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Facebook Could Pay Up To $3M Per Year To License News Content

Facebook Could Pay Up To $3M Per Year To License News Content

Facebook has offered news outlets millions of dollars for content in a planned news section, according to a report by The Wall Street Journal.

Facebook said it would pay an amount up to $3 million to license the headlines and article previews from companies. Facebook reportedly pitched ABC News, WSJ, The Washington Post and Bloomberg.

Facebook has faced scrutiny for taking the bulk of the advertising that used to go to newspapers when they had classified sections. Newspaper revenue has historically shrunk year after year. Together, Facebook and Google get about 60 percent of all of the digital ad revenue in the U.S.

The proposed deal would last three years, and the news section would debut in the fall. It’s unclear whether any media outlets have agreed to the deal. Facebook told the outlets that it would give them leeway when it came to how the content was going to be presented in the news tab.

The outlets could choose between hosting the stories right on Facebook, or just having headlines and previews that would then shepherd the user to the original site. For the latter, the tab would create web traffic in addition to allowing for a licensing fee.

The news tab will be different from the “Today In” tab, which is meant to be a more local source of news. The financial arrangement will be different than the one Facebook made for instant articles in which Facebook splits ad revenue with outlets instead of just paying them upfront.

The idea of Facebook paying licensing fees is not new, as it pays to license videos in its Facebook Watch section. It has also paid publishers to create Facebook live content.

Facebook CEO Mark Zuckerberg said he wants to have “more high-quality news” and a “business model and ecosystem to support it.”

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