Three options to help journalism in Canada
CANADA HAS WRESTLED
WITH THE DILEMMA FOR
A NUMBER OF YEARS ...
— GREENSPON, DAVEY
As Canadian news organizations continue their unsustainable revenue decline, who should step into the breach but Facebook and Google, the two giant platforms that gobble up three-quarters of all digital ad dollars?
They have signed secret deals with dozens of desperate publishers to provide financial and other supports.
On the surface, their assistance may appear a positive development. Closer consideration reveals a disturbing new dependency. One of the great functions of journalism is to hold the powerful — political and economic — to account. Do Canadians really want their watchdogs reliant on the goodwill of two wilful and self-interested corporations with combined market capitalization larger than the GDP of Canada and with strong pecuniary interests in such public policy matters as data and privacy, taxation and regulation of disinformation, hate and other harmful content?
Critics of news media long felt their local news outlet was beholden to the whims of advertisers. This kind of pressure actually arose far less than imagined, but when it did occur, it was relatively easy to resist. A single advertiser rarely accounted for more than a tiny fraction of revenue, exercising limited clout.
These new deals are opaque. It is unclear who gets chosen and why and how much money changes hands. Theoretically speaking, if the platforms account for, say, 10 per cent or 20 per cent of the editorial budget of a given news organization, they would enjoy a far stronger position of influence than any advertiser ever did. Not to mention that platforms have a long record of abruptly reversing policies to the detriment of publishers.
There are better ways to proceed — ways that would be transparent to the public and designed to protect their interests.
Canada has wrestled with the dilemma for a number of years of who will finance a diverse and robust news gathering ecosystem as the old advertising model proved inadequate to sustain journalistic numbers and Canadians largely resisted the siren call to subscribe. In some places, like Boston, benevolent billionaires have stepped up. But billionaires are few and far between, benevolent ones most particularly. People have looked to charitable foundations, but they also tend to be relatively small in Canada and are besieged by other needs in an era of rising inequalities.
When you work your way down the list, two imperfect sources of funding stand out — governments and the platforms. There is justification in both cases. Journalism is a public good and governments have a responsibility to protect the health of our democracy.
As for the platforms, they serve as distributors of content created by others, including by journalists, and Canada long has a tradition of balancing the playing field between well-heeled content distributors, such as cable operators, and hard-pressed producers of the content these distributors carry.
The Canadian government introduced four programs in 2018 and 2019, three of them originating in the Public Policy Forum’s 2017 report, The Shattered Mirror. First there was a Local Journalism Initiative that put $50 million over five years into funding local journalism. Then, there was the five-year, $595-million package of measures contained in the 2019 budget, highlighted by a labour tax credit to encourage the continued employment of journalists. Controversy has at times surrounded these programs because of discomfort about governments handing out money to the very news media charged with holding them to account. This risk has been mitigated by setting out clear policies with transparent criteria administered at arm’s length. It is imperfect, to be sure — but so is the desertification of news.
More is needed. Here are three options:
1. Australia has endeavoured to rebalance the market by going after what it considers the anti-competitive nature of Facebook and Google. They have been ordered to negotiate licensing agreements with news publishers. Should these talks fail to lead to agreement, then each party is forced to submit its bid to an independent party that would, as in baseball salary arbitrations, select one or the other.
Canadian publishers have estimated this could result in a transfer of $620 million to be allocated based on a percentage of an outlet’s editorial spending. Governments and platforms would be kept from exercising discretion over who gets what.
2. An alternative approach would be to replicate the long-standing arrangement by which Canadian cable and satellite companies pay a levy on their revenues that is then recycled to film and television producers. In the cable model, the money is handed out on a discretionary basis by the Canada Media Fund. For news media, a more objective system, such as a proportion of editorial spending, is preferable to a discretionary fund.
3. An Australian-style approach might not work for smaller, local news operations or niche publications, although the bigger publishers would be well advised to include them in collectives. Either way, it is time to reimagine and expand the successful Local Journalist Initiative (LJI), which in 2019-20 funded 342 journalists in 251 newsrooms across Canada, into a more broadly based trust. As it stands, the federal government is the sole funder of the LJI. Turning it into a trust would enable philanthropic giving and community fundraising.
The Australian model — with collective negotiation, backed up with baseball-style arbitration — and a more ambitious LJI can help preserve journalism through its transition, nurture the green shoots of change we are witnessing, reduce media reliance on government and even provide a transparent, neutral forum for platforms to support journalism free of any appearance of exercising influence.