In a previous blog I discussed our free press problem, pointing out that a truly free press cannot be counted on to be fair. In fact, we should demand just the opposite. Fair, after all, is so clearly in the eye of the beholder.
But that observation doesn’t detract from a general dissatisfaction with the quality of our news outlets. A 2016 Gallup Poll solicited opinions about the honesty and ethical standards of people in different professions. 43% of respondents ranked Journalist’s standards to be Low or Very Low, barely better than Lawyers and State Governors. And our opinion of them is going down. Even as late as 1992, only 15% of respondents ranked journalistic standards below average.
Perhaps journalism is getting a bum rap. Perhaps our political polarization has jaded people so much that our news has become just as suspect as our politicians. Perhaps they’re just part of the problem. Whatever the situation, we should still demand accountability.
As we contemplate alternatives, we should keep in mind that producing news has always been a business, as it should be. Unless we’re prepared for the press to be funded by our taxes (i.e., by government), somebody needs to pay the bills. Investigative journalism is expensive. It takes time and people, especially in a world that is dominated by US national and international events.
A CEO friend of mine recently pointed out to me that a business’ customers are the ones who fund the enterprise. They’re the source of its income. Unfortunately, we in the US haven’t had to directly pay for our press for some time. Broadcast news is funded through paid advertising. Even CNN, Fox News, and MSNBC are paid for by a combination of advertising and cable subscriptions. And it’s well-known that the business model for most newspapers is that advertising pays for producing content while subscription fees pay for printing and delivery. More than two-thirds of domestic news revenue comes from advertising.
We the consumers of news are not the customers of news outlets, advertisers are. We’re the audience. Advertisers are the entities with financial skin in the game. Yes, advertising rates respond to readership/viewership. But advertisers don’t pay for good content, they pay for eyes on their ads. Even nonprofit digital outlets (e.g., ProPublica, Texas Tribune) derive most of their revenues from major contributors, not readers. Can we imagine either news advertisers or donors willing to support outlets with what might be considered offensive non-mainstream news? Probably not.
If the production of news were a normal business activity, we might expect bouts of creative destruction. If production of news were a normal business activity, we might expect disruptive innovations (especially in our well-connected internet world). If the production of news were a normal business activity, we might expect competition to create better choices. None of these things seem to be happening.
I hate to say this but we’re getting what we pay for – which is essentially nothing. The news that we’re consuming appears to be essentially free or cheap. I say appears because there are obviously hidden costs in the goods that are advertised and cable subscription fees. But the price we’re paying for news is so hidden that it’s easy to forget about those hidden payments.
In a normally functioning marketplace for any good or service, consumers freely choose the products they wish to buy. But our news is very different. In most major cities, there is only one functioning newspaper. And as for broadcast news, advertisers pretty much advertise on all of them. Even our cable subscriptions are bundled. We effectively end up paying for all of them whether we like them or not.
Most commercial enterprises will change (or go out of business) when there is competition. Unsatisfied customers will take their money elsewhere. The disconnect between viewers/readers and paying customers muck up the usual business relationships.
The fix is an obvious one – get the middleman (advertisers) out of the transaction. We, as the audience for news, should also be customers. We need to start paying.
I subscribe to the Economist magazine. It’s expensive, around $135/yr for weekly news. Yes, it has advertisements, but very few. And though I don’t always agree with their point of view, I find the news generally well balanced and certainly worth what I pay for it.
It’s unfortunate that our free press has become so economically free. After a while free stuff starts to feel like an entitlement. Perhaps those of us who are interested in a better press should start putting our money where our mouths are. Let’s get used to sending some of our hard-earned dollars to those outlets who are providing us with the news we want. And if we tune out the outlets supported by advertising dollars, perhaps they’ll quietly fade into their apparent fate as more entertainment than news.