Schmidt believes that the future of newspapers is for the newspapers to accept aggregators, like Google News. He believes that the only way for newspapers to survive is for them to become more like Wikipedia and blogs. This all came partially as a response to the Associated Press making statements about protecting "news content from misappropriation" by aggregators like Google News.
"In that model, newspapers become platforms for the technology to use their services," Schmidt said, "to build businesses on top of them, and also to interlink -- hyperlink -- all of the different information sources that end-users will take."
He also feels one of the keys to saving newspapers is breaking into the internet phone. Schmidt said that newspapers should be taking advantage of mobile technology as a distribution mechanism, beginning to think of stories not as happening on a given day, but as continuous and "living," and, of course, improving the experience of reading online.
"We need to reinvent the way the Web delivers this content," he said, "so that you can have the kind of experience, when people are wandering around with their phone and so forth, that you can have with a printed magazine.
Schmidt also indicated that it is more important for newspapers to make money from advertisers than consumers because newspapers are a "consumer business."
Meanwhile, AP is not the only newspaper-related business upset with Google. Guardian Media Group, which publishes The Guardian in the UK, is asking the British government to investigate Google News and other news aggregators. In its written response to the preliminary Digital Britain report, The Guardian argues Google reaps the benefit of content from news sites without contributing anything towards their costs.
The AP is also preparing a lawsuit against Google News.
I think this is a bad business model for the AP and for The Guardian. They need the advertising money that comes from Google News linking to their websites. I disagree with Google News that newspapers should depend on advertisements for their primary source of income. Advertising is to subjective to the economy, and the best newspapers (like The Wall Street Journal and the New York Times) depend on subscriptions not advertisements. However, news aggregators is a big help to giving more advertising money to newspapers.