As Emma Dawson and Miriam Lyons point out in their article on this website, ‘INTRODUCTION: Ideas for an Australian media policy‘: ‘As citizens in a democracy we rely on the media to scrutinise the actions and decisions of those in power’.
A responsible, robust news media is an essential pillar of a healthy democracy. However, in Australia and around the world these pillars are being corroded by commerce. Market forces, left unchecked, will see our news services dominated by sound grabs, zealots, celebrities’ opinions, gossip and funniest home videos.
According to a report in The Economist last year, most newspaper companies in the developed world still earn almost all of their profits from print, which is in decline.
While the long-term future of quality journalism is under real threat, the media debate in Australia is focusing far too much on issues of ownership.
We are too hung up on media concentration. Of course it would be wonderful to have a diverse range of media moguls all competing in this country. But the stark reality is Australia is not a big enough market to sustain this anymore than we can sustain diversity in our vehicle manufacturers.
We have to choose between diversity of ownership or commercial strength. I say we should choose commercial strength.
Dawson and Lyons go on to say, quite rightly, that we ‘need media that is independent and diverse; capable of putting the public interest above the interests of media owners – whether those owners are governments or shareholders’.
But let’s be clear about this – the only media owners capable of putting the public interest above their own are those who can afford to.
The most obvious example of this would have to be The Australian. This is our only national daily general newspaper – the other national daily being the business oriented Australian Financial Review.
Whether you read it or not, The Australian is one of our most important news outlets and it would be a catastrophe for journalism and democracy in this country if we were to lose it.
So let’s not forget that we have The Australian because Rupert Murdoch (for all his faults) had vision and was ‘capable of putting the public interest above‘ the financial interests of his company and shareholders.
The Australian ran at a loss for many years, in fact I believe it was more than a quarter of a century before it showed a profit. Even today The Australian manages to fill many column centimetres with news, features and analysis, and maintain a large stable of journalists on very low circulation numbers. In fact, Monday to Friday, it’s out-sold by the regional daily, the Newcastle Herald.
Only a large company like News Corporation, that has deep pockets and more lucrative sources of income, could afford to launch and maintain The Australian.
If another large company were to launch a national daily in competition to The Australian, we would not have more diversity, because it would not be sustainable. One, or both, publications would go out of business.
As we make our way into the 21st Century, I would argue that there are no more important institutions than the general newsrooms of our major daily newspapers – national, metropolitan and regional. These are the troughs that all other news outlets – radio, TV, Internet sites, blogs, magazines – feed from. They are also the main incubators for future generations of journalists.
The reason for this is resources. Only the major newspapers, and to a lesser extent the ABC, have the journalistic resources to seriously scrutinise the avalanche of information that flows every day from the wires, the internet, the courts, the councils, the parliaments, the politicians, the stock exchanges, the business community, the sporting community and the general public. Let alone still have resources to get involved in any meaningful, proactive investigative journalism.
Of course TV and radio and websites also break news stories. However, they do so in a more ad hoc fashion. They do not have the resources to provide the blanket community coverage that the newspapers do.
Most of the electronic and new media content involves responding to, interpreting, analysing, discussing, developing, displaying and investigating what the papers say.
Now I don’t want to be seen to underestimate the importance of all these other outlets. Radio, TV and the Internet have taken public discourse to a whole new level. They facilitate vigorous and immediate community debate on the issues of the day. It’s this dialogue that defines who we are and what we stand for.
Many media commentators have been predicting the end of newspapers.
Anton Harber, Caxton Professor of Journalism at the University of the Witwatersrand, suggested that many of the 1600 editors and publishers who attended this month’s World Association of Newspapers international congress and World Editors Forum in Cape Town, were in a state of denial. “On the face of it, the patient is already in a coma, and they are just not prepared to turn off the life support”.
Professor Harber says the figures in the US and most of Europe show clear trends – as internet audience and revenue grows, newspapers sales are plummeting, advertising is fleeing and the average age of readers is over 50 and getting older every year.
Surveys show that more and more people are getting their news from the telly. I say this is rubbish. They may well be hearing their news from the telly, but most of the news they get from the telly actually comes from newspapers.
Unfortunately the increasing popularity of the electronic media outlets are bleeding the market share away from the big newsrooms on which they rely.
This is one reason why ending cross-media ownership restrictions is a good thing. It may help to stem this erosion, but it won’t put an end to the issue.
The fact is that as our communities expand in size and complexity, our major newsroom resources are being eroded. This is not unique to Australia, it’s a worldwide trend. Many of the largest and most important newsrooms in the world are finding it difficult to merge onto the information superhighway.
In a May 24 memo to staff announcing that 57 journalists are to be made redundant, Los Angeles Times Editor Jim O’Shea pointed out that staff adjustments were “an unfortunate reality in nearly every paper in the nation”.
Between 1990 and 2004 employment at US newspapers fell by more than 17.5 per cent while US employment overall rose by more than 20 per cent.
At the core of the problem is ROCE (pronounced Rocky) – Return on Capital Employed. ROCE has a variety of nom de plumes, however, if it was a person, he would have “Show me the money!” tattooed on his chest.
ROCE is the pure measure by which the share markets of the world can assess any business, no matter its size. And it’s on this assessment that the big investment decisions are made. ROCE is the heart of the market system that has essentially delivered the free world as we know it today.
By and large it has had an overwhelmingly positive impact on living standards, life expectancy and quality of life. We got a graphic example of what the absence of these free-market mechanisms would be like when the Berlin Wall came down and the Trabant coughed its way through the Brandenburg Gate and parked between a Mercedes and a BMW.
But ROCE does not always deliver the best results. And news is a case in point.
Rupert had to lock ROCE in the bathroom until The Australian could learn to walk.
As far as ROCE is concerned, the big newsrooms will never cut it against their increasingly popular, low-cost competitors.
However, while our leading newspapers are publicly traded, many remain privately controlled and this, to a large extent, has kept ROCE at bay. But the tide is turning. We are now seeing the equity funds moving on our media assets. These funds are ruled by ROCE because they are essentially responsible for investing our superannuation dollars.
If we want to preserve the health of our modern democracy we must find a way not only to stem the market erosion of our newsrooms, but to reverse it. We don’t just need to preserve our news services – we desperately need to improve them.
Considering that robust competition will always deliver the best outcomes, we can find a way to harness the power of the market rather than try to resist it.
I don’t pretend to have all the answers, nevertheless here is one suggestion to start the discussion.
We dramatically expand the role and resources of the Australian Electoral Commission to oversee the news media in general, not just during election campaigns. This makes sense when you consider that most voters have made up their minds on how they will vote prior to the election campaign.
I would envisage the AEC providing incentives rather than regulations. This is where the resources come in. It would establish criteria that it would then use to rate news organisations according to the quality of their information – in the same way we apply credit ratings.
The criteria could, for example, include such things as number of journalists employed, accountability to audience members – publishing of corrections, readers’ advocates, independent avenues for feedback, letters columns, online forums, chat rooms etc.
The AEC could then provide accreditation that would make news organisations eligible for financial incentives – tax breaks and/or subsidies.
In other words we would be putting a market signal on quality information in the same way we plan to put a price signal on CO2 in order to curb greenhouse gas emissions.
We do this for political parties, and in a sense we even do it for religions. If we do it for our news organisations we will be helping our media owners to act in the best interests of the community as well as their shareholders.