Success of federal fund to subsidize news media undetermined
The federal Liberal government has decided to help (bail out?) news media with a $595 million fund spread out over five years.
The fund recognizes the vital role news media plays, informing residents and allowing voters to keep government and powerful figures accountable. Since 1787, the news media, described as the fourth estate after clergy, nobility and commoners, has been recognized for its influence on society. That influence waned mightily in the last 20 years as online giants such as Google and Facebook captured a major share of the advertising that keeps traditional news media prosperous.
The plan is to set up an independent panel of journalists and news media to determine who qualifies for support. The central idea is to support labour costs of producing original news content.
Two associated moves offer a 15 per cent tax credit to people who subscribe to online news media. And media will be allowed to offer tax receipts for charitable donations. Right out of the starting gate, skeptical Conservatives criticized the Liberals for trying to buy the media just before an election with this media fund. If the government-funded CBC is an example, government support for that outlet has only bought successive governments grief as foolishness has been exposed.
The NDP critics asked why most government advertising is placed with Google and Facebook if traditional media are so important?
That is a good question. Advertisers place ads where they feel they best reach the audience they want. Few millennials read traditional newspapers, thus the popularity of Google and Facebook.
Local news outlets like The Moose Jaw Express keep operating because advertisers find them useful in distributing their messages and because they offer local residents a news package they want to read.
The Liberal media fund created controversy within the media. Many executives salivate at the notion of assistance. Most journalists shudder at the perception their owners may be in the government’s pocket. Total independence from government is preferable.
The $595 million — or $99 million a year – spread out across Canada over hundreds of outlets won’t buy much of anything.
The tax credit for online subscriptions could be a big boost. Newspapers have difficulty attracting online subscriptions. The Wall Street Journal and the New York Times are among few online subscription successes in North America.
The charitable receipts access should be a boon, especially for struggling local and regional online media. The make-up of the independent panel and the guidelines on what outlets get assistance will be crucial to the success of the measure assisting labour costs. Will local and/or non-profits benefit most from the assistance? Or will funds be skewed to larger traditional media?
The bottom line for any new legislation becomes: will it make a real difference? Or is it just a cosmetic patch?
The fund could help in the transition of readers from print media to online operations. But the trend to mass online media will continue until the Facebooks, Instagrams and Googles of the world can no longer deliver large audiences at low cost.
The sad part of the whole discussion arises from the fake news aspects of online giants and the loss of the sense of community that comes from local news outlets.
The Liberals recognized the problem but the success of their solution is uncertain.