What The Rising Power Of Google And Facebook Means For Journalism
Much of the larger journalism industry, as time has gone on, view Google and Facebook as a threat to news institutions and the work they produce.
Such a mindset was very evident at an event Tuesday hosted by New America’s Open Markets Institute and the Tow Center for Digital Journalism at Columbia University called “Breaking the News: Free Speech & Democracy in the Age of Platform Monopoly.
“About 80 percent of the revenues for most digital publishers come from advertising,” Jason Kint, CEO of Digital Content Next, a trade association focused on the online publishing industry, said on a panel titled “The New Gatekeepers: Journalism in the Era of Platform Monopoly.”
For Google it’s 90 percent, and Facebook it’s 98 percent, so almost all of their revenue is dependent on marketing, Kint continued. He added further statistics showing how much those two U.S.-based tech giants — now more commonly regarded as a “duopoly” — profit from the online ad marketplace.
There’s a “massive concentration of who’s benefitting from digital advertising — 85 to 95 percent of the growth is just going to Google and Facebook,” said Kint, referencing similar oft-cited statistics. And it’s not just in that sphere, as the Silicon Valley pair also have a disproportionate stake in the mobile app marketplace.
“There’s been a huge sift in social media and mobile viewing,” BuzzFeed editor-in-chief Ben Smith said. “There’s also been a terrifying collapse of local journalism with no real replacement like you’ve seen nationally. Publishers like us [BuzzFeed] have been one of the most successful navigating this ecosystem” by focusing on “distribution and what kind of stories and what kind of content your audience is going to share on the network they are on.”
Quite candidly, Smith spoke of the time when he arrived from Politico at BuzzFeed in 2011 when it “wasn’t very journalistic” and more so focused on content like “cute animals” because that’s what many people like to share on Facebook. Smith brought a new perspective to the publication as a political reporter, focusing on what people would share on Twitter — another primary social media platform and thus a source of potential revenue — which he views as, for the most part, original news stories. The problem with Facebook, according to Smith, is that it needs to find a way to get quality news in their newsfeeds.
“I think they need us more than they would like to recognize,” he continued.
Smith echoes similar concerns from other media executives and publishers. Media mogul Tina Brown, formerly of The New Yorker, said late last year she is so disappointed and annoyed with Facebook and Google’s hogging of digital ad revenue that she proposed the creation of a super-fund for more traditional media with the two companies as the main benefactors.
“I am very angry and upset about the way advertising revenue has been essentially pirated by the Facebook-Google world, without nearly enough giveback — no giveback, really — to the people who create those brilliant pieces that are posted all over their platforms,” Brown said in an interview with Recode. “It’s high time they gave back to journalism.”
Showing that the apprehensiveness cuts across party lines and varying ideology, both CNN and News Corp (Fox) bosses, Jeff Zucker and Rupert Murdoch, have respectively expressed their deep-seated skepticism of Facebook and Google’s relationship with publishers and news agencies.
The News Media Alliance, a trade association representing around 2000 newspapers including powerhouses like The Wall Street Journal and The New York Times, was founded in 1992, but appears now as a manifestation of an intensifying sentiment of feeling cheated. The large and diverse coalition tried to petition the government for a classification exemption in an attempt to carve out a larger, and in their eyes more fair, stake for the content they work so hard to develop and generate and that Google and Facebook so handsomely profit from. (RELATED: Google Is Changing Its Relationship With The News Industry As European Rules Approach)
Julia Angwin, an award-winning investigative journalist who most recently worked at ProPublica, said she saw such a power dynamic transpiring from at least around 2008 while working as a tech reporter for WSJ.
She noticed that some of the most powerful and ostensibly innovative tech companies weren’t selling products anymore.
“So how are they making money? Our data is collected and monetized by Google, Facebook, and all of these other companies you’ve never heard of,” Angwin said at the event Tuesday. “We underestimated the threat of that at the time. The industry was like ‘whatever'” because they knew of this and were used to it.
“The development of that business model was the downfall of journalism,” she continued. “Out of the top 100 websites in the world, there’s only two news properties, TheNYT and ESPN, and neither one can continue to support their work with online ad revenue.”
As Smith lamented the apparent suffering of local journalism, Angwin said the same of investigative journalism, an incredibly important but highly expensive part of the field, especially for publishers who feel more and more squeezed by the duopoly.
The goal is “to game” the headlines for search engine optimization (SEO). “It’s who can get most traffic,” said Angwin. People essentially “outsourced trust to the tech companies. They get to rank it, tell you what’s the most important. We have chosen as a society to say I am sure some algorithm will figure it out. But the gaming of the algorithm has become the business and it’s tragic.”
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