The failure of aggregation as a business
A few days ago on the Journalism That Matters email list, someone posted a note that Blognetnews.com, a news aggregation service of some kind, had gone under, probably due to lack of advertising revenue. I had never heard of Blognetnews.com, let alone read it. Someone asked whether any aggregators were making money.
My guess: No. Or not much. For all the energy being poured into creating different aggregation services, I firmly believe there is no business there. There are three reasons for this.
First, whenever you convene a bunch of engineers to talk about the future of news, they inevitably want to focus on the issues of aggregation and personalization. The premise here is that there is a massive problem plaguing people on the Web. Namely, there is so much content being created every day (6 billion pages is a figure that gets tossed around a lot, but I’ve never seen that confirmed) and that people are drowning and need help finding the best stuff.
The thing is, I think this is mainly a problem for a handful of news nerds (like me) and Silicon Valley insiders. But beyond that, most people aren’t really that worried about it. They just don’t care that much. They don’t have the capacity to read much more than they read now. This means that the market for such aggregation services is much smaller than is typically assumed.
Second, factor in that the cost of starting these types of services, which has fallen dramatically over the past decade. Any decent programmer can throw these together and push them out. So there are way too many of these services, slicing the potential market into even smaller chunks that each will have trouble generating enough audience.
Third, in terms of finding stuff, the bulk of people are still fairly passive in their consumption habits, despite the way the Web has created avenues for greater participation. They’re content with what they’re getting through their Facebook and Twitter streams, or catching the top headlines from Yahoo News. There’s a reason that Yahoo News is still far larger than Google News. Most people don’t want to do the work of assembling their news, creating context, building a profile, re-finding their friends through another service.
The harder challenge is finding new ways to create quality, relevant information that expands the universe of news that people can consume. And then packaging that in a way that fits the way people want to consume it, when they’re ready to consume it.
As an aside, I do think that aggregation as a feature on news sites is helpful and appreciated. And the same with posting links to your followers on Facebook and Twitter. But finding new ways to re-package over and over the same stuff floating on the Web just doesn’t address a burning problem in most people’s daily lives. And failing that test, it doesn’t make much sense as a standalone business.
