Is Murdoch's Bid to Join Bing and Ditch Google Doomed?

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Bless you, Rupert Murdoch, you really do keep things interesting. The News Corp media maven is threatening to take all of his newspapers' content off Google and give Microsoft Bing exclusive rights to index his news. This is the second Big Murdoch Threat recently, the first being his brazen announcement to put all of his news behind a pay wall. What is Murdoch thinking? I think I know.


The central struggle of monetizing online news is that ad rates for web pages are significantly worse than the print ad rates that once buttressed newspapers. So for a newspaper publisher like Murdoch, big online traffic helps, but it doesn't pay for a sprawling roster of reporters and editors. Somebody's gotta break the tyranny of revenue-light banner ads, eventually. You can go the Daily Beast model and try to infuse online ads with a dash of glamour to drive up premiums and juice click-through rates. You can go the Financial Times/WSJ model of combining limited free content with paid registration for full access. Or you can think outside the box, turn off Google and get another search engine to pay you for exclusive rights to your content.

Would Murdoch lose traffic with this gambit? Oh you bet. By "turning off" Google, WSJ could, by one estimate, lose 25% of its page views -- although that number doesn't take into account any increase in traffic from the Bing deal. But remember, big traffic numbers are a fig leaf. Ryan Chittum of the Columbia Journalism Review found that this 25% Google crowd accounted for less than $12m a year in advertising. If Murdoch can get a better deal with Bing -- at a time when Bing might be desperate to increase its news integrity -- then we should take this threat seriously.

As a coda, Jeff Jarvis thinks this idea is suicide, and I think Jeff Jarvis is wrong. His critique of Google-blocking is all about traffic, and that's crazy, because nobody in his right mind thinks that online traffic is going to save the New York Times, or the Washington Post or the Wall Street Journal. Just ask them! (The NYT is actually making more money from readers than advertisers now even though their online traffic is killer.) Jarvis doesn't mention ads or ad rates in this article, and he uses the word revenue once in reference to About.com. He's not engaging with the central problem, which is that today's online ad rates can't save journalism. So why blame Murdoch for looking for something that can?

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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