Social media's rising importance in news distribution, VR and publishers, and the business of digital news

Friday, September 30, 2016      Future Media Lab.       0

Continuing with our bi-weekly news roundup, George Sims and Karin Fleming share the news that caught their eyes over the last two weeks. The news round-up is a way for the Future Media Lab. team and members of the Future Media Lab. network to share articles about innovations and developments in the media sector, including references to relevant media policy debates.

Here are George and Karin's choices for this week:

Where do you get your news? Increasingly, the answer to this question is social media platforms, with 51% of respondents to the Reuters Institute’s Digital News Report 2016 saying they use social media as a source of news each week. According to a recent INMA report, “The Facebook-Media Relationship Status: It’s Complicated” by Grzegorz “Greg” Piechota, if news is meant to thrive in social media it has to become part of the conversation. Facebook’s ever-changing algorithms prioritise content that catches and retains the attention of users. Other content, says Piechota, needs to be boosted with payment. Because a news feed is individually curated depending on the user, the editorial decisions about what content is displayed and what isn’t is nearly impossible to ascertain. This could result in filter bubbles, limit people’s access to a diversity of sources and information, and lead to political polarisation and the blurring of fact and fiction in the public debate.

Facebook ad revenue soars: Since March, the number of businesses actively advertising on Facebook was of approximately 3 million. Seven months later, that number has risen to four million. As well as a rapid general rise of businesses advertising on the platform, more and more companies are making use of video ads. These video ads are viewed on the Facebook news feed and are almost exclusively viewed without sound, pushing Facebook to instruct brands to express their message visually. Different platforms create different viewer behaviour, meaning that advertising companies are having to tailor their ads to the platform on which they are going to be published, as well as adapting to a faster and more difficult audience. A traditional thirty-second TV commercial with sound has a very limited effect on social media platforms where distracted and fickle viewers scroll down after a couple of seconds at best.

At the same time as ad revenues are increasing,  last week Facebook admitted to grossly overestimating the average user time spent watching videos on the social media platform for two years, meaning that advertising companies have been investing in video ads on the platform based on inaccurate data. The Zuckerberg’s company has since corrected the metric and apologized to the advertisers, but the fact that they were fed false data for two whole years just highlights the need for third-party data tracking. As online advertising revenues soar each year for the GAFA giants, they continue to be extremely protective and secretive of their own data, allowing mistakes like this to go unnoticed.

UK Publishers meet to discuss strategies on how to face Google and Facebook’s duopoly. The problem of two platforms taking approximately 90% of the online advertisement revenue without having to pay the price of content creation has been worrying publishers for several years already, and potential solutions or ways of fighting this phenomenon are few and far between. At the Future of Newsbrands conference last week, Trinity Mirror's James Wildman called for a “unified platform” in order to have more impact, while Jamie Dunlop (Head of publishing, Total Media) had a different approach: "My advice would be to work with [Google and Facebook], rather than against them. I understand the idea of there being safety in numbers, but competition breeds innovation and I think the market needs that."

Legacy news organisations still struggle with the business of digital news. At least this is what has come out of a new study by the Reuters Institute that shows 80-90% of revenues in most newspapers still come from print. The main challenges that newspapers and broadcasters identified when it comes to adapting to an evolving digital media environment were: 1) the dominant role of large technology companies like Google and Facebook that attract a large share of online advertising; 2) the low average revenues per user, especially on the mobile web; and 3) the growing number of people who use adblockers.

Ad companies investing in VR custom content, publishers are slowly following. A new initiative by Circa – the fledgling news app - was announced at Advertising Week earlier this week. The new project will produce two weekly VR pieces, and the chief creative officer of the initiative, John Solomon, says that he sees it as taking “our consumers to places that journalists get to go but the public very seldom gets to go.” The pieces will be supported by advertising, though the initial advertisers were not named. Additionally, NBC News is experimenting with VR at live events, such as the red carpet or at “Democracy Plaza” during the 2016 American elections, an area where monetization is also possible.

European Media Freedom Conference 2016 is where we’ll be next week on 6-7 October. The conference, which takes place in Leipzig, Germany, will look at some of the many threats to press freedom in Europe – from the impacts of populist movements, international terrorism and anti-terrorism laws to economic pressure and organised crime that leads to massive self-censorship. At the conference we’ll be launching a “Call for Action” that addresses the legislative and technological challenges that impact press freedom today. The report is the result of the (R)EVOLUTION OF EUROPE’S PRESS conference, which took place in Wroclaw on 1 July.