Jon Fine, media columnist for Business Week (subscription required), muses on the idea of a Content Consortium, an alliance of big content producers to create a common website with technical barriers to outside search engines. Tom Curley, CEO of the AP, is thinking along these lines, talking about setting up subject-specific Web packages, and then inviting search engines to bid for the right to access the traffic.

Is is an interesting idea, especially because there is no way in which content can be provided for free, in the long term, so some method of paying for its production must be found.

As the old saying goes, prediction is difficult, particularly when it involves the future. But a few things are clear.

1) The old business model of newspapers was to put out a product that would pull in eyeballs and sell those eyeballs to advertisers while collecting a little additional revenue directly from the readers. That model is stone dead, largely because the Internet is a much more effective and efficient medium for most of the important advertisers -- autos; department stores; classified. This is a downward spiral, because ads are also content -- as advertising leaves, so will the many readers who buy the paper for the ads.

2) A major function of newspapers has been to filter, package, and frame the news. These functions, especially the commentary part, are also being replaced by the Internet, largely by the blogger armies of people who have day jobs but can comment more authoritatively than any J-school trained generalist.

3) The Internet does not and cannot do the core job of collecting news. It may in the future - armies of amateurs might post information, and press releasers of all sorts might just release to the Net, relying on search engines to do the aggregation and selection tasks now performed by reporters and editors. But that day is not here yet.

4) So, given #3, newspapers do have something of value to add, and it is not possible for them to keep providing it withour a revenue stream. If their old sources of payments by print readers and advertisers dry up, then the money must come from on-line subscriptions (a la the WSJ), from web advertisers, or by payments from entities that do have a revenue stream, such as Google.

5) The potential members of Curley's Content Consortium are in rather different positions. Creative companies, such as movies or TV, clearly have value to add, an ability to create that cannot be easily duplicated in garages or basements.

Newspapers are more precarious, because their value for anything beyond the collection function is questionable, and that is pretty much a commodity. All monopolies corrupt their internal staff, and newspapers have been monopolies for a generation. They have become exceedingly sloppy in performing their filtering and interpretation functions, and are getting shown up by the Netizens. If they want to add value beyond simple collection of news, they are going to have to reestablish standards of professionalism that have been allowed to lapse. (Most conservatives regard AP as a poster child for this trend, too.)

6) The institution of property rights will be the major mechanism for working out these interactions. Who owns what, how can they protect it, what is and isn't fair use?

posted by James DeLong @ 11:51 AM | Media: Video, Music...

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