June 2009, the future of 21st Century journalism moves with protestors across Iran’s capital. In an area somewhat removed from the commotion, philosophy student Neda Salehi reportedly steps from a car and is soon shot by a sniper. A bystander videos her death and uploads it to YouTube. The moment becomes the rallying point for demonstrators in the country and for spectators from around the globe. It is a seminal moment of change for the news media.

The next night, June 21, I write

This week’s turmoil on the streets of Tehran is but a metaphor for another turmoil: How the Internet is tearing down monopolies of power and empowering individuals and smaller groups. The Internet is the new democracy, which can be seen from pictures and videos coming from protests in Iran.

The Iranian protests are capturing the world’s attention in part because of fairly new tools that make it easy for most anyone to be a broadcaster, a real-time journalist. These tools punctuate change sweeping through the news industry and destabilizing others…

The best reporting wasn’t from CNN or many news organizations but Flickr, Twitpic, Twitter, and YouTube. The tweets (hashtag #iranelection), images, and videos poured out in real time. Where is CNN getting some of its best material? Citizen journalists, like this story and images from CNN’s citizen-driven iReport.

But the videos—captured by compact digital cameras and cell phones—tell the story of unrest that only quieted today.

YouTube launched to the public in November 2005 and Twitter summer 2006. iPhone came a year later, followed by imitative devices capable of capturing broadcast-quality photos or videos. I write about watching Neda Salehi die:

The video is raw and unfiltered. It’s the kind of footage that only a few years ago professional news organizations could capture and broadcast—and there would have been tight control over when and how it was broadcast and copyrights against redistribution. Now, people can self-broadcast to YouTube.

On this June evening, I look across the vast Internet landscape populated by emerging social media tools—few available for more than three years—and see the Fifth Estate rising to challenge the Fourth. “As the people take their masses of content to the Web, news monopolies of power begin to crumble. There is too much content, and not enough advertising to support it”.

Search and Social
Six years later, as U.S. President Barack Obama brokers with the Iranian government, I fathom social media’s influence on how news is gathered and distributed and the economics behind it. We start with the money.

There are two sides to the Free Economy—that is giving away content subsidized by advertising: Search and social. Part 1 of this report explores Google’s role, as search share leader—near 90 percent in Europe, based on combined analyst estimates, and about 67 percent in the United States according to comScore. The ad- and search-driven market enables the success of new media sites like BuzzFeed, which largely depends on social shares to drive pageviews. Then there are services like Facebook, which provides native ads and, in some categories and on some platforms, competes with Google in search and advertising.

For example, in 2013, Facebook nudged past Google, 15 percent to 14 percent, in share of digital banner ad revenues, according to Pew Research, which compiled the data for its “State of the News Media 2015” report. The lead widened, 24 percent to 14 percent, in 2014. Banner ads are among the most important revenue generators for news sites.

In mobile, which rapidly emerges as the most-valuable for news dissemination, Facebook banner ad share also leads Google—37 percent to 12 percent, according to Pew, for 2014. Like the broader banner ad category, the search and information giant’s share stagnated year over year.

Let’s step back and look at some other numbers before moving forward to the showdown between two Free economies—search led by Google and social driven by Facebook:

  • Facebook ended 2006, the year when opened to the public, with 12 million monthly users. By June 2009: 200 million. On Aug. 27, 2015: 1 billion active users in a single day.
  • Twitter in 2006, also its first year of operation, had 5 million registered users. By July 2009: 28 million. As of June 2015: 316 million active users sending 500-million-plus tweets per day; total registered account number is 500 million.
  • YouTube already had about 50 million users when Google acquired it in November 2006—11 months after opening to the public. In 2015: 1 billion users (reached two years earlier); 300 million video uploads per minute.
  • Facebook and YouTube are the planet’s largest social networks, ranked numbers 1 and 2, respectively.

Social vs. Search
Where the Free economies collide is mobile and video. According to combined data from GSMA and World Bank, more than half the planet’s population had a cell phone at the end of 2014. Stated differently: 3.6 billion cellular subscribers. By region, Europe has the highest penetration, according to GSMA:  78.9 percent. The Commonwealth of Independent States and North America follow, each at 70 percent.

Thirty-three percent of the the world’s cellular subscribers have mobile Internet access—60 percent in developed markets—GSMA reports. Biggest data consumption driver though 2020: On-demand video.

Facebook has 1.49 billion monthly active users—1.31 billion on mobile devices (data current as of June 30, 2015). Daily active users: 968 million and 844 million, respectively. Not surprisingly, then, mobile advertising accounted for 76 percent of revenues during second calendar quarter 2015, up from 62 percent a year earlier.

Google’s mobile reach is greater because of search, but its economy appears to be smaller on mobile as a percentage of revenue despite Android’s success (at the end of Q2 2015 global smartphone sales share was 82.2 percent, according to Gartner). Google was not as forthcoming in its second-calendar quarter earnings release or conference call as Facebook. CFO Ruth Porat boasts about mobile’s growing importance and contribution, while providing little quantifiable data. Given the company’s near-obsession with data, the oversight is glaring. Nugget from Omid Kordestani, chief business officer: “30 percent of mobile queries are related to location and our efforts around local search”.

Video is the other category to watch, and as GSMA contends, also ties to mobile’s future fortunes. In most geographies, YouTube would rank second to Google in search, if categorized as such. Half the videos are consumed on mobiles.

But Facebook pushes hard, as its mobile revenues rise. In summer 2015, daily video views exceeds 4 billion, or about half YouTube’s, and most of the number was gained during the previous 12 months. Meanwhile, video posts to the social network surpassed the search giant in November 2014, according to analytics firm SocialBakers.

The numbers parade could go on and on, but the point surely is obvious: The dynamics are changing as social, led by Facebook, makes gains against Google search. Both companies champion Free economies, but the continued massive monopoly influence of one grows uncertain.

The Fifth Estate
Social networks’ influence on news gathering and consumption cannot be overstated. For example according to Pew Research, in 2015, 63 percent of American adults get news from Facebook and Twitter, up from 47 percent and 52 percent, respectively, two years earlier. Usage varies, with 59 percent getting breaking news from Twitter versus 31 percent for Facebook. It’s not unusual for news to break first on either service, as citizen journalists take leading roles before professionals.

Two recent social services shocks stirred intense reaction, while demonstrating the impact on news gathering and consumption. The first, on Aug. 26, 2015: Vester Lee Flanagan, a journalist fired from WDBJ7 in Roanoke, Virginia, killed former colleagues Allison Parker and Adam Ward during a live, remote broadcast. The gunman later rebroadcast the murders, by uploading video he had captured to Facebook and to Twitter. The services’ autoplay feature presented the killings to some users unexpectedly, before his accounts were locked.

Starting Sept. 2, 2015, Reuters photos of a drowned Syrian refugee, 3 year-old Aylan Kurdi, washed up on a Turkish beach, exploded across social networks while editors at major news organizations debated the ethical and professional responsibilities of publishing the shocking images. The Guardian‘s story with the photos generated more than 167,000 social shares by September 8. On Twitter, hashtag #KıyıyaVuranİnsanlık accompanied many tweets about the photo or sharing it.

The Syrian refugee crisis isn’t new, nor are the tragic deaths at sea. But the striking images, accompanying video footage, and a kind of news dissemination cooperation between the Fourth and Fifth Estates galvanized governments to publicly welcome the displaced people. Suddenly, the Internet Democracy awoke like a sleeping giant and political houses of power trembled. By day’s end on September 7, leaders in and outside Europe agreed to take Syrian refugees fleeing from ISIS rebels. Among the countries committing: France, New Zealand, and United Kingdom. Germany acted sooner, days earlier taking about 20,000 refugees languishing in Hungary.  Germany’s expected tally for the year: 800,000.

As the shooting of an Iranian woman was a pivotal point for the news media’s future in 2009, the drowning of a Syrian boy six years later is another. It is a metaphor for how the Fourth and Fifth Estates can, in tandem, affect public policy and serve the public interest.

Changing Roles
Solely in context of the Google and rapidly developing Facebook (and other social media) economies, the future of the Fourth and Fifth Estates is frenemy cooperation. Facebook is example. In May 2015, the social network introduced the “Instant Articles” platform for publishers. Currently, Apple also courts publishers for the new iOS 9 news app. Both strategies seek to be foundational technologies rather than silos solely tied to their core products.

The Internet’s increasing disadvantage for news producers, particularly as the overwhelming amount of content becomes even more overwhelming, is gaining visibility with large enough audience and generating enough revenue to be sustainable. Apple, Facebook, and others pushing publishing platforms present news and other content where the consumer spends most of his her time. Rather than search, users find.

One question to ask, particularly in context of the Free Economy and emerging publishing platforms: Should news organizations become authenticators, curators, and editors rather than reporters. That is the evolving role of the Huffington Post, for example. The Internet’s great news aggregator is more a legitimate news producer in 2015 than ever. The company operates a sophisticated newsroom and generates more homegrown original content.

When not from wires, much of the featured news is assembled from second-hand sources. Huffington Post excels at presentation—headlines, deks, and storytelling narratives—and some original reporting. The point: With the large amount of socially generated news and other content generated across the Internet, with perhaps the exception of investigative journalism, should news organizations put reporting second to editing? As does the Huffington Post?

HP is excellent context because of founder Ariana Huffington’s broader ambitions. The news aggregator claims to have 100,000 contributors but she seeks 1 million. Social, not search, will lead the organization towards that goal. Someone within should verify, write tempting headlines, and assure the narrative is snappy storytelling.

The Fourth Estate’s longstanding mandate is the public interest by ferreting out truth. The Fifth Estate is often unchecked, as social sharers spread something that may or may not be factual. As curator, editor, and fact-checker, the more traditional news media could take on a vitally important role that benefits and educates. Such position also makes more sense when primping news and other content for distribution through third-party publishing platforms, like Apple’s and Facebook’s.

Editor’s Note: This analysis first appeared on Byline.

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