wire services

The grumbling by some Associated Press members has "gone public" and is nicely summarized by Forbes writer Louis Hau, who asks: "Do newspapers still need The Associated Press? And does The Associated Press still need newspapers?" I discussed this last September when I wrote that "AP's goose has been in the oven for years." Not a lot has changed since then except for some editors objecting to AP's fairly reasonable efforts to perpetuate itself in the new world.

AP has announced it's restructuring and simplifying its member assessments (that's AP-speak for "pricing") in a revenue-neutral way. By definition, that means there will be winners and there will be losers.

Hau writes that "AP copy accounts for up to 40% or more of many a daily paper's news content," but that's not true of smaller daily newspapers, most of which are pulling back on global coverage and focusing entirely on local issues. Some have simply dropped AP service.

My employer owns a bunch of smaller newspapers. Not surprisingly, we came out slightly ahead in the rate restructuring.

Larger newspapers generally are likely to see increases, and some of them are complaining.

AP is a member-owned cooperative and a business. Under the direction of its newspaper owners, it's mutated into a company that derives only 30 percent of its revenues from U.S. newspapers, and those newspapers are clearly receding in importance as a "customer base." Any sound business strategy would have the AP focusing on growth areas such as new media and commercial sales.

For editors who are frustrated by the existence of new media, this is no comfort. But the AP's new plan actually has some benefits for newspapers, at least in theory. Members will be able to choose from a much broader selection of content, including much that's not available to commercial customers.

Here's the idea: Local interest isn't entirely defined by geography. If you're editing a newspaper in a cotton-producing area such as West Texas, a cotton-related news item from afar might be of more interest than a news story from Dallas. So AP's plan is to let editors search pretty much everything and use what makes "local" sense, rather than requiring that a newspaper in a cotton town subscribe to a separate business wire in order to find out what's happening in Egypt.

In practice this doesn't work as well as you might hope, because all search technology falls short of what we imagine it to be, editors still have to dig through a pile in order to find the occasional gem, and the wire/copy desk has just about disappeared from the American newspaper scene due to budget cutting.

The big picture is that the old Associated Press is dead. It exists only in the imaginations of a few newspaper editors. The new Associated Press may find a path to survival, but it's not going to please those in the world it's leaving behind.

The new accord between Google and the wire services -- Associated Press, Agence France-Presse, Press Association (UK) and Canadian Press -- has been met with a range of reaction from ho-hum to what-were-they-thinking.

My old boss Tim McGuire is in the latter camp: "The first question is how much money is at stake here? I’m guessing newspapers still provide a LOT more of APs revenues than do partners like Yahoo and Google. Which leads to the second question, where are the angry newspaper people with their fiery pitchforks and nooses? I’m more than a little surprised newspaper executives aren’t up in arms over this partnership."

It reminds me of something I heard McGuire say many years ago: "Tactically smart and strategically dumb." You could apply that label to a whole series of decisions made by the AP, and the newspaper-dominated AP board, over the years.

But I'm in the ho-hum camp, for a couple of reasons.

Reason #1 is that AP's goose has been in the oven for years. The association came into being in 1846 to fix a problem that no longer exists. Technology and the market have moved on.

Habits are changing. People who are interested in news have the whole world at their fingertips, and routinely consume news from multiple sources. People with less interest rely on word of mouth, which also has been amplified and accelerated by the Internet. As a result, the value of AP news to newspapers is dropping rapidly.

Only an aging minority still relies on print for global news. There is nothing AP can do to change that.

Reason #2 is that there is little or no impact on local media online revenues. Most local media websites get their revenues from local advertising, which is targeted and naturally sells at a premium relative to "junk inventory" network advertising. Random traffic referrals from Google News have no value in that model, so losing them is no big deal.

But beyond that, traffic to wire content on most local websites is not significant to begin with. Some local websites have already pulled the plug on wire news; many never had it in the first place.

Local news websites are under tremendous pressure to build audience. Having generic AP content isn't an effective way to do that, so they're turning to blogging, photo galleries, social networking tools and databases of local information.

At some point, wire copy is not merely of low value, it's of negative value. Local sites are drowing their users with too much stuff, too many links. As Jakob Nielsen has said, every added link subtracts from the prominence of every other link. A cleanup is in order.

I'm not celebrating any of this. It just is.