Web 2.0 Television

The official announcement came today: Google is expanding its computer system to take online bids for advertising space in more than 50 daily newspapers. Steve Bryant explains how it works:

The basics: Google will sell the remnant ad space that would otherwise run house ads for the paper. Ostensibly tha ad buyers will be small businesses that the newspaper wouldn't be able to service anyway. The advertisers log into the AdWords system and are presented with a list of participating papers and available ads. They can then enter a bid for a certain type of advertisement, specifying the section and date range. Newspapers in turn see these bids and accept the ones they want.

Love the hip-hop spelling in there, Steve ("tha ad buyers"). (More after the jump.) Media columnists, pundits and bloggers can't get enough of this story, but let's start with a breakdown from Saul Hansell's New York Times article (also via Jim Romenesko): 

For Google, the test is an important step to the company’s audacious long-term goal: to build a single computer system through which advertisers can promote their products in any medium. For the newspaper industry, reeling from the loss of both readers and advertisers, this new system offers a curious bargain: the publishers can get much-needed revenue but in doing so they may well make Google — which is already the biggest seller of online advertising — even stronger.

That test (to begin later this month) was reported in a similar way by The Wall Street Journal: "Under the three-month test effort, a group of more than 100 Google advertisers will be able to place bids for space in newspapers including the New York Times, Washington Post, Boston Globe and Philadelphia Inquirer." (Via I Want Media; other news stories from Forbes, Washington Post's Frank Ahrens, Editor and Publisher and USAToday.) The test run makes its way into several bloggers' comments.

John Battelle on Hansell's article and Google's foray into "a maddeningly human business": 

The Times coverage does nail the big issue - "it might make Google stronger." The newspapers worry that Google treats them as just so much unsold backfill inventory. And that's not what "content" really should be, eh?

I think the issue here for Google really comes down to scale and context. Print advertising is a maddeningly "human" business, driven by passion, emotion, and gut feeling. I'm not sure that's ever going to go away. Ads for a specific, community driven audience need to be part of a conversation, not an algorithm. However, I can see this working well for remnant/backfill, as well as classifieds, where I'm guessing the system will really excel.

Huh. Interesting point about the classifieds — wonder what Craigslist founder Craig Newmark will have to say about that aspect of the Google move, since the popularity of the classified ads site he founded has added a good deal to the newspaper circulation decline. 

Mathew Ingram notes that this isn't the first time Google's tried something like this, concluding with a nod to Scott Karp's points as well:

Google’s desire to move into newspaper ads — which it apparently thinks are a better fit than magazines — is yet another signal of its unquenchable thirst for ad inventory of any kind, so that it can keep growing at those triple-digit rates the stock market is so enamoured with. And let’s face it: the newspaper business needs all the help it can get. Although Scott Karp of Publishing 2.0 points out that one of the unintended consequences of the Google experiment could be that it only reinforces how disconnected and hard to measure print advertising really is.

Ingram's colleague Mark Evans (one of several bloggers I'm quoting here also quoted by CNET News.com's Blogma), asks whether this move will "save" newspapers: 

The question can Google be the newspaper industry's salvation? If the newspaper market is shrinking, how can it be attractive? Truth be told, Google, isn't looking to do newspapers any favours; it's simply using its brand and clout with advertisers to diversify its advertising "engine" to markets where it can generate more business - be it newspapers, magazines, radio (dMarc) or the Web. For newspapers, they clearly need any help they can get to adjust to the new media landscape. Before anyone gets too excited about Google's newspaper strategy, what ever became of its thrust into magazine advertising, which you hear nothing about these days?
By the way, despite all the hue and cry about the decline of newspapers. the New York Times' Sunday newspaper still remains an impressive beast - huge, chalk-a-block of advertising, lots of great stories.

Douglas Mcintyre's 24/7 Wall St. POV (the post title of which is nearly identical that of Evans): 

The problem is that newspapers, as a print medium, cannot tarket audiences with the laser focus that AdSence can. And, local newspapers are already running a large number of local classifieds. But, that business is dropping sharply. It is going away for two reasons. One is that internet sites like CraigsList and CareerBuilder are more efficient at getting leads. The other is that newspapers are losing their circulation, mostly to online news sources. As circulation drops, ads become less effective. Silk purse. Sow's ear.

Selling more ads, even it the appear to be targeted, into a dying medium, is not going to solve the core problems that newspapers face. They don't work for advertisers anymore.

Now, if Google would step up its program to target ads to the newspaper industries online websites like nytimes.com, that might help large paper chains a great deal.

And, it would make sense. AdSense?

Quippy … though at least the AOL money & finance blog, where this also appears, gave it a different header.

Dan Blank, who calls the move "a curious opportunity, but not without risks, even if successful", boils it down to this:

At the core of the Google plan is to solve 2 needs of small businesses:

• Allow small businesses to easily reach larger audiences than their local newspaper ads would
• Offer a self-service model that creates effeciency on both ends of the sales process

Tamar Weinberg at Techipedia, who isn't sure why it's taken Google this long to break into print ads, comments:

…if these advertisers really wanted to publish their ads in the newspaper, newspapers did come first, after all, so wouldn’t they have thought of this method of advertising already?

…I don’t see a shortage of print news anytime soon, but I do think that Google will need to look forward to having online real estate on which to populate its ads, because this won’t be a good long-term solution for the company (or for its advertisers).

Jeff Jarvis' BuzzMachine seconds that emotion asks a similar question, notices that newspapers have finally come around though it seems he thinks it's too little, too late: 

Is it a good idea? Of course, it is. It is an idea the newspaper industry should have taken on itself 10, no 20 ago. It’s not just about the internet. It’s about finding ways to serve small local advertisers with self-serve sales and new locally focused products. It’s also about finding ways to bring together newspapers into national networks that can sell demographically targeted ads to new marketers.

… And turning over ad sales to Google — strengthening Google over their own brands, as Hansell’s story points out — only reveals the bankruptcy of their own strategies and soon businesses. Oh, if I were running a newspaper (fat chance), I’d probably sign on, too, because there’s little time and less choice. But it is only an indication of what Google can do and newspapers can’t.

Ah, right. That's why Jarvis is the consultant: vitriolic and controversial at times perhaps, but he knows his stuff. (And for the record, he does allow trackbacks as comments on BuzzMachine). I wonder how Jarvis might relate the outsourcing of print ad revenue to the outsourcing of (for example) business sections he suggested last week?

And it's early to comment on the commenters, but still — Stephen Larson responds to Jarvis with a prediction: 

The thousands of newspapers in the US, from the smallest that lack resources or have their cash flow already allocated elsewhere, to the biggest ones that are stuck in financial models that have huge debt interest or dividend payments or most newspapers that simply don’t have the culture to innovate on the web side in a cost effective manner have no chance against a single well financed company like Google that has none of these problems.

I don’t have much hope that a distributed group of newspaper owners will somehow get together on this.

Over in the U.K., Press Gazette blogger Martin Stabe at Fleet Street 2.0 — who kindly fixed his link to our post, and liveblogging from the  Society of Editors conference (where digital convergence is a focus) I'm getting to ASAP, along with the coverage of paper's ownership (editor's post, Roy Greenslade's post, PG job predictions post )  — notes that Google's move comes as no suprise. "Criticism of some of the search giant’s other activities has already become one of the talking points." 

Image from Stephen Leary's blog The Reflective Librarian.