The coronavirus health crisis and the economic destruction it brings in its wake is hitting services and business across the world. For the news media this is the latest, and possibly most intense challenge to its revenue and its business model. Yet, the huge increase in consumption of news seems to validate journalists’ claim that their work is vital to a functioning society. How can it be funded? This briefing by Rob Sharp gives a selection of ideas, policies and inItiatives. We’ll be adding to it on a rolling basis. Please let us know about other sources or reports we’ve missed.
The crisis facing news organisations worldwide is yet again imminent, exposing deep seated structural malaise. Adverting revenue is falling, staff furloughed, subscriptions under pressure. Though there has been a Covid-related spike in online traffic, it may not last.
Now Facebook and Google will be forced to share advertising revenue with Australian media companies, it was announced earlier this week. How should other countries follow suit in finding new revenue sources for the news media?
There is a longstanding scepticism towards media organisations – reported on by the LSE’s Truth, Trust and Technology commission in 2018 and underlined by recent surveys. In the UK, the furore last weekend around the Sunday Times’s paywalled investigation into Prime Minister Boris Johnson’s slow-to-act approach to Covid-19 is an example of a debate about the quality of news and what is worth paying for.
Solutions need to be found, and fast. What’s the latest?
- The World Association of Newspaper and News Publishers has published this useful list of emergency funds available to news organisations, including from Google, Facebook and the Poynter Institute;
- Google’s global Journalism Emergency Relief Fund, was announced earlier this month. Google has since stepped up its direct support through $6.5million for organisations including First Draft, Full Fact and Maldita.es; Facebook has also stumped up $100million through the Facebook Journalism Project including an additional $75million in marketing spend;
- Over 40 MEPs earlier this week called for emergency funds to support journalism from the European Commission. Others have called for a longer-term policy shift in the EU’s stance towards news;
- The Director of the Reuters Institute for the Study of Journalism, Professor Rasmus Nielsen believes the current crisis might take pressure off the BBC and points to non-profit and “member based news organizations with a clearly articulated mission” as well as established subscription models;
- The Media Development Investment Fund recommends transparency, cutting costs through remote working and careful planning.
- The New Zealand government has announced a $50 million package for news media organisations to help them through the COID-19 crisis
Long-term state subsidy
- There is already considerable direct or indirect subsidy of news in many European countries along with the US in the form of tax breaks, along with the UK, and other parts of Europe. News UK received a favourable ruling by a tax tribunal regarding VAT earlier this year, while a broader ruling for the entire sector followed in March;
- Beyond this, the Canadian government announced last year a $600million fund through a variety of tax breaks and grants, though its national Covid-19 mass advertising buy-in has come under fire. On a local level, a restaurant in Canada is cross-subsidising news platform Postmedia. New Jersey’s Civic Information Consortium will hand out $2million to local news publishers, it was announced last year;
- Twenty organisations in the UK are receiving £2million funding via Nesta to explore and secure new business models and audiences for public interest news after last year’s Cairncross Review, recommendations of which included new tax relief and direct funding of local journalism;
- Elsewhere in the world, some have warned against the possibility of such finances being used by hostile governments as a means of control.
Tax big tech
- The announcement this week in Australia follows a report by the Australian Competition and Consumer division in 2018 into digital platforms. This raises the question why this cash should be injected into media and not other sectors. Facebook has since hit back;
- France’s plans to impose a local tax on internet giants was announced earlier this year, but hit the buffers in January after President Trump promised tariffs in reprisal (the French government already already offers significant subsidies to media organisations each year);
- The Organisation for Economic Cooperation and Development is developing global recommendations on taxing tech giants in countries where they do business; the OECD believes this could raise $100billion/year in national tax revenue;
- Last week the UK’s National Union of Journalists launched its News Recovery Plan, including proposals for a six per cent windfall tax on tech giants;
- The UK government’s Digital Services tax announced in 2018 and last year’s Cairncross Review recommended greater regulation, direct funding for public interest journalism and a new Institute for Public Interest News (while the spikes in revenue seen by big tech are transnational, solutions must be local, dependent on regional political and media systems with varying degrees of public and commercial operations).
- NTB, Norway’s leading news agency, has innovated re.: delivering content to its news publisher clients, by integrating Live Blog, its professional live-blogging software, with NTB’s content management system;
- The LSE’s JournalismAI project has announced its call for collaborator over an ongoing AI innovation project – see here;
- Some have pointed to micropayments but its worth noting some websites including Blendle have sometimes struggled to make a profit and pivoted away from this;
- Twipe has done a useful roundup of key considerations for news media, including taking down paywalls and expanding pop-up products. There is also pressure on news platforms to give key Covid-19 content away for free;
- Any solution must take into consideration the toll Covid-19 is taking on journalists’ mental health, and subsidise suitable responses.
[This resource will be updated on a rolling basis. Please email Polis director Charlie Beckett firstname.lastname@example.org or Rob Sharp email@example.com with any contributions]