Consumers Prefer Short Videos: Meta Explains Why It Is Ending News Deals

A smartphone and a computer screen displaying the logos of the social network Facebook and its parent company Meta in Toulouse, southwestern France, on Jan. 12, 2023. Lionel Bonaventure/AFP via Getty Images

Meta has said the lack of user interest in news was the reason it decided to withdraw from deals with Australian news organisations.

Following the introduction of the News Media Bargaining Code in 2021, social media giants Meta and Google entered into commercial agreements with news businesses across Australia, with the former paying the latter for putting up news on their digital platforms.

The deals have resulted in up to $200 million (US$133 million) in extra revenue for new organisations, allowing many of them to maintain and expand their operations.

However, in March 2024, Meta announced that it would not renew the contracts, which would expire later this year.

Meta’s announcement has sparked fierce objections from media outlets due to its negative impacts on their businesses.

At one point, News Corp Australia Executive Chairman Michael Miller suggested the government ban Meta if it withdrew from the Code and ended deals with news organisations.

In late May, News Corp announced that it would lay off as many as 100 staff in a major restructuring due to a sharp fall in advertisement revenues.

Meanwhile, Nine Entertainment has become the latest media outlet to join the redundancy game, letting go of 200 staff to cope with advertising challenges and the revenue loss caused by Meta’s decision.

Meta Explains Its Withdrawal Decision

At a recent social media inquiry, representatives from Meta were questioned about its decision and the company’s next move.

In response, Mia Garlick, Meta’s regional director of policy for Australia, said a very small proportion of Facebook users were using the platform to read news.

“For the vast majority of people using Facebook, less than 3 percent of their feed is news links,” she said.

The director also talked about Facebook News as an “unsuccessful” product after its introduction in 2019 due to a significant shift in consumer preferences.

“People are now primarily engaged in short-form videos, and primarily with the non-news content,” she said.

“So overall, we’ve seen an 80 percent drop in the use of Facebook News and the poor performance of this product led to our announcement that we would deprecate it here in Australia in February of this year.

“In 2021, we entered into deals with Australian publishers to support the Facebook news product, but now, with the product being withdrawn from the market, those deals will not be renewed.”

In addition, Ms. Garlick said Meta had received “repeated and sustained” feedback from users that they wanted to see less news on the company’s services.

“To remain competitive with the numerous apps growing in the digital space, we must prioritise the experiences that are most relevant and valuable to our users,” she said.

Meta Questioned About Its Data

Labor MP Kate Thwaites, the chair of the joint committee on social media, questioned the accuracy of Meta’s data that news made up less than 3 percent of what users saw in their Facebook feeds.

The MP said that the committee had heard evidence from other people, including news publishers, disputing those figures and saying that they felt the news content on Meta’s platforms was much higher.

In response, Ms. Garlick said the 3 percent figure had been consistent since 2018.

“Prior to 2018, I think the number was 4 percent,” she said.

“In 2018, we made a change to reduce the amount of public content on our services, which included news content, and then it dropped down to 3 percent.”

Member for Jagajaga Kate Thwaites during question time at Parliament House in Canberra, Australia, on June 18, 2020. Sam Mooy/Getty Images

Ms. Garlick also stated that some people’s impressions of the amount of news on Facebook might not necessarily be true.

She explained that because people’s experience on Facebook was highly personalised, if someone engaged with a lot of journalists and liked a lot of media pages, they might feel that their experience was very media-driven and think it was the same for other people.

While Ms. Garlick acknowledged that some users consumed news via short videos on Meta’s digital platforms, she said that proportion was “dwarfed” compared to the overall size of the engagement.

“It is not news content that is having that virality and having that greater engagement on the platform because news tends to be quite time specific,” she said.

“As we’re surveying people on the platform about the types of content they want to see.

“Consistently, the feedback coming back is that it is not news content.”

Meta’s Next Move

The committee also questioned Meta’s representatives about its upcoming course of action, as there had been speculations that if Meta were designated under the Code and subject to stricter regulations, the company would remove all news from its platforms in Australia, just like it did in Canada.

Ms. Garlick said the company was considering all options at present.

“We have made the announcement that we are deprecating the Facebook news product, that we’re still paying out the deals that supported that product, and [that] news continues to be available,” she said.

“But we haven’t sort of had any indication from the government about any potential next steps.”