The web will have an impact, but on who?

Bill Gates has probably generated more copy than any other figure in the IT industry.

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By  Peter Branton Published  May 10, 2007

Bill Gates has probably generated more copy than any other figure in the IT industry but the Microsoft chairman's words this week would still have been unwelcome to many in the publishing business.

While his claim that the newspaper industry is steadily losing readers won't have taken too many people by surprise, his warning that revenue models that worked in print will not work so easily online is going to have sent a chill down the spine of more than one publisher.

Gates and other Microsoft executives used the event to demonstrate new technologies that make advertising more interactive and better targeted to individual users, but some observers felt that the firm was doing some targeting of its own: attempting to bolster its online image against rival Google.

Last week's reported talks between Microsoft and Yahoo were seen as an attempt to counter Google's internet dominance. Both Yahoo and Microsoft have struggled to compete with Google in the online advertising market, with Google using its dominance of the search market to increase its market share.
Google's capture last month of advertising services company DoubleClick even led to Microsoft calling for US federal regulators to scrutinise the deal, claiming that it would give Google an unfair advantage in the marketplace.

Gates is undoubtedly right about the impact that the internet is going to have on the newspaper business: it remains to be seen just how much impact it is going to have on Microsoft's own business.

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