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Wednesday, October 05, 2005

Google WiFi as threat to local newspapers?

After Google announced its bid to provide free WiFi in San Francisco last Friday (see, for example, this article), there has been some discussion about what that means to telecom firms and internet service providers. That Google's move could actually be a threat to local newspapers is an interesting perspective, brought in by Preston Gralla, former editor-in-chief of a local newspaper chain, on networkingpipeline. He writes, "the key to local newspapers' survival is their ability to get money from small local advertisers... Local classified ads are a sizable source of revenue as well ... Papers get those ads because the papers cover local news, and so attract local readers. Advertisers don't have to spend money trying to reach people who can't buy their goods. But Google's WiFi service can make that kind of local targeting look crude. It will be able to deliver ads literally on a block-by-block basis... It could deliver localized classified ads, as well, which are the financial mainstay of many local papers."

Also a comment piece on MarketWatch says, "Google's grand ambition to get San Franciscans onto the Internet for free - as altruistic as it sounds - is really about targeted advertisements." But the comment piece states as well that Google's bid is not a major threat, because firstly the deal is not yet approved, secondly Google is just testing such a service for the moment and thirdly targeted ads could also prove useful. However, the article is more focussed on the situation for telecoms and ISPs and does not discuss possible consequences for local newspapers. For local newspapers, which are already fighting with decreases in readership and advertising, competition from Google in the local advertising business would be a big challenge (see also former posting).

Also in other cities free wireless internet services are planned. Yesterday, Philadelphia announced that it will build a municipal wireless internet system that would be the biggest in the US. The Washington Post states that Philadelphia is "the latest of a growing number of cities to treat high-speed Web access as a basic municipal service like water, electricity and trash collection".

Sources: networkingpipeline, MarketWatch, Washington Post, News.com

Posted by Anna-Maria Mende on October 5, 2005 at 04:14 PM | Permalink


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Tracked on Oct 7, 2005 9:14:58 PM