Attention economy: Facebook delivers traffic but no money for news media

Facebook and quality journalism are uneasy companions. Recent headlines suggest the platform’s “lies” about video metrics “smashed” journalism and the platform “crashed and burned” news companies’ referral traffic after it changed its algorithm in January.

The Australian Competition and Consumer Commission is currently holding a digital platform inquiry to investigate what kind of impact social media platforms, search engines and other content aggregators have on the local media market. In the United Kingdom, the Cairncross review is assessing similar issues, looking for ways of sustaining high-quality journalism in a changing market.

My research suggests these enquiries should pay attention to the impact of Facebook and the lessons we’ve already learned about the social platform.

Read more: Class action against Facebook over facial recognition could pave the way for further lawsuits

Lesson one: overstated metrics

You should not trust all the metrics platform companies offer.

A recent article in The Atlantic revealed that a lawsuit has been filed against Facebook, because it allegedly overstated its video statistics for years, “exaggerating the time spent watching them by as much as 900% percent.”

The article asserts that “hundreds of journalists” lost their job after Facebook lured news companies to invest in video. However, Facebook has denied these claims.

The Spinoff, a digital native media company in New Zealand, recently posted a story with a similar analysis of the platform’s impact, saying that Facebook’s fake video statistics “smashed New Zealand journalism” because when it encouraged news companies to invest in online video production, they followed.

New Zealand media were collateral damage in Facebook’s obsessive desire to grow at all costs.

Read more: How to stop haemorrhaging data on Facebook

Lesson two: traffic dependency

You should not rely on Facebook traffic.

A recent report by the Tow Center for Digital Journalism shows that in the United States, news companies have a substantial presence on Facebook. The report found that roughly 80% of the local news outlets are using the social platform.

Additionally, two recent studies demonstrates how news companies rely on Facebook to drive their traffic. My own research of four New Zealand news companies shows that 24% of their traffic came from social media, and most of that came from Facebook. Together social and search drove 47% of New Zealand news sites’ traffic.

A larger study of 12 newspapers and broadcasters in Europe, conducted by Reuters Institute for the Study of Journalism, notes:

… news organisations are making major investments in social media and report receiving significant amounts of traffic" from social media.

These studies confirm news companies’ Facebook dependency in terms of traffic, although the level of dependency differs between media outlets. The Reuters study found that Facebook’s algorithm changes in January had a severe impact on some of the news companies’ traffic. However, the severity of impact differed between media outlets. For example, Le Monde saw its interactions drop by almost a third, but for The Times these grew.

In New Zealand, The Spinoff suffered a substantial drop in its traffic after Facebook’s algorithm tweaks: its traffic from the platform dropped from 50% to 30%. We have seen similar drops in other markets, too.

The Nieman Lab, which reports on digital media innovation, found that following Facebook’s algorithm change, the drop in referral traffic was not universal. Some not-for-profit media organisations benefited.

Bottom line: The decline in referrals to publishers from Facebook is not universal, and in the face of those declines, other sources of traffic are more important than ever.

Indeed, it would be wise for all news outlets to grow their direct traffic which delivers better user engagement and monetisation.

Lesson three: don’t do it for the money

You don’t make much money on Facebook.

My research suggests if news companies abandoned Facebook, they would hardly lose any money. For the companies studied, social media traffic made up 0.03%–0.14% of their total revenue, and social shares 0.009%–0.2% of total revenue. These figures don’t take into account advertising income from platforms or subscription conversion.

The reason news companies continue to distribute their content on social media platforms is because they gain attention. News companies believe they can turn this attention into money, but so far with little success.

However, some news publishers have reported that they have gained digital subscriptions from the platforms. The Reuters study notes Facebook delivers news companies audience engagement that is “considered more cost effective at driving digital subscription sales.”

The bottom line is there is no data yet to verify how well news publishers manage to convert social media attention to digital subscriptions. Google, Facebook, Amazon and Apple are all offering, or are in the process of offering, digital subscription services to news publishers, but how well these will work for news companies remains to be seen.