Money Quote January 23, 2018
There’s a lot going on in the world (scroll down). But man, the Facebook news is beyond fascinating these days.
Honestly, I really do not set out to write about Facebook every time I sit at my keyboard, but the past few (months, weeks, days) have been riveting, as we watch the most influential company in the media world (yes, that’s you Facebook) attempt to think its way through what has to be its most difficult of transitions: From adolescent King of the Valley to adult Citizen of the World. This past few days have been particularly trying, with Rupert Murdoch asking for a handout (really!), multiple press outlets eviscerating the company’s approach to decision making, and the Economist — the Economist!!! — doling out management advice. To the news:
Hi. My name is Rupert Murdoch. I own a lot of publishing assets. I’m in the gloaming of my influence, and I’ve not got many bullets left to spend. So I’m pointing my gun at… YOU Mark! MQ: “The time has come to consider a different route. If Facebook wants to recognize ‘trusted’ publishers then it should pay those publishers a carriage fee similar to the model adopted by cable companies. The publishers are obviously enhancing the value and integrity of Facebook through their news and content but are not being adequately rewarded for those services. Carriage payments would have a minor impact on Facebook’s profits but a major impact on the prospects for publishers and journalists.”
As I’ve already said, these certainly are not easy times to be Facebook. In response, they’ve launched a series of posts on their “Hard Questions” site. Not sure this is going to get ‘er done. But it’s a start. However, having a Harvard professor write the following as the lead to one of the pieces is likely not going to convince a lot of skeptics: “On balance, the question of whether social media platforms are good for democracy is easy. On balance, they are not merely good; they are terrific.” Ummm…mmm-kay.
Facebook is getting a peer reviewed response to its ideas, regardless of its unwillingness to actually engage in peer review. Facebook does have a tendency to just proclaim its response to something, as opposed to, say, positing an idea, having folks critique it, responding, learning, formulating a new hypothesis, then iterating again. I’ve no doubt internally they’ve been doing that, but publicly, it seems the company just… rolls code.
You know you’ve hit the bottom (one hopes) when you lose the Economist, which pens a satirical memo from a Burning Man fellow traveler to the CEOs of America’s tech companies. MQ: “It is critical that you compete with each other. If you are waging war on various fronts, such as commerce and digital advertising, you look a lot less monopolistic. This is probably an argument for keeping alive businesses that you might otherwise scale back, as Google has done with its social offering, Google+. Acting as if your rivals are too well-resourced and entrenched for even another giant to take on lends credence to the arguments against you.”
BTW, Facebook‘s’ very long, very bad moment in the sun is likely to continue, because it can’t promise our 2018 elections won’t play out exactly as they did in 2016. Great.
Just in time for Davos, President Trump tosses his base a slab of protectionist red meat. MQ: “The imposition of tariffs will most likely exacerbate trade tensions with other nations, including China, and could result in an escalation of retaliatory trade measures against imports from the United States. Both China and South Korea harshly criticized the move, with both suggesting they could take their complaints to the World Trade Organization, which settles trade disputes between countries.”
Last week I gave Larry Fink of BlackRock props for being a standup capitalist. BusinessWeek ain’t buying it. MQ: “On the one hand, you can’t blame BlackRock for siding with activists who are pressuring managements to boost the price of their stock. Even index-fund investors want the best returns they can get. On the other hand, let’s face it: When you are siding with activists in a proxy fight, you are usually voting for short-term fixes over long-term value.”
Oh wait, you mean we have to think about, like, data and sh*t? But we’re creatives! Fascinating, in depth story of how huge agencies are trying to come to terms with the inevitable shift in their business models. MQ: “We’re now all about targeting and retargeting,” said one creative director at Leo Burnett who is skeptical of the digital overhaul. “Who’s thinking about what people are going to be dreaming about?”
Hell no, we won’t go! Apparently, that’s what tourists are saying as they consider visiting the US these days. I’m not sure we want to be on any list that includes Turkey these days. But… MQ: “Since 2015, the U.S. and Turkey have been the only places among the top dozen global travel destinations to experience a decline in inbound visitors, a time when other nations such as Australia, Canada, China and the United Kingdom have marked sizable gains. A strong U.S. dollar has also contributed to this dynamic.”