Facebook (FB - Get Report) says it has the best interests of news publishers in mind. And toward that end, Campbell Brown, a former broadcast news correspondent hired by Facebook six months ago to heads up its news partnerships, teased a subscription-based news product that the world's largest social-media platform plans to launch later this year.
David Chavern, president and chief executive of the News Media Alliance, which represents 2,000 newspapers and digital publishers in the U.S. and Canada, says the idea of a product that might drive digital subscriptions would be warmly welcomed, though he said Facebook has yet to unveil details about the product.
"It's too soon to tell," Chavern said in a phone interview from Washington. "There's been a longterm request that Facebook have better integration with the publishers' subscription models. We're hopeful. I would love for it to be a great product that was really great for publishers but we don't know yet."
The News Media Alliance has begun talks with federal legislators about securing an anti-trust exemption to allow publishers to collectively negotiate content deals with platforms, most prominently, Facebook and Alphabet's Google (GOOGL - Get Report) . Chavern argues that the very business model that sustains legacy newspapers is at risk for the simple reason that Facebook and Google currently control about two-thirds of all digital advertising.
And digital advertising is fast becoming the largest category of ad spending, surpassing television.
Securing such an exemption from Congress is a long shot, but one that the publishers' group is willing to explore as it seeks to reverse more than a decade of declining advertising and circulation sales. Weekday circulation for U.S. daily newspapers -- both print and digital -- fell 8% in 2016, the 28th consecutive year of declines, the Pew Research Center reported last month. Sunday circulation also fell 8%.
Advertising revenue at the seven publicly-traded newspaper companies revealed a faster rate of decline in 2016 -- 10% -- than the year earlier's 8% drop, Pew said.
The upshot, Chavern emphasized, is that newspapers need to get more revenue from the places that more readers are going to for their news: Facebook and Google.
In response, Brown said on July 18 that Facebook will launch a subscription-based news product with initial tests beginning in October. The feature appears to be built on top of its Instant Articles platform, which aggregates stories from hundreds of publishers based on a reader's interests and preferences. Once the paywall product is launched, readers would have to become subscribers of either an individual publication or a Facebook service to be able to access more than 10 articles from a particular media outlet during a single month.
"One of the things you'll find about publishers, particularly these days, is that they're willing to experiment like crazy," Chavern said. "They're willing to try a lot of different options for getting to the point that what they produce is valuable. You can't infinitely produce something of value that doesn't get a return on that work.
"It's too early to tell but we look forward to seeing how it works."