In 2016, Facebook is eating the world.

The story so far.

1. People are increasingly using their smartphones for everything.

2. They do it mostly through a handful of apps, and in particular social and messaging apps, such as Facebook, WhatsApp, Snapchat, and Twitter. (Google recently discovered that while we might have an average of 25 apps on our phones, we only use four or five of those apps every day, mostly social media.)

3. Competitive advantage for platforms relies on being able to keep your users within an app. The more your users are within your app, the more you know about them, the more that information can then be used to sell advertising, the higher your revenues.

So what do you do? In the past year, Snapchat launched its Discover App, giving channels to brands like Vice, BuzzFeed, the Wall Street Journal,Cosmo, and the Daily Mail. Facebook launched Instant Articles, which it recently announced will be opened up to all publishers in April. Apple and Google quickly followed suit, launching Apple News and Accelerated Mobile Pages, respectively. Not wanting to be left out, Twitter also launched its own Moments, an aggregation of trending material on the platform to tell complete stories about events.

Now publishers can publish on these platforms and users can read their work, without ever leaving the site.

As publishers are being enticed to publish directly into apps and new systems, which will rapidly grow their mobile audiences, Apple has announced it will allow ad-blocking software to be downloaded from its App store.

In other words, if as a publisher your alternative to going onto a distributed platform is to make money through mobile advertising, anyone on an iPhone can now block all ads and their invidious tracking software.

Articles that appear within platforms, such as Discover on Snapchat or Instant Articles on Facebook, are largely, though not totally, immune from blockers.

Effectively, the already very small share of mobile digital advertising publishers might be getting independently from mobile is potentially cut out.  Facebook is their only option,. Or is it?

There are three alternatives for commercial publishers.

One is to push even more of your journalism straight to an app like Facebook and its Instant Articles where ad blocking is not impossible but harder than at the browser level. As one publisher put it, “We look at the amount we might make from mobile and we suspect that even if we gave everything straight to Facebook, we would still be better off.”

The second option is to build other businesses and revenues away from distributed platforms.  Membership or subscription are most commonly considered in this context. For this work you need a strong brand identity that subscribers feel affinity towards. In a world where content is highly distributed, this is far harder to achieve than when it is tied to packaged physical products. Even in the handful of cases where subscription is working, it is often not making up the shortfall in advertising.

The third is, of course, to make advertising that doesn’t look like advertising at all, so ad blockers can’t detect it. This used to be called “advertorial” or “sponsorship,” but now is known as “native advertising,” and it has grown to nearly a quarter of all digital display advertising in the US.

In fact, digitally native companies such as BuzzFeed, Vox, and hybrids like Vice, have disrupted the failing publishing model by essentially becoming advertising agencies—which are themselves in danger of failing.

 

The logical answer reached by many publishers to much of this is to invest in their own destination apps.

But there is a decent chance no one will read it – because people only read four apps.

This critical balance between destination and distribution is probably the hardest investment decision traditional publishers have to make right now.

As more and more publishers use Facebook’s Instant Articles another danger arises.

With billions of users and hundreds of thousands of articles, pictures, and videos arriving online everyday, social platforms have to employ algorithms to try and sort through the important and recent and popular and decide who ought to see what. And we have no option but to trust them to do this.

Right now, there is no transparency about how they do this.

As Emily Bell at the Columbia Journalism Review has pointed out, there are huge benefits to having a new class of technically able, socially aware, financially successful, and highly energetic people like Mark Zuckerberg taking over functions and economic power from some of the staid, politically entrenched, and occasionally corrupt gatekeepers we have had in the past. But we ought to be aware, too, that this cultural, economic, and political shift is profound.

We are handing the controls of important parts of our public and private lives to a very small number of people, who are unelected and unaccountable.

Unless these social media platforms are regulated people’s access to important news they need may whither, while the business of news will die completely.

Posting journalism directly to Facebook or other platforms will become the rule rather than the exception. Even maintaining a website could be abandoned in favor of hyperdistribution. The distinction between platforms and publishers will melt completely.

And social media platforms – and the billionaires who run them – will be all-powerful. Unless we act now.

Interested in digital training? Email Andy P now

Posted in: Digital Training, Infographic of the day, Strategy