As 2019 comes to an end, we see that publishers have reevaluated their relationship with technology platforms. According to the Tow Center for Digital Journalism’s new report, Platforms and Publishers: The End of an Era, news publishers no longer expect scale and ad-based platform products to earn significant revenue or bring audience growth. Publishers recognize that monetizing traffic from posting a news story on Facebook is not a sustainable business model. Tow’s year-long research included 42 interviews with individuals from 27 news organizations (representing national and local outlets, national and local digital natives, broadcast, audio, and magazine), six platform companies, and one foundation.
According to the Tow report, this new publisher sentiment is a complete departure from a year ago, when publishers were still hopeful about partnering with platforms to help sustain the news business. Today, publishers report that they are examining internal business strategies and the rise of reader revenue to further revenue diversification (e.g. live events and podcasts) to regain control of their audiences.
Publishers are thoroughly assessing which platforms fit their needs best and identifying the necessary requirements for the platforms to meet. Tow’s research identifies four key explanations as to why publishers are more selective today about platform partnerships. They:
- No longer feel they are missing out if they choose not to partner with a platform
- Have seen insignificant return on investment from previous platform partnerships and products
- Better understanding of the extensive integration costs and expense of supporting third-party products
- Have greater recognition of the conflicting business models between publishers and platforms
Little fanfare for new platform products
Publishers note that platforms are closely following subscription growth in the marketplace and now offer their own subscription products. Last year Apple announced and launched Apple News+, a magazine and news subscription service at $9.99 a month. In their deal with publishers, Apple takes 50% of the revenue and the remaining is left to be divided among participating publishers.
Google rolled out a product called Subscribe with Google (it takes in the range of 5 to 15 percent of the revenue); and Facebook launched a paywalled version of Instant Articles. However, unlike previous rollouts of similar offerings, these overtures received little fanfare from publishers.
Platforms investment in relationship
Further, publishers recall Google’s and Facebook’s “goodwill initiatives” to help build stronger relationships with news publishers with healthy skepticism. In January 2019, Facebook committed $300 million to local news projects. In March, they kicked off with their first local news summit as an effort to address newsroom operations. At the same time, Google announced its commitment to local news and started a boot camp for eight local subscription publishers.
Then in May, Facebook announced that it was bringing its Digital News Initiative stateside by funding projects to help generate revenue and increase audience engagement for local news. And, in September, Facebook awarded “Community Network” grants, to support initiatives that connect communities with local newsrooms. Even with these significant investments (in the range of $1.0 billion in total) publishers remain very skeptical about the platforms’ commitment to journalism.
Publishers reinforce the basics
Publishers think a lot about the future. Undoubtedly, the platforms and their role in the online information ecosystem cannot be ignored. As seen in the Tow report, publishers present their new awareness in pragmatic terms. They are regaining control of how they publish and how they bring in revenue. Importantly, while publishers are not abandoning the tech platforms, they are much more carefully evaluating platform products in terms of business models, audience growth, and the editorial relationship.