Kerry:

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A COVID-19 Bail Out for Newspapers Would Perpetuate a Dying Business Model

Written for Bacon’s Rebellion by James A. Bacon.

Virginia’s two U.S. senators, Mark Warner and Tim Kaine, have joined 17 colleagues in signing a letter calling for emergency COVID-19 funding for regional and local news outlets.

“Local news is in a state of crisis that has only been exacerbated by the COVID-19 pandemic,” the senators wrote. “Local papers and local broadcasters have lost even more of the advertising revenue they rely upon from [businesses that have shut down]. Communities across the country have seen the further decimation of this important industry as local publications have stopped printing and laid off staff in the last few weeks.”

Great idea! Where do I sign up for my share of the money?

Wait, what? Bacon’s Rebellion won’t qualify? Blogs need not apply? The letter goes on to say:

“Any future stimulus package must contain funding to support this important industry at such a critical time. Such a provision should be tailored to benefit aid recipients who make a long-term commitment to high quality local news.”

Who make a long-term commitment to high quality local news… Here’s the crucial question: Who decides what constitutes a “long-term commitment” and what constitutes “high quality local news”?

The letter doesn’t say, but I would suggest that the job most likely would be given to some “reputable” organization here in Virginia like the Virginia Press Association, which represents vested media interests against upstart competitors. I don’t see the VPA looking out for blogs, no matter how much news they report. (Consider how the VA News digital clipping service provided by the Virginia Public Access Project stopped including Bacon’s Rebellion’s straight news coverage on a variety of topics, most notably Steve Haner’s reporting on the State Corporation Commission.)

Look, I agree with our august senators that the long-term decline of the commercial newspaper industry in Virginia, and nationally, is a tragedy. I share the letter’s view that “local news plays an indispensable role in American civic life as a trusted source for critical information … on governance, elections, health, and numerous issues specific to their cities, towns, and neighborhoods.” And I certainly think that newspapers and television stations should be entitled to the same kind of financial backstops as every other small- to midsized business. (I normally oppose business subsidies of any kind, but these ain’t normal times.)

But giving special consideration to a dying industry? Dumping cash into local newspapers and televisions won’t address the long-term challenges that the letter acknowledges has devastated the industry: “The growth of social media and technology platforms has concentrated critical advertising revenue in the hands of a few.”

Local media enterprises need to reinvent themselves. No one knows yet what the new model will be. Perhaps a foundation-funded model — as in the Virginia Mercury and Virginia Public Media — is the way to go. Perhaps the volunteer model — Bacon’s Rebellion, Kerry Dougherty’s blog, Blue Virginia, and others — is the way to go. Or perhaps a new business model will emerge that’s based upon an entirely novel revenue source.

There is a demand for local and regional news. Some creative entrepreneur needs to figure out how to monetize that demand. However, federal subsidies for legacy news enterprises wedded to an outdated business model will only perpetuate the status quo and crowd out experiments and innovation by entrepreneurs seeking to find the new business model. If legacy media enterprises are going to die, we might as well let them get on with it so we can figure out what comes next.