Adviser Update Adviser Update Spring 2017 | Page 13

13 single most controversial, influential and secretive algorithm in the world is the one that drives the Facebook News Feed” for “while publishers can freely post to Facebook, it is the algorithm that determines what reaches readers.” The lure of social media platforms for news publishers is understandable, given their size and reach. Today, more than 62 percent of the U.S. population gets some of its news from social media. Facebook alone has 1.9 billion users worldwide and, as the report says, “No publisher in the history of journalism has enjoyed the same kind of influence over the news consumption of the world.” Social media and search companies are in the business of generating huge user bases to attract digital advertising, which is rapidly replacing the print advertising that long supported news publishers. But news, while important, is only a small part of their offering. “The essential nature of journalism has not changed; it is still about reporting stories and adding context to help explain the world,” the Tow Center report stresses. “But now it is threaded through a system built for scale, speed and revenue. The platforms’ business model incentivizes ‘virility’—material people want to share—which has no correlation with journalistic quality.” In this rapidly changing news environment, Ms. Bell and Mr. Owen see not only threats and challenges to traditional journalism but also, in MARK ZUCKERBERG the wake of a presidential election that produced a wave of “fake news” revelations, “an immediate opportunity to turn the attention focused on tech power and jour nalism into action.” Led by Facebook and Google, platform companies have “been proactive in starting initiatives focused on improving the news environment and issue of news literacy,” even as “more structural questions remain unaddressed.” In late February, Mark Zuckerberg, Facebook’s founder and chief executive officer, went out of his way to thank “all the journalists around the world who work tirelessly and sometimes put their lives at danger to surface the truth.” If news organizations are going to remain autonomous, the Tow report notes, “there will have to be a reversal in information consumption trends and advertising expenditures or a significant transfer of wealth from technology companies and advertisers”—developments that, at this point, seem little more than wishful thinking. A major issue facing news companies is whether to continue maintaining their own costly “publishing infrastructure, with smaller audiences but complete control over revenue, brand and audience data” or to cede control “in exchange for the significant audience growth offered by Facebook and other platforms.” The Washington Post and The New York Times have been trying both to use social media platforms to attract new readers and revenue as well as to encourage heavy users to become direct subscribers to the full digital editions on their own websites. Yet, such a path for metropolitan newspapers without national aspirations and small and mid-sized publishers appears much more difficult, if not impossible. “Despite new opportunities and publishing models offered by the huge variety of platforms, most news organizations have not been able to find reliable return on investment,” the report concludes. “The current progression of publishers into the social world is creating two types of news organizations: one that maintains and develops its own presence, subscriptions and destination sites, and one where publishing stops being the activity which is used to support journalism.” None of this bodes well for the future of American journalism or our democracy.