An excellent piece on re/code used Facebook and media companies as an example when considering "what happens when what you do is now done by someone else." But, the author didn't take it far enough, arguing that Facebook (a platform) now does two of the five things that media companies traditionally did, here:

But actually, Facebook does all five.

1. Curates via algorithm (and apparently people too)

2. Distributes to audiences through their platform.

3. Monetizes through advertising.

4. Hosts content through Instant Articles.

5. Creates content by paying publishers to post certain formats, for instance Live Video, and through its acquisitions like Oculus Rift, which creates both hardware and some proof of concept VR experiences.

Now, some may argue that Facebook isn't really "creating" but sponsoring content. And to a certain extent that is true, but it is certainly moving more towards creating, and it is naive to think they won't become a "publisher." More likely is that Facebook just won't call themselves that.

Facebook is already a concern to publishers, who are losing control over the distribution of their content. But, at least for now they still create the content that Facebook distributes. What happens to publishers when Facebook decides to properly move into content production?

It seems likely that those who have niche business and have already moved to subscription models -- showing that individuals are willing to pay for their content -- will be okay, but will have to figure out how to work that model into distributed content. More teasers (a nice example is what FastCo does with Medium) or working with other publishers to build a paywall on/with Facebook (Google's AMP works with subscription models, for instance), seem to plausible outcomes.

But, what happens to everyone else?

Historically, high journalism has largely been subsidized by low journalism. In modern times, however, the two are increasingly decoupled, largely because we can get the latter online in unlimited quantities, and people are willing to pay for the former. While high journalism outlets are attempting to exist on their own through the use of paywalls or events businesses (in addition to various forms of advertising) around traditionally "high" content, low form companies like Buzzfeed and Gawker are moving into long-form and hard news articles.* Indeed, “viral news has been co-opted by advertisers, pranksters, political operatives and others looking to sell something” forcing these media agencies to evolve their offering.

Consider Buzzfeed, a website dealing with "low" forms of news. It is a product designed for a new set of client who want to target a specific user- the bored at work crowd. It is responsive to its customers and focuses on R&D, and has shown remarkable innovation in its use of analytics, community and monetisation. The company’s focus on mobile only, as compared to “digital” is a forward looking response to current media trends. Now, the company’s ability to harness virality into revenue has allowed it to expand its content (including video and hard news content) and develop its business based on a committed user base. They have managed to become a news source to readers.

But, if young, innovative firms gain the high journalism market, legacy organisations may not survive. Clayton Christensen’s theory of disruptive innovation suggests established firms fail not because they are unable to keep up, but because they are unable to pursue these innovations when they arise. And indeed, it is this newer convergence that legacy institutions seem unable to adapt to. The business environment makes them unable to dedicate resources to the new innovation, either because they feel unable to take resources away from a sustaining innovation (paywall, being one of them), or the company bureaucracy/identity does not allow for it.

Firms who succeed typically bring unique departments within their organisations that do this. And certainly, a number of organisations are looking at building these more innovative sites. The Trinity Mirror created UsVsTh3m, the Daily Mirror launched Ampp3d, and the Atlantic has Quartz. But, will these converged forms be enough? The next wave of development will now depend at how these will be brought into the legacy organisation, and whether they are able to act on this convergence/decoupling paradigm.

*By high Journalism, I mean strong news reporting and investigation pieces (think Pulitzer). In this context, low journalism means diarists and parodists (think The Onion, The Daily Show, Colbert, etc).