Quentin Wray’s contribution today is a bit of preaching to the converted. You do, after all, make a direct financial contribution to our efforts through your Biznews Premium subscription. But his insightful piece unpacks why new business models are vital in keeping a free media alive – and winning the war against fake news.
Quentin writes: “Back in the earlyish nineties, when the internet was first becoming something more than just the means to distribute hard-core pornography and unlicensed pharmaceuticals, newspaper publishers made a catastrophic error of judgement. Their folly not only pushed their own industry close to the brink but also created the space for a new scourge called fake news.
There were some exceptions – Alec’s Moneyweb being a case in point – but generally publishers saw the internet as a technology rather than as a publishing platform and didn’t adapt business models accordingly. By going online without any real thought about a proper business plan, publishers broke a model that had worked for hundreds of years. And they had nothing to replace it with.
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At heart, the media business is a very simple one: you sell news to readers and then you sell those readers to advertisers. You can only ignore this model if you are funded by philanthropists or have near-captive markets with high barriers to entry allowing you to compensate for the lack of circulation income with higher levels of advertising or vice versa.
When companies took their content online without paywalls, they broke the first leg. Readers started getting the same news they paid for in a newspaper for free. And when quality stuff and the crap costs the same, it becomes increasingly hard to differentiate between the two. Especially when newsrooms are shrinking and the quality stuff is no longer as good as it was.
Because barriers to entry for online competitors are so low – especially if they ignore boring things like balance, research, ethics, sub-editing and quality control – the second leg also got broken. Advertisers started getting audiences effectively for free as publishers accepted ever sliding pay-per-click rates on the basis that something is better than nothing.
For the past decade and a half I have been arguing that the standard digital news business model is unsustainable and must be fixed if journalism is to survive. The future of media is definitely online. But it is a bleak future indeed if we don’t change the trajectory. We cannot have an industry where social media (ie Facebook) and search (Google), which do none of the work and scoop up all the cash, leaving publishers fighting for scraps in a race to the bottom.
Now, finally, a fightback is underway. Ironically, it is being built by going back to the old way of doing things – charging audiences for quality content and selling advertising on the basis of positioning and association rather than clicks. As a result, the future of journalism is looking brighter than even a few short years ago.
Maybe I’m being overly optimistic but it seems to me that traditional news values are regaining lost ground with signs that the war against fake news is being won.
Research released this month by Reuters found that when a news story breaks, three quarters of people verify the facts with a news brand they trust. Half of them compare multiple sources. Also, joy of joys, only one-in-10 now use social media as their primary news source. Trust in shared, or viral, news is down even when shared by friends, family and colleagues. And such “news” is increasingly being fact-checked before being shared further.
And what is good news all who earn our crust in this wonderful profession is nearly 90% of respondents to the survey think advertising on a news site associated with a fake news story damages the brand. Over half saying that they are more likely to notice an advertiser if it appears on a trusted news site. Some 57% agree that trustworthy content is the “number one factor” that makes online news brands appealing.
If nations are to hold the line against rapacious politicians, unscrupulous business people and the economically illiterate, it needs quality journalism. It’s by no means a cure-all but independent news is an essential element of any fight back against those who would rob us of our rights, dignity and opportunities for their own selfish ends.
And for this we should all be glad that we are now being asked to dip into our pockets to pay for something that we have all become far too used to getting for free.”
Quentin didn’t mention the hidden bonus in all this – in the new world that’s emerging, there is no place for purveyors of the dark media arts. Which means goodbye to Bell Pottinger and those of its ilk. Not before time.
