News Publishers Have Value Proposition Backwards on Facebook and Google

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Maybe you’re following the discussion of the proposed Australian legislation that would require digital platforms such as Facebook and Google into negotiations to establish a price to be paid for news content that appears on their sites.

A lot is at stake in how the world follows on as to Australia and how business models are developed to compensate various parties in this new age of news content circulation.

Binding and mandatory arbitration clauses with awards that may favor news publishers may mot be not be the answer.

As reported by Mike Isaac and Damien Cave in this morning’s New York Times, Google began striking its own deals with media companies such as Reuters, The Financial Times and Rupert Murdoch’s News Corp.

Facebook did just the opposite. Facebook turned off users’ ability to share local and international news stories on its social network.

Per Issac and Cave,

Facebook has repeatedly argued that the law gets the value proposition backward because it has said it is the one that provides value to news publishers by sending traffic to media websites, which can then be monetized with advertising.

I tend to agree with Facebook, though we’ve yet to arrive at the right business model.

Historically, The New York Times circulation came via print. Print at a huge expense and print that had to delivered via trucks, newspaper vending machines and the like.

Those costs have largely been eliminated.

In the last ten years, news publishers have benefited in a new way of circulation, people circulating their stories from person to person via social social media platforms.

Social media platforms that do drive readers to news publishers.

I’ve subscribed to the Seattle Times, digital version, because of stories I’ve seen shared on Facebook. I am about to do the same for The Atlantic.

I would never have considered subscribing to either but for Facebook’s demonstrating their value.

Just like we don’t go to the mall to buy everything (or in my case, anything), we don’y get our “print news” the same. Many of us get our news from people we trust, our fellow users – and the algorithms – on social networks.

Because we aren’t going back, it’s just figuring out the business model, not hardball legislation that’s likely to be a loser for all – readers/users, news publishers, and the social networks.

Facebook has turned the lights back on, as Isaac and Cave report.

Campbell Brown, Facebook’s Vice President of global news partnerships, said in a statement that the social network was restoring news in Australia as “the government has clarified we will retain the ability to decide if news appears on Facebook so that we won’t automatically be subject to a forced negotiation.”

Bold statement by Facebook, “…The social network was restoring news in Australia…”

Not far from the truth.

Trial lawyer turned legal tech entrepreneur, I am the founder and CEO of LexBlog, a legal blog community of over 30,000 blog publishers, worldwide. LexBlog’s publishing platform is used on a subscription basis by over 18,000 legal professionals, including the largest law firm in each India, China and the United States.

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