Tag: Facebook

  • Journalism in the Twenty-First Century

    Journalism in the Twenty-First Century

    Today I’ve been invited to appear before the Australian Senate’s committee on the Future of Public Interest Journalism. Here’s my planned opening remarks looking at the challenges facing media organisations, particularly in an Australian context.

    I’d like to start off by pointing out I’m not a career journalist, I fell into the media industry through a series of happy accidents starting with appearing on ABC Radio to discuss the Y2K bug twenty years ago, this evolved to where I’m now a freelance contributor to all the major Australian media outlets.

    As a longstanding contributor to various ABC stations across Australia ranging from ABC Darwin through South Australia’s Riverland to the national Nightlife program where the hosts pretend to be floating somewhere above Middle Australia rather than admit they are in the Sydney studio, I have seen some profound changes within the organisation.

    Due to cost cutting and political interference, the organisation has steadily seen power and resources concentrated in the Sydney head office to the detriment of local coverage and regional stations.

    To be fair to the ABC, the same process has happened in commercial media – in print, radio and television – as flawed policy decisions over the last forty years have seen market power accumulating in Sydney and Melbourne at the expense of local content, diversity and regional coverage.

    Wasting the digital dividend

    One of the great missed opportunities of our time was the gifting of the digital TV spectrum to the established radio and TV operators.

    The digital broadcasting switch was an opportunity to bring diversity back into Australia’s media landscape and spur both journalism and the creative industries.

    A few minutes watching what the Free To Air networks have done with those new channels shows how that resource has been squandered.

    This concentration of market power has left Australian media organisations saddled with a protected and well paid breed of managers incapable of responding to the threats posed by US and Chinese social media networks – not to mention streaming services like Netflix or the continuing catastrophic declines in advertising revenues.

    Journalism as a team effort

    Producing quality media to compete globally is a team effort. Good journalism isn’t just the result of good reporters, it requires good sub-editors, producers, researchers, photographers and a small army of other skilled workers. Not to mention strong, principled editors and station managers.

    The media industry’s casualisation, something as freelancer I’ve encountered the brutal reality of, makes it difficult to develop those skills. The ABC is a good example of this where, outside of management and administration, there are few salaried staff aged under 40. This has great ramifications for the workforce, industry and the community.

    It’s difficult to see what governments can do in the face of the global industry’s changing economics, particularly in the advertising industry’s shift.

    We should keep in mind however if we were having this discussion a hundred years ago we would have been asking how people can make money from radio. Entrepreneur David Sarnoff who founded Radio Corporation of Australia figured out the commercial broadcasting model in the 1920s and that industry went on to become one of the most profitable of the last century.

    So it may well be that encouraging a new generation of media entrepreneurs and journalists who can figure out 21st Century business models can be the best thing Parliament can do to ensure a diverse media culture that tells modern Australian stories to today’s Australians.

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  • Monopolies and innovation

    Monopolies and innovation

    An interview with Media scholar Jonathan Taplin, author of the new book Move Fast and Break Things, on the Pro-Market website poses some interesting questions about the direction of the digital economy and innovation as market power coalesces around the big four internet giants. 

    This power is particularly marked in online media with Facebook and Google pocketing most of the global advertising spend which leaves little for content creators.

    I kept coming back to these three—Google, Facebook, and Amazon. All have extraordinary market shares. Google has an 88 percent market share in search advertising and an 80-plus percent market share in Android. Amazon has a 74 percent market share in e-books, and Facebook controls 70-plus percent of mobile social media when you add Instagram, Messenger, and WhatsApp. What more empirical evidence does one need to prove concentration?

    Over the past decade we’ve seen the power of the big four online gatekeepers growing although ironically Apple’s light seems to be dimming as the company’s innovative vision fades following Steve Jobs’ passing.

    The monopoly problem is broader than just the tech industry though, as The Atlantic pointed out last year, market dominating corporations are suppressing innovation throughout the US. The problem is even greater in Australia and some other countries.

    The rise of the monopolies shouldn’t be a surprise as the neo-liberal policies of the United States and most of the western world for the last 40 years have been largely focused on increasing the wealth and power of corporations and their managers. It’s fair to say those policies have been successful.

    Where we go next is the big question. An economy dominated, and suffocated, by a handful of well connected and powerful corporations is not going to drive wealth creation, particularly in a world where more businesses functions are being automated.

    One short term step may be to break up the monopolies, something that Taplin himself suggests.

    This just goes to show how quickly the ground is shifting. I now have a piece coming out in the New York Times that explores the idea of breaking them up, but when writing the book, I tried to be reasonable. I thought no one would buy the idea of breaking them up. And now people are raising that idea.

    While that’s a start there’s vastly more that needs to be done from bankruptcy reform – the last 40 years have seen governments make it harder for small businesses and households to seek financial protection – through to intellectual property reform.

    Generational change may turn out to be the solution though as the lucky generation of business and government leaders – those born between 1935 and 55 – responsible for the ideology and policy that allowed such an accumulation of corporate power move on.

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  • Counting the digital pennies

    Counting the digital pennies

    With media companies around the world struggling to make money, the publishing platforms on Facebook and Google promised to bring in much needed income streams. They appear not to have worked.

    Business Insider reports how US based premium publisher trade body Digital Content Next surveyed its members on their online platform income and discovered some disappointing answers.

    On average, premium publishing companies generated $773,567 in the first half of 2016 by distributing their content on YouTube. Content published to Facebook earned an average of $560,144 in the period, Twitter generated an average of $482,788, and Snapchat generated $192,819 for each publisher in the sample.

    To call these returns derisory is an understatement and it illustrates how the current media model is unsustainable as it’s impossible to sustain a basic newsroom, let alone produce investigative features with those sort of budgets.

    It isn’t just the media model that’s unsustainable, Business Insider cites the CEO of Digital Content Next, Jason Klint, who flagged in a blog post last year that all the growth in digital advertising is being accounted for by Facebook and Google – the rest of the industry is shrinking.

     

    Even Facebook and Google aren’t immune from the unsustainable model that’s currently in place, Klint points out that fraud and intermediaries further skew the model which undermines advertisers’ confidence in the platforms and online media in general.

    For the moment though, the intermediaries seem to be doing okay. Klint cites IAB research which claims AdTech companies are making 55% of the online advertising industry’s revenues while publishers are only getting half.

    That illustrates how the tail is currently wagging the dog with publishers and content creators losing out while middlemen who add little in the way of value get the bulk of the revenue. That too is not sustainable.

    We’re still in early days for online media and the models are still being worked out. While we wait for the 21st Century’s David Sarnoff many sectors are threatened including the advertising, marketing and PR industries. At least the publishers aren’t alone.

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  • Goodbye to Yahoo!

    Goodbye to Yahoo!

    And so Yahoo!’s journey comes to an end with the company being renamed Altba and most of its operating assets given over to Verizon.

    With the changes both CEO Marissa Mayer and original co-founder David Filo will leave Altba’s slimmed down board.

    Mayer’s failure is a lesson that being an early employee at a successful, fast growth tech startup isn’t a measure of leadership. It may even be a hindrance given companies like Google were inventing new industries during her tenure there which develops different management skills to what a business like Yahoo! needs.

    The biggest lesson of Yahoo!’s demise is how even the most powerful online brands isn’t immune from disruption itself, with what was once the internet’s most popular website being eclipsed by Google and Facebook.

    Interestingly, as Quartz reports, Yahoo! is still one of the US’s most popular sites and only slightly behind Google and Facebook in unique monthly views.

    Despite this, Yahoo! has struggled to grow for 15 years and has struggle to make money although it remains a four billion dollar a year business.

    Which shows eyeballs aren’t enough for a mature web business, at some stage it has to show a return to justify its valuations.

    Among Yahoo!’s many properties remain some gems like Flickr and it will be interesting to watch what Verizon does with them. Sadly any successes will be tiny compared to what the company once promised.

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  • Trusting the web

    Trusting the web

    Following last week’s US election attention has fallen onto the role of Facebook in influencing public opinion and the role of rumours and fake news.

    The CEO of Facebook, Mark Zuckerberg, says claims that his company’s news feed influenced the US election are nonsense but, as Zeynep Tufekci the New York Times writes, the platform has shown in its own experiments that the service does influence voters.

    Sadly misinformation is now the norm on the web given anyone can start a blog and post ridiculous and outlandish claims. If that misinformation fits a group’s beliefs, then it may be shared millions of times as people share it across social media services, particularly Facebook.

    Facebook’s filter bubbles exacerbates that problem as each person’s news feed is determined by what the company’s algorithm thinks the user will ‘like’ rather than something that will inform or enlighten them.

    Those ‘filter bubbles’ tend to reinforce our existing biases or prejudices and when fake news sites are injected into our feeds Facebook becomes a powerful way of confirming our beliefs, something made worse by friends gleefully posting fake quotes or false news that happens to fit their world views. If you click ‘Like’, you’ll then get more of them.

    Over time, Facebook risks becoming irrelevant if the news being fed from the site becomes perceived as being unreliable

    For Facebook, and for other algorithm driven services like Google, the risks in fake news don’t just lie in a loss of credibility, there’s also the risk of regulatory problems when news manipulation starts affecting markets, commercial interests or threatens established power bases.

    The fake news problem is something that affects the entire web and its users, for Facebook and Google it is becoming a serious issue.

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