldn’t have had free news all the time — I think we’ve been asleep. It costs us a lot of money to put together good newspapers and good content. No news Web sites anywhere in the world are making large amounts of money.”

Immediately the web went all a flutter, myself included, predicting that that Murdoch would rue the day.  Joe Mandese at Mediapost.com noted:

According to an analysis of Google-generated traffic released late Monday by Experian’s Hitwise service, Google and Google News currently account for more than 25% of the daily traffic to the Wall Street Journal‘s WSJ.com site.

That’s an awful lot of traffic to put at risk.  Now the other side of the coin is that Murdoch knows that showing tons of traffic low cost network ads begging them to Punch the Monkey or telling them they just won a lottery is the absolute path of least resistence.  You go there when you have nothing else to possibly do…

In retrospect, this may not be a bad thing.  Harry McCracken at Technologizer was one of the first to expound some of the reasons this might be just what media needs.  His first (of several great points):

I’m tired of hearing media executives whine about Google without doing anything about its alleged misconduct. It’s extremely easy to configure a Web site to prevent Google from crawling it. So why don’t these sites that are so nonplussed about being in Google’s index opt out? If Murdoch blocks Google, he’ll at least be safe from charges of inconsistency and/or hypocrisy.

He’s right…it’s about time that someone actually acted rather than simply wringing their hands.  If you’ve got dragon trouble, you don’t talk about it, you get your sword and do something about it.

Jason Calacanis had the best bit in his newsletter yesterday.  He sees this as a well orchestrated play to put the News Corp.’s search rights into play and open a bidding war.  His theory:

In fact, a couple of weeks ago we had this *exact* discussion on This Week in Startups. Essentially, I put forth a simple strategy for Microsoft to pursue with Bing in which they would go to content providers like the New York Times or Wall Street Journal and offer them 50% more revenue then they are currently getting from Google search referrals to be exclusively indexed in Bing.

Jason’s right.  There’s value in the search rights to News Corp. content.  Let the search giants bid for exclusivity (or just pay for access) and you’ve once again got the horse ahead of the cart.  Then if it’s a success, he can rebid every few years. At the same time, he’ll get his inbound search traffic back, so I’d expect to see this happen fairly quickly.

What will Google do?  They’ll bid along with everyone else.  Because otherwise Google News will dry up and blow away.  Because if this works, every media company in the world will jump on board.

Why?  Because something is better than nothing, and because as Dow Jones Chief Executive Les Hinton (a Murdoch employee) reminds us, Google is no more than “a digital vampire.”

Of course, as Sam Whitemore reminded me yesterday “when Rupert was eyeing WSJ, he was going to give all content away, remember? Now this. He’s at sea w/o Peter Chernin.”

Whatever happens, this is gonna be fun to watch…

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