Meta downgrades commitment to Facebook News service, tech giants don’t want to pay for News
Meta, aka Facebook, are looking to review commitments to pay publishers for their news articles. The payments, said to be 100s of million US$ a year to mostly larger news publishers, have shown little return to the Facebook platform or gained them many extra users.
Some of the larger publishers, both in the US and elsewhere, are going to have to figure out a way to make up for a substantial shortfall if Facebook decides to abandon its commitment to sharing the news articles, and paying for the pleasure. Sites include The Washington Post which was making US$20 million a year, The New York Times, much the same amount, and more than US$10 million to The Wall Street Journal.
The so-called Journal fee, introduced in 2019, was a business model which proposed to reward news publishers, was part of the “Facebook News Deal”. The initial deal expires this year and industry pundits say Meta are already in contact with some of the large publishers and say they are not going to renew the contracts.
Meta, trying to keep Facebook relevant and growing, says they intend to shift investments away from news and toward products and services that attract individual creators and producers so that they are better able to compete with TikTok, YouTube Shorts and other growing social media platforms.
They are also pouring money into the ‘Meta’verse, a virtual world which is starting to gain traction and is believed, at least by Meta, to be the ‘next big thing’, and incorporates role-playing, gaming, virtual reality and new ways for users to interface.
Different world regulatory bodies have progressively tried to target the larger platforms, including Google and Facebook, to pay for the re-publishing of news articles, even thumbnails with click-thru links. But, whilst trying to comply back in 2019, Facebook is now shying away from the news and balking at the amount it is having to pay out.
News Corp, in the US and Australia, has been a fundamental critic, and the biggest winner, after years of accusing the big media platforms for not pulling their weight and sharing the spoils of re-posting news stories from news publications, big and small.
Whilst originally rolled out in the US, the payments expanded to the UK, Germany and Australia last year. France joined in this year.
They were reacting to the quantum shift of advertising revenue from traditional media bases to the online platforms. To put the problem more plainly, in 2018 the combination of Facebook and Google were getting 77% of the digital advertising revenue in the US market. Meanwhile, 1,800 US newspapers over the preceding 14 years.
Just last month, former CNN and NBC journalist, Campbell Brown, and the brains behind the Facebook News feed, has now broadened her role, negotiating global media partnerships and contracts with sports leagues, film studios and streaming services – a move away from the Facebook ‘News’ project.
Google are yet to make any changes to their current payment structure for news content negotiated with various regulatory bodies over the past 3 years but it is expected that there will be an ongoing shift away from the enforced payment for news by the social media giants.
