Local News Is Struggling — But Handouts From Digital Giants Aren’t the Answer

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Two very smart thinkers about the future of American journalism — Steve Waldman and Emily Bell — have called for Facebook and other hugely prosperous digital enterprises to pay reparations for what their success is allegedly costing journalism and democracy. I’ve worked in journalism all my life, but I don’t buy Waldman and Bell’s arguments.

First, here’s what Waldman proposes in his New York Times op-ed:

“If the leaders of [Facebook, Google, Verizon and Apple] put the equivalent of just 1 percent of their profits, for five years, to the cause, local American journalism would be transformed for the next century.

“That would be $4.4 billion — enough to establish a permanent endowment to fund local journalism. That would produce about $200 million in income a year, more than 15 times the current philanthropic spending on investigative journalism — and enough for about 50 new investigative reporters in each state, or to underwrite the technology operations of most nonprofit news organizations.”

And here’s Bell in her Columbia Journalism Review opinion piece:

“If…the four or five leading technology companies could donate $1 billion in endowment each for a new type of engine for independent journalism, it would be more significant a contribution than a thousand scattered initiatives put together.”

Waldman’s proposal is a new take on his 2015 “Report for America,” which called for unspecified philanthropies to finance 100 investigative reporters for two years. I wrote in this column at the time that the plan didn’t really go to the heart of journalism’s central problem at the local and community levels:

“The entire local news industry – both ‘legacy’ newspapers and broadcasters and entrepreneurial and corporate ‘pure plays’ – need to get out of their journalistic, Fourth Estate mindset and show their communities that they are all-in,” I said. “They have to do this not only with residents they want as readers but also local merchants as advertisers. And with everybody else in the civic space. Otherwise, they’ll continue to be minor players in the otherwise thriving local digital space.”

One and a half years later, the local news industry is making some encouraging stabs at better relationships with its readers and advertisers, but it still hasn’t gone all-in. To begin with, it hasn’t been able to define the mushrooming crisis of America’s poorly informed and divided communities and declare what it will undertake in an attempt to heal them. It took Mark Zuckerberg, the founder and CEO of Facebook – a technologist — to do that in the remarkable manifesto for action he’ll lead at his 2-billion-member social giant.

What worries me is that if journalism did get the kind of philanthropic windfall that Waldman and Bell propose, the news industry – especially the local sector – would, once again, get complacent. Just as bad, it would have a guilty-conscience relationship with companies it needs straightforward, mutually beneficial business partnerships.

There are many things that local news could start doing that would put it on the path to sustainability. Facebook is already a partner in making that happen and, with more prodding from publishers, can be a bigger help.

Every day, local news sites get hundreds of millions of inbound links from Facebook and other social platforms as well as Google search. It’s not Facebook’s fault that the users doing the clicking on those links don’t stay on the digital real estate of local publishers to which they’re transported. Some publishers are finally beginning to understand that it’s not pageviews they should concentrate on but “sessions.” Single pageviews can yield as little as $1 per thousand user impressions and even less. Sessions – all the pages that are viewed on one visit – yield multiples of one PV.

The trick, of course, is that it takes good “UX” – user experience – to get longer, high-earning sessions. UX comes, primarily, from high-value content and how and when it’s presented, but also important are clear navigation and ads and promotions that don’t grate on the user.

I think my local paper, the Charleston (S.C.) Post and Courier produces outstanding editorial work, but I have to stop unprompted video ads from interrupting me during almost every article I read on the papers’ pages.

As they figure out how to turn pageviews into more revenue-productive user sessions, news publishers are on the threshold of getting another benefit from their relationship with Facebook. Fake news and other unwelcome content is beginning to put the distribution platform on the defensive, and local news leaders are sensing they now have the momentum to get better revenue-sharing deals from Facebook. The “Journalism Project” recently announced by the social platform will give publishers more leverage in getting those deals, and at least some publishers, from what I see, are determined to exploit that advantage..

Still mostly over the horizon, but coming closer into view is the movement to create a whole new relationship between users, publishers and advertisers that promises to benefit all three. This is the Information Trust Exchange that would let users instantly access any content they want, channel micropayments to publishers with the same speed and give advertisers a treasure trove of demographic and behavioral information about users while totally protecting their identity. I wrote about all this here and here.

ITEGA, as the Exchange is now called, recently had its incorporation papers approved by the State of California. A pilot ITEGA may be launched within months.

So promising things are happening for news publishers on several fronts. Nothing involves reparations being extracted from Facebook and other digital enterprises and disguised as “philanthropy” to save journalism. Journalism doesn’t need that kind of saving, nor do the publishers who produce it.

Tom GrubisichTom Grubisich (@TomGrubisich) writes “The New News” column for Street Fight. He is editorial director of hyperlocal news network Local America, and is also working on a book about the history, present, and future of Charleston, S.C.