Digital Myth: The Internet Will Save News

The perfect storm that hit the news.

‘I’m level 186 on Candy Crush.’ The room laughed at my joke, added at the end of a question I asked from the floor at a talked entitled ‘Can Google Save the News Industry’. The speaker, Google News executive Madhav Chinnappa, had made several references to the popular game so I picked up on that to soften my question. Google wants to present itself as a friend of the news industry, a business partner, but if you look at the evidence it will have to try much harder. Let’s assume that the free press is important and that it needs money to live, that should not be too controversial: the Panama Papers leak is but one example, revealing large-scale tax evasion by policy-makers, sports stars, business leaders and others. Transparency does not come on its own, but free journalism can make it happen, in this case when combined with internet-era phenomena such as terabyte databases and online leaks. It appears the lessons from WikiLeaks have been taken to heart: there needs to be an editorial layer. Snowden used Glenn Greenwald and several established news organisations, and hundreds of editorial teams have worked on the Panama Papers. Internet cannot replace journalism, but it can make it better. However, it seems it can also hurt it.

‘The news media let the genie out of the bottle; now they’re trying to put it back inside’.

‘The news media let the genie out of the bottle; now they’re trying to put it back inside’. This is how a friend of mine captured the news media’s current digital predicament. While snappy, is it really true? For sure, traditional news media is in dire straits – subscription revenues dropping, ad sales moving to digital competitors, cutbacks mean fewer pages in your daily and fewer reporters in the newsroom. The news organisations are trying to fight back with no lack of innovation, ‘native’ advertising formats, dieting clubs, tailored events and so forth. Some hope for patrons to save quality journalism: Amazon founder Jeff Bezos now owns the Washington Post; Facebook co-founder Chris Hughes last year acquired The New Republic. No small irony that these publicist icons are now in the hands of Silicon Valley billionaires. How did the news media end up here?

When the Web was young and ‘information wants to be free’ was still a credo that a lot of people believed in, daily newspapers had two main sources of income: sales (subscriptions and newsstands) and advertising. A rule of thumb was that sales paid for the print and distribution, while adverts paid for the content. By this logic, it looked like a great idea to publish all the content for free online, never mind the distribution and its zero sum game of cost and revenue. With free access, more readers would come and thus more advertising revenue. No shortage of new media experts sang this gospel and many publications joined the chorus. The sacrifice was severing the direct tie of the delivery to the content: no print paper hitting the doormat early in the morning; no financial exchange taking place at the newsstands on the way home from work. (I realise it was a gradual process, such things as these don’t happen overnight – in fact you can still subscribe to a daily, twenty years into this process.) This was the first part of the perfect storm.

The next part of the news business to be challenged was the advertising. Relying mainly on a single source of revenue obviously makes a business vulnerable. With the freenomics of the Web, advertising became the #1 business model not only for news media, but for pretty much all the internet services. Without the competitive advantage of paper delivery, newspapers saw themselves compete for the limited ad budgets with native digital business which could offer better deals in many cases. Concepts such as ‘buying traffic’ and ‘eCPM’ arrived. While the news media may have still had better quality content to offer, it was dethroned as the main advertising channel for many categories. Classified ads went to online services like Craigslist.com and Subito.it etc., typically broken down by country, but just as typically with one dominant player for classifieds per market, because with the law of the networks, why would you need more than one? Job ads went online, car ads, insurance ads … the list goes on. Not only specialized niche online services, but also general services like search and later video, social media and who-knows-what competed for the ad revenue. The other half of the news business revenue began to crumble.

Relying mainly on a single source of revenue obviously makes a business vulnerable.

With sales and ad revenue diminishing, the news media was left with its quality content, but that too was challenged by native digital competitors. The Huffington Post is only one example of online publications that have been accused of lifting content from traditional news media. More spectacular was the case in Spain last December, where a new law required Google News (and similar services) to pay fees to the copyright owner when showing snippets of news stories from other publications. If there was ever a need to demonstrate how dependent the news services have become on Google as a source of traffic, if the case had to be made that the power balance is skewed heavily in favour of the global big data companies, if an example was needed to illustrate the different logics of the valued pluralism in traditional media and the monoculture of cloud services, hardly any could be more convincing than what followed suit: Google News simply shut down its service in Spain, the news publications found themselves losing up to 25% of visits to their web pages and with no option but to waive their rights under the new law.

Three digital strikes brought the news media to its knees: first the loss of sales, second the loss of ad revenue and third the lost integrity of the content. Did the news business do it to itself? Probably to some extent, at least in the first step – to publish content for free online – looks ill-advised in retrospect. But the rest was outside the influence of the news organisations – it was the result of the actions of other parties.

Another blow came with smartphones and the mobile web, which allowed readers to access online content from anywhere and not only the desktop. That is of course good news in many ways, giving flexibility to users, new opportunities for businesses, new offers and new forms of culture. The news media has indeed embraced mobile in many ways; for a while it even looked like apps would save its revenues. But it also meant that another exclusive domain for the traditional newspapers – the commute. Instead of reading a paid-for newspaper on the metro or bus, commuters access the same content for free on their smartphones.

The news media has an added dimension of difficulty, freedom of expression being the foundation of its existence. While it is true that unauthorized distribution of the expressions of others has nothing to do with freedom of speech, that copyright is the other foundation of free speech, that not all data that travels in digital networks can be regarded as expressions – the ethos of news is to never go anywhere that even remotely smells of any restriction of freedom of expression. An honourable position, but in this case perhaps contributing to the difficulties.

It is safe to make the case for the importance of independent media in modern democracies. The public’s access to information, the scrutiny of power, the formation of public opinion are all central tasks of independent media. Without knocking the new sources of information that have arrived with the digital media, it is difficult to imagine democratic elections without independent media. Consider, for example, the media’s position in authoritarian regimes: it is no coincidence that the dictators of Belarus or North Korea win more than 90% of votes in elections, and that the media is loyal to the regime.

The public’s access to information, the scrutiny of power, are all central tasks of independent media.

But democracy is not the only irrefutable value of the independent media. Many of the challenges that new digital media struggle with – editorial responsibility, threats, hate speech or cyber-bullying, user comment, lack of fact verification and thus the dissemination of myths – have all been addressed by the traditional media. In addition, solutions have been developed over the years in the form of press ethics: simple things like responsible editors; signed articles; verifying facts with an independent source; giving each side of a story an opportunity to comment; rules on revealing the identities of crime suspects; protection of sources; and some system for dealing with abuse of the rules of press ethics. This continuously evolving setup has developed over at least two centuries, with the purpose of fair reporting and the formation of free public opinion. It takes time to learn; reporters go to journalism school and work with more experienced editors to understand the system. It is the topic of continuous debate within the journalists’ trade. All in all, it is a fundamental contribution to modern democracies and gives important clues as to how to deal with those same problems in the online public sphere, which suffers from a lack of fair reporting and often breeds myths and filter bubbles. That is the dark side of democratized digital media, but the exact same problem is why traditional media have worked it out in the form of media ethics. It would be well advised to put some of that insight to use in online media before it’s too late.

In this chapter, I have painted a dark picture of the situation for news media online. Is there no hope? Of course there is. The news media is still around, both in traditional distribution forms and new ones. The arrival of Silicon Valley patrons as media owners is surely not the first time in history where industrialists or vested interests have bought or started news businesses. And some of them may have the best intentions, in which case the resources can help journalism. New business and funding models have seen the light and will continue to grow. And for sure there is a case to be made for the benefits of democratized media. It’s also true that while young people use traditional media less, they’re better informed than previous generations – the bloggers, social media and streamers can do a good job spreading the news, but it can’t dig like investigative journalists can. Let’s appreciate the values of traditional media and protect them. There should be room enough for the bloggers, the patrons and the classic media. The threat is the loss of skilled reporters as news organisations cut back, the loss of revenue for independent quality media and the monolithic big data companies that concentrate power and revenue to a very small number of people. That last bit is not only for the news media to worry about.

So what was the question I asked Google’s Chinnappa? ‘Does Google share the data harvested from partners using its news services back with them so they can develop better services and offers?’ Chinnappa dodged the question and talked about privacy rights (I took that as a ‘No’), but the moderator had a good follow-up, asking if news were more important than other content, to which Chinnappa replied: ‘Everything is important.’ That says it all. If everything is important then nothing is important. If everything has the same value, my cheesy holiday videos are as important as the Panama leak. Data is data and nothing is more important than the other. No wonder conspiracy theories, filter bubbles, hate speech, organised disinformation and piracy flourish online. That is not democratized distribution; it is an illusion of democratized distribution. The absence of priorities does not make everything equal; the opposite is true: to have democracy, equality and freedom, there must be rights. There must be priorities. Some things must be more important.

Can the internet skyscrapers save the news industry? No, but they could stop help killing it by sharing their ad revenue, distributing other people’s content (even in snippets) against their will, letting news partners own their data, respecting intellectual property rights across various services, being transparent about the priorities for its search results and applying established press ethics on their online publishing channels.

Digital Myths is a series of posts published from the book 21 Digital Myths, Reality Distortion Antidote where Netopia editor Per Strömbäck takes a closer look at some of the concepts that have shaped the way we think, talk and make decisions about digital technology and the internet.

 

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