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Publishers Won’t be Getting Much in the Way of Ad Revenues From Facebook , But They’re Going to Have to Go Along Anyway

4815259737_4b08662719_oFacebook has been talking about hosting news and other web content for well over 6 months now and the last piece has fallen into place.

On Friday the WSJ finally said the word that could make or break this program. Many of the details are still vague, but the report said:

Facebook is offering to let publishers keep all the revenue from certain advertisements, in a bid to persuade them to distribute content through the social network, according to people familiar with the matter.

Many publishers now post links to their content on Facebook, which has become an important source of online traffic for news sites. But opening those links on a mobile device can be slow and frustrating, taking around eight seconds.

The Facebook initiative, dubbed Instant Articles, is aimed at speeding that process, people familiar with the matter said. Facebook plans to start hosting news and videos from BuzzFeed, The New York Times, National Geographic and other publishers as early as this month, those people said.

I was wondering when we were going to hear the discussion turn to talk of money.

It’s all well and good to talk of whether it is wise to tie yourself to a gaping maw like Facebook, but you don’t know if the deal is practical or even possible until after someone starts talking about finances.

And with most news sites (and Facebook) funding themselves through the sale of adverts, that means that Facebook’s plan can’t go through until ad revenues are discussed.

That hasn’t quite happened yet; we’re only hearing vague generalities, but not specifics. "Sources" are saying that in "one of the models under consideration, publishers would keep all the revenue from ads they sell on Facebook-hosted news sites". If Facebook sells the advert, it will get to keep all the money.

That doesn’t sound like a terribly good deal, but the fact of the matter is publishers will have to take the deal anyway.

As Quartz informed us some months ago, there is a growing population of Facebook users who don’t know that they are on the internet. For example:

Indonesians surveyed by Galpaya told her that they didn’t use the internet. But in focus groups, they would talk enthusiastically about how much time they spent on Facebook. Galpaya, a researcher (and now CEO) with LIRNEasia, a think tank, called Rohan Samarajiva, her boss at the time, to tell him what she had discovered. “It seemed that in their minds, the Internet did not exist; only Facebook,” he concluded.

To be fair, some of those users may be accessing FB through its apps so they are technically not online, but that doesn’t change the fact that they do not venture beyond Facebook’s walled garden.

This growing body of Facebook residents, both in the US and out, are why some publishers feel that they have to get into bed with Facebook.

I think they’re wrong, and that they’re basically committing the same mistake that book publishers got into with retailers. But as I look at the Quartz data, I can see where they’re coming from.

images by mkhmarketingdkalo



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