I created a screencast comparing Google News to ABCNews.com, San Antonino Express News and the Houston Chronicle for the same AP story.

Google announced this major event quietly on a Friday before a major holiday. That in itself is highly interesting, but will not be the focus of this discussion. At 10:48AM (not sure what time zone) on Friday, August 31st, 2007 Google News Business Pro…

http://www.daviddalka.com/createvalue/2007/09/02/new-york-times-should-link-to-original-stories-from-the-source/

Absolutely. And not just to hold onto those readers, but to show them a better news experience. See more on that in my write up of Google’s move to host wire content.

The real problem here is of channel conflict. The smartest move would be for AP, AFP, etc. to create their own branded sites and have Google point to their versions for them to monetize. This is what Reuters does, pointing traffic to Reuters.com.

AP decided a while back not to go that route because it didn’t want to annoy its newspaper partners/owners by building its own competing destination site. Instead, it hosts stories for partner newspapers in an awkward, not SEO friendly, template.

And it sells the feeds to AOL, Yahoo and now Google for them to build the competing sites that the newspapers don’t want AP to build.

I think this is mistaking cause and effect. Most of that stuff is all over the web because it was initially reported by the wires and has been picked up by dozens of different newspaper sites, plus Yahoo News etc.

Wire services are far from irrelevant online. Quite the contrary. Chris Paterson of Leeds University has shown (PDF), the agencies are the dominant sources of online news, particularly in international coverage. Most people just never noticed because their stories appear under other people’s brands. Google, however, quickly understood this feature of online news because of the problem they had with duplicated wire stories on Google News.

This doesn’t suggest the “irrelvance” of wire services. It does suggest something that has been discussed for years — that news wholesalers are coming into competition with the retailers they traditionally supplied.

What newspapers need these days to stay viable is more local content as well as insightful and intelligent writing that you can’t easily get online.

This deal can be a lifesaver and a wake up call for local newspapers.

In my 35k circ daily, AP is becoming less important and valued. Most days at least three of the four front-page stories are local and many days we don’t think a wire story is worthy of the frontpage. You often hear an editor grumble how much we’re paying AP and how little they’re delivering. On our Web site we have some automatic AP feeds but they’re at the bottom and don’t get many clicks.

I have a feeling some papers are questioning the value of AP since it’s so prevalent online and their stories are old news when the morning edition is printed. It’s only a matter of time before newspapers pull out of the AP.

When that happens, AP will take a huge budget hit. (Keep in mind there are only a few newspaper corps. Imagine if Gannett orders local papers to cut AP). Many local news stories on AP are from members and rewritten by AP. Those stories will vanish. AP will only have enough manpower and funds to cover major stories such as politics, wars, etc. They won’t have as many local stories for Google to sell targeted ads to. Google’s AP news will compete with national news outlets.

People seeking local news won’t find it on google or yahoo. They’ll get it from their local news outlet.

Now my scenario assumes many things like newspaper execs being forward thinking enough (hasn’t been the case). But Google’s deal should spur some papers into becoming more local and focusing on what they do that is unique.