Facebook’s brilliant news feed revamp
IHAD originally planned to continue the series of columns on the impact of data on our lives, with a focus on measures we all can take to protect our personal information and data. Supervening events prompted this column instead, and I will continue the data series in my next column.
Facebook CEO Mark Zuckerberg recently announced massive changes to the social media platform’s news feed, emphasizing the posts, photos, and videos that family and friends share. This would effectively remove the emphasis on our Facebook News Feed from businesses and brands.
Zuckerberg commented that the revamp is geared toward bringing back the company to its roots, “to help people stay connected and bring us closer together with the people that matter to us.” The company noted that the phenomenon that brought about this decision, called “context collapse,” sharing of information about themselves and their lives.
That is not to say that people have posted less on Facebook. Rather, status updates have increased, but the content of those updates mostly consisted of reactions on news, world events, or links to other sites. The company users began using Facebook as a means to publicly share information and opinions, while reserving more personal, intimate posts to Instagram or Snapchat.
The move raised many eyebrows, to say the least. Wall Street reacted immediately, bringing Facebook shares down $8.40, or 4.47 percent, to $179.37 per share on the day of the announcement. That reportedly cost Zuckerberg $ 3.3 billion from his personal fortune. As I write this column (Wednesday), the share price of Facebook stands even lower at $178.39.
The News Feed revamp is sig - ion that it is a brilliant move by the company, for the following reasons:
First, the move is excellent PR, meant to enhance user experience. It emphasizes the fact that the company is devolving back to what it was meant to be, a platform to connect family and friends and enable them to share the happenings in their lives. The revamp brings more meaningful posts to us all. By meaningful, we mean the platform wants posts with lots of comments, likes, and shares, building on the study by researchers that people who actively comment tend to have a better time on the platform and feel better about themselves. In a previous statement, Facebook stated that users who were not actively participating in posts, but instead were engaging in passive
consumption of information on the News Feed, were potentially less happy.
Second, the move should limit the fake or slanted news that previously became rampant on the site. With a refocused algorithm for family- and friend- oriented based on fake news is likely to be less accessible. While this will not completely remove fake news on Facebook, this surely is a good step.
Interesting to note is how this affects legitimate news organizations that use Facebook for content sharing. A study for the month of December 2017 alone showed that all of the top 10 most engaged sites on Facebook are news sites, with Fox News topping the list with 21.70 mil- lion likes, shares, comments and reactions on the mind-blowing 49,330 articles the Fox network published and posted. With a much smaller reach, these news sites may end up having to pay to boost posts and content.
Third, and most important, is the fact that Facebook revenues are based mainly on online advertising. In a previous column, I mentioned that in 2016, Facebook earned roughly $ 7.02 through advertising from its 1.23 billion users. That year alone, the company’s advertising revenues were at $8.629 billion. Today, Facebook is targeting breaching the 2-billion user mark.
The revamp limits, to a great degree, the reach of businesses that use the social media platform through run-of-the-mill free public posts. Companies can no longer reach as many users as it used to with their content without paying for boosted posts or sponsored advertisements. Clearly, businesses will now be prompted to pay in order to reach the same number of users and target markets as before.
Now you may argue that businesses and news organizations can simply decide to spend the advertising budgets elsewhere. That may be true, but you have to consider that in the digital advertising industry, the platforms or media are effectively a duopoly composed of Facebook and Google, with both companies in 2017 holding 60 percent of digital ad spending. To put it simply, businesses, at least for the time being, have to stick with Facebook.
What can we expect from our News Feed in the near future? More meaningful posts, more conversations and interactions, and less business-related news, videos and links.