Why most publishers made a bad move with Facebook

Facebook’s news-feed change is likely to cut into the money publishers can make from producing and distributing custom branded and sponsored editorial videos on the platform, their top source of revenue on Facebook.

With exception of those publishers that actually have custom audiences to target, a publisher has spent the last 10 years indexing the audience of Facebook and other social media platforms– they have out smarted the big blue demon.

The other alternative for publishers is to develop their own distributed media platform with video, podcasts, and content that only their audience gains access to, this is where niche media is now the 800 lb. gorilla in the room. 

With highly targeted audiences and content that is super valuable, Facebook looses the connection to these consumers and business people and puts search for relevant content back in the hands of the niche publisher. 

Top Facebook publishers can nab a 50-70 percent margin on custom branded videos they distribute on Facebook after paying for production and paid media, according to four publishing sources, including three executives from publishers with at least a billion monthly views on Facebook.

With Facebook counting views at 3 seconds, the cost per view has been incredibly low — “less than a penny,” one source said — which means top publishers can scoop up plenty of ad dollars based on their organic reach on Facebook.

There was even more money to be made from sponsorships of editorial videos that publishers already had on their schedule and required no additional production dollars — “essentially free money,” said one exec, who is top Facebook publisher. And it helped that the typical, made-for-Facebook news-feed videos — short, silent, text-on-screen autoplay clips — are cheap to churn out.