Major news organizations like The Wall Street Journal, The New York Times and The Washington Post are among the media outlets that will be affected by Meta’s recent decision to phase out exclusive deals with news publishers.
The planned axing of paid deals with American publishers — worth more than $100 million — is part of Meta’s goal to restrategize and shift focus from its news tab strategy to the creator economy.
Read more: Meta Pulls Payments Plug on News Outlets Publishing on Facebook
“A lot has changed since we signed deals three years ago to test bringing additional news links to Facebook News in the U.S.,” a Facebook spokeswoman told the Wall Street Journal. “Most people do not come to Facebook for news, and as a business, it doesn’t make sense to overinvest in areas that don’t align with user preferences.”
It is worth noting that deals the firm has in other regions, particularly Europe, will not be affected by the changes. Facebook News will continue to maintain partnerships with outlets in the U.K., France and Germany.
In fact, under regulatory pressure to remunerate content creators for news distributed on Big Tech platforms, paid Facebook News deals in Europe seem to be solidly in place for the time being.
Related: Google Faces EU Regulator Crackdown on 2 Fronts
Google, another Big Tech firm, has also come under intense scrutiny from competition watchdogs in Europe, and last year, the U.S. tech giant was forced to sign a deal to settle a copyright dispute with French news publishers.
Commenting on the $592 million fine the company received from France’s competition regulator as part of the dispute settlement, Le Monde’s CEO Louis Dreyfus told PYMNTS that the deal was necessary “to force GAFA [acronym for Google, Apple, Facebook and Amazon] to negotiate with French and European publishers.”
See more: France Orders Google To Pay News Outlets For Content
Dreyfus acknowledged, however, the importance of maintaining a healthy relationship with Big Tech platforms: “[Big Tech firms] are not enemies. [European outlets] need to build the right balance in the relationship and learn to live with them [because] those deals are good for business.”
Watch the interview: Le Monde CEO Says Big Tech Partnerships Key to Unlocking Digital Sub Growth
Since the beginning of the year, the clamp down on Big Tech firms has intensified, and besides concerns around intellectual property rights and advertising revenue, data protection rules could be a key deciding factor in Meta’s ability to operate across Europe.
Last month, the company reiterated its warning that it may have to withdraw its Facebook and Instagram platforms from the European Union market if a new data sharing agreement between the EU and U.S. is not put in place.
Read more: Meta May Have to Pull Platforms in EU
Since the EU’s highest court struck down the EU-U.S. Privacy Shield in 2020 over concerns about U.S. intelligence agencies’ illegal surveillance of EU citizens’ data, American firms like Meta have been stuck in legal limbo.
Alongside Google, particularly the Google Analytics service, the social media platform relies on the wholesale export of EU data to be processed in the U.S.
In recent months, however, E.U. regulators have been increasingly cracking down on such practices.
For Meta, incorporating the so-called standard contractual clauses (SCCs) into its usage terms has so far offered a way around the ban on exporting data to the U.S. But in light of the Irish Data Protection Commission’s (DPC) incremental moves toward blocking Meta’s data-transfer practices, time is running out for the current system.
Read also: Irish Privacy Regulator Closer to Blocking Meta Data Transfers
So, as regulators in Europe look to rein in Big Tech firms over antitrust, competition and privacy concerns, it remains to be seen how firms like Meta will navigate their Europe business, particularly with publishers, moving forward.
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