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May 13, 2015, 11:49 a.m.
Mobile & Apps
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Facebook’s Instant Articles are live: Either a shrewd mobile move by publishers — or feeding the Borg

Nine publishers have signed on, hoping it’s a way to better monetize mobile traffic they struggle to turn into dollars. But is it a smart adjustment to digital reality — or a surrender?

I hesitate to roll one more boulder up Thinkpiece Mountain today, but the long-rumored publishing-natively-to-Facebook deal has finally arrived. Nine publishers — The New York Times, National Geographic, BuzzFeed, NBC News, The Atlantic, The Guardian, BBC News, Spiegel, and Bild — are involved, and top editors at many of them are in this Facebook promotional video for what it’s calling Instant Articles.

If you want to see what an Instant Article looks like, head to the Facebook app on your iPhone — or check out this video of one from the Times’ Alastair Coote:

(It’s worth noting that, while that article looks nice inside Facebook, it also looks good on the web.)

Facebook engenders a strong response in media people, who have a natural apprehension about this digital giant somehow gaining an even bigger role in their work lives. (Bloomberg’s Justin Smith: “The list is a lot longer than is publicly known of those that have Facebook delivering half to two-thirds of their traffic right now.”) And Instant Articles is an avatar of the broader trend toward distributed content — the idea that publishers will increasingly be distributing their content directly onto social networks and other platforms they don’t control.

A few stray thoughts below.

It does seem as though publishers negotiated a pretty good deal on user data. Being able to bring your own analytics to the table will make combining Facebook data and website data into coherent user profiles easier. But it’s unclear if publishers are getting any useful data beyond what their own analytics suites can provide — all the sweet, sweet user data that Facebook has.

This article from the Times’ Vindu Goel does the best job I’ve seen of explaining the nuts and bolts of how Instant Articles work.

Facebook has worked hard to integrate the technology with publishers’ content management systems. Essentially, the social network reads special tags coded into the story to reformat it, but refers back to the underlying link so that reading it counts as a mobile web view and the viewer can easily share the article with people outside Facebook…

With instant articles, Facebook is allowing publishers — including The New York Times — to include ads, typically up to one large banner ad or two smaller ads per 500 words. Publishers can sell their own ads and keep all of the money or let the company sell ads through its Facebook Audience Network, in which case Facebook will take a 30 percent cut.

“We are going to be selling our ads,” [Declan Moore, chief media officer of the National Geographic Society] said. In National Geographic’s first article, the ads are simply invitations to join the society. “But there is no doubt that people are spending more and more time in these communities. There is an opportunity to introduce our partners on the advertising side to this.”

It’s worth looking back to the interview John Huey and Martin Nisenholtz did a couple years back with Facebook’s Chris Cox for the Riptide oral history project. Cox has taken the lead on Instant Articles within Facebook.

John: So now you’re a news distributor?

Chris: Yes.

John: And you’re all in the journalism business?

Chris: Yes, which is cool because we were never writing content. I mean the cool part about our relationship with journalism is that we very, very, very clearly never wanted to create content. We’ve always said we’re a medium. We don’t create content here. We’re in Silicon Valley. We build this connective tissue so that people can quickly distribute content to their friends. That’s all we’ve ever done.

We are all avid news readers. So if we can make it a little bit easier, remove a little bit of the friction between a great piece of content getting published on The New York Times and me finding out about it the next day. That’s awesome.

It also frames Instant Articles in the context of the larger cardification of the News Feed:

Chris: The latest iteration is trying to do two things. The first is make the content sort of more respectful of its original home. If you a link attachment inside of Facebook, all of our new designs are trying to do a better job of presenting the image, the headline, the author and the description in the way that an author represents them on sort of where the article is being published and that may seem like a nuance.

But because the headline and the image get so much investment and time from the publisher, if we can make those a little bit bigger and a little bit nicer, we feel like we’re doing a better job of like having a good, strong, positive relationship with the publisher but also giving the user something that they understand and recognize “Oh, that’s from The New York Times. Oh, that’s from The Washington Post. Oh, that’s from The Economist.”

Facebook is increasingly important for news. In 2013, a Pew study found that 30 percent of the American population “ever” gets news from Facebook. But by 2014, a different Pew study found that 39 percent had gotten news about politics and government from Facebook in the past week. (Slightly different questions, so not strictly comparable, but you see the trend line.)

We talk a lot about the rise of social media for news, but you could reasonably rephrase that simply as the rise of Facebook for news. In December, for example, Facebook drove more than three times as much traffic to publisher sites than the next seven largest social platforms (Pinterest, Twitter, StumbleUpon, Reddit, Google+, LinkedIn, and YouTube) combined.

I wouldn’t be surprised if someday in the future, today was viewed as a big day in the history of native advertising. As Peter Kafka reports at Recode, Facebook is letting publishers upload native ads as if they were regular editorial content:

“Facebook really understood what would be important to us,” said BuzzFeed president Greg Coleman. “So instead of acting like someone who would dictate, they came to us and asked us what would be great for BuzzFeed.” For example, Coleman said, Facebook will allow BuzzFeed to upload its “sponsored posts” — BuzzFeed stories it creates on behalf of advertisers — into its “Instant Articles” format, and treat it just like any other story from any other publisher.

That’s potentially huge, and a better play for publishers than selling more mobile display ads to show after every couple screenfuls of text.

It’s remarkable how much Facebook has been able to get away with making this about loading speed rather than, you know, the many other reasons it might want to become a common platform for the world’s top publishers. But maybe this will give publishers a wakeup call to invest more time and resources into being faster on the web.

If there’s one big risk for publishers that hasn’t gotten enough attention, it’s not Orwellian Facebook censorship (unlikely) or an abstract “loss of independence” (publishers work with distribution channels all the time). It’s this: Premium publishers charge premium advertising rates. Maintaining that pricing power is one of the few things that can make their higher-cost business models sustainable.

So what happens if brands realize they can reach a Times (or Atlantic or Spiegel) audience more efficiently and more cheaply without dealing with the publisher directly? It’d be the same kind of premium-eroding effect that cheap ad networks had on many publishers’ models a few years back.

It’s in that context that I share this tweet from The Boston Globe’s David Skok:

Asus came to Dell and said, “We’ve done a good job fabricating these motherboards for you. Why don’t you let us assemble the whole computer for you, too? Assembling those products is not what’s made you successful. We can take all the remaining manufacturing assets off your balance sheet, and we can do it all for 20 percent less.”

The Dell analysts realized that this, too, was a win-win…

That process continued as Dell outsourced the management of its supply chain, and then the design of its computers themselves. Dell essentially outsourced everything inside its personal-computer business — everything except its brand — to Asus. Dell’s Return on Net Assets became very high, as it had very few assets left in the consumer part of its business.

Then, in 2005, Asus announced the creation of its own brand of computers. In this Greek-tragedy tale, Asus had taken everything it had learned from Dell and applied it for itself. It started at the simplest of activities in the value chain, then, decision by decision, every time that Dell outsourced the next lowest-value-adding of the remaining activities in its business, Asus added a higher value-adding activity to its business.

Photo by Ricky Lai used under a Creative Commons license.

POSTED     May 13, 2015, 11:49 a.m.
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