Servicification of news: A sustainable model for independent journalism

Introduction

The profession of journalism is broadly held in high regard at a global level. A study conducted in the United States in 2016 found that students and professionals of modern day journalism have much evolved and updated perceptions about the rights and duties of 21st century journalists in opining their ideas on critical contemporary issues and the role of citizen journalists in increasing people’s access to information. When public and professional perception about a vocation is strong, talented people are attracted to it. Looking through this somewhat myopic lens, there is nothing worrying about the state of global press, had not the ground reality have indicated otherwise. News, and the freedom to report it, is in danger.

The public, the institutions, and the governments have always unilaterally agreed upon the importance of journalism for social progress, but to begin with, it is interesting to examine the other end of the spectrum – people who were not big fans of the media, and instances where press and its freedom have been decried and cried foul about. The fact that it was Adolf Hitler who said “It is the press, above all, which wages a positively fanatical and slanderous struggle, tearing down everything which can be regarded as a support of national independence, cultural elevation, and the economic independence of the nation” – a clear unhindered call for crusade against the freedom of press in favor of bigotry, hatred and self-interest, gives an indication of the unparalleled and inexcusable importance of free press in the 21st century. It also gives clear hints at the possible repercussions the civilization might have to endure if the society were callous enough to not give free journalism the importance it merits.

Human Dignity and Freedom

Humans are born a free entity and die into freedom; the journey in between is filled with rules and laws which theoretically restrict them from doing exactly what they please to do. With the sophistication of society, the accepted norms of human behavior have become channelized and restricted, but along with it the distribution of justice, opportunities, and freedom among all have been strengthened.

With civilization came inter-dependence. Transfer of information became crucial to general progress. In practical matters of governance, public administration, agriculture, maintaining sovereignty etc, there was a need for quick transfer of information which would create a dynamic exchange. The dependence of the self on other humans for survival makes it imperative for anyone to keep track of occurrences in parts of the world where they are not physically present. Therefore rises the need for an unbiased eye, a proxy for one’s own, to observe and report narratives exactly as they occurred – and hence media and journalism.

Even at such a fundamental and primary level, the scope of conflict is apparent. Human perspective and interpretation differ based on social and cultural environments, and if perspectives are different then they result in separate interpretations of the facts. When one person is dependent upon another for recording and reproduction of facts and events, diverging assessment and opinion between the two can create disparity.

From the days of the Acta Durna in ancient Rome (the first recorded journalistic product) to the modern day of print, electronic, and the rapidly rising online media, we have traveled a long way. There is now a social responsibility of news organizations to inform, educate, scrutinize, discuss, debate, and to perform these duties while conforming to the strictest of guidelines on journalistic ethics and commitment. An unwritten contract between the reader and the journalist is forged which is based on the premise of unbiased, objective truth.

Business and Conflict

Everything requires a business model, and journalism is no exception. The thousands of professionals associated to the field of journalism require remuneration for their services, for which raising revenue becomes an activity of importance for a media firm. Not just that, the processes involved in collecting and distributing news and information are also expensive and highly resource intensive. As public scrutiny gets stronger and more demanding, every unit of news keeps incurring progressively higher costs upon the team working on it. The news thus needs to draw revenue.

At this juncture it is important to examine the revenue channels of conventional media houses. If we consider the three most prominent channels of news today, print, televised, and online, the revenue streams arising from direct sale or distribution constitute only a minor portion of a media firm’s revenue. The printed price of a newspaper, subscription charges for a DTH TV channel, or per-screen revenue on the internet are hardly enough to cover a fraction of the total costs the media houses are incurring. In order to break even, if journalists passed on the entire costs incurred to the consumer, the per unit price of news consumption would have been higher than what we are used to paying. Advertisements are filling in over here, and in effect subsidizing our news. The evolution of the media business model is a fascinating study, and the point we have reached now is one where advertising and journalism is presented to the viewer as an hybrid arrangement. A major part of the news we are consuming is coming to us for free, and as the Silicon Valley proverb goes, “If you're not paying for the product then you're the product”.

A study done earlier in 2014 by Pew Research reveals that two-third of domestic news revenue generated in the United States are from advertising. While print media is on a steady path to decline in almost all parts of the world, newspaper still contributes 58% to total media ad revenues. In India, a lot of people are still buying printed newspapers and paying an amount in the vicinity of ?10 for a copy (equivalent to less than 15￠ at current exchange rates) – this does not even cover the printing and distribution costs. Advertisement revenues are bridging the gap.

In “The Changing Business of Journalism and its Implications for Democracy”, Robert G Picard has summarised the situation succinctly: “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.” The price we are paying for commercial unviability is high, and conflict of interest lies at the root of it.

Advertisements themselves do not present the objective truth to the consumer (a marketer can argue they are not even supposed to, or that there is no objective truth in marketing). By receiving financial support, a news organization severely hinders the possibility of reporting without partiality on an issue where the advertising organization is itself concerned. The advertisers who invest heavily upon buying space in a newspaper are forcing themselves into a position akin to the equity holders in a publicly traded company, whose profit it is the duty of the business to look after. While Friedman’s take on corporate ethics allows shareholders’ profits to be the only responsibility of a corporation, in case of a news organization there is the possibility that this might come in direct conflict with its other significant duty – repaying the trust reposed by the reader and reporting the truth.

Governance and Conflict

The discussion on ulterior motives behind media advertisement is not complete without considering the second and equally critical aspect of politics and governance. In case of a political party, an elected government, or a law-making/law-enforcing official exerting influence, the stakes they hold in the press are not directly monetary. Democracy is liable to succeed only if its fundamental pillars are not compromised with, and media here is supposed to play the role of an aggregator of public response. Governments usually have such power at their behest that individual voices questioning their actions are not audible, so it is the role of the media as a body to aggregate these questions and demand of a government one crucial behaviour – accountability.

Governments are elected around the world with the purpose of serving the polity that is electing them. Most governments and representatives have a fixed tenure of authority within which they are the undisputed decision-makers, but that never forsakes of them the need to be answerable to the people. To challenge and dissent against the ruling dispensation is not only an option but an absolute, uncompromisable duty of every citizen. Challenging one’s government, under no circumstance, amounts to disloyalty or treachery towards one’s country. In the words of Gandhi, “Silence becomes cowardice when occasion demands speaking out the whole truth and acting accordingly.”

There is also the additional lens of diverging motivations at play. To a rational game theorist, it is always the absolute highest payoff achievable which determines the “pure strategy” within the game being played. Very clearly, the payoffs of elected politicians and the people who elected them are unaligned. What this can result in is a cycle of self-serving politicians adept at gaming the system once they are in power, while the public are not served based on the promises made to them prior to exercising the franchise. Free and accountable press can potentially disrupt this scheme by breaking the game and forcing elected leaders to align their efforts with public interest, under the duress of open scrutiny.

And therefore arises the need to isolate media from the government. Transactions carried out between media houses and governments are not necessarily of a financial nature; politics opens up vistas of opportunities for quid pro quo. Just like corporate advertising robs a journalist of firm ground to challenge the corporation, government influence mutes a journalist’s voice with coercion or corruption. The raison d'être of the profession is lost.

Degeneration and Consequences

It eventually boils down to the absolute compulsion of keeping press free – free to question, challenge, suspect, and be a collective medium for the society’s voice. The trends are disturbing. The entire political narrative in powerful and influential states across the world are increasingly being built on dictatorial, anti-dissent philosophies. Media is not any more a voice of the masses but a tool for the powerful. Political polarization is being preached, vitriolic nationalistic sentiments being propagated, and people’s loyalty to the country is being challenged on the face of dissent against the government. Big corporations and private entities are aiding this process. India’s deterioration to its present position at 142nd place out of 180 countries on the World Press Freedom Index is a glaring indicator of the impact that policies and governance stands to have on journalistic independence, as is the accompanying report produced by Reporters Without Borders (RSF) which speaks about “police violence against reporters, ambushes by political activists, and reprisals instigated by criminal groups or corrupt local officials”. Beyond freedom to report, a 2020 study in the United States also reports how political animosity misperceptions about social divisiveness are being fueled by partisan media (Wilson, Parker & Feinberg 2020).

The rot is caused not only by politicians and administrative officials. The 21st century corporations are in spirit the successors of colonial governments of the 18th and 19th century. Multinational empires in steel, garment, FMCG, chemicals, electronics exhibit powers no less than colonial forces. The tendencies to bypass environmental, social, ethical routes of doing business are also similar. When the media fails to serve its purpose the first casualties are the people, and next in line is the environment. Climate change is real, and the world needs to accept it. Making corporations follow sustainable business practices is not possible through regulations and law-making alone, unless there is proactiveness shown by every stakeholder. A decade old UN study shows that the world’s top 3000 companies are responsible for causing $3.3 trillion of environmental damage every year. There is a need for a mechanism to keep corporations in check, and free press alone can play this role.

Servicification of Press

The solution lies in making a service out of good journalism. Classical economists believed that given the freedom to produce and exchange goods and services as people wished, there would eventually be an established order of production and consumption bringing to an equilibrium every unit within the economic frame. The rational customer gets to choose the product, and it is the duty of a firm to create and convey the value that a customer seeks in a form that is more attractive than the rival firms, and in the process charge a price for it.

Journalism, as is clearly observable, does not follow this rule. According to Carvajal, “most users are not willing to pay for news they can obtain for free”. The root of the problem can be traced to the psyche of the average consumer of news. With the snowballing of information thanks to democratisation of news on the internet and social media, news has come close to a ubiquity. The effort behind honest evidence-based journalism is somewhat lost upon the consumer.

The value of quality journalism needs to be conveyed to the populace and the legitimate price charged. All news organizations report the same incident in a similar fashion, so a uniform servicification of the news content will foster differentiation and focus upon quality in the industry. Among other ways, this could be signaled through better quality and depth of coverage, sharper investigative journalism, mechanisms for busting fake news rackets, etc. A good example to emulate would be the OTT streaming services industry. Audiences are paying for these because of the superior quality of content over other competing alternatives.

Subscription-based Journalism

Subscription models have seen a tremendous rise in the last couple of decades across multiple categories of content. It is clearly being buttressed by a rising propensity and willingness to pay for quality content. The trick to crack the subscription code is a complex one, involving a detailed understanding of consumer psychology and profiling. But it is imperative that a well thought out and purposeful shift towards advertisement-free subscription-based news be engineered.

An obvious downside to this model is the possibility of ignoring the interests of the poor who might not be able to pay a premium for news. The willingness and capacity to pay for news of quality would be higher for the economically advantaged. This can have two adverse effects – the underprivileged might be deprived of news when they need it the most to equip them against injustice, and the media houses might be inclined to focus on issues affecting only the rich since they are the ones who are contributing more to the revenue. Investment banking and equity trading might get undue importance over farmer loans and student movements, if that is indeed what the payers are more interested in.

Admittedly, there is no obvious solution to this conundrum, apart from the rich subsidizing the news consumption of the poor. But if there were a way of preventing damage to the underprivileged fortunes, ad-free subscription-based news is the only way forward. Once this model picks up, economies of scale would actually reduce the price of quality journalism as more and more people would join in. Similar to any ordinary class of goods, different providers would target different segments of the population based on the type of news and information they value, but without compromising on journalistic ethics and independence. Most importantly, there is potential for a huge jump in the quality of news being served since the competition would now be on quality and a paying customer would expect value for money. Yellow journalism is successful only when it is cheap; consumers would not be willing to pay for unworthy content which is unworthy.

Conclusion

A 20th century pessimist’s view of the world in 2021 might have erred on the wrong side of caution. The world is outdoing itself every day in harming the environment, spreading hatred, promoting inequality and fanning feud. Media is one way of keeping the imposed self-harm in check, but the rider of keeping the press free comes along with it. It is in the interests of a privileged, powerful few to smother the freedom of press. It is the prerogative of the remaining ordinary millions to unite and resist it.

Disclaimer: The ideas and views expressed here are the author's personal,?and they do not reflect any organization or institution's opinions.

References

Carvajal, M., García-Avilés, J.A. and González, J.L. (2012) Crowdfunding and Non-Profit media: The emergence of new models for public interest journalism. Journalism Practice.

Coleman, R., Lee, J.Y., Yaschur, C., Meader, A.P., et al. (2018) Why be a journalist? US students’ motivations and role conceptions in the new age of journalism. Journalism.

Erjavec, K. (2004) Beyond advertising and journalism: Hybrid promotional news discourse Discourse and Society.

Levy, D. AL and Kleis Nielsen, R. (2010) The Changing Business of Journalism and its Implications for Democracy.

Punj, G. (2015) The relationship between consumer characteristics and willingness to pay for general online content: Implications for content providers considering subscription-based business models. Marketing Letters.

Wilson, A.E., Parker, V. and Feinberg, M. (2020) Polarization in the contemporary political and media landscape Current Opinion in Behavioral Sciences.

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