Commentary

Facebook News Isn't Likely To Quell Publisher Complaints

Facebook last week introduced a place on its social network for news from major media outlets, but that may not be enough to ameliorate critics in the publishing industry.

Last week, Condé Nast CEO Roger Lynch added his name to the list of publishing executives who want to see stricter regulation   of Facebook and search giant Google, which control about 60% of the U.S. digital advertising market.

There are real issues that need to be looked at, given the dominance of these companies and the impact, and maybe unintended impact, it has on other industries,” he said in an interview  with CNBC's Julia Boorstin.

Digital media advertising is on track to grow about 20%  this is year, according to eMarketer, but Facebook and Google will scoop up most of that expansion. The only major rival to the "duopoly" is Amazon, which is parlaying its vast data trove of consumer data into a growing ad business.

That shift in ad dollars has forced publishers like Condé Nast, whose titles include Vogue, GQ and Vanity Fair, to develop business plans that are less dependent on advertising. Revenue strategies include subscriptions, paywalls, ecommerce, events and video licensing.

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Still, publishers can't avoid Facebook and Google, given their power to control what billions of consumers see online. The companies act as gatekeepers to the internet, generating vast amounts of referral traffic to publishers.

Lynch's call to regulate Facebook and Google followed similar remarks from Time magazine co-owner Marc Benioff, who last week said Facebook should be broken up to curtail its power in shaping public opinion and politics.

Breaking up Facebook and Google wouldn't necessarily bring ad revenue back to publishers, although they would be less dependent on only two major sources of web traffic.

Google and Facebook can make a publisher's website practically disappear with a few changes to their algorithms, the kind of power that’s dangerous when concentrated among a handful of Silicon Valley companies.

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