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No Leaf Clover: Newspapers Keep Pointing to Google as the Source of Their Problems; They Should Be So Lucky.

While newspapers have undergone a few hamfisted redesigns and relaunches of websites, made bad acquisitions and laid off employees, Google has innovated and bought its way to relevancy.
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When a newspaper goes to bed at night, this is what wakes it up in a cold sweat, its newsprint wrinkling and ink running:

You don't have to have an MBA to realize that the chart is heading in the wrong direction and that it's getting worse by the quarter. Three entire years of accelerating declines in advertising revenue would keep anyone awake at night. You'd much rather have a chart that looks like this:

Which just happens to be Google's revenue over a similar timeframe. Which makes you realize part of why newspaper execs are hot on demonizing Google right now: they're jealous.

But, of course, charts only tell half the story. Here's the other half:

$37.8 billion vs $21.1 billion

Want to take a guess at which one is newspapers' ad revenue from 2008 and which one is Google's?

Believe it or not, the bigger number -- the one a healthy $16.7
higher is the newspaper industry's. That's right: Google's bringing in just over half what the newspapers haul in on print advertising alone. Which makes the current
more than a little disingenuous. Sure, Google's share is growing and newspapers' is shrinking, blah blah blah. Five years ago, Google's entire revenue was a scant $3 billion. Newspapers' print ad sales for 2004? $48.2 billion. And yet, with significantly smaller revenues, over that five year window, Google launched or acquired (list in vaguely chronological order as
  • Orkut
  • Google Local
  • Google SMS
  • Desktop Search
  • Google Scholar
  • Google Book Search
  • Google Maps
  • Google Code
  • Google Analytics
  • Blogger Mobile
  • iGoogle
  • Google Finance
  • Google Earth
  • Google Talk
  • Google Reader
  • Google Transit
  • Mobile Gmail
  • Picasa
  • Gmail Chat
  • Google Calendar
  • Google Trends
  • YouTube purchase
  • Google Docs
  • Google Sites
  • Google Street View
  • Google Hot Trends
  • Google Sky
  • Android
  • Adsense Mobile
  • DoubleClick purchase
  • OpenSocial
  • Friend Connect
  • Google Chrome
  • G1 phone launches
  • Google Wave

Phew. And, really, that's like a fraction of everything they've done, as it doesn't count a ton of failed launches, updates, language translations, 8,000 widgets, their insane space programs and green initiatives and giving everyone that works for them bicycles and a million T-shirts and and and.

What have newspapers done in that same timeframe? A few hamfisted redesigns? A couple relaunches of websites? A few bad acquisitions? And layoff after layoff after layoff.

Have all those products that Google has launched done well? Not by a longshot (unless you're Brazilian, you've probably never even heard of Orkut, for instance). But for every Google Catalog, there's a Google Docs to fill in the gap. Google innovated (and, yes, bought) its way to relevancy. And it did it with a fraction of the revenues of the newspaper industry.

Yes, I'm comparing a bit of apples and oranges here: newspapers are an entire industry, Google a single company. And yes, I'm not counting investors in the money mix. But still. Still.

Newspaper execs talk with exasperation, as if they've tried everything they can. But they define "everything" so narrowly that it renders the word almost meaningless. In reality, as they watch their massive river of money slowly shrink away, they've tried almost nothing. They had a couple hundred year head start on Google, and yet they collapse in a heap here at the dawn of a new age.

Is there any hope for newspaper companies? I'm not sure. But it'd be nice to see them at least go down fighting. That doesn't mean forcing all their employees to start Twittering, but instead opening their institutions up to ideas -- all of them. Why not give their beleaguered employees Google-style 20% time? Allow them to devote a day a week to building new things. Why not create small teams of reporters and charge them with reinventing their beats by any means necessary? Why not create contests for programmers to build a better ad engine, the way Netflix is doing with recommendations? Why not really try everything?

What do newspapers have to lose?

This was originally posted on the site of the forthcoming Chicago Media Future Conference, which will be awesome and which YOU should go to.

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