Channel conflict flares in the news business
September 1st, 2007 by Benjamin KuoAnyone familiar with Google News is well aware of the duplicate articles — usually pulled from AP, AFP, UPI, and other wire feeds — which show up in their automated news ranking systems. So the announcement Friday that they will carry AP and other wire feeds directly — not through the publications which license AP content themselves — is probably not a huge surprise.
However, it looks to me like a prime example of “channel conflict” — the issue all tech companies face when they are looking to craft their product distribution structure. Channel conflict results when you, because of poor planning or understanding of the market, or even just pricing policy — compete against your resellers and distributors.
In this case, the Associated Press and other wires in essence are competing for Internet traffic (and hence, revenues) against their own customers, the many local and other newspapers who license and distribute their content. It’s a dangerous road to go down–by allowing Google to essentially capture all of the viewers of that content from the wires, the wires risk alienating the publications who rely in a great part on traffic and readers driven to their web sites. It also puts Google in a bad spot — in particular, as Google said it may begin running ads next to the content–because it is pitting itself against the publications for the same eyeballs. If I were a big publisher (which I am not) I’d be very concerned over the move.
