Bill Doskoch: Media, BPS*, Film, Minutiae

Curated knowledge, trenchant insights & witty bon mots

An airy future view of journalism

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Erin Millar of The Discourse thinks that once we kick that tired old advertising business model to the curb and embrace subscriptions, things in the Canadian news industry will be peachy* once again. I’m doubtful.

*Millar says my word, not hers. For more on our Twitter exchange, scroll down.

CBC.ca (“There is reason to be hopeful about the future of news. Yes, really“):

Yes, we are in a tough and ugly place in many ways. We’ve lost 10,000 journalism jobs across Canada over the course of five years. Nearly 250 news outlets in 180 communities have closed in a decade.

Meantime, while newspapers shuttered across the country, we allowed technology innovation to advance unfettered (in fact, we subsidized it). That seemed like good policy — it created a lot of jobs and wealth. But from our vantage point today, on the heels of Facebook’s Cambridge Analytica scandal, it seems clear that technology advanced faster than our culture’s ability to keep up.

So where’s the hope part? …

There is no reason to think that the market for digital news subscriptions won’t mature here in the same way they have in other countries where both new and old outlets have succeeded by focusing on serving audiences.

That’s already starting to happen. The Globe and Mail is seeing strong growth in digital subscriptions by doubling down on a product that its core audience values enough to pay for. The most hyped digital media startup in the U.S. is The Athletic, which just raised significant capital because of its fast-growing business selling premium sports coverage to people who can no longer find it in their newspaper. They are also growing aggressively in Canada. The New York Times is likewise investing in Canada, with 27 per cent of its international subscribers being Canadian.

This is good news for news consumers. Because it means that there are opportunities for new and old media outlets to fill the gap. And instead of chasing eyeballs to sell to advertisers, they will succeed by earning the trust of audiences.

We don’t need to wait for someone else to save journalism for us. Canadian audiences will drive the future of Canadian media, so that journalism can reassume its critical role contributing to the social fabric that unites us.

I don’t much like Millar’s take. She talks a bit about disruption without explaining how it devastated newspapers in particular (and is now working its magic on television).

The shift to digital hit in multiple ways. First of all, the growth of services such as Craigslist and Kijiji cut out the classified advertising leg of the newspaper’s business model stool. Classifieds usually accounted for one-third of a newspaper’s revenues.

Secondly, display advertising began to change. Instead of buying big, expensive ads in newspapers, advertisers turned to the internet and social media. This caused a decline in display advertising revenue, which had traditionally accounted for for just over 40 per cent of a newspaper’s revenue. No one has forecast when this trend will finally bottom out.

However, those internet ads were cheap, and you got what you paid for. People in the industry referred to the internet move as trading print dollars for digital dimes.

And then along came “smartphones” and tablets to further disrupt the advertising market. Those digital dimes I referred to above? They became mobile pennies.

To wiggle the blade wedged in the back of newspapers, Google and Facebook scoop up most of that change (they are the most efficient vacuums of advertising dollars ever invented). This leaves newspapers fighting with everyone else for a small piece of the digital ad pie.

At whatever inconvenience to traditional news companies, people want news on their digital devices. Older people like myself still enjoy reading a high-quality newspaper, but we’re a declining minority. And with all the hits that newspapers have taken, quality and quantity of content has slipped too (the size of the current Globe is puny. It’s not a true broadsheet any more).

So who’s expected to pay for high-quality content as we move into the digital future? You, dear reader. Historically, you contributed about 25 per cent of revenue when you bought or subscribed to a paper. Broadsheets preferred subscribers because advertisers preferred them. The plan by publishers is to ramp that up.

In today’s milieu, subscribing has morphed into crowdfunding for young companies. Take CanadaLand, which asks you to become a patron for as little as $1 per month. If you listen to one of its podcasts, you’ll notice a sponsor’s message. But the home page currently has no advertising on it.*

*That’s another conundrum. Many people find content these days through social media and expect a link straight to it. They don’t surf to the website’s home page and pick stories there so much. As a result, the ads are worth even less. Back in 2011-12, Toronto Star editor Michael Cooke told a Canadian Journalism Foundation audience that the Star‘s website wasn’t paying for its newsroom.

Trying to do everything by crowdfunding has its own problems. CanadaLand has had its begging bowl out for months trying to raise money for an investigative field trip to Thunder Bay, Ont.

“We want to make Canada’s S-Town: a serialized investigative series digging into the truth about Thunder Bay, a city where Indigenous youth keep turning up dead, and where the where the Police Chief and Mayor are facing criminal charges. Hosted by Ryan McMahon. It’s a crowdfunding goal this year, and your support helps us get there,” writes CanadaLand on its Patreon site.

But here’s the thing: The Toronto Star‘s Tanya Talaga has been to Thunder Bay and come back with an award-winning book called Seven Fallen Feathers, about the suspicious deaths of seven Indigenous youth who had come to Thunder Bay to get a high school education.

What different angle will CanadaLand have to top Talaga? How will they have anything other than a stale story at this point?

One good thing about legacy media: They made enough profit to be able to fund large-scale projects without waiting for a crowdfunding request to come through. And when CanadaLand found out allegations about former CBC Radio host Jian Ghomeshi, site founder Jesse Brown wisely partnered up with the Toronto Star, realizing this was too big a story for his little website.

Unless subscription and crowdsourcing revenues allow the Browns of the world to build up a large enough operating budget to move quickly on big stories, they’ll forever be niche, second-tier news providers, with occasional successes. But I think there’s only so big a pool of crowdfunding cash and a ceiling on how much people are willing to pay for news.

Towards the end, Millar writes: “And instead of chasing eyeballs to sell to advertisers, they will succeed by earning the trust of audiences.”

That’s a silly thing to say. They will be flogging subscriptions at people and begging with crowdfunding schemes. Good stories might run the risk of falling by the wayside if fundraising efforts don’t pay off.

Ultimately, the problem of how to pay for good journalism is not yet solved, and it’s foolish for Millar to suggest it is.

Twitter exchange

Millar saw the post on Twitter (I included her handle when I sent out a tweet about this post and responded thusly:

The text of my tweets:

  1. Times were pretty peachy in the 1980s. Even in the 1990s, things weren’t that bad, given the recession. The revenue collapse started about 2000 & was worsened by the 08-09 recession. (1/2)
  2. You say it will be an improvement to have news orgs directly funded by readers & not ads. Theoretically, sure, but remember this is being forced on the industry & will come with its own set of problems.

Millar’s response:

Of course it will come with its own set of problems. There is no perfect funding model for journalism. But forcing the industry to have to serve its consumers? I’m all for that. I’ve always found journalists who have disdain for their audience to be strangely entitled.

I couldn’t let that stand:

I’m sorry. When did newspapers et al fail to serve their audience? Why will charging more for the same content be of benefit to readers? I gave up my G&M & NYT online subscriptions because of costs. The Nat’l Observer costs as much as a discounted NYT.

Millar:

Many media failed their audiences by prioritizing advertisers during the trust-damaging race to the bottom as they grasped for ever-shrinking ad $$. Serving people, instead of advertisers, presents fewer ethical dilemmas. Digital sub growth shows that people are willing to pay.

Me:

Name some of those outlets. How much should an average adult budget to spend on journalism to be reasonably informed in your new order?

Millar:

So many. In fact, most. As a reporter myself at some of Canada’s best media outlets, I was under pressure to produce more content and clicks faster while compromising depth and accuracy. That was in service of advertisers not readers. Every journalist has experienced this.

Me:

These outlets didn’t have names? Pumping out more copy isn’t to serve advertisers, it’s to serve the media outlet by holding costs down in the face of falling revenue.

Millar:

Anyways, I’m signing off here as my plane to Vancouver is about to take off. In summary, all I’m saying is that there is reason to be hopeful. Let’s check our skepticism enough to be imaginative about the future of journalism in this country. It’s not all bad news!

PS I don’t see the point in calling out specific media since they all did it. I worked for some of Canada’s best media outlets and they weren’t the worst offenders. Your comments suggest you may not fully understand the economics at play. Anyways, thanks for the spirited debate!

Me:

I think I understand the economics of the news business in a fairly intimate way. This exchange has not swayed me towards your view. You’re welcome.

Millar:

That’s ok. Have a nice weekend!

Thu, May 3 2018 » Main Page, Media