Media networks in Australia who cut multimillion dollar deals with big US social media Companies are keeping a close eye on the US media market after Facebook owners Meta have come out claiming “Most people do not come to Facebook for news” after announcing that they are set to stop paying US media Companies millions of dollars for news content.
Meta has decided that they won’t renew contracts to feature their content in its Facebook News tab, according to sources.
In May 2021 several media organisations in Australia cut three-year deals for their news content to feature on Facebook.
In the USA Meta is set to cut US$100M in payments after signing a host of publishers up to three-year deals in recent years including the Wall Street Journal who are now claiming the deals are coming to an end.
Earlier this month, the WSJ reported that Facebook had reallocated resources from its News tab platform to focus more on the creator economy, citing an internal company memo.
“A lot has changed since we signed deals three years ago to test bringing additional news links to Facebook News in the U.S.,” said a Facebook spokeswoman. “Most people do not come to Facebook for news, and as a business it doesn’t make sense to overinvest in areas that don’t align with user preferences,” she said.
The Facebook News tab will remain as a feature. While payments to U.S. publishers are being phased out, deals in countries such as Australia the UK and Europe will be renewed when the contracts are coming to an end.
Last week Meta posted its first-ever decline in quarterly sales with Chief Executive Mark Zuckerberg now working urgently to revamp the tech giant’s operations, from the content that is presented to users, to how digital ads are delivered, to focusing more on video content.