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Microsoft has had discussions with News Corp over a plan that would involve the media company being paid to “de-index” its news websites from Google, setting the scene for a search engine battle that could offer a ray of light to the newspaper industry.The impetus for the discussions came from News Corp, owner of newspapers ranging from the Wall Street Journal of the US to The Sun of the UK, said a person familiar with the situation, who warned that talks were at an early stage.
However, the Financial Times has learnt that Microsoft has also approached other big online publishers to persuade them to remove their sites from Google’s search engine.
News Corp and Microsoft, which owns the rival Bing search engine, declined to comment.
Microsoft has had discussions with News Corp over a plan that would involve the media company being paid to “de-index” its news websites from Google.
The Financial Times has learnt that Microsoft has also approached other big online publishers to persuade them to remove their sites from Google’s search engine.
One website publisher approached by Microsoft said that the plan “puts enormous value on content if search engines are prepared to pay us to index with them. This is all about Microsoft hurting Google’s margins.”
Steve Ballmer, chief executive of Microsoft, has said that the company is prepared to spend heavily for many years to make Bing a serious rival to Google.
[edited by: tedster at 8:24 pm (utc) on Nov. 23, 2009]
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Steve Ballmer, chief executive of Microsoft, has said that the company is prepared to spend heavily for many years to make Bing a serious rival to Google.
I guess MS has decided that if you can't beat 'em, (try to) sabotage 'em!
Google is so engraved in society today that building a better search engine(not saying Bing is) would not beat Google. Drastic measures are the only way to compete with Google.
Anyway we all loose big time if there ever is a search engine war where sites decide to be listed in one search engine and not in another one.
[edited by: encyclo at 7:52 pm (utc) on Nov. 23, 2009]
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Nice move Microsoft. If you can't develop a worthwhile product, try to hurt your competitor by buying away their publishers.
Might work for a year or two, until the publishers start to hold Microsoft accountable for all the promises of increased revenues and advertisers... and when it doesn't come... they will all go lurking back to Google... which will at that time now hold a 80% share of the market...
And since their sites will be newly re-listed, it will take years for them to recover their rankings...
Does this damage the web?
No, not really. It just means that we'll have to use Bing to search for news-related stuff instead of Google - I'm not going to loose sleep over that.
Does this set a precedent that others will follow?
No, not really. For everyone else, maximum exposure is everything - Microsoft can't afford to buy everyone off.
Kaled.
It is a PRIVILEGE for a search engine to list a (good) website and Google has been taking it for granted for too long..
if Bing are paying the papers for their content, then they can't object if Bing try and make a bit back.
Google would probably find themselves on the end of an argument with the papers if they tried to follow suit.
The primary issue might surprise you. (It did me.)
There are very, very few products that can be sold in context to the news. And news content performs worse than average in regards to branding. Google has been disappointed with the income; their agreement with Associated Press is mostly a marketing ploy.
This is why everyone talks about charging for the news. It's not, as News Corp seems to believe, that it's free. It's that news is not good for presenting ads.
It's funny. Much of what is passing around on WW as common wisdom is unknown to executives in the news biz. I believe most webmasters in the news business keep their mouths shut because they fear for their jobs, rightfully so. There are very few cutting-edge web talents working for newspapers today.
Feels like MSFT should be investigated for exploiting their monopolies in other areas to gain unfair advantage in search this time.
While it might depend on how the final deal develops (assuming there is one), I do not see how negotiating exclusive rights to republish copyrighted material can be seen as an abuse of monopoly. It is how copyrights have been handled for years.
Seems to me that M$ is basically saying, "If we pay for access to this content you have to assure us that others are not getting the same access for free."
And, if the model proves profitable for both parties, then I would guess many more traditional news outlets might defect from Google as well - unless Google develops a way to begin paying publishers for the use of their content.
Or may be that's exactly what they want, far fewer readers for whose privilege MS would pay far more.
"very few products that can be sold in context to the news"..."It's that news is not good for presenting ads."
I assume you are qualifying that as clickthrough ads - ie. MS Adcenter as I would have to disagree on that as a general statement.
If M$ have a way to use Y! display ads in the future deal, then brand awareness and product association-wise it's big stuff... not a G buster, but a good solid income stream which is not OS related....
Targetted ads displaying next to news content can work - provided it is only about associating a brand to the broad topic or the focus of the news story.
It would need a very good ad inventory as well as good contextual matching of ads to stories - maybe therein lies the problem?
It would need a very good ad inventory as well as good contextual matching of ads to stories - maybe therein lies the problem?
But there's the rub. What ad do you match to Gov. Sanford facing 37 ethics counts (Cheap Flights to Argentina? Smokey Mountain Vacations?)
How about 104 Killed in Coal Mine Blast? Radiation Leak at Three Mile Island? International Tensions Heat up Over Iran Nukes?
Is this ethical? Is it even legal? To me, it sounds like Budweiser going into a bar and telling the owner, "We'll pay you not to serve Miller." (As opposed to "We'll pay you to serve Bud in addition to Miller.")
Given Microsoft's history on the antitrust and restraint-of-trade front, it seems like a risky move for Microsoft.
As for Rupert Murdoch's News Corp., is getting a limited-term subsidy from a search engine the best he can do? A few weeks ago, Mr. Murdoch was complaining about Google News and talking about getting users to pay for content. Now he's looking for a handout from another referrer of low-quality drive-by traffic. This sounds like an act of desperation, not a long-term plan for monetizing his content.
Google is so engraved in society today that building a better search engine(not saying Bing is) would not beat Google. Drastic measures are the only way to compete with Google.
But there's the rub. What ad do you match to Gov. Sanford facing 37 ethics counts (Cheap Flights to Argentina? Smokey Mountain Vacations?)How about 104 Killed in Coal Mine Blast? Radiation Leak at Three Mile Island? International Tensions Heat up Over Iran Nukes?
Click through ads are not a good choice for these examples, but display ads can match perfectly. The news item causes fear, the ad the solution. A perfect combination if these news items are combined with one of the ad types below:
I run a few medium sized news sites and have to say that contextual ads wise hard news performs OK. Only TV, health and tech news do better for us eCPM wise. A lot better than movies or celebrity anyway. Non-contextual no advertiser has ever requested we exclude ads from hard news. I would guess they use the sort of hard news (tabloid or broadsheet) to target the users for branding and later purchases. I don't think you should get obsessed with matching a specific banner ad to a story, not going to happen in most cases.
The problem is not that hard news cannot generate well online, it does as well as most other news topics. It is just online newspapers cannot generate as much as they did in print and hard news is very expensive to produce if you are doing your own reporting.
In respect of Google and AP, have you seen the page. One Adsense unit at the bottom. They are hardly going to rake it in from that. I would guess if they put the same amount of ads as most big sites then they would do OK. But I think Google is wary of becoming a publisher and so the half-hearted effort that was really to solve the duplicate agency content issue on Google News.
Hard news is the problematic part of this. You will see lots of tech, celebrity, movie, tv, gaming news sites. That news is cheap to produce and you can turn a profit with it online. Far fewer hard news sites and most of them are also in print.
My worry is we will be left with just a few agencies like AP, Reuters, DPA and AFP gathering/veryfing all the news from the ground plus some big public funded ones like BBC. That number might even drop as they are hit with the declining revenue from the newspapers who buy it. Since agency news is far less valuable online as people can read more than one paper easily. The less sources the less reliable and more open to abuse/manipulation. Difficult/expensive hot spots to cover will just be ignored.
I look forward to seeing what happens with this, if anything.
It won't work anyway - if I'm looking for news I hardly ever see any results from News Corp properties, and if I do then the same story is repeated in loads of other locations - that's why I think Murdoch is fighting a bit of a losing battle here...
I'm pretty miffed with News Corp. Sky have monopolised sport here in the UK and I hate it. If anyone thinks Google are Goliath, in UK sport Sky are monsstrous.
Newspapers need advertisers.
Microsoft chooses to advertise only in newspapers that sign up to Bing exclusively.
As part of the deal, newspapers advertise Bing and their share of searches rises significantly.
Now, the figures may not stack up directly for Microsoft, but they are more or less at war with Google, and if they can afford this, I am in no doubt that it will hurt Google in the area of search (but may not affect profits in a big way immediately).
Kaled.
In a thread titled "Will Microsoft pay publishers to boycott Google news?" on the Microsoft Corporate Forum, I asked:
Is this ethical? Is it even legal? To me, it sounds like Budweiser going into a bar and telling the owner, "We'll pay you not to serve Miller." (As opposed to "We'll pay you to serve Bud in addition to Miller.")
Pubcos in the UK do exactly this all the time, although they don't pay landlords, they just make them sign draconian contracts. Also as far as I know even in the US, drinks companies often have "exclusivity" deals with various event companies.
I think this would be good for competition. If Google were paying sites to delist from other engines, that would be market abuse since they are the leading player (as Intel were the leading player in their market). But for a smaller engine to do it - that's fine. In the unlikely event that Bing goes on to become the market leader, these deals will need to be revised, but for now, I don't see how else Google's near-monopoly can be broken. And breaking up a near-monopoly is a good thing, whatever you think of Microsoft.
edit: another thing: the fact that there may be no relevant ads for these topics is kind of beside the point. A deal like this would get more people into the habit of using Bing, and would benefit Microsft, though maybe not directly.
Hmmm, I'm no legal expert, but paying a supplier not to supply another retailer?
There are very, very few products that can be sold in context to the news.
As for News Corp., THE ECONOMIST recently reported that the share of its revenue that comes from cable TV distribution fees has doubled since 2006. It seems pretty clear that, in Rupert Murdoch's estimation, the way to make the Internet profitable for media properties is to control distribution through exclusivity deals that ultimately could lead to "carriage fees" like those paid by cable carriers to cable TV networks. Getting Microsoft to pay for "carriage" of news headlines and snippets is a small step in that direction. Will it work? That's unlikely, but the fact that Rupert Murdoch and Microsoft are discussing such a deal suggests that Microsoft has changed its stance on "net neutrality," at least as far as search is concerned.
It seems a bit Mafia-like to me. If you don't pay us money we'll come round and smash up your house. I dislike Murdoch a whole pile more than Google, I hope he looses this one.
