No such thing as free money to save the local press

As I was leafing through the Guardian on Saturday morning I came across an article with the rather alarming headline

Google news tax could boost local papers, report says

Google and other websites that carry news they do not produce should be taxed and the money generated used to prop up local newspapers, says a report which warns control of the media is concentrated in too few hands.

I tweeted it and got a number of interesting replies:

The report comes from the Carnegie trust UK’s commission on Making Good Society. It does indeed set out a suggestion for Industry levies citing Institute for Public Policy Research research that a 1% levy on pay TV providers of 1% “bring in around £70m a year”

A similar fee imposed on the country’s five mobile operators could generate £208m a year. Making Google meet its full tax liability in Britain would boost the pot by a further £100m.‘ The same IPPR report argues that ‘such sums could save many local newspapers and web sites from closing down, could stop the destruction of local and regional news on ITV and could help new media start-ups to plug these gaping holes in public service provision – all without the taxpayer having to stump up any more cash and without having to raid the licence fee.’

But the report also makes it clear that the money would come with something of price

Levies on the use of aggregated material have the potential to generate significant revenue to support the production of new public service and local content, involving civil society associations. If this form of funding were to be explored, changes in regulation would be needed to ensure that revenues go to original news producers and not just to those who present and disseminate material. Original news reporting needs to be supported so that it is financially viable; this could require charging those who are not authorised to use and distribute this material.

Not quite free money from a google tax.

The whole report makes for an interesting read (I mean genuinely interesting not that other academic definition of interesting)

It’s pretty wide ranging but it singles out “democratising media ownership and content as one of it’s four main areas where “a stronger civil society could make the most difference”

A whole chapter (chapter 3) is devoted to trying to understand the pressures on and drivers of news production and the impact that has. They are clear that technology plays a key part citing radical cultural shifts associated with pervasive technology and the rise of ‘digital natives;’ as an uncertain driver of change. But the discussion is a bit more broad ranging:

…[D]espite the proliferation of online platforms, more of the news we receive is recycled ‘churnalism’ and aggregated content. Trends of concentration in media ownership and increased pressure of time and resources have narrowed the sources from which original news derives. Moreover, the centralisation of news production and neglect of local issues has particular repercussions for access to information across the UK and Ireland, especially in the devolved nations.

And it’s clear where the problem is:

…the central issue affecting traditional news providers is not the decline of audiences or interest in news, but the collapse of the existing business model jeopardising the democratic role of journalism. According to the National Union of Journalists: ‘The media industry is essentially profitable but the business model is killing quality journalism.’

Media concentration.
When I first read the Guardian article I bristled at the idea of a google tax of newspapers. Why? Because we would essentially be propping up commercial organsiations who still work at a profit. It would be akin to a bail out. So I found myself drawn to the areas of ownership and centralization in particular. The report is pretty robust here.

The challenge of creating original content and the diminishing number of newspapers is further compounded by the concentration of media ownership in relatively few hands…..with four dominant publishers controlling 70% of the market share across the UK

That concentration of ownership and the influence it exerts is cited as a “key obstacle to transparent policy-making which incorporates a sustainable role for civil society associations” Which comes from the ‘continuing and intimate relationship between key corporate interests and policy-makers; a relationship whose bonds are rarely exposed to the public’

Their suggestion seems to be that the Scott Trust/Guardian model is more likely to serve the development of a pluralist media landscape than a purely commercial one. But it sounds a note of caution

While independent funds directly supporting journalism can come with strings attached and endowments are not immune from economic pressures, philanthropic funding can help preserve journalistic independence and secure guarantees on public service content.

General suggestions.
The big ticket suggestions like tax breaks and levies are balanced by some more specific suggestions that form the main discussion of the chapter.

  • Growing local and community news media.
  • Protecting the free, open and democratic nature of the internet.
  • Strengthening the transparency and accountability of news content production.
  • Enhancing the governance of the media.
  • Protecting the BBC.
  • Redirecting revenue flows to promote diversity and integrity.

Their ideas for strengthening transparency include the suggestion of a Kite mark that shows no dis or mis-information. Good luck with that one.

But back to funding, the last three points are interesting in themselves.

When they talk about enhancing the governance of the media they say that”

“All news organisations in receipt of public funding should actively engage with the public and with civil society associations, through their governing bodies as well as through their daily practice.”

Which could only really mean the BBC right? But in developing the suggestion of redirecting the revenue flow they:

…want to see new funding models explored: for example, tax concessions, industry levies or the direction of proportions of advertising spend into news content creation by civil society associations, or into local multimedia websites.

The price of public money.
My reading of the report was that nothing comes for free. In an earlier chapter the financial sector comes in for a real battering. But though the media orgs are more delicately handled the implicit message is still the same. All the money that could come from tax breaks, funding and other sources comes at a cost. That cost is de-centralisation, openness, stronger regulation and in transparency (a phrase that seems to disappear mid report to be replaced by integrity)

Would be nice but I can’t see it happening.

The full report is available here.

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