Facebook Could Be Moving Ahead With a Subscription News Service and Paywall
is reportedly planning to test a news service with a paywall that would direct users of the social network’s Instant Articles feature to sign up for digital news subscriptions after reaching a threshold of monthly articles.
Campbell Brown, Facebook’s head of news partnerships, told attendees at the Digital Publishing Innovation Summit in New York on Tuesday that the company is launching the subscription-based news service, according to The Street. The new service would ask readers to subscribe to the news platform after they read 10 or more articles in a month--or else they would be locked out of viewing additional stories for the remainder of the month. Large publications such as The New York Times and The Washington Post already employ similar limited paywalls on their websites. (Digiday also reported last week that a subscription service could be in the works.)
In a statement, Facebook’s Brown confirmed that the company is exploring the potential for a subscription news service. “We are in early talks with several news publishers about how we might better support subscription business models on Facebook,” Brown said. “As part of the Facebook Journalism Project, we are taking the time to work closely together with our partners and understand their needs.”
Facebook has not said whether the company would share revenue from the digital subscriptions with news publishers and a source familiar with the proposal told Fortune that the specifics of the payment process have not yet been determined. That source also said Facebook has met with several publishers to discuss the proposed subscription service and to understand the publishers’ needs, with the company planning to give publishers full control over which articles are locked behind the paywall. That would allow for the authentication of the publishers’ existing subscribers. Facebook plans to roll out tests of the subscription service with certain publishers near the end of this year, with the goal of expanding the service in 2018.
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Facebook’s two-year-old Instant Articles feature already aggregates news content from more than 10,000 publishers worldwide, with the social networking service sharing a percentage of advertising revenue from the feature with its publishing partners. However, while many news publishers initially saw Instant Articles as a way to potentially add much-needed new revenue streams, publishers have since complained that distributing content on Facebook has failed to result in any meaningful return and that the site hasn’t offered much help to alleviate the problem.
Last week, a group of news organizations launched a petition asking Congress for a limited antitrust exemption. The exemption would allow publishers to negotiate collectively with major digital platforms, like Facebook and , in order to guarantee a business model in which those digital giants fairly compensate publishers for the content that gets shared on their platforms.
A month ago, the Wall Street Journal reported that Facebook was working on building support for a subscription model with paywalls into the Instant Articles feature. At the time, Fortune noted that such a move could prove to be “a giant double-edged sword” for publishers, many of whom could stand to gain financially from the service at a time when they are struggling to boost revenue. But such a service could also present the risk of publishers becoming even more dependent on social networking platforms like Facebook for readers and revenue, thus giving the tech giants an uncomfortable amount of control over the news industry’s fate.
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