The relationship between news publishers and Big Tech platforms in rebuilding the business of journalism requires a range of solutions focused on direct dialogue, collective bargaining, and changes in law.
On Wednesday, INMA a Webinar for members based on its recent report, “How to Decode the Publisher-Platform Relationship.” Presented by Robert Whitehead, head of the INMA Digital Platform Initiative and author of the report, the Webinar distilled the issues, solutions, and potential publisher playbook into the essentials for news media companies.
Whitehead walked attendees through the most important key elements of the report, helping to bridge the gap between what publishers say they need and what platforms are delivering.
Rise of the regulator
“The sharp jump in the number of regulatory requirements is evident from wherever you are on the planet,” he said. “There are about 109 currently running, and we’re only counting major inquiries.”
There is broad agreement that regulators have gotten out of control when it comes to platforms, which have become their own regulators, and support to rein them in. The base of all this is in Brussels, where European Competition Commissioner Margrethe Verstager has been reappointed for another five years. “The ramifications of this are going to be felt around the world,” Whitehead said.
Business of journalism
Within those regulatory investigations, we can see for the first time the platforms’ effect on the ability to produce quality journalism. A groundbreaking inquiry in Australia has also included the impacts on the advertising industry and those impacts on the business of producing journalism.
“It’s interesting that right now you can almost play a game of interchanging the quotes from the heads of Apple, Google, and Facebook around how they think the importance of journalism plays out — why it’s central to the needs of liberal democracy and how they’re doing everything they can to support journalism,” Whitehead said. “In reality, observers are saying the policies don’t play out that way, and their policies are in fact having negative impact on the sustainability of top-end, quality journalism.”
There has also been a marked deterioration in the relationship between publishers and platform, with a majority of news media companies now formally and actively lobbying for legal changes. An interesting note is that the negativity against the U.S.-based platforms is strongest in Europe.
Publisher pain points
Whitehead discussed four specific pain points for news media publishers:
- Payment: Platforms paying to use publisher content is at the top of the list. Facebook and Apple News+ have created new products to pay selected publishers for content and others are following, though Whitehead cautioned it’s too early to say this is a major trend.
- Priority for quality journalism: Publishers have been pushing for changes to Google’s algorithm to prioritise original, quality, breaking news stories from reputable brands (whether locked content or not), while regulating “churnalism” that doesn’t provide attribution to the original sources. “Google regularly released updates that this is getting closer to fruition.”
- Data: Platforms have tightened privacy settings in a way that entrenches the giants’ stranglehold on data. “We’ve seen, in the past few months, the release of software updates for the platform browsers,” Whitehead said, talking specifically about Chrome and Safari. “The privacy clampdown is manifesting itself in ways that is hurting publisher data. It’s actually strengthening the data stranglehold,” leading more users to resort to dark and incognito browsing, and anonymous registration with Apple is going to take off significantly.
- Ad tech: Google’s dominance of advertising technology is the next big flashpoint and the object of several special investigations underway.
Six categories to watch
Whitehead shared a slide presenting the six main inquiries to be keeping an eye on, including state Attorney General investigations in the United States, reactions by EU Publisher Right, and the Australian Competition Inquiry.
“The Texas [Attorney General] Google inquiry is the one that’s probably going to have the biggest impact,” he said. “It has the potential to wreak havoc, and all of the [US] states are submitting queries to Google on that.”
In the EU, the first country to put in copyright changes for the Publisher Right was France last week. This needs to come into effect in every European member country by the end of next year.
In one interesting turn of events, an individual who used to work for Google to protect the company against anti-trust actions has now switched sides and is leading the charge in the U.S. Federal Trade and Justice Department investigations.
The media industry is awaiting response from the Cairncross Journalism Review in the UK, and the Australian Competition inquiry is interesting because a prosecution was launched against Google for the way it urges users to take control of its own privacy.
“Politicians from both sides of the aisle in many countries are supporting action against the platforms,” Whitehead said. “The U.S. Journalism Conservation and Preservation Act will potentially allow news media companies to collude and negotiate jointly with the platforms on a range of topics.”
Users relationships to the major platforms
In an INMA survey conducted in April and May of 2019 about users’ attitudes toward the digital platforms today compared to three years ago, 44% reported having a much more negative attitude, and 28% said they had a slightly more negative attitude. Only 16% reported a slightly or much more positive reaction.
“We wanted to get a sense of just what was the health looking like,” Whitehead said. INMA then dived into a platform-by-platform look at the user happiness factor.
“Google is more liked, 31% collectively, and Facebook is least liked.” Whitehead mentioned this survey was conducted at a time when further data breaches were being reported and investigations being launched.
Four challenges for journalism business models
Whitehead outlined the four main areas that present the biggest challenges for publishers.
- Quality content.
- Poor monetisation.
“Poor monetisation is the heart of it,” he said. “How can we generate more money using the platforms to help create quality journalism? The industry maintains that the platforms make an awful lot of money out of the use of that journalism. There’s no question that news content is actually quite important for the platforms, and conversely the platforms are vitally important for publishers.”
Is it time to break up with Facebook?
Referencing a recent opinion piece by Facebook Co-Founder Chris Hughes maintaining the platform has lost its relevance and is now unhealthy, Whitehead said Facebook has done a number of things noteworthy to news publishers since the INMA user survey:
- It launched Facebook News, which offers payment to between 200 and 400 publishers for content, though Facebook gets to choose the players.
- It released subscribe tools that are by far the most publisher-friendly subscription tools, with the publisher not paying for article subscriptions and retaining transaction data — though it doesn’t bounce from the Facebook platform to the publisher Web site.
- When an Apple device user is in the Facebook platform, they bounce out of the Apple ecosystem so the publisher does not have to pay the 30% Apple fee or anyone for the data.
Google policy changes
This platform has made some good progress, Whitehead said, with big steps towards prioritising original, quality, unbiased journalism. This is still a work in progress, however.
Other actions, positive and negative, at Google include:
- Directing traffic to news publishers’ Web sites.
- Offering the second-best subscription terms for publishers.
- Increasingly poor adtech and reseller deals for publishers.
- Continuing to stand firm on not paying publishers for content.
Apple: Clear pain points
Whitehead started with the good work that Apple is doing. “They invented a new product to pay publishers for some content,” he said, speaking of Apple News+. “It doesn’t appear that they are big payments at the moment,” he cautioned.
On the downside, however, they keep readers in the Apple bubble when it comes to news aggregation. Their privacy clamp-down is also hurting publishers: “Apple has never handed over subscriber data to a publisher, and that doesn’t change with Apple News+,” Whitehead said.
Additionally, Apple has the poorest subscription terms for publishers — they take the largest fee, 30%, without sharing the valuable user data.
“But the flipside is that in many markets, the Apple audience is the most valuable of the subscriber audience,” he said. Apple users tend to make more online purchases through their devices.
The resulting INMA report from all of this research offers publishers a playbook that they can make use of. Though the report is extensive and does a deep-dive into all of these topics, Whitehead distilled the playbook into a snapshot of eight key points:
- Hold direct relationships, both with consumers and clients.
- Prioritise publishing on your own networks.
- Premiumisation — quality brands shouldn’t compete in a “race for the bottom.”
- Local industry alliances.
- Resell platforms’ solutions.
- Acquire through platforms.
- Learn from those lobbying.
- Monitor legal breakthroughs.
An important element, Whitehead said, is partnerships: “On their own, most news companies cannot create the scale or can’t ratchet up the penetration per market without getting into a bid with similar brands, of similar quality, to be able to pool together all of the first-party data an alliance partner can bring so that you can create quality scale.”
Through surveys and other tools, although INMA is not a lobbying organisation, it does have a mission to pull information together in one place to help news media publishers on this topic.
“It’s moving very fast in some markets,” Whitehead concluded, “and while it may not be in the headlines, journalism is affected by every one of these inquiries in some form. As the platforms respond, publishers are certainly right in the middle of this.”
INMA: Do you feel that there’s one particular platform that “gets us” as publishers better?
Whitehead: I don’t think Apple particularly gets the needs of news media. They get the rhetoric around the importance of journalism. Google goes further and says, we know that business does better when a liberal democracy is thriving. Google is also the highest on the love/hate relationship. There’s no question, there’s a huge amount of good stuff going on in those programmes. Facebook is playing catch-up on this, but Apple has the most to learn.
INMA: What’s the purpose of the publisher playbook?
Whitehead: The relationship between a media company and the platforms has been an operational relationship. Now this has to be elevated fairly quickly to the desk of the CEO or the strategy desk, so they understand how this relationship might play out very soon. It’s important that people get up to speed quickly.
The idea of the playbook was to learn from the best, get the first draft down and get it out for feedback, and publish again in a few months. So the industry doesn’t have to have everyone reinventing the wheel. You can obviously mix and match for your market, but it gets people to a deeper level of learning much, much quicker.
INMA: If you can boil that report down to the big takeaways, what would they be?
Whitehead: Be constructively critical of the relationships you have with each different platform. They each offer you different services and different prices. Make sure you aren’t depending on certain products or tools, which can change. It’s super important that you get on top of your options, and it’s really clear that there is a deeper range of options now than there has been before.