maglog

By Terry McMullan Publisher

When Insurance News launched 11 years ago, Facebook was a useful and entertaining online platform in the early stages of learning how to screw billions of dollars in revenue out of advertisers by tailoring its advertising to customers’ individual interests. Who could have foreseen that 10 years later it would close down every Australian news site, including Insurance News, rather than negotiate with publishers in Australia.

Now that the dust has cleared and Facebook has backed down for the time being, it’s worth looking at the ways the so-called digital giants interact with the companies that provide the material they republish and sprinkle their ads all over.

Did I say interact? I meant ignore.

Facebook is a tremendously powerful machine operated by a man who still dresses like a college kid but mainly just looks confused.

Mark Zuckerberg isn’t an inspirational genius like the late Steve Jobs, and neither is he a hard-headed, laser-focused innovator and businessman like Jeff Bezos. He’s just a guy who allegedly stole* an idea that coincided perfectly with the growth of the internet. But for some reason he hasn’t yet finessed the art of balancing awesome reach and power with the realities of the world.

For example, had Facebook (and Twitter) acted intelligently from the start towards Donald Trump and his stream of unhinged tweets and posts, would the United States have got into the sort of mess that led to the invasion of the Capitol in Washington in January?

So with that in mind we shouldn’t be too surprised that Zuckerberg made the decision he did when it came to new Australian legislation that would force the digital giants, especially Google and Facebook, to strike a deal to share the advertising revenue with Australia’s major news publishers.

The publications get their articles out there, but at present Google and Facebook keep all but a small percentage of the ad revenue.

While Facebook’s reaction to the legislation was spiteful, Google’s threat to withdraw from Australia for the same reason would have hurt far more Australian businesses had it gone ahead. Which should give us pause to consider whether these US companies should have been allowed to scoop up and bury any potential competitors until they grew to a size where they could behave like Benito Mussolini.

I’m indebted to my friend Nassim Khadem, an Insurance News alumnus who is now ABC News’ Business Reporter, for pointing me to her own article on the Facebook fracas, which shows that Zuckerberg’s baby is nowhere near as important to publishers as Google.

Using the Australian Competition and Consumer Commission’s Digital Platforms Inquiry report, she shows how 34% of referrals to the websites of Australian print/online and online-only in 2017/18 came from Google, while only 16% came from Facebook.

Last year we published 2678 articles online, 26 of them Breaking News and those articles have been read 7.7 million times. We have just under 30,000 subscribers and 35,000 LinkedIn followers and our articles are regularly picked up by Google News.

We just see that as part of being accessible to subscribers and readers. We’re not hanging our future on getting a cent from the ads Facebook and Google sprinkle around articles like confetti. Having seen the damage done by Google a few years ago when it decided to move in on small businesses and downgrade them to the back pages of their search engine, we don’t think any of the digital giants have a conscience.

As an independent publisher our focus has always been on attracting the largest possible audience through the quality and value of our journalism – which also ensures we give our advertisers the best access to the people they want to reach.

Nassim says small news publishers who are heavily reliant on referrals to their news sites from Facebook would have suffered from Zuckerberg’s ridiculous dummy-spit.

We didn’t, thanks to the strong support of advertisers, the industry and our readers.

History shows that while Facebook and Twitter are top of the heap at present, it’s still consumers who drive the digital universe.

New platforms and concepts are emerging all the time, and somewhere right now someone is toiling in their parents’ garage developing the next big thing in online person-to-people communications that will diminish the power of Facebook – if the digital giants are prevented from buying it for themselves.

For Insurance News, the digital future isn’t reliant on the digital giants. Our plans include such things as podcasts and whatever other innovations will best serve our readers’ interests. And in a world that’s changing so fast, who knows where that might take us?

* Be sure to read Ben Mezrich’s excellent book “The Accidental Billionaires: The Founding of Facebook, a Tale of Sex, Money, Genius, and Betrayal”.