Meta's first revenue decline is now affecting U.S. news publishers. Experts explained that these publishing firms are the first to experience the impacts of the sudden earnings loss.
Recently, the tech giant manufacturer announced that its 2022 Q2 revenue only reached $28.82 billion. This is a big deal since the company was able to generate almost $30 billion back in 2021.
Now, it seems like Meta is trying to pull out its funding from business areas it thinks are no longer useful, such as the Facebook News Tab.
Meta's Revenue Decline Affects US News Publishers!
According to Engadget's latest report, Meta confirmed that it would no longer pay news companies to publish their content on the Facebook News Tab.
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"Most people do not come to Facebook for news, and as a business, it doesn't make sense to over-invest in areas that don't align with user preferences," said a Meta spokesperson.
For the past few years, the tech giant manufacturer spent millions of dollars on deals with U.S. news publishers. These include The New York Times ($20 million), CNN ($3 million), and The Wall Street Journal ($10 million).
All in all, Meta is estimated to be spending around $105 million. As of writing, Meta hasn't confirmed where it will exactly use the pulled-out funding.
But, Meta Media Partnerships Vice President Campbell Brown said they would shift their financial resources to more creative initiatives.
What Meta Plans To Do?
As of press time, Meta clarified that some news publishers will still receive funding, allowing them to continue posting their content on the social media platform.
However, Axios reported that the tech firm said that around 50 of them will not have their Facebook News Tab funding renewed. As Brown explained, Meta will focus on more creative content.
This means that Meta will put more funding into its short-form video and other similar enhancement projects for Facebook.
Recently, Meta allegedly plans to demote Facebook's COVID-19 misinformation posts instead of removing them.
On the other hand, Facebook's TikTok-like features are now being tested.
For more news updates about Facebook and other social media platforms, keep your tabs open here at TechTimes.
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Written by: Griffin Davis
