By Benjamin Mullin
Allegations that Facebook Inc. misled advertisers about video
viewership on its platform have reignited debate among publishing
executives about who is to blame for the publishing industry's
ill-fated bet on video produced for social-media networks.
The Wall Street Journal reported Tuesday that a group of
advertisers filed a complaint alleging that Facebook knew of
problems in how it measured viewership of video ads for more than a
year before it disclosed them in 2016.
Facebook called the lawsuit "without merit" and said it told its
customers "about the error when we discovered it."
The allegations have rankled many in the media industry who
watched as publishing companies shifted resources away from
traditional text and toward shareable videos based, in part, on
hopes they would perform well on Facebook and eventually pay off
financially. The so-called pivot to video proved ruinous for some
publishers that emphasized underwhelming video at the expense of
their own website audiences.
"If they would've known that their video was being watched on a
significantly shorter duration than it actually was, would they
have been less likely to aggressively shift resources into Facebook
video?" asked Jason Kint, the chief executive of Digital Content
Next, a trade organization that advocates for publishers.
Fox Sports, Mic Networks Inc. and Mashable were among the group
of digital publishers that laid off writers to make room for video
producers. Each was seeking to accelerate its digital advertising
growth and tap into higher engagement for video content on social
media. Fox Sports owner 21st Century Fox Inc. and Wall Street
Journal parent News Corp share common ownership.
Fox Sports didn't respond to a request for comment.
"Mic's decision to build out a premium video journalism newsroom
in 2016 was a result of growing digital video consumption, which
has only accelerated across all platforms including social, mobile,
web and streaming. It did not have to do with Facebook's average
watch-time metrics," a Mic spokeswoman said.
Jessica Coen, editor-in-chief of Mashable, said "Facebook is one
of our valued partners. We're always open to exploring additional
paths for distribution. It's not a zero sum game."
The debate played out on Twitter on Wednesday, with journalists
from publications including the Athletic, GQ, and Gizmodo Media
Group expressing frustration that Facebook encouraged the media
industry to invest in video while it was allegedly misleading
advertisers about the level of engagement of video on its
platform.
Publishing executives "all felt like this pivot to video was
something that was being pushed on us that we didn't have the data
for," said Phillip Picardi, editor in chief of Out, a magazine that
focuses on LGBTQ fashion, lifestyle and entertainment.
"This was a time in digital media where we pivoted strategies to
the changes in Facebook algorithm or the rapidly changing ad
business," Mr. Picardi said.
Mr. Picardi noted that his previous employer, Teen Vogue, was
insulated from the industrywide shift toward video in part because
decisions about video investment were made by Condé Nast
Entertainment, a separate division of the company.
In January, Facebook dealt a blow to publishers that had bet big
on social video by announcing plans to prioritize posts that are
shared and discussed among users and their friends.
A month later, Vox Media laid off employees of its sites'
social-video teams, who accounted for about 5% of its entire staff.
Vox Media Chief Executive Jim Bankoff said at the time that the
layoffs were prompted by the realization that social-video
initiatives won't be "viable audience or revenue growth
drivers."
Some in the publishing industry balk at connecting allegations
that Facebook misled advertisers with the hapless investment in
video produced for social media.
"I completely agree that hiding information intentionally is a
bad business practice," said Rameez Tase, vice president of
audience and analytics for Axios. "But that's completely besides
the point when it comes to publishers' business. The idea that
publishers based their decision to pivot to video on this reporting
error is categorically false."
Facebook's inflated viewership metrics might have resulted in a
decrease of advertising dollars being spent on other platforms, but
it likely didn't cause publishers to invest heavily in video by
itself, said Alex Skatell, founder of the Independent Journal
Review. He noted that Facebook was upfront about the limitations of
video advertising products for publishers in 2016, the year that
the social-media company was allegedly misleading advertisers.
"Blaming Facebook for a pivot-to-video strategy is a stretch,"
Mr. Skatell said.
In July 2016, Facebook Chief Executive Mark Zuckerberg said his
goal was to turn Facebook into a "video-first" platform, and
predicted that within five years or so most of what people consume
online would be video.
Media companies and publishers were given inaccurate data about
how long their video content was watched across the social network,
possibly affecting the types of content they chose to post. But
that didn't affect the ad revenue publishers made from individual
videos they did publish, said Joe Speiser, co-founder and former
chief executive of the women-focused media company LittleThings.
That is because they earn based on "CPM," or the cost per thousand
views that marketers pay.
"Because publishers are paid on a CPM basis, Facebook's
incorrect viewership metrics would only have had an impact on
publishers if the corresponding CPMs didn't regulate to market
rates," Mr. Speiser said. "As we have seen since the metric
correction, CPM rates have just climbed to make up for any fall in
measured viewership."
(END) Dow Jones Newswires
October 18, 2018 10:14 ET (14:14 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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