Zuckerberg tries to buy off journalists with .3% of Facebook’s yearly revenue
Jason Calacanis
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Yesterday I wrote the first piece in a three-part series about how Facebook could turn around their “WORST. YEAR. EVAR!!!”
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The basic premise: share revenue with publishers, Instagrammers/influencers, App developers and anyone else creating content on the platform, just like YouTube, Airbnb, Apple and Google’s App Stores and countless other partnership platforms do.
Right on cue, Facebook does the most misguided, heavy-handed and unsustainable version of sharing the wealth, by sharing $100m a year — .3% of their yearly revenue — in a series of grants.
The cynical take is that these kinds of one-time payoffs, to highly influential media organizations, are designed to silence and tamper criticism — they’re buying off influential people for a pittance.
The most gracious take is that Facebook feels bad for being such a horrible partner to the press and democracy.
Either way, it’s not sustainable and it’s braindead stupid. Who on earth is advising Zuckerberg about this?!
In June of 2017, Apple reported they shared $70 billion with App developers.
Google doesn’t break out YouTube’s revenue, but everyone knows it’s tens of billions, and that they pay out 55% to partners. The rumor in 2015 was $9B in total revenue, and we can assume that has grown to $20b+.
If YouTube paid out 55% of even $10B that’s $5.5b to content creators — we’re talking Netflix-level spend, and 55x the pittance Facebook is splashing around a bunch of journalist nonprofits.
The data in this chart is from Forbes, not YouTube, so it’s likely incomplete, but if this is anywhere in the ballpark, YouTube is paying it’s top five stars MORE than what Facebook is donating to non-profit organizations.
Right now Facebook makes $33B+ a year, or almost $100M a day, off the backs of Instagrammers, Facebook users and publishers — they share zero point zero.
If I were running Facebook I would commit 20% of top-line revenue to creators, from the New York Times to podcasters to App developers, and splash $7B to creators — a fraction of what Apple pays out a year, but what would build a base of stakeholders in the future of Facebook.
Right now Facebook has zero friends in the industry, and legions of enemies and detractors, including the founders of WhatsApp and Instagram. Think about what a poor job Zuckerberg has done building goodwill with his juggernaut. Even the founders he made billionaires are attacking him on the way out the door with their paychecks?
Facebook Misguided Announcement
https://www.facebook.com/facebookmedia/blog/doing-more-to-support-local-news
Apple Inspiring Announcement
https://www.apple.com/newsroom/2017/06/developer-earnings-from-the-app-store-top-70-billion/
PS — We’re hosting LAUNCH Festival in Sydney again this year, from June 18–19. We’re giving away the first 1000 tickets to founders (free!) → https://www.launchfestivalsydney.com/founderpass
PPS — We’re all set for Angel Summit 2019. 75 angel investors & venture capitalists, two days of discussion, debate, learning & late-night poker. Learn more → https://launchangelsummit.com
PPPS — I am blogging everyday this month! Check out my other blog posts below:
Day Fourteen: “Saving Facebook, a Three-Part Strategy for the New CEO”
Day Thirteen: “A carry comp kerfuffle in Micro VC land”
Day Twelve: “Why aren’t VC firms focused on slow/modest growth startups?”
Day Eleven: “Why aren’t VC firms focused on slow/modest growth startups?”
Day Ten: “Podcast Recommendation: Cafe Insider & Stay Tuned with Preet”
Day Nine: “Podcast Recommendation: Bret Easton Ellis”
Day Eight: Day Eight: “Lean Management: The Power of the EOD Report”
Day Seven: “The Ultimate Outsider’s Hack: Read All The Biographies”
Day Six: “The Three Vendor Rule”
Day Five: “Should I move my #startup to Silicon Valley: the 2009 & 2019 answers compared”
Day Four: “How can I do an #MVP for a delivery service I want to start?”
I worry that there exists a world of tech geniuses who don’t know right from wrong and good from bad. And there is a world of tech users who’ll sell their soul for a giggling emoji. https://www.pewresearch.org/internet/2021/02/18/worries-about-life-in-2025/
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5 年Great article! Why the focus on local journalists as opposed to buying a stake in an existing national media company? Is it to avoid anti trust law? Is local media really that big of a threat to facebook?