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May 11, 2012, 10 a.m.
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This Week in Review: Facebook social apps’ dropoff, and AOL’s Huffington Post dilemma

Plus: News Corp.’s ongoing problems and growing profits, one publisher’s disillusionment with apps, and the rest of the week’s must-reads in media and tech.

Slideshows, Facebook apps, and annoyed readers: After a few weeks revolving around News Corp., the media-watching world seemed to fixate on The Washington Post this week, focusing specifically on two developments: First, Adweek’s Lucia Moses reported that several top Post editors and reporters met with the newspaper’s president, Steve Hills, and that among other things, he urged them to produce more pageview-grabbing slideshows.

The Atlantic Wire’s Alexander Abad-Santos called it “one of the more disturbing things you’ll hear from someone in charge of one America’s best papers,” and his colleague, Alexis Madrigal, further explained the futility of slideshows. Those slideshows, he argued, may be producing more pageviews, but they’re not actually drawing more people. And the people that do read them come away with the feeling that the site doesn’t value them. “People know when your product is cheap; there is no ‘trick’ of the web,” he wrote.

The second development came when Forbes’ Jeff Bercovici reported that the number of users of its Facebook Social Reader had dropped precipitously over the past month or so. BuzzFeed’s John Herrman noticed that a lot of other Facebook social apps have experienced a similar drop, including The Guardian’s, and proposed that the decline might be because the apps just enable too much sharing, even for Facebook: “they felt more like the kind of cold, descriptive, invisible and yet mandatory services we’re used to seeing from Google rather than genuinely new and useful tools for spreading information.” SF Weekly’s Dan Mitchell agreed, calling the apps “spam, basically.”

But there seemed to be something amiss with such a simple explanation. Jeff Sonderman of Poynter noticed that there was a huge change in most apps’ statistics around April 10, and TechCrunch’s Josh Constine hypothesized that the drop was a result of Facebook’s transition to “Trending Articles,” which made social reader articles much less prominent in users’ news feeds. That theory was confirmed by editors at the Post and the Guardian, as the Lab’s Justin Ellis found.

From this explanation came a different lesson for news orgs — as GigaOM’s Mathew Ingram argued, with a social reader, “Facebook owns you, in the sense that it controls access to your content. It controls who sees it and when, and it controls how it is displayed — or even whether it is displayed.” Sonderman made a similar point and also touched on the user annoyance issue.

Facebook, for its part, countered that engagement on many of its social apps is up, and Poynter’s Andrew Beaujon pointed out that even though there was a valid logistical explanation for the user decline, many observers still insisted on sticking to user annoyance as the root cause.

This week, on ‘as AOL turns’: AOL’s been providing us with a steady supply of drama over the past couple of years, and this week came the latest bits of maneuvering: A month after she was reported to have gained more power in an executive reshuffling, Arianna Huffington acknowledged at a conference that her role at AOL has been shrunk back to just The Huffington Post, as The Wall Street Journal reported. (When AOL bought HuffPo, she had been put in charge of all of the site’s editorial content, though some of its brands have since been folded into HuffPo.)

As Huffington told it, she asked for the role reduction as an attempt to focus more specifically on HuffPo and gain more independence for her site. She also said she’d been approached by private-equity firms trying to buy HuffPo from AOL, though she said nothing had come of it. Huffington insisted her relationship with AOL CEO Tim Armstrong was fine, but others were skeptical. New York magazine’s Joe Coscarelli said it’s tough not to see this as “a crack in the facade of a relationship many believed to be doomed from the start.”

GigaOM’s Mathew Ingram was similarly dubious, and he also explored some possibilities for a HuffPo sale, concluding that Huffington will either take her site private again or end up taking over the whole operation at AOL. Forbes’ Jeff Bercovici wondered why AOL doesn’t just sell HuffPo anyway, but reasoned, as Ingram did, that AOL has invested all of its content resources into HuffPo, leaving the company with very little in the way of media if it were to sell. AOL, he argued, overpaid for HuffPo on the premise that it could replicate the site’s model across its other properties, which hasn’t panned out.

AOL also announced its most recent quarterly earnings, which were higher than expected, though one of its key ad metrics was down, and, as All Things D’s Peter Kafka reported, its traffic continues to slide. Meanwhile, PandoDaily (made up largely of ex-TechCrunchers) reported that AOL is shopping TechCrunch and Engadget for $70 million to $100 million. Armstrong denied that, and TechCrunch said the rumors of a sale actually originated from AOL’s aborted plans to spin the two blogs into their own company.

A deepening scandal and rising profits for News Corp.: It was a quieter week for News Corp. after the whirlwind of the last few weeks, but there were a few smaller developments. The company’s British newspaper division missed another deadline for its latest government accounting report, and its second-biggest investor, Saudi Prince Alwaleed bin Talal, voiced his frustration with the phone hacking scandal’s influence on the company. Here in the States, 70,000 people have signed a petition to ask Congress to investigate the scandal for potential breaches of U.S. law.

Amid all this, News Corp.’s profits keep growing. Its net income grew 47 percent, and its profits, announced this week, beat analysts’ estimates. The company’s costs from the scandal keep soaring, too, hitting $167 million since last summer. The New York Times’ David Carr said News Corp.’s continued profits and its board’s ongoing support of Rupert Murdoch might make him still seem invincible, but he’s still on an irreversible fall. He pinned much of blame for News Corp.’s tone-deafness on the board, saying that “the primary reason Mr. Murdoch has not been held to account is that the board of News Corporation has no independence, little influence and no stomach for confronting its chairman.” Former Times editor Bill Keller, meanwhile, said Murdoch’s greater shame will be Fox News’ pretensions at honest journalism.

Reading roundup: A few smaller stories running a little bit more under the radar this week:

— Jason Pontin of Technology Review wrote a piece on how publishers have grown disillusioned with apps after expecting them to do so much to restore their old business models, concluding regarding his own publication’s app experience: “I hated every moment of our experiment with apps, because it tried to impose something closed, old, and printlike on something open, new, and digital.” GigaOM’s Mathew Ingram echoed Pontin’s discontent with apps, and Dave Winer and Doc Searls touted the superiority of rivers of news over apps.

— The New York Times’ Binyamin Applebaum documented the frenetic daily routine of Business Insider blogger Joe Weisenthal, and Reuters’ Felix Salmon responded that Weisenthal’s style isn’t something indicative of bloggers in general, but unique to his distinctive personality.

— Finally, Belgian developer Stijn Debrouwere wrote a fantastic post on the astounding number of ways that journalism is being chipped away at by services and sites that aren’t journalistic themselves, but that are being consumed by people instead of news. Give it a read — it’s probably the best piece about the state of journalism yet this year.

POSTED     May 11, 2012, 10 a.m.
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