Lukas Eddy

Facebook vs. The World and the Future of Media

Amazon may be trying to monopolize the material world, but it looks like Facebook is on track to take over the digital world. To my surprise, Google advertising revenue has dropped slightly for 2016 while Facebook’s has grown by 5% each year since 2015, according to the Pew Research Center’s report on the State of the News Media.

If it continues to increase at the rate shown on the site, within 13 years Facebook will get 100% of the annual digital display advertising revenue. This is completely understandable, with Facebook being able to sell not only user information but also general content exposure to billions of eyeballs.

Mobile Dominance
Facebook is usable as an app and on a desktop computer, helping ensure accessibility and wide reach to the audience. Similarly, the majority of successful media companies have support for Apple iOS and Android devices. On top of that, the vast majority of successful media companies also have Apple News, led only by an even higher percentage of successful media companies having newsletters. Here’s the thing, Apple News, Facebook, newsletters via email (with links to mobile friendly sites) all have one thing in common: mobile usage if not specifically Apple iOS device usage. That’s why mobile display advertising has grown more than tenfold in the last five years to supplement slightly decreasing desktop advertising.

Revenue Increase and Newsroom Growth (or lack thereof)
In class we learned about the growing advertising revenue coming from digital advertising and how in total it’s still lower than for print advertising. We see the exact same concept described in the various graphics about advertising revenue for both print and digital. However, we see a general increase in estimated ad revenue for evening and morning news shows. Cable TV profits also have been increasing. Local TV news has also seen various degrees of increase in revenue like retransmission fees and political advertising. However, newspapers have seen a sharp drop in total revenue and newsroom employment numbers. What I’m wondering is if newspaper companies can make big enough gains in digital advertising to offset the losses in print advertising, will we see a resurgence in newsroom size or will the existing numbers of people make more money?

Tying it all Together
To get on this wave of digital advertising revenue on mobile devices we need to go back in time and become Facebook executives. But we can’t, so the best thing would be to take advantage of this growth while we can, because at some point way down the line there will be another form of advertising that will sink digital/mobile ad revenue just like print news advertising revenue. Investing in the capability for newsletters, Apple News and support for both major mobile platforms are what seem like the most obvious and foolproof steps to increase exposure to audience and thus advertising revenue for the time being.

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