It has been a long time coming, but the UK’s ailing news industry may finally be on the verge of structural change that could help slow, or maybe even reverse, the more than decade-long economic decline of public interest journalism.
Over the past year, investment in news innovation and the extension of charity status to include journalism could open routes to make news organisations more financially viable. Meanwhile the announcement of a new Digital Markets Unit to counter the dominance of big tech and the drafting of new laws to protect against online harms could together help to contain the rise of the super-platforms at the expense of news organisations.
Even prior to the 2008 global financial crisis, it was becoming clear that the old business model of news was breaking. News shifted first online and then onto mobile phones – but advertising failed to shift with it. First the classified ads disappeared to standalone sites such as Craigslist and to companies’ own websites, then contextual ads headed to Google, and soon after to Facebook.
By the end of the first decade of this century it was becoming obvious that certain types of news would struggle to survive the transition to the web. Foremost among these were on-the-ground “beat” reporting, investigations and local news. Since 2005, 245 UK newspaper outlets have closed, local news conglomerates including Local World and Johnston Press have been sold off or collapsed and local news staff have been cut to the bone.
Lots of new local and hyperlocal sites have sprung up online, among them Cornwall Reports, Inside Croydon and Oggy Bloggy Ogwr, but most of these are shoestring operations run out of kitchens and bedrooms, with an average annual revenue of less than £25,000 a year.
Meanwhile the tech titans have mushroomed. The Competition and Markets Authority has calculated that of £14 billion spent on digital advertising in the UK in 2019, 80% was spent on Google and Facebook.
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As income flowed away from news and towards this tech duopoly, the US corporations set up schemes to provide journalism grants – the Google News Initiative and the Facebook Journalism Project – but these only account for a tiny proportion of the income lost to news. In any case, most of the Google grants have been given to established commercial companies, and – since the tech giants are under no obligation to provide them – they can be stopped whenever the platforms choose.
Green shoots
All this paints rather a bleak picture for the future of public interest news in the UK. Yet, in the past year, we have seen the possibility of real change. A good deal of credit for this can be put down to inquiries led by two people, Dame Frances Cairncross and Jason Furman (the former chief economist to US president Barack Obama).
The 2019 Cairncross Review into the sustainability of journalism in the UK made it absolutely clear that what was most under threat in our brave new digital ecosystem was “investigative journalism and democracy reporting” – and that to sustain them, public intervention was necessary.
The Furman Review into digital competition, also in 2019, argued that a reliance on merger and antitrust enforcement was insufficient for countering the market dominance of firms such as Google and Facebook. It proposed the establishment of a new digital markets unit which would – among other responsibilities – draw up a code of competitive conduct to which the digital “big beasts” would have to adhere.
Cairncross’s review sparked the launch of a new innovation fund to stimulate new methods and approaches to public interest news. The government gave research institute NESTA £2 million to distribute among the most innovative news projects in the UK. NESTA received 178 applications, out of which it gave grants to 20 projects to do four-month prototypes in 2020.
Furman’s review triggered the announcement on November 27 that the government would establish a new Digital Markets Unit to regulate the competitive behaviour of the tech platforms.
Within days of this announcement, and months before this unit has been set up, Facebook sought to pre-empt some of its actions by saying that it would start paying UK news organisations for their content, and would give news a dedicated page on its platform.
Charitable status
And, on November 27, the House of Lords Communications and Digital Committee endorsed the extension of charitable status to include journalism. This should mean that news publishers – should they meet the criteria – can now benefit from tax relief, foundation grants and charitable donations. Small, non-profit local news outfits may finally be able to sustain themselves while performing a critical public service.
Still to come this year is the long-awaited and much-anticipated Online Harms legislation. This was originally touted by the government as the first attempt in the world to address online harms “in a single and coherent way”. We are yet to see what the legislation contains, but at the very least it ought to increase the liability of technology platforms such that they will want to prioritise more trustworthy sources.
There is still a long way to go in the quest for new, more sustainable models for news. But these are all green shoots that could support the gradual recovery of public interest news – and, as a torrid and difficult year comes to an end, and in the spirit of festive cheer, we should celebrate some good news for news.
Martin Moore is a Trustee of the Public Benefit Journalism Research Centre