Freed up, locked down


Rupert Murdoch is mad. It seems Google has been lifting his content for free (Google helps you find things by copying paragraphs of material it doesn’t own every time you punch a query into its search engine) … and so he is threatening to shut Google down. You know. Refusing to release content from The Wall Street Journal in a format that search engines (or others beyond his walls) can read and republish. All you have to do is subscribe to his protected (unphysical) material.

Sony is happy. It seems Sony wants you to buy its new TVs. Alas, you just upgraded your television two years ago to the big flat-panel in your basement, and Sony’s new gadget is only marginally better with, um, slightly more contrast. Sony knows you’re saturated with electronics and don’t really need a new device … so it is offering to open content up. You know. Giving away free movies from Hollywood in a format your family will enjoy and rewatch. All you have to do is buy the Sony (physical) material.

Payment force = mass times acceleration

Who wins in these scenarios? Both involve cross-subsidies — in which you pay for one thing (subscription, gadget) to get another future series of stuff (stories, movies) for apparently free. Murdoch wants you to spend a few hundred a year for a stream of business content. Sony wants you to spend a few thousand for a giant slab of glass that streams “free” content. Our bet is the Sony scenario wins. Consumers perceive value at the point of purchase, and a sexy device (think, the iPhone in your pocket) feels worth a sudden outlay of cash, even if that outlay is bigger.

We admire Murdoch’s stubbornness in defending the value of content streams. We just don’t think people want to pay for it. The pain of spending has to be tied to something substantial, like a big block of glass. Perhaps it’s all the result of the caveman bartering logic that we relied on for thousands of generations before the advent of electronics just one breed-cycle ago: If the deal doesn’t involve mass, we can’t accelerate payment.

Image: Hey Mr Glen

4 thoughts on “Freed up, locked down

  1. Good. Let him block his propaganda garbage from Google. Who cares about Murd(er)och. He’s just another greedy money monster.

    As the old saying goes, a fool and his money soon part.

  2. What if he is creating a paid Google competitor with social capabilities, that only searches through News Corp’s websites contents?

    I mean: “(very) expensive premium news, for exclusive people.”

    With that positioning, would they be in the same place as Sony?

    A possible second thought is that he is bluffing.

  3. Curious to see how this plays out Ben.

    It was a widely known “secret” that any articles blocked by a pay wall on WSJ.com could easily be accessed by typing the headline into Google. (For some reason WSJ.com did not block people coming in through Google.)

    People knew they were scamming the system but likely figured that at some point wsj.com would catch up with the glitch.

    Ditto the WSJ iPhone app, which gave you access to all their content for free… they changed that about two weeks ago.

    Now that their blocking the Google door, it really boils down to whether the content that’s found at WSJ.com is valuable enough for you to actually pay for it versus doing without it or spending some time tracking it down for free (illegally) online.

  4. I think he was talking about paying subscribers being a more valuable revenue source than random ad impressions served to Google-referred search traffic. And when I looked at how much traffic Dow Jones properties get from Google (I could only look up US sites), I started thinking that maybe he has a point.

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