An attention economy trap? An empirical investigation into four news companies’ Facebook traffic and social media revenue

ABSTRACT

Earlier studies and reports suggest that news companies have handed power over their traffic and news distribution to Facebook, and this is harming their business. This article, based on data analysis of four media companies, evaluates to what extent this is true. The article finds that 24% of news companies total traffic came from social media with 67% of traffic coming either directly or from search to their sites. The article suggests that abandoning Facebook would cost news companies traffic, but not much revenue.  For the companies studied, revenue from social media traffic made 0.03%–0.14% of their total revenue, and from social shares 0.009%–0.2% of total revenue. The article argues that because news companies rely on Facebook for the audience, they continue to be trapped in the attention economy.

KEYWORDS:

• Social media
• platforms
• news publishing
• attention economy
• traffic
• revenue

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. Kaleida’s valuation is based on an example of company X which had 240,000 social shares and these were calculated to drive 1.1 million page views for a publisher X. A single share on Facebook was estimated to equal to 4.5 page views. Publishers gain revenue from their pages via advertising, and this is measured by “cost per thousand” (CPM). Kaleida used then CPM of $10 dollars to calculate advertising revenue from Facebook shares which was for a publisher X $10,000. Based on this math, Kaleida concluded that an organic share on Facebook for a publisher X was worth $0.04 dollars (McAlister, 2017).

2. Deloitte’s econometric model for the value of a single website visit is based on model: estimated revenue impact / total traffic = average value of visit. Its model gives a single website visit a valuation of $0.05-$0.09 (Deloitte, 2016).

Additional information

Funding

The research was conducted as the author was employed as a research fellow at her university, and the author has not received any external/third party funding for the research, authorship, and/or publication of this article.

Notes on contributors

Merja Myllylahti

Dr Merja Myllylahti is a research fellow at Auckland University of Technology (AUT), New Zealand. She is also project manager at the AUT research centre for Journalism, Media and Democracy (JMAD). Her work has been published in international academic journals and books including Journalism Studies, Digital Journalism and The Routledge Companion to Digital Journalism Studies.