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Schmidt Fires Back at Google's News Critics

Google CEO Eric Schmidt
Google CEO Eric Schmidt
Source: Google
While traditional media companies struggle to come to grips with the changing fortunes of their industry as customer attention moves online, Google -- as a key aggregator of news content -- says it's not helping to speed their decline.

Of course, that may be hard to believe for the newspaper publishing executives who routinely bash Google for contributing to their demise.

In response to such criticism, Google CEO Eric Schmidt fired back today in an opinion piece in the Wall Street Journal.

"With dwindling revenue and diminished resources, frustrated newspaper executives are looking for someone to blame," he wrote. "Much of their anger is currently directed at Google, whom many executives view as getting all the benefit from the business relationship without giving much in return."

Instead, Schmidt defended Google's role in the online news cycle, adding that publishers need to get with the program and figure out new ways to make money on the Web.

"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," he wrote.

The comments come as Google is facing increasing pressure from some of the heavyweights in traditional media. News Corp.'s Rupert Murdoch has been one of the search leader's most vocal critics. Most recently, he chided aggregators like Google News for, as he sees it, profiting off the hard work of newspapers like News Corp.'s own Wall Street Journal.

"There are those that think they have a right to take our news content and use it for their own purpose without contributing a penny to its creation," Murdoch said earlier this week at a Federal Trade Commission hearing.

Murdoch has threatened in the past to pull News Corp. content off Google News.

His company is now also said to be in talks with Microsoft's Bing search engine to create a deal that would block Google from indexing its sites while allowing Bing users access -- potentially a major blow to Google News.

Google not at fault

But Schmidt said Google's hardly to blame for the news industry's woes -- and even cited an earlier argument by Murdoch in making his defense.

"It's understandable to look to find someone else to blame," he wrote. "But as Rupert Murdoch has said, it is complacency caused by past monopolies, not technology, that has been the real threat to the news industry."

To cope with changing modes of usage, he added, newspapers publishers must use "technology to develop new ways to reach readers and keep them engaged for longer, as well as new ways to raise revenue combining free and paid access."

"Nor is there a choice, as some newspapers seem to think, between charging for access to their online content or keeping links to their articles in Google News and Google Search. They can do both," he added.

Schmidt also responded to perennial claims among some in the media business that Google profits wrongly from their content -- a charge that he said "misrepresents the reality" that Google in fact makes little off of news-related searches.

Media execs have also not been shy about claiming that Google even violates their copyrights by pulling headlines and other content from their sites.

"We only show a headline and a couple of lines from each story," Schmidt wrote. "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.)"

He added that publishers can also choose to remove their content from Google's search index or from Google News.

"I certainly don't believe that the Internet will mean the death of news," he wrote. "Through innovation and technology, it can endure with newfound profitability and vitality. Video didn't kill the radio star. It created a whole new additional industry."

In addition to Schmidt's opinion piece, Google has taken other efforts to smooth its relationship with traditional media players. In a revamp of Google News this week, the company gave enable publishers to better control how the site indexes and publishes their content.