Who are America’s media powers today? The election has put that question at the center of the news, but the answer applies far more broadly. For any leader in any field, understanding today’s most influential media players is crucial. Call them the new ‘Powers That Be,’ after the title of David Halberstam’s 1979 book analyzing that era’s most influential media players: CBS, the New York Times, Time magazine, the Washington Post, and the Los Angeles Times. The new Powers are entirely different, however, and they number just two: Facebook and Google.
They’re in the news over speculation that “fake news” spread via Facebook posts could have influenced the election outcome, and over Google’s high placement of a search result reporting wrongly that Donald Trump got more popular votes than Hillary Clinton. The larger issue is that it’s now possible to hold a serious, legitimate debate on whether these two sites wield excessive influence over hundreds of millions–or perhaps billions–of people worldwide.
Some 44% of U.S. adults get news from Facebook, says recent research from Pew. No other site comes close to that; YouTube ranks second with 10% of U.S. adults, followed by Twitter with 9%. It would appear that more Americans get at least some news from Facebook than from any other individual source. Back in 1979, none of the old powers that be, except maybe CBS, could have approached Facebook’s reach today, and none of them could approach it now.
What users see on Facebook is highly influential. One of the company’s own studies from 2012 found that “I voted” posts orchestrated by the researchers influenced an estimated 280,000 additional people to vote in the 2010 midterm elections. The researchers were careful to make their experiment nonpartisan, but it’s easy to imagine how partisans of any cause could launch similarly powerful efforts.
That’s especially significant in light of today’s concerns that many Facebook users are in a “filter bubble” that exposes them mostly to people with views like their own. Separate work by Wellesley University researchers details dozens of past efforts to influence Google search results and Facebook news feeds. The companies constantly try to shut down such efforts, but they’re inevitably always a step behind.
Facebook and Google hold extraordinary power in another way. At least 75% of all the growth in U.S. online advertising this year will accrue to those two companies; some estimates say 90%. Emarketer forecasts that digital ads will be the largest category of all advertising as of next year. None of the old powers that be ever dreamed of such dominance.
Both companies insist that they’re not media companies—they don’t want to be—and by traditional standards they aren’t. They don’t employ thousands of reporters (or any reporters). But in today’s world they are indeed media companies because that’s how people use them.
In the recent controversy, Facebook CEO Mark Zuckerberg posted that “We must be extremely cautious about becoming arbiters of truth ourselves.” But the reality that all leaders must confront is that being influential today requires competing for attention in the online realms of Facebook and Google, today’s towering kings of media.
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What We’re Reading Today
Reynolds American turns down $47 billion offer
Nicandro Durante‘s British American Tobacco made the bid for 58% of Susan Cameron‘s Reynolds. BAT already owns 42% of Reynolds. The combined entity would have created the world’s largest public tobacco firm. Talks are ongoing and BAT has signaled it would be willing to boost its price a little more. Reuters
Warren Buffett cashes out of Walmart
Berkshire Hathaway slashed its exposure to Doug McMillon‘s company as the purchase for Jet.com became official. Buffet‘s Walmart investment fell from nearly $3 billion to less than $1 billion. Fortune
Google, Facebook remove fake news outlets…
…from their ad networks. It’s an attempt by Mark Zuckerberg‘s Facebook and Sundar Pichai‘s Google to control information disseminating from their platforms that will mislead the public. Facebook has come under heavy pressure for the rise of fake news on users social media feeds, which some claim swayed the election. Zuckerberg disagrees with the sentiment. The Guardian
Media sees boon from Trump
On Friday, New York Times co-chairman and publisher Arthur Sulzberger Jr. and executive editor Dean Baquet sent a letter to subscribers, vowing to rededicate its pages to news. It comes as some feared the election mistakes would keep subscribers away. But a Donald Trump presidency has led new viewers to their pages, along with WSJ and ProPublica. NYT subscriptions have risen four times the normal rate since the election, while new subscriber volume jumped 300% at the WSJ the day after the election. Bloomberg
Building Better Leaders
Tackling prescription drug abuse
Few large employers try to stop the epidemic, but Cummins has started testing employees for using prescriptions, like OxyContin. It also encourages employees to find alternatives to the drugs, but it’s a difficult line to walk since most employees don’t abuse the drugs. WSJ
If you find yourself as the only woman in the room…
…finding the right time to speak up can be difficult. But Pandora’s SVP of ad products and strategy Lizzie Widhelm says there isn’t really a right time, you just have to start chiming in. Fortune
If political correctness starts going by the wayside…
…what speech should you protect and what should you address in the office? Demeaning language to vast groups is an easy one to nix, but more nuanced discussions around economic equality can also create passionate responses. Fast Company
Trump speaks to Putin
The two leaders spoke via the phone on Monday, according to the Kremlin. President Vladimir Putin and President-elect Donald Trump agreed that the two countries should have greater ties, while Russia hopes it will include “noninterference in the other’s internal affairs.” NYT
President Obama says Trump’s antics will change
While speaking to the media, Obama said that, “this office has a way of waking you up.” He added that certain parts of Trump‘s temperament won’t produce results in the White House because everyone will be listening to everything he says as president. His words will lead to movements in the market and responses from other countries. Fortune
Where’s the Brexit plan?
It turns out that there may not be one, yet. In a leaked memo, developed by a consultant in the government department, which aides the prime minister, the report details the belief that Prime Minister Theresa May has been “drawing in decisions and details to settle matters herself,” leaving top cabinet members without a clear indication of what’s going on. It also added that it could be six months before a clear strategy is developed. Reuters
Up or Out
Nasdaq named Adena Friedman CEO, effective at the start of the new year. NYT
SEC Chair Mary Jo White has decided to step down from the role. Her term wasn’t set to end until June 2019. CNNMoney
Online lending company Prosper has named David Kimball its next CEO, beginning in December. WSJ
Fortune Reads and Videos
Apple Pay expands its offering to accept donations
UNICEF, charity: water, The American Red Cross and St. Jude Children’s Research Hospital are just some of the non-profits planning to add the feature as a payment option. Fortune
If Donald Trump refuses his salary…
…he would be only the third president to do so, joining John F. Kennedy and Herbert Hoover. Fortune
Jack Ma isn’t funding ‘mini Ma’s’ education
A little boy named Fan Xiaoqin became an Internet sensation, labeled as the Alibaba founder’s doppelgänger. But the connection ends there. Fortune
Oreo released its first ever candy bar
The Oreo Chocolate Candy Bar and The Oreo Big Crunch Bar will be produced in partnership with Milka. Fortune
Quote of the Day
“This office has a way of waking you up…Those aspects of his positions or predispositions that don’t match up with reality, he will find shaken up pretty quick because reality has a way of asserting itself…There are going to be certain elements of his temperament that will not serve him well, unless he recognizes them and corrects them…Because when you’re a candidate and you say something that is inaccurate or controversial it has less impact than it does when you’re president of the United States. Everybody around the world is paying attention. Markets move.” — President Obama on how the job could impact President-elect Donald Trump. Fortune