Will beating Meta be enough to save news media?

Forcing Meta back to the bargaining table is a necessary first step, but structural ad market issues remain.

David Kennedy · Venture Insights28 June 2024Period: June 20244 min read

32%↓

Proportion of online Australians using Facebook for news (2024)

150↓

Positions cut by Seven West Media following Meta's decision

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Abstract

This report examines the impact of Meta's decision to cease news licensing agreements in Australia. While Meta claims news represents less than 3% of feed content, 32% of online Australians still rely on the platform for news access. The brief argues that while government intervention via the News Bargaining Code is essential to prevent immediate industry contraction, it will not solve the deeper structural imbalances in the programmatic advertising market dominated by tech giants.

Key Takeaways

Meta's refusal to renew news deals is expected to lead to its 'designation' under the News Bargaining Code by the Australian Government.
Despite Meta's claim that news is only 3% of feed content, 32% of Australians still rely on Facebook for news access.
Seven West Media has already cut 150 positions, citing the impact of Meta's withdrawal from news funding.

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Frequently Asked Questions

While Meta claims news represents less than 3% of feed content, 32% of online Australians still rely on the platform to access news. This creates a significant discovery gap that threatens the reach and relevance of traditional publishers.

The impact is already visible through major workforce contractions, such as the 150 positions recently cut by Seven West Media. Furthermore, the industry stands to lose the equivalent of A$115 million in referral traffic value that Meta currently provides to news sites.

Government 'designation' under the News Bargaining Code acts as a necessary short-term liquidity backstop but does not address the core issue. The ACCC has identified deep structural imbalances in the programmatic advertising market that licensing deals alone are unable to fix.

Evidence from other markets suggests news consumption habits are highly resilient to platform changes. In Canada, 25% of users continued to use Facebook for news even after the platform implemented a total block on news links.

Will beating Meta be enough to save news media?

Abstract

Key Takeaways

Frequently Asked Questions

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