Big Idea: How online publishers can rival Google

Quite sometime ago I did a rather entrepreneurial proposal to the World Association of Newspapers (WAN) about a new, non-profit industry-focused search engine and advertising network to rival Google. I know what you’re thinking, apart from the general nuttiness of the idea itself: I must be crazy approaching a “newspaper” body? But the idea around approaching an organisation such as WAN and others, was that they’re an important umbrella industry bodies for worldwide media, both online and offline. To put it plainly: They have the network. (They’re also bit more than about newspapers these days and rather about media companies — if only this would reflect in their name too).

While there was interest from WAN, the organisation felt the plan a bit too ambitious for them. A pity. My personal view is that I think there should be a more proactive stance emanating from the industry, lead by a body or members if its to stay relevant and provide value for online and offline users. I also think it should start co-ordinating with one voice and strategy. It’s no easy task, but possible under the auspices of a respected, legitimised umbrella body. I think this is a way the publishing industry and other industries could rival Google by creating a differentiated offering.

It would be a way industries — any industry with some co-ordination and umbrella body — could rival Google. The idea is that industries and organisations (such as online publishers and general media) would form counter networks, to counter the great, big Google network.

This media network, of course, would only be undertaken in the spirit of creating competition, which would result in diverse and differentiated products for users, resulting in a richer user experience. It wouldn’t be to explicitly “beat” Google, but a way to secure a foothold in new markets. It’s not appropriate that I publish the full proposal, so here’s some adapted excerpts:

Market conditions
We all know about the very big and very dominant search and advertising player on the web. Publishers both love and hate the world’s biggest search engine. Google is getting bigger and “scarier” every day, or as Wired magazine puts it: going from “guerrilla startup to 800-pound gorilla”.

Google, whose mission it is to organise the world’s information, is a big source of traffic for online publishers. But publishers are also cognisant of the fact that search engines like Google spider and aggregate publishers’ quality content for free. In fact, publishers argue that search engines owe their very existence to this content – and then profit with it at publishers’ expense.

To be fair, Google is also a saviour: in many senses the search giant saved the web by making relevant content easily and quickly accessible. It also created a superior contextual search advertising model in Adwords and Adsense, which accounts for most of the search behemoth’s revenues and is the reason for its success today.

The problem with online advertising
Arguably Google’s contextually relevant network advertising model is more suitable for a web context than current forms of banner online advertising — I’d argue it is merely an adapted and tweaked traditional print advertising model that was never a good fit for the web medium. Critics point to low clickthrough and conversion rates of traditional banner advertising to make their case.

There appears to be mounting evidence that contextual search networking advertising models work more efficiently than the traditional banner advertising model that most traditional online publishers employ. Perhaps this is why many online publishers begrudgingly accept the use of Google Adsense on their sites?

Publishers therefore would welcome a new contextual search advertising project, especially if it was an initiative from within the industry, which offered them a better deal, and perhaps something which they had a stake in.

Publishers are wary of Google

  1. Google’s search and news aggregator is a source of large amounts of traffic to online publishers worldwide, but at the same time it’s creating an unhealthy dependence on the search engine.
  2. In some cases Google’s model is disintermediating the publisher-advertiser/advertising agency relationship. These are relationships publishers value immensely and guard jealously.
  3. For most publishers, Google does not disclose the Adsense revenue share percentage portion due to the publisher, obliquely insisting that the “majority is given to the publisher”. Google has been criticised on many occasions for this lack of transparency. Google does make an exception for larger online publishers, in which specific commission deals are negotiated.
  4. Online publishers across the world are contributing revenues to one, very dominant online player in the form of Google, which does not necessarily have the best interests of the publishing industry at heart.
  5. Revenue is flowing out of the media and publishing industry to a single company: Google. This is ultimately eroding investment in the industry and making Google more powerful.
  6. Google’s adsense programmes result in crucial advertising revenue flowing outside countries to the detriment of local industries and economies.
  7. It’s generally unhealthy to have such a big, dominant player in any industry without very much real competition.

The big idea: Create new media-centric search & advertising network

  1. Transparent commissions: Commission structures (ie. what is paid to advertisers, WAN and the publisher) should be transparent, with between 70%-90% of the revenues redeemed to publishers. It’s important to be clear that the lion’s share of revenue generated is transferred to publishers. This is not a venture for profit.
  2. Profit-making, yet non-profit: Another important way to differentiate the new offering from Google and create a favourable image for the project in publishers’ minds and get buy in is to emphasise that the profits are for the industry and for the individual publishers. Unlike Google, the primary aim is not to make profits off this programme, but to ensure its members make the bulk of profits and earn the revenue. So the project would be non-profit, but its objectives would be to make profits for the members, and the industry. This would contrast against for-profit ventures, which would seem less palatable in the face this nobler initiative?
  3. Quality search engine: Create a search engine that would search through content only from original, quality content providers that follow stringent rules, upholding the values and principles of journalism (this includes all sizes of publishers, including quality blogs that adhere to the principles and become members). The search would thus differentiate itself as a different kind of search product to Google’s search, but a smaller search of quality content from publishers. It would be a mistake to go head-to-head with Google, but rather to provide a product that is differentiated. (Possibly this could also lead to the creation of a quality news aggregator).
  4. The main emphasis would be that this is a “quality search” through “quality content”. The emphasis on “quality” is key here: The digital age is increasingly bringing content clutter and information overload to the world. It’s only going to get worse as content distribution and production gets cheaper and faster as a result of the internet.
  5. Contrary to the doomsayers, media brands are in a good position in this environment, as they are a guarantor of quality in this increasingly cluttered world. There is also another benefit here in that it would be an economical and prudent option to create a smaller, focused search as a startup strategy.
  6. I think the world would buy into the idea and see the advantages of a more niched, differentiated search product.
  7. Despite the issues the publishing industry has with Google News as an aggregator, the concept is a good one and here to stay. So rather than resisting against such a concept, the industry should take control and create its own news aggregator, owned by the industry. As part of the deal, publishers would aggressively market the aggregator.
  8. Worldwide advertising: Advertising would be localised/geo-targeted and also on a worldwide basis.
  9. Do-it-yourself, minimalist interface: The interface publishers and other stakeholders would use for signing up and administering the new advertising programme would be minimalist and easy to use, much like Google’s Adsense interface. It will result in low admin and generally help to keep costs down.
  10. Publishers don’t need to abandon Google: It would be emphasised that the new advertising model would be tested out by online publishers in conjuction with their current advertising programmes (such as Google’s Adsense), not to the exclusion of them. Many publishers have good relationships with Google and are securing lucrative revenue streams via its advertising programmes – and may be reluctant to tamper with this.

Why I think it would work

  1. It’s non-profit, yet profit-making for individual members: Therefore simpler to run.
  2. It’s a closed, quality search, therefore manageable, and not too ambitious.
  3. Market sentiment is that Google needs a competitor: Few publishers disagree that it is unhealthy to have such a dominant player. The market would react favourably (and critically) to such a move, but it will be seen worldwide as a much-needed thing.
  4. Advertising agencies and companies: They would buy into the project as publishers are in a position to influence their own clients and stakeholders about this new initiative, emphasising that it is a publisher initiative, custom-made for publisher sites. Publishers are more likely to push the model as there will be a greater feeling of ownership and buy-in to the new offering. (Unlike Google).
  5. Publishers would write about and advertise the initiative: Publishers would write about the initiative and advertise it, generating interest and publicity.
  6. Smaller publishers would embrace the concept: It provides smaller players with more transparency and a greater revenue share on the new advertising programme. It’s the small publishers (eg smaller sites and smaller blogs) in particular that may feel “bullied”. It would also mean that advertising revenue would not flow out of countries to one dominant company — as is the case with Google’s Adsense programmes.
  7. Advertisers and publishers: They will perceive this new advertising model to be a more sustainable and positive business, because it will keep revenue within the publishing industry, thereby growing the industry – as opposed to flowing to one company, eg Google.

There is no doubt that this is an ambitious plan, possibly a bit crazy too. Publishers need to control their destinies by innovating and creating new models that support the interests of their organisations and industry. WAN, despite it’s “slow-mover” status, is in a position to lead the world-wide media industry and do thing differently.

There is no doubt that publishers are losing power to search behemoths like Google, which are eating away at their main revenue streams. It’s unlikely this will change in the future, so publishers should be pro-active in creating their own rival models to compete with Google and grab market share for themselves.

It is argued in this proposal that the industry via its industry bodies are in an ideal position to pioneer such a plan, using their reputation, networks, leverage and influence worldwide.

I think it would work.

Photo credit: Mark Knol

Matthew Buckland: Publisher


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