The Newspaper Industry versus the Internets

There’s been a sudden and sharp increase in commotion in the past few days about the traditional media’s take on the Internets, and what to do with it. There has been a corresponding response from said Internets to the traditional media, which has been equally dismissive and probably far more angry.

The traditional media’s take on the issue could more or less be summed up by this statement made by Rupert Mudoch:

“Should we be allowing Google to steal all our copyrights?” asked the News Corp. chief at a cable industry confab in Washington, D.C., Thursday. The answer, said Murdoch, should be, “‘Thanks, but no thanks.’” –– Forbes

The Internets’ response is a bit more varied, but it tends to run along the lines of this Daily Kos headline:

In the wake of the newspaper execs’ hissy fit –– Daily Kos

So, who is right? The answer, as it almost always is (at least on this humble blog), is nobody.

Let’s look at the issue point by point. Be warned; there are many points that I’d like to discuss.

The Google –– and, relatedly, free access

On one hand, let’s examine the newspapers’ point of view. Like the RIAA, they’ve been looking at the bottom line and seeing it dwindle. The RIAA looked at reasons why, and it seemed like this file-sharing thing was a big reason people weren’t buying records anymore. So they went after file-sharers. Similarly, newspapers are seeing their profits drain away to the Internets: their subscribers are dropping in favor of online versions of their daily news, which are harder for the papers to pin down and tout to advertisers (hence why the New York Times requires registration on their site) – and their classified traffic is moving away to the cheaper and faster Craigslist. So, they’re rattling their sabers at the Internet. And who’s the biggest player on the web? Google.

Their fundamental argument at the moment is that the Internet is entirely too open and free. With aggregators like Google, it’s impossible to secure a loyal readership, as users can pick and choose what articles to read from a remote location. By cutting off Google from their material and charging users to use the online editions of their newspapers, they hope that they can regain some semblance of loyalty to their particular brand and thus constant and guaranteed revenue and readership, which they can once again tout to their advertisers. After all, whoever ordered two, three, or four copies of physical papers daily?

The converse is, of course, also true. Google, in the course of making hand over fist in advertising, is doing the web a sort of public service: joining the Internet together as one. By offering sheer choice and volume, Google enables users to learn and experience more than ever before, and lends information sources potential audiences they could never have dreamed of before. So on this point, there is no correct answer – at least not yet.

What is the role of the “media”?

Now, let’s take a look at what the Internet community is saying. Composited between a lot of the meaningless vitriol that is the lifeblood of the web, it’s easy to tell that there are two basic counterarguments, one of which is a more extreme version of the other. The first, which could be considered true at least in part, is the sentiment that “they just don’t get it.” Daily Kos followed up with an article discussing one particular example of how traditional media execs and reporters miss the point. And they’re not wrong – it will take a new breed of journalist and executive to get the traditional media to understand the information (and business!) market of the Internet.

But this sentiment is always stated with an air of dismissal, an air that exposes the more extreme reaction that the Internet has generally taken. “Look,” web users, evangelists, and enthusiasts say, “look at our blogs and our Twitters and our Googles. We don’t need you anymore. With the Internet, we can collect, distribute, and discuss information with far greater efficiency than you could possibly hope to!” There are several arguments and counter-arguments on both sides regarding this point.

Who can we believe?

If you ask the traditional media, their main response can be summed up in one keyword: credibility. “Without some journalist’s name backing up what you’re consuming,” they say, “how can you possibly allow yourself to believe anything at all?” I’m not convinced by this argument – and nor are a lot of other people. I disagree with this argument on two counts.

Firstly, when you know that the set of information you’re getting is raw and unfiltered (say, a Twitter Search on #Mumbai while the attacks were occuring), you naturally build your own mental filters on the information you’re getting. You’re forced to absorb data from a multitude of sources, to do the work of parsing and putting together the picture yourself. It’s more work, but it’s ultimately not only more intellectually stimulating and satisfying, it leads to a better comprehension of the issues at hand. Conversely, I’ve seen too many blindly trusting the traditional media’s news simply because it has a name on it, without putting it through any filters. And, as history has repeatedly shown, even with a journalist’s name, we need some filters on everything we read.

Second, I don’t think that the traditional model is the only way in which journalists can make a name for themselves anymore. I made the observation a couple of days ago that blogs are feeling less and less like “new media,” based simply on a passing gut feeling. The quantization of that train of thought, I think, is that blogs now have the potential for a wide enough readership that credibility matters for the authors behind them. The medium may be different, but when the usage is the same, the net equation ends up being the same.

Take, for instance, Dave Winer. As TechCrunch‘s Michael Arrington pointed out (incidentally in a post about credibility in journalism, though specifically regarding conflicts of interest) in a recent editorial, Winer took a $10,000 bribe from the owner of a blog to surreptitiously insert it into the top content of a commercial news aggregator he was running at the time. Winer is still a prominent Internet personality, but those who remember this story will never quite look at anything he writes the same way again.

Where does our information come from?

The argument that I believe the traditional media should be making as to why they are necessary is quite a bit more fundamental. They are a step in the process of information dissemination right now, and an extremely critical one. Look again at that Daily Kos article that I quoted the headline of earlier. You’ll see that same Rupert Murdoch quote I opened this post with in that article. If you trace the series of citations back, you’ll find that they took it off a post on Daggle.com, who in turn took it off of Forbes.com, which is who I credited above. Most people would consider Forbes.com a member of the traditional, mainstream media.

In fact, if you look at nearly all the information on a Daily Kos, or a Huffington Post, and trace it back far enough, you’ll find some mainstream news organization or another as the founding source. This has less to do with any sort of credibility issue, and more to do with the current flow of information. At the absolute least, the established traditional media organizations are at the moment information clearinghouses, a current necessary step in the flow of data from news source to consumer. In this way, the blogs do, in fact, need the established traditional media.

So is the flow of information the fundamental problem here?

I’m not sure that calling anything a problem is really the point.  Rather, any system that we attempt to build for information dissemination will inevitably involve some number of steps, each of which have their own problems.  Clearly, from a business perspective, information flow isn’t a very important topic.  But, looking philosophically at what we have right now, their step in the chain is one of the big chips that the mainstream media hold.  So, let’s examine this topic.

Exceptions: models for the future, or tales of warning?

There are, of course, exceptions to this observation. It would be tempting to choose the tech industry, with its wealth of gadget, industry commentary, and other blogs, but there’s too much muddle there – the business of tech is a bit of a spider web. My example is the games industry.

With rare exceptions, all information on the Internet on gaming news flows through the blogs, most prominently Kotaku and Joystiq. The entire games industry understands that its audience lives on the web, and thus by going directly to web publishers, they can reach their demographic efficiently. In fact, the web press surrounding the games industry has been so successful and effective as a result of this streamlined process that an extreme version of the same trend that has newspapers disturbed has already taken hold of gaming press: EGM, once a giant of the gaming world, lost too many subscribers to continue operations and folded.

There are, of course, problems with my argument. Foremost is that my earlier argument about the medium not being the important element still holds true: there are still information clearinghouses, they’ve just moved one step down the chain, and the new link is still not the end consumer. But, the ratio is at least somewhat greater now, and more people have control of the raw information with the current games industry model. Greater, however, is the set of problems that arises when “non-journalists,” as the newspapers would claim, are the direct recipients of raw information. I have two examples, and both have to do with the relationship between the reporter and the reported, when mixed with the volatile environment of the Internet.

Biting the hand that feeds, Internet edition

One of the prominent differences that still exist between even established blogs with a journalistic pedigree and respected names and traditional media is the prevalence of the unconfirmable. Perhaps it’s the need to fill up the day, perhaps it’s simply because they can, but blogs report on a lot of rumors. Unconfirmable information is always a controversial topic in journalism and journalistic integrity, and when you report a higher ratio of rumor material, you’ll encounter a higher rate of controversy.

Kotaku posted a rumor a while back about the now-[long-]announced Playstation Home before anyone really knew about it based on some tips it had received. Sony’s response pre-publication, publicly posted on Kotaku, was in Kotaku’s words to effectively blackball it from future direct information unless they didn’t run the story. They did. The gaming community, tight-knit group that it is, threw a bit of a fit and the issue disappeared without terribly much explanation as to what went on behind the scenes, but this is a frightening tale of what can happen when information is handed directly from sources with their own interests at heart and something as fickle, capricious, and wildly unpredictable as the Internet.

Refusing to bite the hand that feeds, Internet edition

My other cautionary tale of this model comes due to another phenomenon that is largely exclusive to the web: the ability of extremely niche outlets to survive. Because of the consumption model of the Internet, and the low cost of publishing to it, publications can last with far more niche topics and a smaller audience on the web than on paper. However, a side effect of having a niche topic is that to maximize income, advertising also becomes niche. This means that often times, the subjects that you write about will also be the ones paying your bills.

There are recent examples in other corners of the web, such the bizarre reverse story of claims of extortion by Yelp – demanding that businesses buy ads or face ratings penalties. However, what I would like to point out is still within the games industry – namely, the dismissal of Jeff Gerstmann, editor-in-chief of Gamespot.

As one can imagine given my setup, this story hinges around an advertiser on a site. Gamespot allows for advertisers to effectively ‘buy out’ the site layout, taking over not only all the ads, but also the background image of the site. Eidos did so for their game Kane & Lynch: Dead Men (a truly vile game), naturally with the expectation that it would help sales of the game. Of course, a well-justified negative review of the game on the site undermined that expectation somewhat. That review was written by Mr. Gerstmann, who was terminated rather abruptly shortly thereafter by execs in the business department.

A lot of rumors swirled in the weeks after the event, involving corporate politics and the usual mess, but the incident is a bit of a warning. The business model of the Internet can lead to fatally flawed situations. How do we deal with these issues? How can we expect newspapers to trust the Internet until these sorts of things are figured out? Jeff’s new site, Giant Bomb (full disclosure: of which I am a former content moderator), still contains a very modest amount of advertising as they attempt to figure out answers to these questions.

So where do we go from here?

The Internet is growing and regrowing upon itself by the week, and it’s a juggernaut we’d be hard-pressed to stop. However, we really need to stop and assess what it means for the flow and processing of information in both our country and around the world. We can’t do this, however, until all the variables in the equation decide to sit down and work out the problems in the system. That means that someone has to get the Internet and the newspapers off of each others’ throats and get them to realize that they need each other.

But then what? And what now? We still have no answers, not even particularly good inklings. And the newspaper companies aren’t about to discuss things with their perceived enemies any sooner than the RIAA.

So we’re at a bit of an impassé. But this isn’t the first time we’ve seen this brand of sabre rattling, and it won’t be the last.

The question is, when will it be the last, and what happens then?

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