Sunday, September 2, 2007

Google to disintermediate newspapers

Google announced a major deal on Friday to begin offering wire service stories directly from four news agencies. This effectively disintermediates the newspapers as a source for stories from these agencies. Before, Google would send you to a newspaper site that was republishing the news agencies' content. No more. The newspapers have been taken out of the middle. The result will be less online traffic directed to the newspapers. Just what they needed, hey?

SAN FRANCISCO, Aug 31 (Reuters) - Google Inc (GOOG.O: Quote, Profile, Research) is playing host to news stories from four news agencies including the Associated Press, the company said on Friday, setting the stage for it to generate advertising revenue from Google News.

The partners -- Britain's Press Association, Canadian Press, Agence France-Presse and the Associated Press of the United States -- now have their stories featured with the organizations' own brands on Google News-hosted landing pages. The companies have agreed to license news feeds to Google.

What does this move mean to newspapers? Google is accelerating their demise, and they are powerless to do much about it. In some ways, maybe this will help them. Perhaps it will refocus their attention on local news which is their only hope for survival going forward.

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