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First Google News, now iPhone. AP is putting its own members out of business, but no one seems to notice. 5/6/08

Posted by Steve Boriss in AP.
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Whenever the AP and its member newspapers meet, the elephant in the room bears an uncanny resemblance to Dr. Frankenstein’s creation. These members created the AP more than a century ago to save money by pooling their reporting resources. Members pay substantial fees and share their own stories with other AP network papers, and in exchange get news from distant places dirt cheap. This worked fine as long as there were just a handful of AP papers in each town and local audiences had no other way to get this news — to readers it still felt like their local papers had valuable, exclusive content well worth the subscription fee. But all that changed once the Internet developed and readers could get the same AP news from a multitude of places, rendering each paper’s national and international content much less valuable. Actually, it’s a lot worse than that. Members had grown so dependent upon the AP that most have been eliminating their out-of-town reporting capabilities while the AP has expanded into a behemoth, now with more than 4,000 employees and 240 worldwide bureaus. The AP is growing, while its members are shrinking.

In other words, the AP monster has turned on its creators and is now taking their money while putting them out of business. Last September it was announced that the AP signed a contract with Google News giving its original wire stories prominence, while reducing traffic and presumably online ad revenues at AP members’ own sites. And now the AP is turning on its creators once again, this time launching a program to make its stories available on iPhones, preempting its members’ necessary efforts to restore their ability to generate and deliver their own, valuable original content. But still, AP members don’t get it. Lincoln Millstein of Hearst Newspapers said AP’s new plan provides “a big benefit for users, and a great opportunity for providers of local news and advertising.” We await a coherent explanation for what exactly that opportunity is for providers who don’t happen to be the AP.

Comments»

1. conservatism_IS_compassion - 5/6/08

You are so right about the AP. When it was founded it subverted the business model of every paper which wasn’t part of the AP. And now, perhaps, it is subverting the business model of those that are.
But, as you indicate in your mission statement, the biggest change the AP made was to make the editorial page of the newspaper simply an adjunct to the AP content. The AP sells news, because delivering news from distant places is what the AP is good at. But the fact that the AP can interest the public in the news does not turn the news into “the public interest.”

2. Brian Fuller - 5/7/08

I’m no mathematician, but if the AP puts its members out of business, wouldn’t it be imperiling its own future? (Said the bitter former Unipresser!)
Its wire is laden with copy that is produced by reporters from its members, not its own staffers. Kill the members and you kill the goose. Google isn’t in the business of supporting the AP long term…it’s in the business of selling cheap ads tied to (mostly) free content and search.
Secondly, there may be silver lining here: If papers get less wire copy, they have to rely on–gasp!–better local reporting to fill their dwindling pages. Something tells me that’s what readers have been crying out for for more than a decade.
Time will tell!


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