Are public media subsidies fair? A recent study by The Reuters Institute for the Study of Journalism has tallied up the amount of public money that either directly or indirectly subsidises media in the U.K., Finland, France, Germany, Italy and the US.
Unfortunately, the study discovered that strategies for funding news organisations have not changed to accommodate the developments of he digital age.
Finland gave the most public money, per capita, to support the media - around £46 a year per head via indirect subsidies, such as tax and VAT exemptions - and France gave the most in terms of direct public funding to media, through initiatives such as the 'My Free Newspaper' scheme, donating around £5 per capita. Germany was found to be the nation that invested the most in public service broadcasting.
Evidently, public media funding is an issue which need to be regularly assessed, as while it can improve circulation by keeping costs low for the consumer and help the industry through difficult times, state media funding potentially has significant consequences for press freedom, especially when it comes to direct funding. Clearly there is a fine line between offering financial support to an organisation and influencing it.
What the author of the study, Dr. Rasmus Kleis Nielsen, found to be most pertinent was the fact that these subsidies did not reflect the digitisation of news and media.
For instance, in the U.K., VAT exemption is extended to newspapers, defined by law as "several large sheets folded rather than bound together, and contain information about current events of local, national or international interest'", but not to their digital content. This means some newspapers, like The Express and Star of Wolverhampton, have to charge more for their digital only packages than they do for subscription packages that include both digital and paper formats, as The Press Gazette explains.
Nielsen concludes that state funding needs to be addressed in order to "bring them in line with the principles purportedly behind them and with the times that we live in" and acknowledge that digital strategies and start ups are a vital part of the media industry.
Sources: Editor's Weblog (1) , (2), The Guardian, The Press Gazette, Reuters Institute for the Study of Journalism Public Subsidies Report,