Nine lessons and a winning outcome from Meta divorce

#278. This post is about tough truths, calling out failures, naming names, and flagging a path forward after news failed Australia's Big Tech test...

See yas.

It’s a year since the three-year arranged marriage between Meta and Australian publishers ended in bitter divorce.

Meta says it did what it was asked to do. It paid for news. Only its internal data showed users didn’t want it, so it stopped.

This post is about hard truths and paths forward.

And it’s Meta’s money. It’s a listed company with fiduciary responsibilities to shareholders, so not paying is its choice - and that’s fair enough.

The undeniable fact is that billions of people go to Instagram, Facebook, WhatsApp, and Threads, for countless billions of reasons.

Sometimes they find news there that they read or share. That’s true. But it’s not why people go there.

Meta has never been a news source no matter how much the industry might wish it was. It’s not that. It was never built to be that.

It was designed, then painstakingly tuned trillions of times, to be an efficient catcher’s mitt for any content that engages consumers long enough to deliver an ad.

It’s a fact that only a tiny percentage of Meta's 3.35 billion daily active users read or share news.

But Meta’s size means that even a tiny sliver of interest feels like a life-sustaining amount of traffic to publishers.

This is where the economics of monopoly power become visible. You probably don’t think as much about monopoly as I do, but this is where you feel it.

It’s when a giant’s afterthought of an afterthought has an adverse impact that can crush an entire multi-billion-dollar industry in one decision.

It’s why Meta faces an antitrust trial to break it up in just 45 days, with regulators seeking to force it to spin off Instagram and WhatsApp.

You can follow it and all Meta’s other trials - alleging harming children and misleading shareholders - in my Meta on trial round up. I’ll be covering the trials daily.

The goal is to shake free $159.95 billion in ads that poured into Meta last year to spark new competition in social and social ads.

Let’s change pace, and remember what happened, how the news turned opportunity into failure, and face up to some hard truths - before getting to solutions.

This will shake some boardrooms and irritate some high-ups, but that’s because it’s true, and it needs to be in the open.

Welcome to new subs from TikTok, Yahoo, the Times of India, US not-for-profit Alliance for Audited Media, the Google of Korea Naver (I am planning a trip so drop me a line 🤙), GenAi consultants UnLTD, Australia’s Mamamia, among others.

Welcome. Share with your friends and let’s keep building the movement…

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The deal struck with Meta and Google back in 2021 handed publishers a critical 1,000-day lifeline. That was a window for publishers to prepare a plan B.

Anyone who thought Meta was going to re-sign when that first three-year term ended was strategically delusional.

Vision that extends beyond the next quarter has become a black hole in Australia’s media boardrooms. That’s a mistake. And this is the price.

Meta was never going to re-sign. Everyone in the know knew that.

What publishers should have done is put their best brains in a room the morning after the deal was struck with a deadline.

Blue flame thinkers, industry experts, company insiders, all working together as a consortium with one mission:

To deliver a raft of new and radical ideas every 50 days to the various boards to act upon, with the outcome of making news self-sustaining.

Instead, they took the cheque, focused on the moment, and hid their heads in the sand.

Some banked the handout, others spent it, but none used Meta’s most valuable contribution, which was time.

What they did do was conspire to fail to find a path forward. The countdown ticked away, and Meta’s middle finger was the inevitable result.

The split last year sent Australia’s media leaders into a tailspin of fear and loathing and name-calling.

I wrote at the time that Australian newsrooms would likely face cuts, and so it was with 200 at Nine, plus more at Australian Community Media and more.

Consumers were hurt too, with news coverage diminished just a little bit more.

Workers and consumers have every right to demand answers from their boards and leaders why they were so inactive ahead of this avoidable trainwreck.

Bosses have offices on the top floor for a reason. They are meant to see furthest down the road, so why didn’t they see that Meta had moved on long ago?

Australia’s flub is now just a page in Meta’s playbook as it brings its fangs to bear on any country that shows the temerity to try to make it pay.

It proved Meta’s contention that the news industry is stagnant, irrelevant to earnings, and incapable of rousing to action even in the face of imminent collapse.

But…

Shortly before the Australia deal collapsed, Meta axed news in Canada without ever pretending to be interested in doing a deal. That signalled its true world view.

With that reality, we as an industry must think differently. Let’s begin by cutting out the emotion and get to the facts.

Contrary to the prevailing narrative, losing Meta is not that big a deal.

If publishers lose all Meta’s traffic forever, it will have zero impact.

That feels mad, right? But that's because this debate is not about traffic, or about news, or about what’s right or wrong, and it never was. It was about money.

Killing the doublespeak and recognising the heart of the issue is priority number one for getting to a sustainable Plan B.

So, let's dig into some hard facts and tough truths that really matter, but will hurt.