WSJ Editor Claims Google Devalues Everything

from the no-wonder-no-one-uses-it dept

This has been clueless newspaper guy month around here, and it's kept up with the appearance of Walter Isaacson (yet again), Mort Zuckerman (owner/publisher of both the NY Daily News and US News & World Reports) and Robert Thomson (managing editor of The Wall Street Journal) on the Charlie Rose program, where they spend plenty of time whining about the way things used to be and why people have to start paying -- but never touch on any reason why people should want to pay. Still... that's a dead horse at this point. Instead, I wanted to focus on the rather stunning claim from Thomson concerning Google:
But one of the -- Google -- I mean, the harsh way of just defining it, Google devalues everything it touches. Google is great for Google, but it's terrible for content providers, because it divides that content quantitatively rather than qualitatively. And if you are going to get people to pay for content, you have to encourage them to make qualitative decisions about that content.
This is wrong on so many levels it's hard to know where to begin. Google doesn't devalue things it touches. It increases their value by making them easier to find and access. Google increases your audience as a content creator, which is the most important asset you have. It takes a special kind of cluelessness to claim that something that increases your biggest asset "devalues" your business. Thomson's mistake seems to be that he's confusing "price" and "value" which is a bit scary for the managing editor of a business publication. Yes, the widespread availability of news may push down the price (that's just supply and demand), but it doesn't decrease the value at all. It opens up more opportunities to capture that value.

As a content publisher, I can say, definitively, that Thomson is completely off base if he thinks Google is terrible for content providers. Google has been a huge help to us because it has helped us build our audience and our community -- which is the biggest asset we have. Thomson's mistake seems to be that he thinks the asset of publishers is the content. It's not. It's the community. It's the community. It's the community. Sorry for the repetition, but it doesn't seem to be getting through.

He's also wrong if he thinks Google divides content "quantitatively." Google's ranking mechanism is the exact opposite. It works out ways to measure the value of content at a qualitative level -- pushing the best content up. If the WSJ is afraid to compete with other content providers, you can understand why they'd be afraid -- but if they truly believe they have good content, that content will rise to the top (of course, the WSJ is harmed by its practice of making that content harder to read).

Finally, he's very wrong that the key to getting people to pay is to have them "make qualitative decisions about that content." If they've reached that stage, they're not paying. The value of the web and Google is that it lets people look at many sources and compare and contrast them qualitatively. Putting up a paywall is what devalues the content. It makes it harder to access and makes it a lot less useful. People today want to share the news and spread the news and discuss the news with others. As a publisher, your biggest distributors should be your community. And what does the WSJ want to do? Stop the community from promoting them. I can't think of anything that devalues their content more.

In that one paragraph, Thomson seems to be wrong on every single point. Is there a way to short the Wall Street Journal? It's really stunning that these newspaper guys (Isaacson goes on to agree with Thomson) can be handed the greatest mechanism for building their audience and adding value to their sites, and they whine about how it devalues them. It's the horse carriage company owners complaining about how automobiles destroy the value of a beautiful horse drawn carriage. Guys: you're looking in the wrong direction. Turn around and look forward at all that opportunity.
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Filed Under: economics, journalism, news, price, value
Companies: google, wall street journal


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  1. identicon
    Lee, 13 Feb 2009 @ 1:24pm

    Certainly quantity isn't a reflection of value. However, I think Michael's point is that value comes from a qualitative improvement over other means of information. If the WSJ's news is little more than what else is out there for free then why should anyone pay for their content? Google has shown that revenue can be had from other means than an upfront charge, such as advertizing and other promotional services. The growth of the community will ultimately create financial value.

    I agree, and I am a fan of this model of value creation. My point is a little different. Regardless of whether or not the WSJ deserves to go under, I'm saying that in general, Google ranks things by looking at the evaluative judgments of a lot of people, which is fundamentally a quantitative measure of value. If that results in better reporting and more accurate news (and more intelligent opinion pieces), those are good side effects, but Google does not have an algorithm to measure those attributes. They are simply what we hope will be a consequence of a new model of value creation.

    I guess the more succinct way of making my point is this: Mike correctly calls Thompson on conflating price with value. I'm calling Mike on conflating value with quality.

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