Woodward? Google? A Plague Week - New York Times: The scariest development for the newspaper industry was the announcement (on that same Wednesday) that Google, the search engine company that wants to be the wallpaper of the future, was going live with Google Base, a user-generated database in which people can upload any old thing they feel like. Could be a poem about their cat, or their aunt's recipe for cod fritters with corn relish. Or, more ominously for the newspaper industry, people could start uploading advertisements to sell their '97 Toyota Corolla. Craigslist kicked off the trend, giving readers a free alternative to the local classified section. If Google Base accelerates the process, the journalism-school debates over anonymous sourcing and declining audience may end up seeming quaint. Google Base reverses the polarity on the company's consumer model. Instead of simply sending automated crawlers out across the Web in search of relevant answers to search queries, Google has invited its huge constituency of users to send and tag information that will be organized and displayed in relevant categories, all of which sounds like a large toe into the water of the classified advertising business, estimated to be worth about $100 billion a year.This could be a fine thing for consumers, but for newspapers, which owe about a third of their revenues to classified advertising, it could be more a spike to the heart than just another nail in the coffin.
LARGE national newspapers like USA Today, The Wall Street Journal and The New York Times have already absorbed a big hit as advertising categories like travel and automobiles have moved online. According to estimates cited by The Associated Press, newspaper advertising revenues will grow less than 3 percent in the current year while online revenue, much of it coming from search advertising, will jump by more than 25 percent.
Google Base could take a bigger toll on local and regional newspapers. So far, those papers have managed to maintain their connection between their readers and the goods and services in the same market. By allowing its audience to customize content and post it for free (all the while selling ads against the audience that information aggregates), Google could all but wipe out the middle man, which could be your friendly neighborhood daily paper.
“Many newspapers have had historic monopolies in their respective markets when it comes to classified ads,” said Christa Quarles, an analyst at Thomas Weisel Partners, a merchant bank in San Francisco. “The local papers have been fairly insulated from major attack, and this could be the next big shoe to drop.”
Not the best time to be in the newspaper business. There have been plenty of newspaper folk in my family, but the era of small papers could be ending soon.
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