Google CEO: "Moral Imperative" To Help Newspapers

SAN FRANCISCO — Google Inc. Chief Executive Eric Schmidt said Wednesday that the Internet search leader hopes its recently acquired advertising service DoubleClick will aid newspapers as they struggle to corral more online revenue.

"It's a huge moral imperative to help here," Schmidt said during a question-and-answer session at an event hosted in San Francisco by Syracuse University's Newhouse School of Public Communications.

Without providing specifics about how it might be accomplished, Schmidt said DoubleClick's system for serving up online display ads could generate "significant" revenue online for newspapers.

Still, he acknowledged the boost probably won't be enough to restore the hefty profit margins that newspaper publishers historically have enjoyed from print advertising.

Mountain View-based Google completed its $3.2 billion acquisition of DoubleClick in March after an extensive antitrust review that focused on whether the deal would give the combined entity too much power over the $40 billion online ad market.

Google also has a financial incentive to bolster newspapers because the stories, pictures and other content that they distribute online creates more opportunities for the company to make money from short advertising links that appear on millions of Web pages each day.

But footing the bill to gather news and other information has become a more daunting task in recent years as advertisers have shifted more of their budgets to the Internet in an effort to connect with consumers who are increasingly eschewing newspapers and other traditional media.

The shift has been particularly painful for newspapers, which have been laying off hundreds of workers and trimming other costs as their revenue crumbles.

Newspaper publishers also are boosting their online revenue, but so far those efforts haven't been nearly enough to offset the decline in print advertising. Last year, for instance, the U.S. newspaper industry's overall ad revenue fell by 8 percent to $45.4 billion, according to the Newspaper Association of America.

Meanwhile, Google's revenue last year rose 56 percent to $16.6 billion, widening the company's lead as the Internet's most profitable business.

In other comments, Schmidt reiterated his belief that advertising on mobile devices eventually will emerge as Google's biggest source of profits. The company hopes to be in a better position to deliver ads to people on the go during the second half of this year when it's scheduled to unveil its new mobile software package, "Android."

Google's plans to make Android available to wide variety of mobile handsets have caused conflicts for Schmidt in his role as a director of Apple Inc., which makes the popular iPhone. Schmidt said he has had to excuse himself from "one or two" Apple board meetings involving the iPhone, which he said currently accounts for a "vast majority" of mobile traffic on Google's search engine.

Comments

[calgary]

Not moral imperative but financial imperative.

[Hardbull]

If he really wants to save newspapers, he should use some of Google's massive profits and buy a few of the better ones. Poor management at Tribune and elsewhere is as responsible for readers losing interest as anything else. Major papers like the Chicago Tribune and the Los Angeles Times are about to have the very things that readers want slashed in a short-sighted attempt to save costs. This isn't about Republican vs. Democrat, it's about coverage of crime in your neighborhood, about local politicians being asked tough questions about education. Blogs are a great and important new voice, but most of them do not have the manpower needed to do this work. The New York Times is relatively safe (even if it too is facing staff cuts), and has a pretty good handle on how to create a truly essential web presence. But many of our finest papers may not survive, along with their websites. And once they're gone, they won't be coming back.

[gypsy508]

Newspapers revenue stinks because their quality stinks. People prefer reading newspapers but there is no point any more. They need to pay writers to make it a more attractive profession (avg salary - $27K, with a masters degree - 33K just doesn't cut it). It is one of those industries which traditionally has required strong unions and those are now non-existent. Writers don't generate income so business models overlook them.

[bikerdude]

Nothing in that article or the quotes by the Google guy say anything about improving the quality of the news or its presentation. This stuff has very, very little to do with the demise of newspapers in print. I want someone to ferret out the non-news cretins who are running these businesses into the ground. The ones who are perpetrating the merging of so many into so few for the purpose of profit. The internet will be the next main stream media for a while. People like Zell and Sulzberger will go away, but not before they destroy a major industry.

[Paul]

Saw a cartoon recently. Two reporters leaving their desks after being fired, one says to the other: "I don't get it. They told us giving away the news on the Internet was the future of this business..."

[ShockandAutism]

You guys are missing the even bigger picture here. Aesthetics and convenience is secondary to what the main source newspapers provide that other media entities can’t...investigative reporting.

Because of the advertising draw owns due to the advent of the internet, established media outlets such as newspaper, news magazines and broadcast news have had major cutbacks to their investigative news divisions which in effect damages the quality of news we all receive. Which is why in recent years cable news and blogs have prospered because they are opinion based and cheap to produce without having to spend the resources of time and energy to gather facts and report thoroughly.

The internet for all it’s informational beauty is ethereal and lacks substantive quality which is also why the majority of all news stories and events link back either to the AP or the NYT. Because they can do the true investigative journalism (or legwork) that gives the internet it’s core content. The problem is that it is financially killing the heart that makes it beat.

Unless they are planning to launch a ‘Google News division’ which sounds ridiculous then what they talking about here sounds encouraging and every internet user should be applauding it.

[letsgetsmart]

When the republican owned newspapers investigate only dems and the problem with our country is republicans, how is this a loss? I say fine, let them fail. The internet will come up with a void filler that fits modern times and already has more respect from the public then older news sources. A lot of us only pay attention to older media because we want to know what the current lies are.

[ShockandAutism]

I suppose by saying 'republican owned newspapers' you are referring to Rupert Murdoch and News Corp. Which I agree they are basically corporate propaganda tools that scratch the backs (mainly speaking) for Republicans that they in turn reciprocate for corporations through deregulation and FCC handouts.

But they are not all like that. The NYT for all it’s faults has been trying to do the right things by releasing stories that got them in a lot of hot water with this administration and so has the Washington Post, San Francisco Chronicle and scores of other lesser know publications.

News has to be investigated. It requires time to dig out the truth and get facts on the record. The internet can’t fill that void because it’s temporary in it’s existence thus expunging anything from actually being on the record cause the record can be deleted, hacked and commented on by a million bloggers before it ever has time to be permeate and be understood by the masses.

The internet won’t be immune to conglomeration and protectionism either and then you’ll have no one to trust. At least journalists are willing to hold peoples feet to the fire and you need to recognize those that do and support them.

[brooklyncitizen]

check out democracy now.also new yorker has great investigative reporting.

[letsgetsmart]

Ahhhhhhhhh, too bad that the republicans went and bought all of these news papers and now they are losing money. I hope they all go bankrupt. Time and technology change. They want to control what we read and what the message is so let them go broke.

[andyg]

you mean the nyt

[GatorGrrrl]

Even tho I'm a big fan of this site, how much original reporting does HuffPo do? Other than bloviating bloggers, it's all links to NEWSPAPERS who have boots on the ground covering this stuff, reading the budgets, examing the records and doing the hard work of journalism.

[larry278]

True, Ms Huffington's quest to make HP America's 1st online newspaper of record means that HP's blogs must include much more HP generated feet on the ground, eye to the key hole, original reporting to replace HP's reliance on using material from traditional MSM, such as newspapers. Stringers scattered all over the country who fed stories to HP's edittors/monitors would be a way to start. HP's editors/monitors are skilled at screening comments to HP. Most of them, if not all of them, could rewrite a stringers copy in cases when a good story needed work to meet HP's stds.
Most users of HP who submit comments have learned HP's stds & style by using HP. A paid stringer earns his pay by learning the stds & style of each media outlet who buy the stories.
larry lynch

[brooklyncitizen]

the success of this site is that it gave us a voice to speak out on the last 8 years on the hell we've endured under Bush. the links to the stories are inconsequential.

for real news i go to democracy.now.

[GatorGrrrl]

I'm glad he put it in the those terms "moral imperitive" because basically the "news" services on the Web are benefitting from newspapers without giving back. Papers are like the smart kids doing all the homework that all the bloggers and news search sites are cheating off of. No one else is going to city council meetings, sifting through budget documents, investigating police forces (unless it's sweeps week). Democracy is at stake here.

[marymansour]

Google offers the major newspapers on line if you have their home page. I don't want to receive all the paper entailed in getting a daily. I love getting my news online in the morning. It's a new day.

[ShantWhite]

I agree!!

I rarely read the news because I hated the big bulky shuffling of paper, but getting my daily fix from online sources is awesome! I now keep up with current events and stay ahead of the game. So by the time I get home to watch the evening news, I'm already familiar with most of the stories being aired.

[imjustsayingthat]

Years ago, people were saying that they'd never give up the printed newspapers because they'd miss that feeling of holding the paper in their hands, shuffling it, folding it just right & even getting ink on the fingers. I kinda agreed. But, I've sure become accustomed to online news. I've definitely become more of a news junkie because I'm able to read so many different papers instead of just one or two. I feel much more informed & I think so many others do too.

[calgary]

Google is a giant vacuum cleaner for content. Newspaper sites produce both content and advertising revenue for Google. If the newspaper sites go away, there will be less people to click on Google's ads.

[wm1066]

Thanks for making that connection.