The Only Way to Fight Fake News Is to Destroy Its Business Model, Outbrain CEO Says

The only way to fight fake news is to eliminate the financial incentive to create them in the first place, says Yaron Galai, co-founder and CEO of online content promotion company Outbrain Inc., in a Tuesday interview at Calcalist’s Mind the Tech conference in New York.

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According to Mr. Galai, there are two kinds of fake news—political, such as Russia’s alleged attempts to interfere with the 2016 U.S. election, and those motivated by potential financial gain, which are much more common. This business model depends on fake news to lure users to a perpetrator's website so that they are exposed to commercial content and ads, he said. Google and Facebook have a model that is based purely on the number of clicks and this gives advertisers an incentive to create fake news, so this model has to change, Mr. Galai added.

Outbrain’s service distributes content through sponsored and non-sponsored links published on various content websites. The company pays publishers for the space on their website, and gets paid by advertisers when its links are used.

Founded in Israel in 2006 and now headquartered in New York with several global offices, Outbrain has raised over $190 million to date. Fox News, CNN, Sky News, The Guardian, and Le Monde are among the company’s customers.

Outbrain is hoping to make news outlets less dependent on social media, and encourage them to collaborate and share content and audiences with each other, Mr. Galai said. However, there are regulatory restrictions that make such direct collaborations between publishers tricky, he added.

“It is difficult to form any type of collaboration between several publishers without either breaking the law or losing the competitive edge, and that is where companies like Outbrain or Taboola.com Ltd. come in,” he said. Outbrain does not have its own audience, and so when users are visiting its clients' websites, they are also being exposed to content created by other clients, Mr.Galai said. This gives publishers better exposure through mutual reliance, instead of giving their content away for free when relying on social media, he added.