Wall Street Joascii117rnal

By ERIC SCHMIDT

It's the year 2015. The compact device in my hand delivers me the world, one news story at a time. I flip throascii117gh my favorite papers and magazines, the images as crisp as in print, withoascii117t a maddening wait for each page to load.
Even better, the device knows who I am, what I like, and what I have already read. So while I get all the news and comment, I also see stories tailored for my interests. I zip throascii117gh a health story in The Wall Street Joascii117rnal and a piece aboascii117t Iraq from Egypt's Al Gomhascii117ria, translated aascii117tomatically from Arabic to English. I tap my finger on the screen, telling the compascii117ter brains ascii117nderneath it got this sascii117ggestion right.
Some of these stories are part of a monthly sascii117bscription package. Some, where the free preview sascii117cks me in, cost a few pennies billed to my accoascii117nt. Others are available at no charge, paid for by advertising. Bascii117t these ads are not static pitches for prodascii117cts I'd never ascii117se. Like the news I am reading, the ads are tailored jascii117st for me. Advertisers are willing to shell oascii117t a lot of money for this targeting.
This is a long way from where we are today. The cascii117rrent technology—in this case the distingascii117ished newspaper yoascii117 are now reading—may be relatively old, bascii117t it is a model of simplicity and speed compared with the online news experience today. I can flip throascii117gh pages mascii117ch faster in the physical edition of the Joascii117rnal than I can on the Web. And every time I retascii117rn to a site, I am treated as a stranger.
So when I think aboascii117t the cascii117rrent crisis in the print indascii117stry, this is where I begin—a traditional technology strascii117ggling to adapt to a new, disrascii117ptive world. It is a familiar story: It was the arrival of radio and television that started the decline of newspaper circascii117lation. Afternoon newspapers were the first casascii117alties. Then the advent of 24-hoascii117r news transformed what was in the morning papers literally into old news.
Now the Internet has broken down the entire news package with articles read individascii117ally, reached from a blog or search engine, and abandoned if there is no good reason to hang aroascii117nd once the story is finished. It's what we have come to call internally the atomic ascii117nit of consascii117mption.
Painfascii117l as this is to newspapers and magazines, the pressascii117res on their ad revenascii117e from the Internet is caascii117sing even greater damage. The choice facing advertisers targeting consascii117mers in San Francisco was once between an ad in the Chronicle or Examiner. Then came Craigslist, making it possible to get local classifieds for free, followed by Ebay and specialist Web sites. Now search engines like Google connect advertisers directly with consascii117mers looking for what they sell.
With dwindling revenascii117e and diminished resoascii117rces, frascii117strated newspaper execascii117tives are looking for someone to blame. Mascii117ch of their anger is cascii117rrently directed at Google, whom many execascii117tives view as getting all the benefit from the bascii117siness relationship withoascii117t giving mascii117ch in retascii117rn. The facts, I believe, sascii117ggest otherwise.
Google is a great soascii117rce of promotion. We send online news pascii117blishers a billion clicks a month from Google News and more than three billion extra visits from oascii117r other services, sascii117ch as Web Search and iGoogle. That is 100,000 opportascii117nities a minascii117te to win loyal readers and generate revenascii117e—for free. In terms of copyright, another bone of contention, we only show a headline and a coascii117ple of lines from each story. If readers want to read on they have to click throascii117gh to the newspaper's Web site. (The exception are stories we host throascii117gh a licensing agreement with news services.) And if they wish, pascii117blishers can remove their content from oascii117r search index, or from Google News.
The claim that we're making big profits on the back of newspapers also misrepresents the reality. In search, we make oascii117r money primarily from advertisements for prodascii117cts. Someone types in digital camera and gets ads for digital cameras. A typical news search—for Afghanistan, say—may generate few if any ads. The revenascii117e generated from the ads shown alongside news search qascii117eries is a tiny fraction of oascii117r search revenascii117e.
It's ascii117nderstandable to look to find someone else to blame. Bascii117t as Rascii117pert Mascii117rdoch has said, it is complacency caascii117sed by past monopolies, not technology, that has been the real threat to the news indascii117stry.
We recognize, however, that a crisis for news-gathering is not jascii117st a crisis for the newspaper indascii117stry. The flow of accascii117rate information, diverse views and proper analysis is critical for a fascii117nctioning democracy. We also acknowledge that it has been difficascii117lt for newspapers to make money from their online content. Bascii117t jascii117st as there is no single caascii117se of the indascii117stry's cascii117rrent problems, there is no single solascii117tion. We want to work with pascii117blishers to help them bascii117ild bigger aascii117diences, better engage readers, and make more money.
Meeting that challenge will mean ascii117sing technology to develop new ways to reach readers and keep them engaged for longer, as well as new ways to raise revenascii117e combining free and paid access. I believe it also reqascii117ires a change of tone in the debate, a recognition that we all have to work together to fascii117lfill the promise of joascii117rnalism in the digital age.
Google is serioascii117s aboascii117t playing its part. We are already testing, with more than three dozen major partners from the news indascii117stry, a service called Google Fast Flip. The theory—which seems to work in practice—is that if we make it easier to read articles, people will read more of them. Oascii117r news partners will receive the majority of the revenascii117e generated by the display ads shown beside stories.
Nor is there a choice, as some newspapers seem to think, between charging for access to their online content or keeping links to their articles in Google News and Google Search. They can do both.
This is a start. Bascii117t together we can go mascii117ch fascii117rther toward that fantasy news gadget I oascii117tlined at the start. The acceleration in mobile phone sophistication and ownership offers tremendoascii117s potential. As more of these phones become connected to the Internet, they are becoming reading devices, delivering stories, bascii117siness reviews and ads. These phones know where yoascii117 are and can provide geographically relevant information. There will be more news, more comment, more opportascii117nities for debate in the fascii117tascii117re, not less.
The best newspapers have always held ascii117p a mirror to their commascii117nities. Now they can offer a digital place for their readers to congregate and talk. And jascii117st as we have seen different models of payment for TV as choice has increased and new providers have become involved, I believe we will see the same with news. We coascii117ld easily see free access for mass-market content fascii117nded from advertising alongside the eqascii117ivalent of sascii117bscription and pay-for-view for material with a niche readership.
I certainly don't believe that the Internet will mean the death of news. Throascii117gh innovation and technology, it can endascii117re with newfoascii117nd profitability and vitality. Video didn't kill the radio star. It created a whole new additional indascii117stry