In this paper, just delivered to a conference in London, Angela Phillips paints a picture of a media sector transforming itself in innovative and exciting ways, held back by failing business models. Many myths are busted along the way: that journalism can be free, that user generated content brings down costs, that video is the way forward. So what's the future? Will the survival of journalism increasingly depend on us giving away our private data? Or will we embrace the alternative: a simple online system that would allow us to pay for the content we want?
Originally presented at the Goldsmiths Leverhulme Media Centre conference ↑ on 3rd April, 2011.
Journalism is not in crisis. It is in many ways more exciting than it has ever been.
- Text journalism can now compete with video and radio for speed
- Light portable equipment and internet connections allow us to file video and pictures from the middle of an event without needing to leave the scene.
- Access to data allows us to monitor the workings of government and, using readily available applications, to turn the data into understandable visual images that can be read by anyone.
- The internet means that activists in Tunisia, Egypt, Libya and Syria have the means to get their own stories out rather than waiting for Western journalists to be parachuted in.
Enthusiasm for new ways of looking at the world can run ahead of the old controls. Having access to private data creates issues of privacy as we have seen. The ability to watch the world from one’s desk is seductive, but cost cutting means that the web is now too often an excuse for shackling journalists to their desks copying and pasting rather than talking to contacts.
The sheer quantity of in-coming material makes it harder for journalists to make judgments about the material they receive. Our research (Fenton 2010: 153) found that journalists were more, rather than less, inclined to depend on tried and trusted channels rather than talking to new sources. Journalists are also starting to realise that, having access to the work of activist reporters and members of the public, brings problems as well as advantages. We have difficulty checking that the information is reliable. The fact that the Guardian felt it necessary to document the extensive verification processes used in the Syrian email story last month ↑ is an indication of the scale of resources required to verify material from unknown sources.
Access to data is useful but the sheer quantity of it can allow important stuff to be hidden and the difficulty of accessing and understanding it has necessitated the development of a whole new branch of data journalism.
Open journalism, we found, is a mirage: the more open a news organisation tries to become, the more journalists they will need to comb and verify incoming material. As one journalist put it: “It’s lying trying to catch a straw in a hurricane.” (Phillips 2010:94))
However some of these are just teething problems. We will find ethical ways of living with potentially intrusive technologies. Journalists are already devising ways of verifying data and social media we will incorporate these new standards into every-day journalism. Young journalists are already learning how to adapt their work so that they can, if necessary, shoot video and pictures and as a result they are now also better at collaborating closely with videographers and graphic designers to produce better ways of telling stories. More collaborative methods of researching stories for example the Guardian’s Reality Check column ↑ are already being developed.
The problem lies not in the journalism itself. It lies in the business models that are failing to support them. Journalism is struggling because the source of income they have depended on for over 150 years has started to desert them. As business writer, Michael Porter argues: “The essence of strategy is choosing what not to do”. (1996, p.20)
Richard Tofel in his book ‘Why American Newspapers Gave Away the Future ↑ ’, suggests that news executives were listening to the wrong advice and just took the wrong route. Newspaper managers, in-thrall to the technologists, and in the case of local news desperate to avoid losing their very, very lucrative businesses (with profits of 20-40 per cent per year) it was very easy to choose wrong.
In 2000- 2001 advertising revenue was buoyant and there were no major threats on the horizon. But within a very few years newspaper owners were starting to panic as audiences started to move towards the web. They rushed head-long online assuming (given the existing model) that advertising would follow them and that the reduced cost of distribution on line would cover them for the loss of the sale price of the newspaper.
What they hadn’t bargained for was that advertising would find other places to go and leave news adrift. Nor had they bargained for the collapse of advertising with the crash of 2008.
The advertising conundrum
Most estimates suggest that online ads, even if you can get them, bring in ten per cent of their print equivalents. So online far more advertising is required to sustain the same journalism output – but output demands were rising and advertising space was limited. A new report from the PEW centre ↑ suggests that the news market is now moving to the smart phone where the ad rate is even lower (about one per cent of print).
By giving away the content on line, news organisations were cannibalizing their own businesses and creating the expectation that news could be provided at no cost to the consumer. In doing so they created the problem that is now in danger of destroying journalism.
Last year the Guardian lost £33 million and chief executive, Andrew Millar warned that the company could run out of cash in three to five years. In spite of the fact that they now have nearly 3 million daily users on line, They still need the paper edition (less than 300,000 readers per day), 890 non-journalism members of staff and another TEN different income streams, in order to pay their 630 journalists who provide the product that they are giving away.
Journalism cannot be free.
Journalism, done well, is an expensive business and it has to be paid for. The question is not whether it should be paid for but how.
Newspaper executives are not keen to take the blame for the debacle. John Paton —CEO of the US Media News Group newspaper chain says the problem is newspaper cultures. In his view one of the biggest changes that most traditional papers have to take is to “put the digital types in charge of everything.” ↑ Frederic Filloux of the French ePresse consortium is pretty specific as to who he blames for the difficulties newspapers face: “An aging staff, locked-in by layers of antiquated guild or union-negotiated contracts, doesn’t favor labor agility. The same goes for training, job reassignments, etc.” (Filloux 19th March 2012).
Ashley Highfield, the Digital Type who is the new CEO of Johnson’s Press, is banging the same drum. He explained in a recent interview that, although print circulations in the regions are down only 2 per cent (and the smallest newspapers are making the most profit), it is necessary to move faster to digital.
But what is the evidence for this often quoted inertia?
Richard Tofel describes what is going on in a very different way. He sees: “A culture of journalistic reach and innovation alongside a culture of business complacency and the status quo.” Tofel, rightly in my view, describes a world in which the journalists were way ahead of the managers and business consultants.
Journalists were happily experimenting with new ways of finding, and disseminating material working at the very edge of ethical enquiry – The MPs expenses, Wiki –leaks, the Liam Fox scandal, the phone hacking scandal etc etc. They were using the new media opportunities to improve journalism. Their managers on the other hand were too often imagining a world in which new media could improve profits. They talked of ‘scale’, centralisation and of multi-skilling.
In some news-rooms journalists were simply told that from now on they would be producing video – often with virtually no training. Those who were reluctant, or who questioned the value of this move, were derided as ‘luddites’ and found themselves the first to go as redundancies were announced. Of course they were also often senior staff with high salaries – replaced by younger people who were less likely to complain about extended hours and little opportunity to follow real stories.
In an ideal world it would be lovely to be entirely multi-platform and have video embedded into every story where it is relevant to include it. But there is no evidence that video improves profits or renders journalism more sustainable. On the contrary, the evidence points the other way.
The very best example of a multi-platform local paper was the Manchester Evening News in collaboration with Channel M. When the Guardian sold the paper, the TV station was closed - because video is expensive. The web is not generating enough to sustain text (which is cheap) how was it going to pay for video, which costs at least ten times as much to produce?
Nevertheless the Government has decided to pump £120 million into the establishment of local TV in collaboration with local news organizations, taking a large chunk of money from the BBC (that is from us), to chuck it at local news just reduces the income for the most used and trusted news source we have and hands it to people who have already demonstrated that they don’t know how to come up with a solution to the decline of their businesses.
Technology and un-paid amateurs
Some entrepreneurs are convinced that technology and active pro/consumers will bring the costs down to manageable levels. Inviting people to participate in news-gathering may be desirable but it is not, in fact, cheap. The journalists involved still have to do the work of verification, whether or not they originate the content. They still have to package it, make it accessible and provide it across many platforms. To be done well, this job requires more skill, not less skill.
Yes you can fill up the space between ads with cheery chatter and listings but good news delivery requires journalists who cover the territory on a regular basis, have a reasonable level of background knowledge and ask probing questions.
The work of curating in-coming material has to be factored in. Ohmynews ↑ – the first and best example of an entirely crowd sourced news operation – died precisely because it could no longer afford the cost of editing contributions.
The Downside of Scale
One possible future lies in scale: the new hope is that by getting bigger and bigger audiences the peanuts paid on-line by advertisers will gradually accumulate. The Guardian have now followed the Daily Mail to America in a bid to push up readership and the advertising dimes that come with them. Media organisations have, always, depended on the high cost of entry to the field to deter competition. What we are in the process of seeing is a worrying new trend – the birth of a different kind of barrier to protect even bigger companies. If the only way to succeed on-line is to be literally gargantuan and to collect lots and lots of very small amounts of money (as in the Google and Facebook models) what does that actually mean for news?
Is the best way to operate in a digital world to get big enough to dominate the field? Can consumers really interact with a newspaper that has millions of readers? Will people continue to read local newspapers that are just vehicles for advertising that isn’t even local - because selling digital ads space to independent local companies is too time consuming to bother with? If newspapers get big enough to succeed will they be too big to be genuinely democratic?
This is a major problem for start-ups. There will be little chance for genuine content innovation in the future if all publications have to be paid for by advertising and advertisers will only pay for a product with millions of hits a day. Niche sites about celebrity, technology and sport may survive but what of the feminist publications or the political publications that, in the past, survived by selling their content. In this brave new world of the free, genuine innovators struggle to raise any money at all and innovation does not thrive on an empty stomach.
Selling our souls to capital
Ashley Highfield recently announced that digital ad sales were up at Johnson Press. They now bring in 20% of revenue. This is a very high percentage for a news business but Highfield is nowhere near being able to dispense with print – which brings in the other 80 per cent. (Roberts 2012)
For him the answer lies is moving FAST into digital and ‘targeted’ ads. To you and me that means giving away more personal data. Because the Corollary of scale and on-line advertising is the sale of data, that means your data and my data. Smart advertising (the kind Ashley Highfield wants to use) is all about us handing over information so that we can be manipulated into buying stuff we didn’t know we needed. Is selling our data, our personal lives, the very heart of our private selves really better than paying in cash for the things we need?
This is the question that confronts us today the very week that Google announces a new way of ‘sharing’ cash with content organisations via a new form of data sharing. And the very week that the Government announces a new Bill to allow access to all of our on-line information.
Another Future?
There has to be another way. There is no problem with journalism going digital. That simply isn’t the issue. Journalists are fast thinking people usually well tuned-into change. But they also need to eat. If they are reluctant to go the way they are being pushed it is because they feel they are being pushed over a cliff and they are not lemmings.
Subsidy may well be the way forward in the short term. It may even be necessary in the long term, but if viable innovation and a plethora of new innovative ways of producing journalism are to stand any chance of survival there needs to be a way to allow free search and payment for journalists.
This is where the future lies. It is not about finding ways of doing away with journalists and journalism. Or about undermining the quality of what journalists should do. It lies in finding a way to get citizens not only to participate but also to pay for the journalism we all need.
If we can have Oyster cards and cash cards that allow us to pay out small amounts of money without needing to sign in or fill in forms then why can’t that technology be available on-line? Why should payment require anything more than clicking yes to a button that asks us to pay a few pence to view an article? Smart payment systems that are not linked to personal data would really give the web back to the people who matter: the journalists, writers, musicians, app builders, animators and other creative people.
Perhaps that is why they don’t exist. Maybe the real reason why we cannot have a simple payments system, that doesn’t require complex and off-putting log-ins, is because that would prevent the big players from getting their hands on all that private data. It is in the interests of big players to keep small players out of the game and they are doing it by telling us that information wants to be free. We should stop listening to them.
Democrats have to wake up to what we are about to lose. There must be a better alternative to free, if real journalism, real innovation and real democracy is to survive into the future.
Fenton, Natalie (2010): NGOs New Media and the Mainstream News, New Media, Old News, Sage
Phillips, Angela (2010): Old sources: new bottles, New Media, Old News, Sage
Porter, Michael (1996): What Is Strategy? Harvard Business Review
Pew Research: New Devices, Platforms Spur More News Consumption ↑
Ingram, Mathew: Is John Paton the savior newspapers have been waiting for ↑
Andrews, Robert: Keep Calm, Carry On And Don’t Charge For News, Johnston’s Highfield Says ↑
Ingram, Mathew: The Guardian draws a line in the sand: Digital comes first ↑
Filloux, Frederick: Media Culture Shifts Theory v Reality ↑
http://www.opendemocracy.net
Copyright: open democracy
Picture: Barbara Schieber, Bromelia, Guatemala
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