The Other Elephant in the Room: Funding public interest news By Justin Schlosberg

9 July 2013 — New Left Project

As we reflect on the post-Leveson political furore, it is worth recalling Stuart Hall’s maxim that it is the way in which public problems are defined – rather than their proposed solutions – which exemplifies the exercise of real power in advanced capitalist democracies. 

The overwhelming spotlight shone by both Leveson’s report and the subsequent coverage has been on the single issue of how to regulate journalist ethics and practice. Yet Leveson’s remit – and even more so the testimony during his hearings – pointed to much wider problems of systemic corruption in the media, police and politics undermining not just the privacy rights of individuals, but the very fabric of our democracy. Leveson uncovered evidence of intensive corporate lobbying – 1,056 texts, 191 phone calls and 158 emails between News Corp executives and the Culture Department during the former’s attempted takeover of the UK’s biggest broadcaster BSkyB; ‘unhealthy’ intimacy between senior politicians and media executives; direct and surreptitious pressure applied by newspaper bosses on policymakers in areas ranging from pedophilia to the EU; and a network of collusive criminality between the News of the World and elements of the metropolitan police spanning several decades.

Having been thrust into the spotlight by revelations about the phone hacking of murdered school girl Milly Dowler, the epicentre of the scandal has remained fixed on the question of journalist ethics. In spite of Leveson’s broad remit, there was always the danger that this issue – the understandable priority of campaigning group Hacked Off and the phone hacking victims they represent – will come to obscure the more fundamental public interest issues at stake.

One key factor overlooked by Leveson is the funding crisis which has long been enveloping the news industry and has accelerated post-digitisation and the great economic collapse. The problem with this crisis is not that it is squeezing the space for news and information generally, but that it is militating against the production and dissemination of public interest news in favour of celebrity gossip and tabloid hysteria. It has provided the backdrop to on-going consolidation – particularly in the local news sector – which has strengthened the hand of media owners and weakened the autonomy of journalists. And it has acutely affected what may be considered the mainstays of fourth estate journalism – current affairs television, investigative reporting and local news. We know, for instance, that spending on current affairs programming by public service broadcasters fell by over a quarter between 2006 and 2011, a figure which fits a general pattern of decline in the sector observed since the early 1990s. In regards to local news, there were a total of 242 local titleclosures between 2005 and 2011 and over a similar period, more than half of local newspaper editors surveyed acknowledged they no longer scrutinised local authorities as much as they did ten years ago.

Yet this problem has been surprisingly absent from the post-Leveson fracas. The reform of press regulation may go some way to shoring up defences against illegal acts of press intrusion that are unjustifiable on public interest grounds. But the prevalence of ‘bad’ journalism practices and ethics in any democracy can only meaningfully be dealt with by widening the space for its antidote: ‘good’ journalism that properly scrutinises power without fear or favour.

Critics of the new Royal Charter are wrong to suggest that it will inhibit good journalism in this sense. Statutory underpinning will constrain the lever of influence over press regulation wielded by both editors and ministers and it will be accompanied by a new public interest defence for journalists enshrined in statute for the first time. But they are right to argue that it will not address the central problem of funding, which remains arguably the greatest threat to journalist autonomy. In other words, the Royal Charter will not inhibit good journalism, but it will certainly not promote it and the latter is what we need if we want to address, beyond short-term or cosmetic fixes, the big picture issues invoked by the Leveson hearings.

Like the problem of media ownership – the other elephant in Leveson’s room – the need for policy to address the funding crisis in journalism is a point of broad consensus among journalists, editors and campaigners. Indeed, any meaningful attempt to deal with media plurality – now taking centre stage in media policy debates – cannot skirt around the issue of funding, a point made by the House of Lords in its report on media ownership in 2008. That these two issues are intimately linked is exemplified by the fact that waves of consolidation in ownership are routinely followed by cuts, often irrespective of profitability. As one representative of the National Union of Journalists at the Manchester Evening News remarked in 2010:

Over the past few years, journalists at the Manchester Evening News and weekly newspapers have seen that when business is good, management cuts our jobs, when business is bad, management cuts our jobs and then when business is improving, management cuts our jobs. Different management, same philosophy.

Outside the UK, there is both well-established precedent and a wind of change blowing across Europe in favour of new methods of funding for journalism beyond the state-corporate framework. One pertinent example is Google’s recent announcement that it has agreed to create a ‘digital fund’ to the tune of £50million to support French publishers and new digital news initiatives. The move was in effect a settlement following several years of lobbying by publishers and murmurings by legislators. This threatened to force Google to ‘pay’ for the content it appropriates from news providers in its search listings. Such arguments were given added force by the fact that Google itself is effectively afforded a huge public subsidy by virtue of the tax loopholes it exploits. According to one analysis, Google pays less than 3 percent of the tax it would have to pay if these loopholes were closed. Google is also the prime beneficiary of digital migration by newspaper advertisers, a process which has fatally undermined the models that have traditionally paid for both local and investigative journalism.

In principle, the idea that Google should contribute to supporting those areas of public interest journalism increasingly under-served by the market is not, as tech pundits suggest, an evil precedent casting a shadow over the flow of free information online. It reflects rather a longstanding tradition in European democracies of cross-subsidising journalism in favour of its ‘merit good’ attributes in which both consumers and producers tend to under-invest. From the creation of Channel 4 to the licensing of local TV stations, this principle has been invoked in UK media policy for several generations and it is the sole reason why newspapers such as the Times and the Guardian have survived for as long as they have.

But cross-subsidies cannot be left solely to the discretion of conglomerates such as News International or indeed Google. Without proper and transparent public oversight, the Google ‘settlement’ with news publishers risks enhancing the former’s gatekeeping power online and/or amounting to a ‘blank cheque’ to newspapers that will do little more than slow down an already painfully slow death. The UK state already offers a blanket subsidy to the press to the tune of half a billion annually (through VAT exemption) but this goes as much, if not more, to supporting ‘bad’ journalism practices than ‘good’.

Some will argue that any form of public oversight in respect of third sector media funding will ‘cross the rubicon’ of independence once more. But the evidence weighs against such arguments. In current global rankings for press freedom produced by both Freedom House and Reporters Without Borders, the top three countries all operate direct public subsidies to support diversity and public interest journalism (the UK is ranked a shameful 31 and 29 respectively). And if we are prepared to accept the Arts Council as an independent funding body for non-commercial creative pursuits, there is no basis on which to exclude journalism from that equation. Arguments concerning the need for independence of the arts and cultural industries from the state are no different from those pertaining to journalism. Indeed, the distinction of journalism from broader cultural pursuits is increasingly untenable in an age of convergence. 

In reality, an annual contribution of £50million is small change to Google. But perhaps understandably, the online giant does not want to be seen as bailing out an industry with an outdated business model or adding to the coffers of media moguls that carry little favour with tech pundits or the general public alike. Google’s framing of the French settlement – describing it as support for “transformative digital publishing initiatives for French readers” – strongly suggests that the company would be amenable to a solution that positions it as a champion of diversity and innovation. 

On that note, several new news initiatives have emerged in recent years that exploit hybrid models of funding, multi-platform strategies and crowd-sourcing techniques in an attempt to revitalise investigative and local journalism. The Bureau of Investigative Journalism was established in 2010 with a start-up grant of £2million from the Potter Foundation. Within just two years the agency secured over thirty-four front-page stories and produced a number of award-winning web, radio and TV reports.

Such initiatives are fragile and marginal but offer the best strand of hope for regeneration. And whilst £50million may be small change to Google, it can be a complete game changer for local and investigative news start-ups. As attention turns to how Google will respond to pressure in other key markets (including the UK and Germany), campaigners and policymakers should be mobilising to ensure that opportunities are not missed and that any outcome works to promote public interest media rather than maintain the status quo.

Justin Schlosberg is a media activist, researcher and lecturer at Birkbeck, University of London. He is the author of Power Beyond Scrutiny: Media, Justice and Accountability

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