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HALIFAX, N.S. March 21, 2016/ Troy Media/ – There is trouble in today’s news media industry. Large newspaper chains such as Postmedia have made staff cuts to offset reduced revenues. Newspapers and local TV newsrooms, which often provide communities with their only source of local content, are struggling. An Ontario daily paper recently shut down. Many now wonder what the future of journalism will look like.
A common proposal to reverse this decline is for government to subsidize newspapers, just as government subsidizes CBC to the tune of $1 billion a year. Proponents of the idea say that subsidies would lessen the importance of readers and advertising dollars on the bottom line, and allow local news providers to remain open. Subsidies would surely stabilize an uncertain employment market for print journalists, as it has for CBC.
But this proposal won’t protect journalistic integrity. What incentive would news outlets have to find consumers if Ottawa offset readers and losses with gobs of tax dollars? One of the main duties of a free press is to hold the government and other public institutions to account – a task that is compromised if the state serves as the press’s financier. Is a newspaper receiving a government handout going to critically question business subsidies and other examples of government largesse?
More importantly, a permanent bailout cannot stop the ongoing transformation in the journalism industry. Media outlets must produce and deliver content in a manner that serves the needs of readers, preserves their role as recorders of truth in public affairs, and earns enough money to pay salaries and invest in a competitive product.
Today’s audiences have grown accustomed to subscription-free information, a demand that private outfits cannot hope to supply in an age of diminished advertising revenues. Instead, the future of journalism will be in creating niche content, more zealously protecting one’s sources and information, and ultimately charging a price for the service.
A significant impediment to this development is Canada’s subsidized public broadcaster. By providing content that appears to be free, the CBC creates a distortion in the news market. It may seem like a fair fight to the naked eye, but private industry actually has to compete with its arms held behind its back. Subscriptions, paywalls, and other strategies to monetize online news consumption compete for audience and advertisers not only with other private-sector news services, but also with the publicly funded CBC news service.
The solution to this problem will not be found in universal subsidies, which would simply create many CBCs. Rather, the answer is in reforming the existing public institution. The Mother Corp. should not be continually boosting its output of “free” digital media in competition with print, radio, and television outlets. In exchange for its state funds, the CBC’s mandate should be limited to programs and initiatives of public value that the market cannot serve, whatever those might be. (Hint: it isn’t Hockey Night in Canada or the Olympics.)
This reform would make the public broadcaster a different service than currently exists. But it would ensure that the CBC is providing a service others are not, thereby better levelling the playing field for private agencies to offer news at a price that audiences are willing to pay, and in a manner they are willing to consume it.
Jackson Doughart is a staff member of the Atlantic Institute for Market Studies.
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