Image by Eric Schmidt / Google via CrunchBase
Eric Schmidt, the head cheese of Google, has written a lengthy article appearing in the Murdoch owned Wall Street Journal. In the piece Schmidt not only clarifies the distortions Murdoch has been laying out these past few weeks, but also what Google is doing to help the news industry.
First off here is Schmidt talking about Murdoch’s claims:
Google is a great source of promotion. We send online news publishers a billion clicks a month from Google News and more than three billion extra visits from our other services, such as Web Search and iGoogle. That is 100,000 opportunities a minute to win loyal readers and generate revenue—for free. In terms of copyright, another bone of contention, we only show a headline and a couple of lines from each story. If readers want to read on they have to click through to the newspaper's Web site. (The exception are stories we host through a licensing agreement with news services.) And if they wish, publishers can remove their content from our search index, or from Google News.
The claim that we're making big profits on the back of newspapers also misrepresents the reality. In search, we make our money primarily from advertisements for products. Someone types in digital camera and gets ads for digital cameras. A typical news search—for Afghanistan, say—may generate few if any ads. The revenue generated from the ads shown alongside news search queries is a tiny fraction of our search revenue.
That is exactly what I have been saying all along. Google isn’t “stealing content”, they are simply indexing very small tidbits of it so people can easily find it, and they do find it at a rate of one billion per month. I don’t think that’s something any serious news publisher would want to turn away.