FACEBOOK, SNAPCHAT DEALS PRODUCE MEAGER RESULTS FOR NEWS OUTLETS

[1/24/17]  Newspapers and other media outlets are struggling to make money from their partnerships with tech giants like Facebook and Snapchat, raising concerns over their business models in a news landscape increasingly dominated by social media platforms.

Some publishers are scaling back on Facebook Inc.’s Instant Articles program, in which they host stories directly on the social-media company’s platform instead of their own websites so they load faster on phones, according to a report by Digital Content Next, a trade group.

Media companies are frustrated that Facebook restricts the number and type of ads in Instant Articles, making it harder for them to make as much money as they can selling ads on their own websites, where they can better target readers, said the group, whose members include the New York Times, the Washington Post and ESPN. Bloomberg News, a unit of Bloomberg LP, is also a member of the group.

Digital Content Next found that 17 of its members generated an average of $7.7 million in the first half of 2016 from third-party platforms, or 14 percent of their total digital revenue. Publishers still “express deep ambivalence” about Facebook’s commitment to helping them make money on the social media platform, the report said.

“On the most basic level, publishers are being disintermediated, losing their relationship with their audiences, and they fear that Facebook will further encroach on their traditional businesses,” the report said.


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