How does news infomediation operate online?

The examples of Google and Facebook

Nikos SmyrnaiosUniversity of Toulouse

10th World Media Economics & Management Conference, Thessaloniki May 2012

Research question & method

What are the socio-economic stakes of infomediation for online media ?

Research project financed by the French Ministry of Culture and Communication in 2011

4 researchers from France and Canada

Interviews with publishers (Libération, Rue 89, AFP, Radio Canada etc.) & infomediaries (Google, Orange, Wikio, Netvibes etc.), In situ observations

What is an infomediary ?

Infomediaries are information intermediaries

“Permits users to get information meeting their needs” (Jacso, 1988, p.217).

“Connecting information supply with information demand and helping both parties involved determine the value of that

information” (Hagel III, Rayport, 1997, p. 9).

Represent the logical layers of the internet composed of algorithms and software that allow communication between

humans and computers (Benkler, 2006)

Google, Facebook, Apple, Netvibes, Twitter, Flipboard etc.

News infomediation Online news oversupply: ½ million news items per

day produced (Yang, Lescovec, 2011)

Need for filtering, selection, prioritization & matching between news supply and demand

News infomediaries: platforms that operate a mix of edition, aggregation and distribution of third

party news content through links

Based on algorithms and mediatized social interactions, financed by advertising and

marketing

Cooperation & competitionCoopetition = simultaneous cooperation &

competition between publishers & infomediaries (Brousseau, 2001)

Mutual dependency: infomediaries need publishers for their content, publishers need

infomediaries for their trafic

Economic competition: both categories of players engaged in fierce competition for online

advertising revenue

Symbolic competition: who’s rules follow the news ?

Google News

Google News transforms the social logics of news into

algorithms (e.g. agenda setting)

Krishna Bharat’s idea in 2001:

how to satisfy user queries on news efficiently and in

real-time ?

Newsworthiness for Google

For news websites: productiveness, reactivity, popularity, topic spectrum width

For news topics: cluster size, novelty, sources

For news items: novelty, originality, click-through rate, mentions in social media, sources

Conflict and adaptation2003-2008 conflicting period between Google and

publishers in Europe

Lawsuit in Belgium on copyright infringement, conflict in France, Germany, Italy, Denmark, UK

Litigation over “customer information confiscation”

2008-2009 Google changes strategy: deal with AFP, Canadian Press, UKPA & French publishers

In the meantime publishers “enslave themselves to Google”: shovelware, extreme SEO, sponsored

links

Google’s still big for news20-80% of all traffic of news websites (Europe &

US)

Also a major competitor: in 2009 $2,100M advertising revenue in France & Germany for

Google, $500M for all news publishers together

2011 Google’s Panda algorithm wiped out a popular news aggregator in France Wikio among

others

Publishers anti-Google strategies: paywalls, joint portals, distribution through Apple and…

Facebook’s infomediationSocial infomediation =

Platform + users sharing information + Publishers

providing content

2010: Facebook doubles the traffic Google News sends to US publishers

2011: Facebook 3rd traffic provider behind Google. 6% for Nytimes, 8% for HuffPost, 13% for Owni

March 2012: The Guardian gets more traffic from FB than from Google

Social but still algorithmicEdgerank is an automated mechanism to

establish relevancy and visibility in Facebook

Publisher need to master Facebook constraints in order to gain traffic (e.g. community manager)

Like and Share buttons proliferate. Facebook is colonizing news sites & gets usage data

Latest feature: “frictionless sharing”& social readers

Facebook Insights becomes mainstream

How to become indispensable

Publishers make Open Graph applications inside

or outside FB

Users share news automatically with friends

New metrics for publishers: Monthly &

Daily Active Users

Accurate demographics and preferences data

Dangers of dependency

In April 2012 Facebook changed the rules: big drop

1st quarter: Washington Post spent $800,000 in ads

Facebook gets all the data about what people

read & like => “confiscating” marketing revenue

ConclusionsOnline media are highly dependent on

infomediaries

They obey at the rules the infomediaries dictate

Competition results in low cost & redundant content

Infomediaries profit from news value without producing content

Concentration of power & revenue in the hands of a few internet firms

So what about Apple …