The brouhaha over Facebook and Google’s owner Alphabet being forced to pay for news is threatening to change the way the free world wide web has worked so far. The traditional business model of newspapers has been to package news alongside advertising and charge for newsstand copies or subscription. The advent of the internet turned that upside down as newspapers shed classified and display ads to tech giants, which were able to connect advertisers to readers they wanted to reach through precise ad targeting instead of casting a wide net. Is it payback time for Facebook and Google, or will they succeed in changing the narrative and make it all about “free” Internet?

These days, most news stories we read are not in print or from newspaper websites but in the form of a Facebook newsfeed or a Google link. Because they “show” news, users tend to stay longer on the internet giants’ platforms, which makes them more appealing to advertisers. Not surprisingly, the ads surrounding the newsfeed or web links generate money for Facebook and Google rather than for content creators or owners. This makes the internet giants powerful gatekeepers of news.

How powerful? Consider this: A total of 52% of all Americans now get their news from Facebook. The remainder gets it mostly from print newspapers or their websites. Unfortunately, a big chunk of that is routed through Google’s search engine. So, newspapers are getting increasingly smaller amount of advertising because their own websites generate a tiny portion of direct traffic.

To continue reading,

Sign in to access this Premium article.

Subscription entitlements:

Less than $9 per month
3 Simultaneous logins across all devices
Unlimited access to latest and premium articles
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)

Stay updated with Singapore corporate news stories for FREE

Follow our Telegram | Facebook