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Old Media Wants A Piece Of The New Media Action

Posted by inet - 2006-02-13

Google, now the world's most highly valued media company, finds itself stepping on the toes of established players as it tries to extend its Web dominance into new domains.
The World Association of Newspapers last week accused Google and other search engines of not paying for the excerpts of news sites they display in search results. The accusation mirrored recent complaints from book publishers over Google indexing their copyrighted material, and points to more skirmishes with the traditional media industry as it weighs the benefits of making it easier for consumers to find their content versus the risk of aggregators profiting at their expense.

Gavin O'Reilly, president of WAN, a Paris-based group representing 18,000 newspapers, issued a statement last week that search engines like Google are "using the content flow of newspapers to build businesses that will ultimately compete with us." WAN has formed a task force to look at ways content owners can get a cut of the money Google makes from search-ad results. The Agence France-Presse has already sued Google for copyright infringement for using bits of its stories and thumbnail photos on Google News, its specialized news-search site.

"It's a truism in the newspaper business that most readers never make it past the jump," said Nate Elliott, a Jupiter Research analyst. "If Google excerpts article leads, they're creating an online jump."

"Google has a long and succesful history working with content owners, and we look forward to learning more about the association's recommendations," said Google rep Nate Tyler.

Having made clear its intent to branch into traditional advertising, Google is likely to face more such pressures, said Matt Naeger, general counsel at Impaqt, a search-marketing firm in Pittsburgh. In October, the Association of American Publishers filed suit against Google, claiming its Library Project, which digitizes copies of books to make them searchable, violates copyright laws. Google's video ambitions could raise similar concerns, said Naeger.

The crux of the debate is whether Google's process of unilaterally gathering and cataloging information, then pointing to its source, violates copyright law, and whether the search giant should share profits from the targeted ads that appear next to search results with copyright holders excerpted, Naeger said.

He sees little legal merit in WAN's complaint, particularly because there are no ads on Google News. All Internet sites can opt out of having their Web pages cataloged by search engines by including a piece of code known as robots.txt, which tells search crawlers to skip those pages. Google's method of copying Web pages for inclusion in its index was given a legal victory last week in U.S. District Court in Nevada, which ruled Google did not infringe on copyrights by caching Web pages without sites' permission.

Many Web sites see search engines as a good way to draw new readers. Sites like Forbes.com and NYTimes.com have hired search agencies to make their pages easier for search engines to index and have bought keyword ads tied to news-related searches on Google's main page.

Few publishers want out of search indexes. Topix.net, a news search engine that competes with Google News, has received only 10 requests via robots.txt code to be taken out of its index of 27,000 news sources, which, like Google News, sends traffic back to sites. Unlike Google News, Topix, which is 75 percent owned by Knight Ridder, Tribune and Gannett, displays ads on its results pages.

"Does Google owe a check to every single Web site?" asked Chris Tolles, vp of marketing for Topix. "You have to acknowledge the industry structures of the information age."

Chuck Richard, an analyst with Outsell, said the tensions arise from mature media trying to "bridge the gap" to a digital world. As of now, newspapers make far less money online than they do from the physical paper. Google, meanwhile, last week reported $1.2 billion in quarterly revenue and $372 million of net income."It's like suing the proverbial deep pockets," he said.

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