Web Publishing Roll-up: The FTC Reinvents Journalism

By Marisa Peacock (@marisacp51) Jun 16, 2010

We’ve been contemplating the future of web publishing and journalism for sometime now, but recently the Federal Trade Commission decided to weigh in on the debate with a discussion paper that outlines potential policy recommendations to support the reinvention of journalism.

Supporting the Reinvention of Journalism

Having started in May 2009, after a full year of investigation, the FTC presented a paper aimed at generating discussion about the current and likely future environments for news-gathering and reporting, as well as FTC’s policy recommendations for supporting “the ongoing “reinvention” of journalism”

In an effort to full understand the evolving world of online and print journalism, the FTC addressed the current state of the news; new sources of revenue; and asked is “experimentation is enough.” Among their observations:

The Current State

Advertising matters: For most of the twentieth century, advertising paid for the vast majority of the news produced in the United States. On average, about 80% of revenues from newspapers came from advertising and 20% came from subscribers.
Revenues are falling: Newspapers’ revenues from advertising have fallen approximately 45% since 2000.
The Internet complicated the news industry: The web provides advertisers with many ways to reach consumers, leaving online advertising to generate much less revenue than print advertising.
The economy: Newspapers have had to cut staff and find sustainable business models, all the while trying to cover news globally and locally.

New Sources of Revenue

Experimentation is good: newspapers need to find new sources of revenue implementing pay walls, subscription models and other strategies
Experimentation is bad: no one knows if any combination of the strategies tried will be able to generate sufficient revenues over the long run to maintain existing newspapers.
Niche sites are cute: Hyperlocal sites, smaller online news sites and sites that rely on funding from venture capitalists are popular, but not profitable.

Is Experimentation Enough?

The news is a “public good”: In general journalism always has been subsidized to a large extent by, for example, the federal government, political parties, or advertising.
News can provide a public service: good news reporting can be essential to maintaining a democratic government and can be a tool of social justice
Sustainable models are needed: There is no sustainable business model that supports free and accessible news while also funding the resources necessary to ensure good news reporting.

Proposed Policies & Impact

With these newspaper knowns laid out, the FTC goes on to propose ways to innovate journalism so that it is accomplished at lower costs. They suggest amending copyright and fair use policies, recognizing hot news protection legislation and licensing the news, among others.

Despite the FTC’s good intentions, the paper comes across as bureaucratic and capitalist. Many critics of the report note the fact that subsidies and tax exemption status alone will not save an industry that has fallen because of consumer choices, publishing trends and options, and an economic recession. While it’s noble for the FTC to want to help out, its strategies are narrowly focused on addressing issues that are financially-related and not those that are related to way the news has been managed behaviorally.