PaidContent.org has posted an important analysis by media consultant Arnon Mishkin showing that aggregator sites derive far more value by compiling headlines, ledes and links than do the news organizations that actually produce the journalism.
This isn’t exactly counterintuitive, but it does run counter to what a lot of us had hoped was true. Jeff Jarvis, more than anyone, has popularized the idea of the “link economy.” Trouble is, it may not exist. At the very least, it’s likely a lot more complicated than simply a matter of posting links and assuming the linkee will benefit at least as much as the linker.
Here is Mishkin’s key insight:
Actually, it shouldn’t be surprising to anyone who’s thought about how people have historically read a newspaper: They’ve scanned the headlines and then turned to the sports, movie listings or recipe pages, depending on their real interest. As the saying goes, “People don’t check the news to read about the fire, they check it to learn that there wasn’t a fire.”
Historically, the value of those casual browsers was captured by the newspaper because the readers would have to buy a copy. Now all the value gets captured by the aggregator that scrapes the copy and creates a front page that a set of readers choose to scan. And because creating content costs much more scraping it, there is little rational economic reason to create content.
Mishkin’s post comes at a time when news organizations from the Associated Press to News Corp. to the Boston Globe are dipping their toes in the water with respect to charging for their content. That’s fraught with difficulties, too, although I’m slightly more bullish about the idea of per-click micropayments than I was even a few months ago.
In the long run, we’re going to have to differentiate between good and bad linking. Blogging is the classic example of good linking, since the blogger adds value through analysis and reinterpretation.
But aggregating in a way that removes nearly all incentives to click through to the original news site defines bad linking. The Huffington Post is one example. Newser is an even more egregious example: when you first access the site, you get photos with headlines; click on one and you get a Newser-supplied summary (with more ads); and, finally, with a second click, you jump to the original. Link economy? More like piracy.
No one really knows what the answer is. Mishkin offers some unsatisfying ideas at the end of his post. My own sense is that newspapers need to try a variety of strategies:
- Charging as much as the market will bear for the print edition.
- Developing paid online editions for e-readers, cell phones and laptops (i.e., Times Reader and GlobeReader).
- Removing the “today’s paper” feature from their free Web sites. (I would continue to offer all or most of the content for free, but not in the form of an exact substitute.)
The search for a business model continues. Mishkin has punched one more hole in a fantasy a lot of people, including me, had believed in for as long as we could.
(Via Howard Owens’ Twitter feed. Owens, you may recall, was a top official at GateHouse Media during that company’s legal battle with the New York Times Co. over the Boston Globe’s aggregation practices.)
