Why Google has to pay up or give up

Hardly a day goes by without a word about paid content online from Rupert Murdoch, chairman of Newscorp. His case for raising paywalls around content from his publications is well documented and shows no signs of abating. The war of words between the proponents of  paywalls and those who believe this will never work shows no signs of stopping and we (and many others) report frequently about this very important debate. Recently Murdoch has aimed his criticism at Google and has even accused them of stealing content. He is planning to withdraw Newscorp content from Google search results. 

Now here’s a chance to hear it from the horse’s mouth. In this interview Murdoch explains why advertising revenue is not the solution (there is just not enough to go around) and why Google will have to pay-up or loose his publications in its search results.

The main points on online content in the interview are:

Google cannot afford to pay everyone for the content they take and show. If they would do so they would not make a profit. They have a brilliant search engine that scrapes content from all over the world, on the back of that they sell search, but they don’t pay for the raw material and we have to do something about that.

We can publish our newspapers electronically and people can still go to a search engine if they want to find something, this may not be news but they will still have a very good business. For newspapers a high quality full colour, attractive tablet would be an attractive proposition as you can read various newspapers on one device. You could then upgrade to a subscription to get more magazines suited to your taste. You can have anything you want on it; you just have to pay, that’s the future.

It costs a fortune to collect and edit news and someone has to pay for this, there is not enough advertising to go around. This will work because we tested it and people will understand it as perfectly fair. If it doesn’t work, newspapers will go out of business, all newspapers; there is not enough advertising for all the sites on the internet. The amount of sites doubles or triples every year whereas the amount of money for it only goes up with about 10-15% a year.

Murdoch also addresses China and if it will become a major powerhouse and addresses some of the company dynamics (after about 4 minutes).

What do YOU think about this debate; does Murdoch has a point or does he not understand the realities of online sharing?

Picture: Stock Exchange | Gun | Michal-Zacharzewsk