Old Media and New Media: Friends, Not Foes
Search and advertising services from Google and Yahoo! are helping traditional media companies extend their content online and generate revenue — If content is king, then its queen is making money. This marriage of substance and sales …
Context & Ripple Effects
Traditional publishers had already pressed the question of whether search engines should compensate them, as shown by newspapers’ push for payment from search engines in February 2006. This account frames Google and Yahoo’s search and advertising services as a commercial answer: distribution and ad sales can be shared rather than treated solely as a conflict.
Google’s planned sale of print advertising for 50 major newspapers and its radio-sales hiring show the company extending its advertising operation into legacy media channels, while Yahoo is improving shopping search and personalization.
First-order effects
- Traditional media companies gain online distribution and advertising tools from Google and Yahoo, giving their content a clearer route to digital revenue.
- Google and Yahoo gain publisher inventory and relationships that broaden the channels through which they can sell advertising.
Second-order effects
- Publishers’ bargaining shifts from a simple demand for search-engine payments toward negotiating the terms of distribution, advertising sales, and revenue sharing.
- Google’s newspaper-print program and radio expansion put more legacy-media ad inventory into technology-led sales systems, increasing pressure on incumbent ad-sales operations to integrate with those systems.
Third-order effects
- If these partnerships proliferate, search and ad platforms become core commercial infrastructure for publishers, even as publishers retain incentives to seek better compensation for the content and inventory they supply.
The trend: Digital platforms are moving from directing audiences to media content toward operating the advertising and distribution infrastructure that monetizes it.