Why Google Is a Media Company

by on August 11, 2008 · 14 comments

I used to get endless grief from pro-regulatory media activists here in DC when I put forward the argument in days past that Google was a media company and a major player in the battle for eyes, ears and ad dollars in America’s media marketplace. Increasingly, however, more people are coming around to seeing that point, even the crusty old media giants themselves.

In a smart essay over at the Freedom to Tinker blog, David Robinson takes the New York Times to task for an article today again wondering, “Is Google a Media Company?” As David rightly argues:

I hope the Times’s internal business staff is better grounded than its reporters and editors appear to be—otherwise, the Times is in even deeper trouble than its flagging performance suggests. Google isn’t becoming a media company — it is one now and always has been. From the beginning, it has sold the same thing that the Times and other media outlets do: Audiences. Unlike the traditional media outlets, though, online media firms like Google and Yahoo have decoupled content production from audience sales. Whether selling ads alongside search results, or alongside user-generated content on Knol or YouTube, or displaying ads on a third party blog or even a traditional media web site, Google acts as a broker, selling audiences that others have worked to attract. In so doing, they’ve thrown the competition for ad dollars wide open, allowing any blog to sap revenue (proportionately to audience share) from the big guys. The whole infrastructure is self-service and scales down to be economical for any publisher, no matter how small. It’s a far cry from an advertising marketplace that relies, as the newspaper business traditionally has, on human add sales. In the new environment, it’s a buyer’s market for audiences, and nobody is likely to make the kinds of killings that newspapers once did. As I’ve argued before, the worrying and plausible future for high-cost outlets like the Times is a death of a thousand cuts as revenues get fractured among content sources.

Exactly right. I’ve made a similar argument in Chapter 2 of my big “Media Metrics” report.

Previous post:

Next post: