News media companies are fighting back against Facebook

By Michael Beach

The Sunday Times



So here we are in what could be called Act 3. This is the act where the important plot twists happen.

You remember Act 1, back when media companies started grappling (or ignoring) the first glimpse of the tsunami on the horizon. It’s when previously hard-headed executives were easily bamboozled by the shiny new digital toy.

Media companies have a responsibility to follow through on their commitment of trust to their readers.
Media companies have a responsibility to follow through on their commitment of trust to their readers.

One of my strongest leadership — and digital — lessons about when you should speak up came nearly 20 years ago, when a new digital guru of the company I was working for gave a brilliant PowerPoint presentation about the online strategy for a major event.

My colleague and I, who were doing the hard yards at the ground level on the wider project but were relatively junior in this meeting, knew he was making it up. The executives, of course, thought the presentation was brilliant. They didn’t know any better.

We should have called out the bullshit, but we didn’t feel empowered back then to tell our bosses they were being sold a mirage. We foolishly thought they wouldn’t be so easily fooled.

So, the guru got away with it, the PowerPoint presentation never left the screen, and the expert duly moved on, probably to repeat the same trick to a new unsuspecting audience somewhere else around the world.

There was much confusion during Act 1 about what to do. We watched digital pure-play companies turning into unicorns as they hoovered up the newspaper classified businesses while the newspapers began loading their expensive journalism onto fledgling Web sites for free.

Then mobile phones got smarter, and Facebook appeared. Ads struggled for attention on shrinking screens and yields as Zuckerberg sold hope and everyone’s personal data.

This was Act 2, when too many media companies lay down their weapons to look on in awe at the Silicon Valley tech magicians. They gladly handed over massive chunks of their digital distribution and readers’ details to Facebook and Google, who returned the favour by basically nicking everything else for nothing — stories, photos, and video. We’d been down this road before — newspapers letting distributors control the data and relationship with subscribers.

While this was happening, people actually got into the vital habit of paying for subscription services, Spotify and Netflix among them. This was an important change in consumer behaviour.

Which brings us to the beginning of Act 3. And it’s opened with a bang this year.

We are seeing media companies finding their inner mongrel again across the globe. They’re fighting hard for their patch, often alongside former rivals, while increasingly calling out the bullshit in front of them. At the same time, governments, regulators, and, most importantly, people are waking up to what’s been going on.

Don’t underestimate the importance of this moment — both for media companies and our wider society.

The value of original journalism is being recognised. The value of captivating storytelling is being recognised. Yes, costs and revenue are under pressure. But the core value proposition between journalists and readers hasn’t changed.

What has long been expected but a long time in coming — the credibility and lack of responsibility of companies like Facebook — is now under voracious scrutiny.

What was once seen as whining about the behaviour of Facebook from sore losers is now rippling around the world into legitimate concern. Hardly a day goes by now without another scandal being exposed at Facebook. Its lack of self-regulation and responsibility with personal data has been truly astounding but hardly surprising.

The Cambridge Analytica data scandal. Russian manipulation of the U.S. election. Fake news. Zuckerberg’s belated damage control. Discriminatory job ad targeting. Selling users’ emotional state to advertisers. The failed fact-checking programme. Lack of transparency. The list goes on.

The genie is now well and truly out of the bottle, and Mark Zuckerberg is furiously trying to stuff it back in. Or, as Tony Soprano once put it a little more bluntly: “You can’t put the shit back in the donkey.”

I’ve often said one of biggest selling points of media companies is trust — that invisible handshake agreement we have with readers and advertisers.

While we sell trust, the social platforms have been saying “trust us.”

What we are seeing is that trust in them is under threat. And the biggest threat of all is people may just stop clicking on the blue app.

The Act 3 plot twist is well and truly in motion.

About Michael Beach

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