Facebook reaches licensing deal with News Corp to feature headlines from WSJ, NY Post, and others in a coming news tab; sources: WaPo, BuzzFeed News, BI also in
Lukas I. Alpert / Wall Street Journal :
Context & Ripple Effects
This closes the loop on an arc that started in August, when sources reported Facebook was offering millions of dollars to license news content, and accelerated with the planned news tab unveiling alongside News Corp's Robert Thomson. The News Corp deal makes the tab's flagship supplier official, with WSJ, NY Post, WaPo, BuzzFeed News, and Business Insider headlines reportedly in the first cohort.
The structure is a reversal of the last Facebook-news arrangement: in 2015 publishers joined Instant Articles for free distribution inside the feed, while this deal pays publishers directly for headline placement — a shift in who compensates whom.
First-order effects
- News Corp secures recurring licensing revenue from Facebook for WSJ, NY Post, and its other titles, with later reporting indicating some partners receive up to $3M a year to appear in the tab reaching a couple hundred thousand US users at launch.
Second-order effects
- Unpaid publishers face pressure to cut their own carriage deals before Facebook finishes filling the tab's slots, turning individual negotiations into a wave — the template News Corp signed here was later extended into a three-year Australia-wide agreement under Facebook News.
Third-order effects
- If payment-for-placement replaces free-distribution as the norm, platform-news economics re-anchor on licensing fees rather than referral traffic, giving large content owners like News Corp a durable negotiating position against social platforms.
The trend: Social platforms are moving from distributing publisher content for free to paying licensing fees for it, with big media groups like News Corp setting the terms.