Wk 7 Reflection: MSFox…seriously
I’m starting to think that the rumored search partnership between News Corp and Microsoft is just the tip of the iceberg. If this deal were a stand-alone arrangement, aimed at cutting News Corp’s content out of Google’s search index, it really benefits no one, and doesn’t hurt Google much at all. Rather, it makes sense for this to be the first date between Microsoft and News Corp. Eventually, MS could gain a huge advantage by acquiring News Corp’s online content, and it could be Rupert Murdoch’s final exit strategy in the game of online media that he has yet to solve.
With this deal, MS barely gains a blip on the radar in search, and it then is saddled with brand association of a very volatile content company. Arguments will be made on whether Bing gives News Corp content preferred status within their search listings, and in general, could cause a massive PR nightmare for a company that seems to be constantly embroiled in them. For News Corp, it might make them a little money, but not enough to offset the potential risk of keeping their content away from a majority of search eyeballs. And for Google, this is hardly concerning. They’ll lose the blip that MS gains in search, and might get some users grumbling about the loss of News Corp content. Oh well.
However. think of the advantages MS gains by acquiring all of News Corps online content. In the past, big technology companies have been terrible at creating their own content. Yahoo hired a bunch of Hollywood executives, slapped them together, and expected mega-hits. It didn’t work that way and Yahoo blew up the model. Microsoft has gone back and forth with creating a multimedia Halo franchise, including a movie, but has had a rough go of it so far. In the build-it vs. buy-it scenario, MS may be seeing that acquiring successful content and franchises it is easier than building them. If they would have bought another search partner years ago, the company wouldn’t be in the predicament they currently find themselves in with Google. Also, realizing their disadvantage in search and their fading software revenues, perhaps Ballmer is realizing that the company needs a new trick up its sleeve, and fast.
For Murdoch, this is the final play in a career that saw him dominate all mediums except digital. Purchasing MySpace, taking WSJ from free to pay to free to pay again, and the like, he’s realized that he’s not as sharp as he was in print and television. He’s also ready to hang up his tycoon hat, he’s not getting any younger. Merging, or entering into a joint venture with MS allows him to spread his empire even further with a company that has the infrastructure and technology, but not the content they so desperately want.
