The cost of news crisis

As news subscriptions become another financial burden for households under strain, research suggests they are at serious risk of cancellation - with news audiences becoming smaller and more homogenous as a result. This should prompt a major reevaluation within Comms teams.

Why do people pay for news?

If you run a media company, there are quite a lot of reasons: a public service remit, political ambitions, perceived prestige, access to the rich and powerful, a moral commitment to free media etc...

But typically the reason is not 'in order to achieve explosive profits'.

News production has always been a loss leader. As Robert G. Picard wrote in 2010 - when news organisations were going through the most tumultuous period of internet-led downsizing - "The reality is that news has never been a commercially viable product and has always been funded with revenue based on its value for other things."*

News production is hard. It requires a lot of manpower, training, resources, expertise and, by its very nature, it has be produced 24 hours a day, seven days a week, generally at the last minute. Hard is expensive. Since the very advent of the newspaper, media companies have effectively subsidized their News departments through more profitable areas of their portfolio, like reality TV or celebrity gossip, which are much better at attracting large audiences and, by extension, advertisers.

In recent years, even those cash cows haven't been able to slow the decline in media revenues, we have seen the proliferation of the paywall as a new revenue stream for media companies, which means that some of these investment decisions are being pushed into the household.

At that level, the reasons to invest in news aren't quite so obvious.

For most people, news subscriptions are simply one regular entertainment cost among many, many others. As the internet has balkanized, we are now paying for a fast increasing number of streaming subscriptions - Disney+, Netflix, Spotify, Amazon Prime, HBO Max, DAZN et al - and then being pushed to pay for news subscriptions on top of that. (And, apparently Twitter**).

With other household costs rising, guess which monthly fee gets dropped first?

A new study by Nic Newman and Craig Robertson, PhD explores this question. From a survey of 20 countries, they found that "around four in ten subscribers saying they tried to negotiate a better deal or have cancelled their payment in the last year because they can no longer afford it." Just 17% of people surveyed paid for any news subscriptions at all.

These stats should be a real worry for climate comms people.

Part of my work is getting Clean Air Task Force experts and research into the media so that it reaches a larger audience (and an audience of decision makers). When I think about the climate coverage in Brussels that I am most reliant on for information and most interested in getting into, a lot of it sits behind paywalls: Bloomberg, Politico, the FT, Carbon Pulse, Foresight Climate and Energy, Tagesspiegel. And that means that a huge chunk of the very best climate coverage is hidden from a wider audience.

That is not an ideal situation for advocacy organisations looking to build broad concensus around large-scale policy interventions. It's especially bad for organisations moving into new topic areas or geographic locations: media coverage is one of the best (and quickest) routes to relevance with new audiences, which is crucial for anyone working in climate***. But the fact that there is only a small subset of "male, older, richer" long-term subscribers to news outlets, reduces your media relations plan to a bet on the influence of this narrow audience.

All that hard-won news coverage your organisation is fighting for is only reaching an incredibly tiny and homogenous subset of your intended audience. Even in the medium-term, that seems like a risky bet.

As the data below shows, we might be looking at another wave of financial damage for news organisations following the 'Coronavirus bump' of the past few years.

This suggests that the small subset of news subscribers isn't getting any larger (or younger or more diverse) any time soon.

There has always been a small subset of news junkies who want to regularly consume news. Nothing has changed there. But even those news junkies can get priced out.

The study found that cost of living increases in the past year were the main driver of cancelled subscriptions****. Some of the other reasons given were "lack of perceived value/concerns about time commitment" and that news was seen as "often negative and downbeat nature of news consumption” - both of these chime with the rising threat of news avoidance, which I have written about before this year.

In short: if people are turning off news coverage because it makes them feel hopeless, might publishers start rethinking newsroom investments in climate coverage which is disproportionately focused on apocalyptic warnings? Let's hope not.

And, in case you were hoping we could dismiss this trend as a recent phenomenon, here is Robert G. Picard again from 2010:

"The fickle audience is showing itself unwilling to use news media in the numbers necessary to support the mass media finance model. We need to recognise, however, that the majority of the audience has not suddenly become uninterested in news; they were never very interested in news."

So, we're looking at a smaller and likely more homogenous audience at the end of our media relations efforts - that's not ideal. But there are also longer term concerns to think about.

If the news industry can't get this subscriber model to work, we will likely see media owners taking even more resources out of newsrooms to balance the books. That could mean losing reporters, editors and perhaps even entire departments.

The first big demonetization wave absolutely decimated the foreign bureau , for example, and, more recently, there has been a marked decline in investigative reporting following the massive round of media sector layoffs in 2019 (i.e. the year the digital media bubble burst). Further cuts are likely if the paywalls and subscriptions model doesn't work. Who's next on the chopping block?

This is also a vicious circle. Losing high-value, high-cost departments also ultimately makes newsrooms worse equipped to explain the events of the world to larger audiences. The news product gets undermined when these cuts occur, which only makes those expensive news subscriptions seem worse value. And so more people cancel subscripotions, and more cuts get enacted, and so on and so on.

All of which begs the question - how important is media relations?

It is something of a kneejerk focus area for NGOs. Press coverage is seen as shortcut to a larger audience, to the quote-unquote "right" audience, and also a quick way to achieve respectability. Fundamentally, it feels good to get your name in the paper or have your study featured on the news. It's the kind of mainstream recognition you can actually explain to your parents without saying the word 'advocacy' or having to explain the complicated research itself - it made the news, so it must be important.

But perhaps 2024 will be the year Comms teams re-evaluate all the effort that goes into getting that coverage. If the only people seeing it are retired white men, how valuable can it possibly be*****?

Let's not forget that there are economic concerns for non-profits as well. With the economy retracting there is a very real fear that the recent growth of philanthropic funding will flatline or decline in the next few years. That means we too have to start making hard assessments of how our budget is being used, and unpacking whether media relations is the best investment of time and energy available for Comms teams is perfectly reasonable. There are many other options to consider - events, thought leadership, targeted campaigns, your likely highly neglected website, hiring more members of the team - any of which may generate more influence and more impact than media relations.

From households to boardrooms to non-profit Comms teams, we are all trying to find out what the value of news really is.

Climate organisations are always trying to convince legislators and experts to focus on things that will really move the needle when it comes to decarbonisation efforts. Perhaps its time to apply that same ruthless focus to our own work areas.

This is part of a monthly series aimed at examining the underlying narratives of the European climate debate, with a healthy dose of media criticism along the way. Read the previous article here . Note that these are personal takes and do not represent the position of my employer.

*This quote comes from the second piece in this excellent essay collection "The Changing Business of Journalism and its Implications for Democracy" from the Reuters Institute for the Study of Journalism .

**I wrote more deeply on the implications of the demise of Twitter as a public sphere when Musk first took it over back in March . I was perhaps being too optimistic.

***We no longer have decades to carefully build a reputation that can then be leveraged for action. What's more, a much wider array of decisionmakers are having to contend with climate and energy issues. The era of climate being the concern only of eco-warriors is long behind us. This is something that CEOs, bankers, investors, trade union leaders and politicians alike have to grapple with.

****In true pseudo science mode I asked my own audience of news junky connections on LinkedIn and it's pretty clear most people have 1 or 0 news subscriptions.

*****Sorry journalist pals. I love you really! Media relations is probably my favourite part of the job, but I have to follow what the analysis shows us.