Old media turns combative against new media
LAS VEGAS (Reuters) - Leading media executives took a combative tone against Internet companies on Tuesday, suggesting that Big Media increasingly considers new content distributors like Google Inc. to be more foe than friend.
Context & Ripple Effects
The hostility on display in Las Vegas did not appear overnight. Business Week had already put the squeeze on Google's content practices in January 2006, and by that February newspapers were openly demanding that search engines pay for the snippets they surface. What changed by May 2007 is tone: the executives are no longer petitioning Internet companies but framing them as adversaries.
The framing is complicated by the fact that Big Media is not uniformly retreating — Reuters itself has been building bridges to new distribution, with a confirmed 2005 pilot letting blogs and online publishers run its news video and a planned MySpace-style community site aimed at fund managers and traders rather than teenagers. The fight is over who captures value from content, not whether to distribute online at all.
First-order effects
- Licensing negotiations between publishers and Google move onto adversarial footing, with executives publicly signaling that free aggregation of their content is no longer an acceptable default.
Second-order effects
- Content owners respond by building proprietary distribution of their own — Reuters' planned community site for financial professionals is the template — reducing reliance on the very platforms they are confronting.
Third-order effects
- If the confrontational posture hardens, the industry splits into camps: platforms that pay for content and those that do not, forcing every publisher to choose a side and resetting the price of news online.
The trend: Media companies are shifting from treating Internet distributors as marketing channels to treating them as commercial rivals in a renegotiation of who pays for content.