Last Wednesday, May 6, the
US Senate Commerce Subcommittee on Communications, Technology, and the Internet held a hearing to review the plight of the newspaper industry, to better understand new media and the new model emerging, and to assess the role that government should play in the media as it evolves. The Future of Journalism hearing was presided over by Subcommittee chair Massachusetts Senator
John Kerry, who called the hearing in response to the threatened closure of his local paper, the
Boston Globe, and the troubles facing newspapers across the country as advertising and circulation decline and the Internet replaces traditional media.
In his opening statement, Kerry says the committee has met to discuss not only the jolting condition of the newspaper, but also its implications for the future of journalism and the country. He believes it is important to "preserve the core society function served by independent and diverse media" and questions whether online journalism will "sustain the values of professional journalism the way the newspaper industry has." The committee invited five prominent representatives of various types of media to express their views about the Future of Journalism and offer their solutions.
"Why is the government interested?" asks Kerry. "We do have a responsibility for the licensing of broadcast. We have a responsibility for the regulatory oversight of ownership of cable, satellite, other issues with respect to communications; and needless to say, how the American people get their information--what the structure of ownership is--is of enormous interest to all of us because it is the foundation of our democracy." Is there even any government role at all, he wonders, or is this simply a normal transition in the marketplace?
Considering the nonprofit modelBefore it heard from the media representatives, Maryland Senator
Ben Cardin spoke to the committee about his
Newspaper Revitalization Act, which proposes a nonprofit, tax-exempt 501(c)(3) status for newspapers. Cardin stresses that online journalism does not supply the in-depth reporting and investigative journalism provided by traditional newsrooms that are essential to a free and democratic society. His bill would provide an opportunity for local supporters--whether individuals, foundations, or educational institutions--to come together to preserve their community newspaper.
The major criticism of Cardin's bill is that it could threaten a newspaper's freedom of speech: 501(c)(3) status allows editorializing but prohibits a paper from endorsing political candidates. The independence of journalism from government is crucial to its role as watchdog, and it is undesirable for a newspaper to have the government involved in judging its content. However, in their addresses to the Committee, both
Steve Coll, former managing editor of the
Washington Post, and former newspaperman
David Simon, say that while they seriously oppose government interference in newspapers, they are intrigued by the nonprofit model.
Newsrooms provide an important public service, so why shouldn't the government give them the tax exempt benefit of becoming non-profits? After all, the danger of government interference in content could be exaggerated. Any single politician or political party attempting to manipulate a publication would be immediately exposed through other media outlets, and the threat is not much greater than private ownership where powerful investors might maneuver the paper to serve their own interests. Nonetheless, the greatest issue faced by nonprofit newspapers and their investors will be where to draw the line between endorsing and editorializing. If a newspaper's responsibility is to provide the public with unbiased information, then blatant political endorsements seem in violation of that role anyway, but nonprofit status could limit criticism and commentary on politicians and legislation that might reduce the media's role as watchdog.
As Coll and
Alberto Ibargüen, President of the
Knight Foundation, point out, nonprofit is not a universal remedy nor will it solve newspapers' profit problems. The initiative could be viewed less as a savior of the newspaper entity and more as a bridge to preserve local journalism during a transitional period. Ibarguen says that relieving profit pressures with nonprofit status might help newspapers "extend their useful life until we figure out what's next and what online model can afford professional journalism."
Relaxing antitrust could help publishers charge for online contentThe other great appeal for government intervention in newspapers has been the request for changes to media ownership and antitrust policy. Last month the Justice Department rejected House Speaker
Nancy Pelosi's request to change the boundaries of media antitrust to include all media in a geographic area--including radio, TV, and newspapers--when deciding whether a sale is anticompetitive.
Pelosi's antitrust proposal raised obvious criticism about the independence of newspapers and consolidation of ownership. However, at the Senate hearing, Simon and James Moroney, publisher and CEO of the
Dallas Morning News, approached antitrust from a different angle: they urged the Committee to give newspapers an antitrust exemption so that industry leaders could convene to discuss copyrighting from aggregators and charging for content online.
Unable to foresee the digital future, at the advent of the Internet newspaper publishers made the mistake of offering content free online. Now readers are accessing that content for free, not through the publisher's site, but through aggregators like
Google News, which also does not pay publishers for content.
Marissa Mayer, vice president of Search Products and User Experience at
Google Inc., defends Google to the committee, calling it a "conduit" for journalism that provides a free service to online newspapers by driving traffic to their sites.
However, Simon and Moroney argue that aggregators do not provide adequate compensation for the revenue generated from publishers' original content. They contend that as of now, the profits publishers make from online advertising are not enough to sustain the quality journalism newsrooms have been providing. There must be
an industry wide initiative to charge for content online, says Simon, as no individual can swim against the tide. According to Moroney, under the current antitrust laws, publishers cannot even begin to have a conversation about possibilities for pricing or charging aggregators.
If the government does relax antitrust to allow for this industry wide "conversation," it could possibly lead to major publications placing a pay wall around content, charging users and aggregators, but does such a pay wall threaten the free market? One of the virtues of the Internet is the accessibility of information, so where do pay walls and content hoarding fit in? A generation of Internet users already views information as a free commodity, and charging online users for content will significantly reduce traffic, which will in turn reduce advertising revenue. Even if industry leaders can convene and discuss, they still might find themselves at a loss for a viable solution.
Experimentation and innovation rather than government intervention The hearing's last speaker,
Arianna Huffington, co-founder and editor-in-chief of the
Huffington Post, opposed antitrust exemptions, paywalls, or really any government intervention. In fact, she countered some speaker's doom and gloom position with the opening statement, "Journalism will not only survive, it will thrive." Her main point is that the industry has changed and moved forward and there is no going back.
Huffington says, "The future is to be found elsewhere: it's a
linked economy, it's search engines, it's online advertising, it's citizen journalism, and the foundations supporting investigative journalism. That's where the future is, and if you can't find your way to that, then you just can't find your way."
Ibargüen, Mayer, and Huffington all support embracing new media and encouraging experimentation and business models that promote digital possibilities. For Ibargüen that means providing universal, affordable digital action and adoption in the US and more inclusive public media that reaches every American. Neither he nor Huffington mourn the decline of investigative journalism, and both praise the efforts of nonprofits like
ProPublica and the Knight Foundation supported
Voices of San Diego for providing quality journalism outside the traditional newsroom.
According to Mayer, "The structure of the web has caused the basic unit--the atom of consumption--to migrate from the newspaper to the individual article," and because of the Web's ability to operate in real time, this allows for "living" instead of "static" stories that are constantly changed and updated like
Wikipedia or the
New York Times' "
Times Topics." These changes to the way information is viewed, insist Mayer and Huffington, mean a different approach to monetization is necessary, which requires innovation and creativity. The solution for newspaper publishers is not to appeal to the government for a handout to preserve the old ways, but to adapt quickly and direct their time and resources into experimenting with the monetization of traffic through advertising.
What will the Senate decide?Despite Kerry and Cardin's concern for the American newspaper, more than one of the subcommittee's senators held up a Blackberry during the hearing, proving themselves a part of the new digital audience. The general consensus of both the senators and media representatives seemed to be that their priority is not to save newspapers but to promote policies that sustain journalism.
How enlightening were the testimonies of the media representatives? Though certainly thorough in unveiling all the problems facing the media today, they failed to provide the government with a cure-all solution as to how it should proceed.
It seems fairly likely that the Senate could pursue the nonprofit solution as it seems basically harmless and might help some local newspapers stay on their feet at least long enough to find another answer. Relaxing antitrust could prove more risky, giving industry leaders the occasion to consolidate prices and possibly restrict information in a move that could prove more harmful than helpful to their own purpose.
The testimonies may have encouraged the Senate to do nothing at all for the newspaper but instead to accept that the audience and the market is evolving and no legislation can hold it back. If this is the case, then publishers will be faced with only one choice: innovate or fail. Instead of resisting change, they must get a grasp on technology and the new audience, paying attention to the success of others, then find ways to provide creative content and advertising solutions. As a few of the speakers said, this is still a transitional period for old media and new media, and there is still immense possibility for originality and advances. Though certain publications might lament their own fate, it is too early to be mourning the future of journalism.