A simple but important question has been lost in the market reaction to Meta’s pivot away from fact-checking and towards Community Notes. Once users are able to crowdsource annotations on posts that they believe are false or need context, what will be the implications for Meta’s vision of “hundreds of millions” of small business creators using its generative artificial intelligence (AI) tools?
According to a Wall Street Journal article last week, the answer is ambiguous: “Meta has told advertisers that Community Notes will apply to organic posts, not paid ads, but its official messages haven’t gone into detail about brands’ and influencers’ unpromoted posts.”
The problem is organic sponsored posts—where a content creator is paid to showcase a product—have historically made up about 25% to 50% of brands’ marketing campaigns on Meta’s platforms and TikTok. Creators rely on these sponsored posts to fill out their branded-content earnings, and brands use it to complement the posts they do pay to boost.
Meta CEO Mark Zuckerberg previously described the opportunity around generative AI as helping creators produce “more creative stuff" "and “UGC that people create for better, wilder use cases that they want”. There are “only so many hours in the day” and a creator’s community “probably has a nearly unlimited demand to interact with” that creator. AI tools will solve that pain point for creators.
The article suggests that “Meta’s new system might push more advertisers and creators to abandon organic content altogether to avoid the risk of critical Community Notes.”
In turn, Meta’s pivot to Community Notes seems to be creating a disincentive for creators to use Meta’s AI tools to create more content and drive more engagement. The question now is, how will Meta reconcile its ambitious vision for creators and generative AI with its pivot towards “free expression”?
Key Takeaway
Meta's “move fast and break things” culture that now prioritizes a Trump-era work culture shift over creator relationships may be disincentivizing the very creators and small businesses needed to realize Meta's AI ambitions.
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“Ham-fisted”
Last week, The Information reported that Meta Platforms Chief Technology Officer Andrew Bosworth described Meta’s handling of parts of its recent changes as “pretty ham-fisted, borderline unintentional”.
Meta now has nearly 3.3 billion daily users across its platforms and is generating more than $152 billion in annual advertising revenue. It does not seem worried about how its pivot will impact advertising spend.
However, if the objective is “more creative stuff" from creators "that's UGC that people create for better, wilder use cases that they want”, it is hard to see why this pivot helps incentivize creators towards using Meta’s generative AI tools towards that outcome. They need sponsored posts to help them grow.
Add in the uncertainty of TikTok’s future for its 170 million plus users in the U.S. looming in the background, the sense is that Meta’s relationship with creators is on shaky ground.
Meta’s Spectrum of Creators and Small Businesses
When I spoke with Meta for last November’s “Armed With AI, Small Businesses Also Challenge Hollywood”, I asked about the spectrum of creators and small businesses on Meta. I learned that, in broad brushstrokes, the vast majority of creators are smaller, earlier in their journey. Some creators are small business only, some are creators only and many are creators who also have a small business (like the Kardashian family). However, the number of creators who also have a small business is smaller than the overall group of creators.
From this picture, we can get a sense of why Meta’s pivot is contrary to the objectives of its generative AI vision. Effectively, the pivot leaves the vast majority of creators who are smaller and earlier in their journey most vulnerable. The AI vision sought to incentivize them to leverage AI to create more content and engage their audiences 24/7. The pivot to Community Notes appears to be a disincentive for organic content creation.
Small businesses and creators who also have a small business seem to be the least vulnerable because they rely on paid ads. But these are both smaller buckets of creators, and they still rely on organic content. This pivot is a disincentive for them to adopt Meta's generative AI tools, too.
Move Fast And Break Things
There were always two big assumptions in Meta’s AI vision: Creators would adopt the AI tools to create more content, and in doing so, they would drive more engagement. Meta's $46 billion investment in AI, AR and VR since 2021 reflects Zuckerberg's commitment to this vision.
Four months after Meta outlined this vision, both assumptions seem to be questionable, and only because of the pivot towards Community Notes. The “move fast and break things” culture that now prioritizes a work culture shift over creator relationships may be disincentivizing the very creators and small businesses needed to realize Meta's AI ambitions.
The question is not whether to bet against Zuckerberg. Rather it is how Meta will resolve this fundamental tension between its Trump-era culture shift and its bet on AI to drive creator growth. There are no obvious answers right now, and that is cause for concern.