Meta's News Breakup: Is Facebook's Love For The Media Over?

Zinger Key Points
  • Facebook-parent has taken a significant step that could signal the end of its longstanding relationship with the news industry.
  • Meta's strategy appears to be shifting, with news and politics being given lower priority on its social media platforms, including Threads.
  • This has led to tensions between Meta and governments, mainly in Canada, where legislation requires it to pay publishers for their content.

In a not-so-surprising turn of events, Meta Platforms Inc. META, the parent company of Facebook, has reportedly taken a decisive step that could mark the end of its longstanding association with the news industry

What Happened: Meta had attempted to placate influential publishers for years by funding non-profit journalism projects and striking deals with media giants like Rupert Murdoch’s News Corp

However, recent developments indicate a shift in strategy as Meta now gives lower priority to news and politics on its social media platforms, reported Financial Times citing people familiar with the company’s strategies. 

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The company’s latest endeavor, Threads, links users’ profiles on the platform to existing Instagram accounts. More importantly, Threads’ algorithm closely mirrors Instagram’s, prioritizing content from creators and friends over hard news and politics.

Instagram chief Adam Mosseri has also said that they don't intend to do "anything to encourage" news on the platform.

This shift in focus has sparked tensions between Meta and governments, particularly in Canada. 

"The company is running the very real risk of losing more in revenue than they would pay news businesses under the Online News Act," said Paul Deegan, CEO of Trade Association News Media Canada. 

What Likely Prompted Meta To Take This Step: Canada’s legislation mandated platforms like Meta's Facebook to pay publishers and broadcasters for their content, prompting the company to announce plans to remove news from its feeds in the region. As a result, over 30 advertisers in Canada, including government entities, have pledged to withdraw their advertising in protest.

Prior to its recent decision to cease news sharing in Canada, Meta had already shown a precedent for such actions. The company previously warned about potentially blocking access to news articles in California. At the time, the move came in response to the introduction of the California Journalism Preservation Act, a proposed state legislative bill.

While some argue that Meta’s users prefer short-form videos and content from influencers over news and politics, publishers dispute the claim, asserting that news content boosts user engagement, the report noted. 

"We're going to hit a tipping point where the decision to ‘unfriend' Canada is going to be bad for users, bad for shareholders, and bad for Meta's reputation globally," Deegan said.

Why It’s Important: Previously, Canadian Prime Minister Justin Trudeau slammed Alphabet Inc.’s GOOG GOOGL Google and Meta for resorting to “bullying tactics” against the country’s push to ensure financial support for news publishers.

In June, Google’s president of global affairs, Kent Walker, expressed his dissatisfaction with the Canadian Parliament’s passing of the Online News Act, stating that it is “unworkable” and could expose the company to extensive financial liability.

Image Credits- Shutterstock

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