Journalism on the Edge

Journalism is in trouble, right at the time when it is more important than ever. The Government needs to move quickly to ensure that public-interest journalism is sustained in some form. 

Bauer Media is shutting its doors, meaning we will lose magazines such as The Listener, Woman's Day, New Zealand Woman's Weekly, North & South, and Next. Mediaworks staff have also been asked to take a 15% pay cut in the face of dropping ad revenue. We can expect more to come. 

COVID-19 didn’t cause this problem. It was a pre-existing condition. The virus was merely the straw that broke the camel’s back. For some time, online advertisers – particularly Facebook and Google – have been eating into traditional media organisations’ advertising revenue. This has made it harder and harder for them to pay journalists to create their content. 

Mediaworks has been on the ropes for some time, not helped by the fact that its competitor TVNZ is government-owned. While radio stations seem to be doing okay (particularly government-funded RNZ), newspapers and websites have been downsizing and reformulating their business model. The NZ Herald has recently gone behind a paywall, joining NBR and Politik. Newsroom operates on a mixed model (free and paywall), while both Spinoff and Interest are appealing for readers to directly contribute. Only Fairfax, which owns Stuff and other newspapers, is continuing business as usual. 

The solution is fairly simple, and has been under discussion for some time now. Since 2017, TOP has been calling for more funding for NZ on Air to enable it to set up a public-interest journalism fund. Media organisations could bid into this contestable fund and use the money to create public-interest content. Hopefully, that would be enough to retain a large proportion of our current journalistic capacity, and encourage some innovation. 

It is increasingly clear that the funding to pay for this should come from the companies that are cannibalising advertising revenue: Facebook and Google. The Government has previously mooted imposing a “Digital Services Tax” on these big internet companies, but seems to have gone quiet on the idea. This tax could net $30–80m: easily enough money to form a public-interest journalism fund. 

There is a lot of talk of an international deal to tax the internet giants, but not much progress on implementation. As a result, many other countries are making noises about taking some form of unilateral action. Naturally, Facebook and Google themselves are squealing about the idea, and President Trump has threatened trade sanctions as he views any such move as an attack on American companies. 

Frankly, that shouldn’t stop us. The alternative is to sit back and watch local media disintegrate. We can blame COVID-19, but Facebook and Google are the real culprits. And in fact the implosion of local media is not in their interests either. With no quality local content being produced, they would have no content except for cat videos and pictures of people’s meals. 

The Government should start moving on a Digital Services Tax. But it should be prepared to negotiate with Facebook and Google, because if they are prepared to do a deal and shell out for public-interest journalism, the tax may not be needed.