“We’re going to hit a tipping point where the decision to ‘unfriend’ Canada is going to be bad for users, bad for shareholders, and bad for Meta’s reputation globally,” he said.
Meta has at times sought to court publishers, with brief initiatives around video clips, for example, or, in 2019, with deals for content to run on the Facebook News Tab product.
However, its senior executives have concluded there is a clash of interests with the news industry, with the growth of the social media giant’s digital advertising business resented as one of the reasons for a global decline in revenues at newspaper groups.
According to people familiar with the shift in strategy, Meta found that its 3 billion users prefer short-form videos and content from influencers over news and politics. From 2021 it began reducing the amount of political content in users’ feeds.
Research commissioned by Meta and published in March found that posts linked to current events accounted for less than 3 percent of people’s Facebook feeds. Around a fifth of users in the US, UK, and Canada consider that “too much” news.
The report, by NERA Economic Consulting, stated that “news content from traditional publishers is of low value to Meta and declining”—a claim that publishers strongly dispute. They argue instead that it boosts engagement.
These findings partly explain Meta’s increasingly combative approach, particularly its opposition to Canada’s law to support the news industry.
“The Online News Act is based on the incorrect premise that social media companies benefit unfairly from news content shared on our platforms, when the reverse is true,” Meta said, adding that news outlets are able to wield social media to expand their audiences and “help their bottom line.”
It added: “Unfortunately, the regulatory process is not equipped to make changes to the fundamental features of the legislation that have always been problematic, and so we plan to comply by ending news availability in Canada in the coming weeks.”
Meta is assessing whether the legislation would compel it to also remove news links and content on Threads for Canadian users, one person familiar with the plans said.
Andrew MacLeod, the chief executive of Postmedia, a major Canadian news network, said that the company had been “modeling out a short-term reduction in traffic” for when Meta’s news blackout comes into force.
But he added: “It’s good that we are shaking up the industry [as] it might create outcomes for a more viable structural future.”
Pablo Rodriguez, the minister for Canadian heritage, said in a statement to the Financial Times that the government was “deeply convinced that Google’s and Facebook’s concerns can be resolved through the regulatory process.”
“If Facebook truly believes that news has no value, they can say so at the negotiating table. Threats to pull news instead of complying with the laws in our country only highlight the power that platforms hold over news organizations, both big and small,” he added.
Meta’s retreat from news comes in the wake of allegations that its failures to moderate its apps sufficiently contributed to discord around former US President Donald Trump’s election as well as the riots in January 2021 when a mob stormed the Capitol building.
Sandra Matz, associate professor of business at New York’s Columbia Business School, said that Meta appears to be discouraging news and politics from Threads as a business decision to avoid more scandals over misinformation and election denial, and to facilitate moderation.
Mark Zuckerberg, Meta’s chief executive, insists Threads will be a “friendly” space in contrast to Twitter, which has loosened its moderation since Elon Musk bought the platform for $44 billion in October, frustrating some users and advertisers. Meta has not hired new moderators for Threads but is relying on those at Instagram.
“If they succeed in setting it up the way they want, it’s going to become a cultural platform,” Matz said. But, she added, “negative content and emotional content... is addictive. It’s going to be interesting to see if Threads can pull this off.”
Pinar Yildrim, associate professor of economics and marketing at the Wharton School of the University of Pennsylvania, noted that “news is not as monetizable as some of the other content” such as fashion, which can link to shoppable products. Meta has indicated plans to run advertising on Threads.
The industry’s defenders claim Meta will be worse off as the rift deepens.
“Without trusted news and being able to share that, you’re cutting out what is going on in the real world,” said Jason Kint, chief executive of Digital Content Next, a trade association representing the digital news industry. “Long term, the question is whether it’s sustainable for them.”
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