November 09, 2009

Murdoch's Folly: Block Google & Kill Fair Use -- Plus a Nasty Truth

Greetings. With all of the pain and horror in the world these days, sometimes it's tough to find something to really make you smile, to laugh, to outright guffaw.

Luckily I was treated to such an experience today while viewing a new interview with "Fair and Balanced" News Corp. chairman Rupert Murdoch, where he blasts Google, free Web sites, amateur journalists, Google, and ... did I mention Google? Yeah.

There isn't a lot spectacularly new in this text and video interview at Sky News, since Rupert has clearly expressed his disdain for Google and its ilk in the past, but a few of his latest ramblings were of particular note.

As he has before, he's still talking of blocking his Web properties from Google Search and Google News. Of course he could do this today with robots.txt and meta tags, but it appears that he wants to wait until after he has his "subscription walls" erected (that's called "hedging your bets").

Perhaps even more interesting in the long run, Murdoch spoke of his conviction that the "Fair Use Doctrine" could be successfully eliminated through court challenges. And he spoke disdainfully of all the dinky Web sites who can't bring in any "serious money" -- you know, more than a million or two (is that in U.S. dollars, Ozzie dollars, or pounds? -- never mind). He even manages to diss the commercial news wire services.

The heady atmosphere in which Murdoch resides seems all too clear, with his focus on the class separation between us and them, rich and poor, quality and trash made all too clear. This is not a man who believes in crowdsourcing -- to him there's the exalted tier of professional movers and shakers -- and then there's all of the "little people" that he expects to pay him for the privilege of being led by the rings in their noses.

Of course, Rupert is free to run his empire however he chooses. Google has noted multiple times that they feel Google brings value to News Corp. sites, but if he wants to block Google, it's just a matter of a few lines of text.

Murdoch says that all of this free Web content shouldn't have ever been "free" in the first place. If people had been paying all along, they wouldn't be bitching about plans to force them to pay for content now, is the apparent reasoning.

Well, it's certainly true that the public Internet could have evolved originally in more of the Big Telecom model of pay-per-byte, pay-per-show, pay-pay-pay. Would the Net have blossomed as widely as it has under such a regime (the model that some big ISPs seem to be trying to move towards today)? It seems far more likely that the Net would be tightly straitjacketed today under such conditions.

Rupert is right about one thing. Once people have had something for free, getting them to start paying later is a problematic proposition at best.

But here's a nasty truth. For most casual users of the Internet, the vast bulk of content on the Internet isn't worth paying for directly in the first place. This includes both reputable, high quality news sites -- like the New York Times, and lower quality publications of the sort that Murdoch is well familiar with.

This is not to say that most Web sites are trash, aren't worth your time, or shouldn't exist at all. Rather, it simply means that while they're good enough to be worth putting up with ads -- particularly of the less intrusive sort -- they're not sufficiently worthwhile to any given individual to be worth paying directly for access.

To regress back to Econ 101, most Web sites exhibit a highly "elastic" demand characteristic. There isn't a great deal to bind any given individual to any given site, vs. the various alternatives available, or simply not engaging with such sites at all in many cases. This can even be true for very large, high quality, and widely used sites such as Google's array of services -- users can easily switch to competitors at any time, and in fact Google is making this even simpler through their user data export initiatives.

There are exceptions, naturally, when specific groups of people have specialized needs. Rupert's own Wall Street Journal is an example of how significant numbers of persons are willing to pay for content when it brings them direct and tangible benefits. Another example of where persons seem willing to pay for Web site content is porn -- but the rise of amateur/free porn sites has taken a big bite out of that industry's bottom line already. Movies and TV shows more generally are another area where selected content will be considered worth paying for by groups of individuals -- but whether that will be from the Internet generally or via ISP "walled content gardens" of their own is another story. Mobile apps, such as those on the iPhone or Android, are another interesting category.

But imagine that every time you accessed a Web page, it cost you a nickel. How would this affect your browsing habits? If you could get much the same content -- by your own definition of value -- at a site that didn't charge that nickel, which would you routinely visit? I can't count the number of times I've had people make suggestions to me along the lines of, "Hey Lauren, why don't you charge for the materials that you put out on the Net! Then you could afford to fix your clutch!" But charging for most Web content is the stuff of fantasies, not reality.

Murdoch's own fantasy is the belief that his content is so superior to all that of the "common riffraff" on the Net that his sites will generally be worth paying for. He claims he'd rather have fewer people paying more, rather than having many people paying nothing. And he suggests that the rest of the world will ultimately see the genius of his model and come rushing to emulate it.

The foundation of his reasoning is as shaky as quicksand. He fails to account for basic human nature, and for the highly fungible nature of most Web content -- that is, six of one, half a dozen of the other.

Actually, it would be most fascinating if Murdoch proceeded with his plans. Let him erect pay walls around his Web properties, ban Google and other search engines from most of his content, and let the money start rolling in from all of those subscribers that he's expecting to be lining up, wallets in hand.

Then we can return in a year or two or five and see how Rupert's philosophy played out in practice.

But if you had to place a bet on the outcome, which organization would you expect to be the stronger in the end? News Corp. a la Murdoch? Or Google?

Your mileage may vary, but for myself, I'd be betting on a bunch of brightly colored balls.


Posted by Lauren at November 9, 2009 02:23 PM | Permalink
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