It’s undeniably ironic that the biggest challenge faced by journalism in modern history has not come from any totalitarian government or omniscient corporation. It has arisen from the democratisation of information, and the challenges this development represents to journalism’s three-hundred-year-old business model.
Since Gutenberg’s printing press, print media relied on its monopoly on the means of producing and sharing information to make money. Prior to the advent of digital media, by the early 1990s, publishers supported the independence of their publications with three pillars of revenue: print sales, advertising space, and classified revenue. As James Murdoch observed in his 2009 MacTaggart address, private ownership and profit are largely responsible for the growth and evolution of journalism in the US and Britain.
Whereas the printed press of continental Europe was largely subsidised by partisan financial support and state money, free market competition provided Anglophone publishers with the revenue to support their independence. The relative absence of political parallelism in US and British press for the most part of the 20th century is testimony to the correlation between independent finance and a relatively objective, non-partisan investigative press.
Such a model was viable up until about twenty years ago, when Tim Berners-Lee figured out a cheap way of using computers to share information at the speed of light. Digital media has destroyed print’s monopoly over information, and with it, the industry’s capacity to support its independence. For the last decade, print journalism has been bleeding cash. With the advent of the internet and the subsequent digitalisation of news media, print sales have plummeted. As consumers yield to free online content, advertising revenue has dropped in tandem with sales. Printed classified sections have almost been rendered obsolete in their entirety by websites that offer essentially the same service without charge to a much broader digital audience.
During the 20th century, this revenue insulated journalists from corporate and state interference and financed independent investigation. But within the new parameters set by digital media, the three-sided print, advertising, and classified sale model is no longer relevant – and the impact its demise has had is both brutal and sobering. Succinctly, the internet’s impact on print media revenue has been iconoclastic.
In The Economist’s recent investigative feature on digital media, veteran European editor Gregor Waller estimated that “by 2020 newspaper circulation will have fallen by 50%, classified advertising revenue by 90% and display advertising revenue by 30%”. In their 2009 book, The Crisis of Journalism, McChesney and Nichols’ catalogued an apocalyptic 29% drop in newspaper advertising revenue within the first quarter of 2009 alone, marking the 12th consecutive quarterly decline in newspaper advertising revenue since 2006 . Between 2007 and 2009, the newspaper market within the US plunged 30%, while Britain’s newspaper market shrunk by 26% over the same period, according to the Australian Media, Entertainment & Arts Alliance’s report Life In the Clickstream.
Maintained by former journalist Erica Smith, Paper Cuts collates job losses in the press industry across the United States of America. In 2009, over 14,000 print media jobs were destroyed across the US. Compounded with the data collected up until present day, around 25,000 jobs have been lost over the last three years. Although the Australian print news industry contracted by a relatively mild 3% in 2011, Fairfax shed 1,900 jobs in June. From any angle, print journalism’s forecast is bleak.
Diminished revenue is not the only challenge undermining independent journalism: technological progress is arguably undermining entire fields of the profession itself. Stijn Debrouwere has written a number of polemics that argue cultural journalism is in the process of being replaced by programs and websites that provide a customised, considered flow of content directly to users. At the most basic level, he argues, a single optimised search on Google surpasses the capacity of most music critics’ to cover the length and breadth of, say, a musical artist’s career.
Spotify’s ‘radio’ function interprets user’s listening behaviour to recommend and play music. iTunes, the biggest online music retailer in the world, now provides a similar service. Film and rental website Netflix recommends films to users based on their purchase history, while Wikipedia offers users a considered critical and historical summary of whatever content they might be chasing. Soundcloud and Myspace let music producers and consumers curate private artistic communities. In each of these instances, the role and relevance of cultural criticism has been diminished by technology.
Besides providing raw content, such websites and programs let users critique and share material both on-site and through social networking. Individually, each individual application is not a substitute for professional music or film journalism. But as a whole, they stress the superstructure of an industry already buckling under pressure of an increasingly unprofitable financial situation.
Furthermore, although digital media services like Spotify and Netflix argue they are optimized to provide users with the best browsing experience possible, there is no guarantee that sponsors, partners, advertisers and other affiliated corporate influences do not interfere with ratings or recommendations. A music or film critic is accountable his or her peers; a music or film program is beholden only to its programmers, and in turn, their employers.
Online advertising provides some revenue, most digital publications have been reluctant to raise paywalls around their content. Those that have raised paywalls have not enjoyed robust success: as of 2011, the Australian Financial Review has accumulated a paltry 10,872 paying subscribers. The Australian has had more success, with around 40,000 subscribers paying $4.50 a week. This figure is poor compensation for the paper’s $3 daily broadsheet price. Not only do paywalls drive users to competitors that offer content for free, but they also compromise the page-views that form the basis of online advertising revenue, further starving a publication of income.
It is inane and tautological to say financial viability is essential to any profession; this is true of all professions. But to journalism, finance has a unique role. Without finance, the press’s independence and investigative capacity are in danger of being compromised. Regardless of their employer’s objectives, an accountant is an accountant, an engineer is an engineer, a worker is still a worker. But if journalists can’t be paid by the free market for labouring on behalf of enquiry and exposure, they will have no choice but to labour on behalf of whoever can pay.
Digitalization has drastically compromised the news media’s revenue, and indirectly, it is compromising its independence. As a result, journalists have become increasingly instrumentalised by advertisers and public relation departments.
The impact of diminished financial independence is already evident in the Australia print media, with the nation’s mastheads increasingly reliant on pre-packaged and research public relations bundles as a source for stories. After analysing a five-day working week in the media across 10 hard-copy papers, the Australian Centre for Independent Journalism and online publication Crikey found nearly 55% of stories in their study were driven by some form of public relations. The Daily Telegraph relied most heavily on PR, with 70% of stories in their analysis driven by press release, while The Sydney Morning Herald demonstrated the most editorial independence, with only 42% of its story originating as PR material.
The internet has broken the model which print publishers have used to finance their independence for centuries. Digitalisation is the only model the press can adopt if it intends to survive as an institution. But preserving the revenue vital to the industry’s independence will be an incredibly challenging undertaking, and one that journalism is unlikely to endure in its present form. Ultimately, unless the changes brought about by digitalisation are incorporated into a viable financial model, journalism will increasingly find itself beholden to the purse-strings of advertising and promotional agencies.