Rupert Murdoch's Serious Internet Strategy

It's not all sour grapes that has Rupert Murdoch suggesting News Corp will eventually pull its content out of Google once it converts users to a paying basis. Listening to the interview with Sky News political editor, David Speers, in which Murdoch laid out his plan to withdraw News Corp content to within paying boundaries, Murdoch makes clear that it's all about getting serious online.

Murdoch observes that very few (actually, he says, "no web sites anywhere in the world") make serious money. Likewise, he observes that "search people" - i.e., visitors to News Corp content that arrive by search engine - are not loyal readers of content. Ergo, they are not serious.

Therein may lay the calculation Murdoch and News Corp are doing in connection with their strategy to get consumers to pay for content and, then, deny access to all the non-paying transient onlookers who come courtesy of Google. The strategy advocates a retreat to defensible, higher value positions. As everyone has freely (no pun) pointed out it means much smaller audiences. But Murdoch's comments suggest that News Corp has taken this into account and it doesn't care. What have big audiences and an over-abundance of inventory given to the world but ad networks and lower prices? It's time to get serious. It's time to get back to business.

The issue of "serious money" is an important one. It has confounded traditional media companies online since the beginning. Plenty of money flows through plenty of big web sites, but the end results in terms of profitability have been underwhelming, certainly in Murdoch's view. For many of the Internet's largest players it has been equally disheartening to ponder a future full of exertions to grow traffic by relying on competitive third-parties, while struggling to raise advertising prices in an ocean of inventory. As Murdoch asserts, there is not enough advertising to go around for any web site to make serious money.

There are two ways to chase after serious money as a publisher, however, and one of them is to be small. Having tried big, Murdoch may be coming to terms with the alternative.

The media world has been addicted to "big" for years. Big has meant serious money thanks to advertising. But, that hasn't translated online where smaller, independent publishers capable of generating $1 million per year in revenue out of a spare office thrive, while large publishers huffing and puffing to do 50x - 75x that amount feel unfulfilled.

Online there is, in fact, plenty of advertising to go around allowing many, many publishers to feel like they are making serious money. The Internet landscape is dominated by those publishers, and collectively they are changing the rules, agreeing to work for lower prices and agreeing to be positively delighted with sales results that wouldn't keep News Corp in corporate jet fuel for a week.

At the same time the advertising community is slowly, but surely, shedding its own dependence on big. Ad networks have left one positive impression, which is that it is possible to aggregate many sites online for less and see results that are equal to or better than what $30 CPMs on big sites may have delivered. The taste left by some ad network experiences was bitter, but the implications of a freer, more open, and more targeted market have broken-through.

Most publishers couldn't survive without Google and other search engines to direct people to their web sites; nor could most Internet users, which should assure the market of free and open access to search engines of one sort or another for many years to come. News Corp, however, has considerable resources of its own to drive traffic to it web properties. It may not be the sort of traffic that earns it a top 10 or even top 20 position among its peers, but perhaps they've stopped caring. Perhaps big isn't quite so important in their calculations anymore. Having experienced the tiresome affects of being big online perhaps Murdoch is getting serious about Internet strategy.

And he may be right. Seriously.

 

Follow Jarvis Coffin on Twitter: www.twitter.com/GJC3

Comments

[ronnie423]

maybe rupert could pay us to read his trash.

[Caru]

Technology will eventually make us communist, get used to it.

[RevSpaminator]

Yes..it will. It will also make you worship goats. Then technology will signal their masters in space and aliens will drop from the sky. Elvis will walk the earth again, as a zombie. All part of the evil Bolshevik plan. :)

[lastpost]

“Murdoch observes that very few (actually, he says, "no web sites anywhere in the world") make serious money”

Hold on to your(e) old hat Murky. There are things out there, other than money. And stop confusing the word “serious” with the word “suckers”. Paying increasingly inflated prices, for things that used to be almost free.

[kunzler]

This is great news! I hate it when I do a news search and some propaganda story from Fox pops up.

[BannedbannedBunny]

With that I'm pulling all my content off photobucket and boycotting all News Corp companies like hula.

[Matt Osborne - Huffpost Blogger]

Heh. Pulling all your content off of Google, the largest source of traffic on the planet? What a terrific idea! A pay wall to keep the casual clicker from finding your content? Awesome! Nothing can go wrong with this plan.

[Caru]

I'm for it.

[berny]

Would love to see Google pull the plug first....how about now. I know I won't miss any of that drivel.

[psychodog]

This is the best news I've heard all day.

Keep FOX's content where it belongs... the bowels of their own servers, and off the general internet.

[Ozarks]

What a joke. Nielsen monitors and measures more than 90% of global Internet activity . Does Neilsen do this for free? NO. Neilsen rates are the basis of advertising rates on network TV. Why do you think the Superbowl has such high cost adds? So advertisers can thru alleged "higher value positions" seek out "much smaller audiences". You got to be kidding with thhe premise in your article where you state:

"The strategy advocates a retreat to defensible, higher value positions. As everyone has freely (no pun) pointed out it means much smaller audiences".

Let Murdock seek out advertisers who want to pay to present their products to "much smaller audiences" who will pay to see advertisements. It won't happen

[josephXY]

It all depends on whether people have time for Murdoch and all that in the first place. He is more
talked than there is to News Corps in overall numbers. News Corp is not that big, just talked
endlessly about, again and again.
And it is for this reason that it might be just as well for somebody having no time for all that
to listen for instance to Spinal Tap's "Gimme Some Parody", a coincidental song parody of
Murdoch's main message, gimme some money:
http://www.youtube.com/watch?v=I-BYzaDwNoE

[SeaBlood]

Murdoch will pull his content from Google. So far so good! Now all we need is for him to pull his contents from TV and from the newsstand. It will truly be a boon to all mankind.

[vlm1948]

Amen to that.

[raindrips]

Murdoch might be able to pull this off. No-one else could.
I'm sure he wants to control the message to his audience. Fox news does that: most of its viewers don't watch anything else. What if he combined his properties into an on-line, subscription-based network? ... the WSJ, sensationalist Post and Sun, and Fox News on-line... maybe even other fox assets .. he might be able to make a site that could be a single-source portal for his audience. Those readers would no longer need Google News, because they'd have their own Murdoch-filtered sources to go to.

[peacechants]

The Murdochs cannot abide the free exchange of ideas, especially on the internet where anyone's voice can be broadcast globally at light speed. Loosing the ability to control information, and therefore the way people think, is anathema to the agenda of tyrants and the global elite. Their desire to restrict free thought and expression goes back to the time of Socrates, and for the very same reasons surrounding control. Murdoch's model of pay-as-you-go access to information is his first, but not last broadside in the movement to eliminate an open and free internet.