Local News Consumption: The Impact of Aggregators on Traditional Media

In public debate about the impact of the internet on the news industry, one particularly contentious issue is the role of news aggregators.

These are websites that do not produce much original content, but instead ‘curate’ content created by others using a combination of human editorial judgment and computer algorithms. The results are presented with a few sentences and perhaps photos from the original article: to read the full article, users can click through to the website of the original content creator. ‘Pure’ aggregators, such as Google News, generally do not make any payments to the original authors of the news content. Rather, they create their page by ‘crawling’ the web and then using statistical algorithms and editorial judgments to organize and rank the content. Only in a few cases does Google News have a direct commercial relationship with the outlets. In contrast, websites like Yahoo! News and MSN mainly show content from contractual partners. A third kind of aggregator, exemplified by the Huffington Post, uses a hybrid strategy of curating blogs and aggregating news from other sources. Why are these aggregators so controversial? Less than half of users’ views of the Google News home page result in visits to any online newspapers. Thus, users may read their news from Google News without ever generating page views or revenues for any of the content creators. Clearly, this undermines the incentives for newspapers to invest in journalism.