[Calacanis's] simple suggestion: Not only should Murdoch de-index from Google, but he should get Bing to pay him for the exclusive right to index it... If other media companies joined Murdoch Google could actually find itself in a very difficult position, where Bing had content that Google didn’t. If you knew that Wall Street Journal and, say, New York TImes content was only in Bing search results, mainstream search users would suddenly have a big reason to go to Bing.
This would shift the balance of power away from search engines and to the content sites – if they could pull it off. Bidding wars over rights to index content would conceivably break out between Google and Microsoft, just as bidding wars have broken out in the past over the right to serve search ads into third party publishing sites.
The interesting thing here is that there's sort of a prisoner's dilemma going on here between the search engines. As soon as Bing offers News Corp money to exclusively index their news, then Google will have to respond with an offer to News Corp to exclusively index their news. The implicit assumption on Calacanis's blog is that Google will just roll over and let Bing buy up the exclusive rights to all news sources - which we know won't happen. If Bing doesn't offer News Corp money though, then Google doesn't have to either.
But once Bing makes that first offer, it doesn't stop there. Next all large news sites threaten to take themselves off Google/Bing unless Google or Bing pays them for exclusive rights. Suddenly, we have a world where news distribution is divided between the two search engines - not necessarily the best situation for users who have to remember which search engines search which new sources.
What seems like a more likely equilibrium to me is that large news sources will start charging search engines to index their sites, but not force exclusivity. News Corp has already proved that's there's value to Google and Bing to index their content, and both have shown willingness to pay for content in the past. I think News Corp could make more money from charging multiple search engines to index its site than it could for just exclusive rights. It would be better for the user at the end of the day too.
One consequence of paying for the right to index, though, is that it creates a larger barrier to entry to new search engine players. It will cost Bing and Google hundreds of millions of dollars a year for the right to index large news sites, which is capital a new search engine would need just to play in the general search engine market. I suppose the search engine market is already duopolistic so what's another little nudge in that direction?
But why now? Why didn't this happen four years ago? First, when we lived in a unipolar world - all Google, no Bing - the news sources didn't have the power to threaten Google. Second, Twitter/Facebook news discovery didn't exist. Dallas Maverick's owner, Mark Cuban highlighted this trend:
What has changed ? Quite a bit, but lets start with this. TWITTER IS SURPASSING GOOGLE as a destination for finding information on breaking and recent news of all types. Whats more, TWITTER POSSES NO THREAT to any destination news site. 140 characters does not a story make. Find it on twitter, link to a story on say, FoxNews and everyone is happy. The same concept applies to Facebook Links. Twitter and Facebook are not news destinations that can compete with traditional news sources. Google is. Rupert loves him some twitter. Google, not so much.
Twitter and Facebook are becoming substantial referrers of traffic, which decreases the news sites' reliance on search engines. That frees up the news sites to negotiate with Google and Bing for access to index their websites.
That's all I got on this subject. It'll be interesting to see how this actually plays out.
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