Google and Newspapers

No, Google's not going to buy the New York Times. But its CEO, Eric Schmidt, says it might come close:

I think the solution is tighter integration. In other words, we can do this without making an acquisition. The term I've been using is 'merge without merging.' The Web allows you to do that, where you can get the Web systems of both organizations fairly well integrated, and you don't have to do it on exclusive basis.

The nytimes.com website is big and fast and very well designed already, so it's probably not top of the list of candidates. But other, smaller, newspapers, which find it hard to afford the enormous continuing investments that great websites need, might well be very interested in outsourcing that kind of thing to Google, especially if Google will do it all for free, in return for being able to sell display ads on the site. If all goes according to plan, the newspaper would make more money, and the web would become a better and easier place to find news.

I think it's worth a try, to see what happens. It's certainly a better idea, from the perspective of Google's bottom line, than Google News, which might no longer officially be in beta, but so far has yet to feature a single advertisement, and which therefore provides no revenue for Google at all.

I did do a double-take, however, when I saw this exchange with Fortune's Adam Lashinsky:

AL: What about Google.org, Google's for-profit philanthropic arm, which is investing in alternative-energy startups?
ES: We didn't want to co-mingle philanthropy with business. We are in the advertising business.

Wasn't Google.org set up with the express intention of co-mingling philanthropy with business? I think I understand what Schmidt is saying here, which is that he doesn't want to co-mingle Google's philanthropic activities with the advertising business in particular, because that's the bailiwick of Google.com. I can half see that. But shouldn't Google be playing to its strengths, instead of artificially constraining its philanthropic arm?