The Facebook News Feed is increasingly becoming the place that people turn to get their news, and while that can be a great way to get the bits of information that are important to you, the company have realised that it's not flawless.
One of the main problems is that the popular stories on the platform aren't necessarily from the most reliable sources, and a lot of people often get fooled in to clicking on a link that's either not true or specifically designed to simply be clickbait in order to get some of that sweet, sweet advertising money.
That's why they have introduced a new way for you to flag up stories that appear on your feed that you believe to be false, in an effort to help them make your News Feed a place where only the best content appears. Of course, their reasoning behind this is that they want to become the major platform that all media uses to reach their audience, and the more stories that break that turn out to be false or staged purely to get hits (like the viral of the drunk girl being harassed on the street), the less people (and advertisers) will trust Facebook to be a reliable source.
According to Wired, Google had a similar problem a few years ago when so-called content farms appeared that "figured out how to game search, deluging users’ top results with low-quality links". They changed their algorithms in order to make sure that they eventually disappeared, but Facebook's problem is that they need to rely on their users not spreading the stories, or asking them to report the content that they don't want. That's a double-edged sword as users may start flagging content that they simply don't like based on their own beliefs, rather than whether or not it's from a source that others would consider reliable.
Either way, the update will give stories that have been flagged by users as being a hoax reduced visibility on the News Feed, but won't delete them entirely. Facebook stated on their blog about the new feature that it shouldn't affect satire sites, but that may depend on how many people actually get the joke. We can't see a problem with that system, the internet is full of reasonable, articulate and savvy people who don't get offended easily or overreact to anything...