Backstopping the Civic Function of Journalism

July 16, 2020

It is not a new story that the business of journalism is in trouble. Large media companies have gone bankrupt or scaled down considerably, local and mid-sized city-scale news deserts are common, newspaper chains are having their debt purchased and their assets dismantled by hedge funds, and start-ups come and go, as they struggle to scale. And, irrespective of the COVID-19 pandemic, there have been steep increases in layoffs in newsrooms around North America.

What has emerged is a journalism ecosystem of legacy newspapers with either national market dominance or international reach (such as The New York Times, The New Yorker and The Globe and Mail), relatively small subscription-based media companies (such as The Athletic, The Information and The Logic), a number of first-generation digital news start-ups (such as Vice and Buzzfeed), a few large public broadcasters (such as the BBC and the CBC) and an emerging non-profit news sector (such as ProPublica). Gone are the heady days of large newspaper profit margins, expense accounts and glossy magazine journalism.

The reasons for this decline are also well known. In short, it’s the story of an industry that time and time again failed to adapt to the emergence of the digital economy, in combination with the inescapable reality that platform companies absorbed the core functions of journalism: the distribution model, the business model and the editorial model. This is not to say that platforms killed journalism — they did not care enough about it to deliberately kill it. Instead, they built a product that was better at distributing content at scale to users (to their massive global user base), better at targeting ads at individuals (vast data sets about our behaviour were used to target these ads at us) and better at deciding what we wanted to consume (algorithms replaced editors in deciding what went in our feeds).

Emily Bell and I outlined this recent history and the complicated give-and-take between platforms and publishers in our report The Platform Press: How Silicon Valley Reengineered Journalism. For nearly a century we relied on an industrial model for news production, subsidized by advertising, classifieds and subscriptions. The internet undercut all three, and we are living the consequences. This old model had its deep flaws, but so too does the model currently replacing it. So, what can we do about it? This is a topic of heated debate (the future-of-journalism industry remains strong), but we can start by asking five questions.

First, will the market solve this problem? We have seen a range of market responses to shifts in the journalism landscape — everything from venture-capital-backed and scale-based models such as Buzzfeed, to successful subscription models such as my Big Tech co-host’s The Logic. Many believe that, given enough runway, the market may sort this out. On the other hand, it’s also possible that the market will not be able to replicate the level of subsidization that existed in the previous journalism industrial model. It could be that once it is fragmented into silos of content, the market will simply not support the type of expensive journalism that we have come to depend on in a democracy. This would not be entirely surprising, given that we never directly paid for this type of journalism anyway; it was always subsidized by the content readers actually wanted to consume and were willing to pay for: sports, entertainment, business news, comics. If a lack of innovation and an ad duopoly prevail and platforms simply continue to offer better products, the free market may not be able to solve this problem.

Second, if it is a market failure, do we, as a society, care? The market fails at all sorts of things, and we don’t demand bailouts for everything. But when a market failure harms something that we decide is a collective good, we expect governments to get involved. So, we need to ask what role accountability and civic journalism play in our democracy, and whether we think the current, and projected, market is providing enough of it. If we think that this market failure is having negative social impact, we must consider government interventions.

Third, if this is a market failure that warrants government intervention, what type of policy is needed? In Canada, the journalism sector is already a product of significant government intervention. Our media support, broadcast regulations, the presence of the CBC all shape what is decisively not a pure free market. But these policies were developed for an entirely different mode of production, financial model and distribution system. They were built for industrial media, not the digital public sphere. So, is this the right governance framework for our current moment? The Public Policy Forum report The Shattered Mirror (for which I was a contributing researcher) suggested a wide menu of options, a few of which the government has adopted. The most controversial action has been a tax subsidy for journalistic labour, but the government also made the — I believe — smart decision to loosen the charitable status restrictions for journalistic organizations. I wish they had started with reforming the one journalism entity they already control, the CBC. But this conversation is ongoing, including through a review of Canada’s Broadcasting Act, Telecommunications Act and Radiocommunication Act, and it is highly likely that further policy affecting the journalism sector will be proposed in the coming months.

Fourth, if we think we need to subsidize the production of journalism, how do we get the money to do so? There are two broad approaches. The first is to have governments lead the collection of these funds. While there are many ways of doing this, some options being discussed around the world include a link tax, whereby platforms are levied a fee for linking to journalism (a potentially problematic solution being proposed in France and Australia and apparently being considered in Canada); a tax on digital ad sales; and, simply, money coming from general revenue. The second model is that the platforms fund journalism themselves, which is starting to happen. In diverse ways, Google and Facebook fund journalism companies, foundations, conferences and research.

Fifth, if more money is needed to correct for the market failure, we must decide how this money is distributed. The core challenge is figuring out how to distribute it in a manner that won’t undermine the very role in society that journalism is supposed to provide. Both the government-led and the platform-led models are flawed, because they leave discretion over how journalism is defined and which journalism entities get funding to institutions that must themselves be the subject of accountability journalism. When platforms, for example, fund journalism start-ups, subsidize journalism conferences and support journalism research, are they undermining the ability for journalism to hold them accountable? Or when newspapers become reliant on government labour subsidies, do they even slightly pull their investigative punches? The paradox is that the two entities most capable of funding journalism — platform companies and government — are the ones that most need the scrutiny of the accountability function that journalism provides.

An approach to this problem is starting to emerge. Ethan Zuckerman, Victor Pickard and our guest on this week’s Big Tech podcast, Emily Bell, have all proposed some version of supporting civic media and civic digital infrastructure. While how this support would be implemented is a broad debate, one model of this would see money contributed by platforms or governments or both but allocated by a third-party organization. One way of determining who qualifies for this funding has been developed by Reporters Without Borders, through their Journalism Trust Initiative. Instead of evaluating the content of the journalism (a fraught premise), they propose a standards-based approach, whereby an organization (whether for profit or non-profit) would be assessed on its compliance with core journalism standards, such as whether there is an editorial board, disclosure of revenue sources and correction policies.

Whatever the cause, we are at a moment during which the capacities of the journalism industry are declining just as the importance of civic and accountability journalism in our democracy has never been more clear. It may be that the market will fix this problem or that new and improved organizations will fill the void left by legacy publishers. In the meantime, we need to think carefully about how best to subsidize and incentivize an industry without undermining its core value — holding power to account.

The opinions expressed in this article/multimedia are those of the author(s) and do not necessarily reflect the views of CIGI or its Board of Directors.

About the Author

Taylor Owen is a CIGI senior fellow and the host of the Big Tech podcast. He is an expert on the governance of emerging technologies, journalism and media studies, and on the international relations of digital technology.