Stories

News aggregation apps take on Big Tech

Illustration of three figures in silhouette with screens for heads
Illustration: Aida Amer/Axios

Several companies and investors around the globe are pouring billions of dollars into a new wave of news aggregation apps that they hope will steer news traffic away from tech giants like Google and Facebook.

Why it matters: The dominance of a handful of tech companies over the entire news and information landscape is worrying policymakers around the world.

Yes, but: Policymakers all have different reasons to be concerned. Some U.S. leaders, like President Trump and Congressional Republicans, claim that tech giants are biased against conservatives. Others, like competition regulators in Europe, worry that their dominance undermines credible news outlets.

Driving the news: News Corp, the news holding company founded by conservative news business mogul Rupert Murdoch, is developing a news aggregation service called Knewz.

  • The website and a mobile app is meant to address concerns that "Google News and other digital platforms don’t reward publishers’ work adequately and play down articles from certain types of sites," sources tell The Wall Street Journal, which is owned by News Corp.
  • "Knewz" will aggregate news from hundreds of news sources, including big national outlets as well as small digital operations and outlets across the political spectrum.
  • Unlike some of the bigger tech companies that refer lots of news traffic, the service will aim to share data with publishers and let them keep all of the ad revenue, while also promoting articles with original reporting, the Journal reports.

By the numbers: In the United States, Google Search and Facebook still collectively drive over 70% of referral traffic, according to traffic analytics company Parse.ly.

  • Facebook's percentage of referral traffic dramatically decreased beginning in late 2017, shortly before the company announced that it would be changing its algorithms to deprioritize posts from news outlets.
  • Since then, other U.S. news aggregator businesses, like Apple News and Flipboard, have seen traffic referral increases. Some heavily-trafficked websites also continue to refer significant volumes of traffic, like Drudge Report and Reddit.

Be smart: Big tech companies are increasingly under pressure to work more collaboratively with news publishers and journalists to ensure that their algorithms and products promote more trustworthy and fact-based reporting.

  • Facebook told Axios' Mike Allen on Tuesday that it's hiring seasoned journalists to help curate a forthcoming News Tab that they hope will change how millions get news.

The big picture: Around the world, news aggregation as a business is exploding. As Axios has previously reported:

  • China: Toutiao, which is owned by TikTok's parent company ByteDance, raised $2 billion in funds at an over $20 billion valuation in 2017. Qutoutiao, the 3-year-old news and video aggregation startup backed by Tencent, received a $171 million convertible loan from Chinese tech behemoth Alibaba.
  • Japan: SmartNews, the Japanese news discovery app that has amassed 20 million global monthly active users, raised $28 million in its latest funding round, bringing the company's valuation to $1.1 billion last month.
  • India: DailyHunt, NewsPoint and others have also gained traction in recent years in India. DailyHunt has raised $98 million to date. InShorts, a news app that provides 60-word summaries of top stories, has raised $29 million to date.
  • Europe: Axel Springer's news aggregation app Upday is now profitable and gearing up to scale further and drive more revenue, Digiday reports. The app has 25 million users, in part due to its pre-install partnership with Samsung.

What to watch: Some global aggregators, like Toutiao and SmartNews, are beginning to dramatically increase their traffic referral footprints in the U.S., according to Parse.ly.

Our thought bubble: There will always be room for plenty of players in the aggregation game, but so far there's little reason to think that anyone can seriously challenge the tech platforms' dominance. Aggregation is what made them big in the first place.