He Got Rich by Sparking the Fake News Boom. Then Facebook Broke His Business

(Bloomberg) -- Cyrus Massoumi spent the last few years building exactly what he thought would thrive on Facebook: A series of inflammatory conservative websites, finely tuned to produce the most viral and outrageous version of the news. The social network rewarded him with an audience.

These days, Facebook Inc. wants something different. Reacting to concerns about how fake news spread on its social network, including by Russian propagandists, the company has altered its algorithm to punish sites like Massoumi’s. Facebook has put out a series of blog posts explaining how higher quality content will be rewarded.

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Massoumi, who’s featured in the latest episode of the Decrypted podcast, said he had to decide between running “a garbage website that is barely profitable after the fake news crisis” and a “clean website.” He chose clean. In August, he shut down his biggest partisan website, MrConservative.com, and poured his resources into TruthExaminer, a liberal website he launched just before the election. He made sure it played by Facebook’s stricter rules, especially around clickbait -- headlines manipulated solely to attract page views. “You know exactly what you’re getting with all our headlines,” Massoumi said.

There was one glaring problem: less traffic. When Facebook changed its algorithm to disrupt the financial incentives for fake news, the tweaks had a collateral effect on the whole ecosystem of businesses built on its news feed, including Massoumi’s liberal property. Traffic for TruthExaminer went down 60 percent starting in March and hasn’t recovered, according to Nicole James, his editor-in-chief.

“We never broke the rules that were constantly changing,’’ James said. “I did everything I’m supposed to do. We don’t steal, we don’t cheat. But I get people who message me and say, ‘I don’t see your posts anymore.’”

To build a business on Facebook is to accept volatility. The company has played host to many startups tuned specifically for what its algorithm rewards, only to crush them later. In 2014, the feel-good website Upworthy reached almost 90 million unique visitors, built on curiosity-gap headlines like “9 Out of 10 Americans Are Completely Wrong About This Mind-Blowing Fact.” That same year, changes to the news feed algorithm cut the traffic in half, forcing Upworthy to change its strategy. In 2016, as Facebook started to prioritize video in its news feed, the tech news site Mashable dismissed writers to focus more intently on the visual medium. The strategy didn’t save the website, which sold last week for $50 million, a fraction of its prior valuation. More job cuts are expected.

Now partisan news sites are reacting to Facebook’s changes to give lower rank to sensationalism, clickbait and misinformation. Massoumi said he saw no reward for his higher-quality content. He saw competitors get even more aggressive to beat the algorithm, and succeed. The experience reinforced what he’s known for years to be the only unchanging Facebook rule: Whoever gets the most attention wins.

That’s at the root of the fake news crisis. Massoumi, 26, started MrConservative.com in 2012, mostly because he thought he understood enough about information going viral on Facebook to get rich off the ads, and because he enjoyed sparking controversy after growing up in a highly liberal part of the country -- Marin County, just north of San Francisco. He used Facebook ads to target conservatives who might be interested in his page, and then served them content that reinforced their beliefs and made them angry.

“News on Facebook revolves around analytics, so we know that we can only write a 250-word article, we know the title has to be tilted,’’ he said, using his term for bias. “We know we have to exclude the facts because if we say anything good about the other side people are like, ‘oh, you’re a closet liberal,’ or on the liberal side, ‘oh, you’re a closet conservative.’ So there is no room to be objective, there is no room to deliver quality.’’

Once others caught on to how profitable the practice was, it became highly competitive. The hyper-partisan sites would keep track of each others’ headlines and rewrite them to draw more eyeballs. MrConservative.com aimed to put out more content, and faster. Sometimes that meant not checking whether it was true.

“In 2014, I was too drunk to realize that there was no editorial value there,’’ Massoumi said. “I was too busy spending the money.’’ The site continued to thrive around Trump’s election, drawing $150,000 in monthly revenue at its peak, Massoumi said.

Around the same time, Facebook was grappling with its role in political media. More than two-thirds of U.S. adults use the site, and a majority of those read news on the social network, according to a Pew Research Center study. The company had been criticized for manually curating a trending topics tool for its news feed in a way that was bias against conservatives. The accepted news sites that contractors could curate on Facebook, for example, didn’t include the far-right website Breitbart. 

In response, Facebook decided to be more hands-off, cutting the human curators in the run-up to election day. Meanwhile, sites like Massoumi’s were becoming more influential. Reports surfaced about viral, false partisan news -- like Donald Trump’s bogus endorsement from the Pope -- raising concern about what information was affecting people’s views. When Trump was elected U.S. president last November, Facebook faced an uproar over its handling of fake news, and the company quickly vowed that its first step would be to disrupt any financial incentives for such content.

Still, Facebook is intentionally unclear about what is and isn’t allowed on its site. The company doesn’t explicitly ban fake news, and remains especially uninterested in policing partisan content, still fearful of appearing biased. Facebook’s program using third-party fact checkers to combat fake news only scratches the surface of the problem. Even during congressional hearings over the Russian propaganda that spread on its platform, Facebook said many of the misleading news stories would have been allowed -- if they had been posted by real users rather than fictitious people.

Massoumi’s TruthExaminer toned down its tactics to fit what it thinks Facebook wants, but the site still publishes headlines with like “Sarah Huckabee Sanders Just Launched A DISGUSTING And Shameful Attack on Pres. Obama” and “Donald Trump Once Took Revenge On A FAMILY MEMBER By Cutting Off Health Coverage For a a Sick Infant, This Is REVOLTING!” For the Facebook algorithm, provocative and hyperbolic language can be an indicator of clickbait, according to a spokesman. Facebook declined to say whether that’s hurting TruthExaminer because the company’s policy is not to comment on specific users or pages.

Much of the controversial content still exists on Facebook, it’s just harder to find as the company experiments with giving lower rank to whatever it deems bad quality. And publishers are left to read the tea leaves.

Omar Rivero, who runs a different liberal site, Occupy Democrats, also saw a shortfall in traffic a few months ago that “made it a lot harder to go viral.’’ He equates the hit to what happened in 2014, when Upworthy got crushed.

“Every site is going through the same thing,’’ Rivero said. “We powered through the changes four years ago, we’ll power through them again.’’

Rivero said he’s been able to get back close to his election-time numbers, by producing “higher-quality content.” He has contacts at Facebook who help explain what that means. TruthExaminer doesn’t, but Rivero has little sympathy for Massoumi.

“They’re owned by a Republican, so their agenda is just to make money,’’ Rivero said.

Massoumi doesn’t deny it. He’s turning his bedroom into a video studio so he can contract some “very likable liberals” to do rants on the site, similar to Tomi Lahren’s popular tirades on the right, which tend to go viral on Facebook. Massoumi’s looking to hire a more robust editorial team, too.

But instead of relying solely on Facebook ads to keep his site afloat, he’s eyeing a bigger payout down the road.

“I’ll offload the property in the next election cycle,” Massoumi said. “I’ll go for the eight-figure deal.”

©2017 Bloomberg L.P.

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