Sam Zell’s Blunder

AT the heels of his $13 Billion acquisition of Tribune, Sam Zell put his big foot in the mouth by saying: “If all of the newspapers in America did not allow Google to steal their content, how profitable would Google be?” Zell said during the question period after his speech. “Not very.”

The statement shows a severe lack of understanding of the newspaper business AND the Internet business. Newspapers have allowed Google to use their articles in exchange for a small cut of advertising revenue, but search engines also help to distribute their content to wider online audiences. Google and Yahoo have financial arrangements with wire services, such as the Associated Press, to provide news stories and photos.

Zell may want to read my article, Newspapers:
Industry in Turmoil for an overview of the strategic manueverings going on, and more importantly, should be going on. It analyzes all the major newspaper companies, their strategies, what’s working, not working, won’t work. It also identifies the key levers that are necessary for the newspaper industry to reinvent itself.