No, tech companies shouldn’t fund journalism

January 16, 2019

Yesterday, Facebook announced it would spend $300 million over three years on journalistic content, partnerships, and programs. The announcement commits the social network to match the funding rival tech giant Google said it would spend on such programs—but more importantly increases the already-dangerous co-dependency between big tech and newsrooms.

Journalism, especially local journalism, is certainly in need of new revenue streams, as the industry faces a fundamental challenge to its business model, as print advertising dwindles and publishers’ meagre share of online ad dollars do little to replace it. Meanwhile, the tech companies keep growing, reaping the online ad dollars that publishers are so eager to get.

Both the financial crisis of journalism and the dominance of big technology platforms are important issues, but they are too often conflated; academics and European lawmakers alike have pushed these two separate conversations together over the last few years, suggesting there’s an easy fix in making technology fund journalism. This is a tempting idea, and one gaining a foothold in the US, but in reality would be a serious mistake—especially when it comes to reader trust.

Many rightly see the rise of big tech, and social media in particular, as the root of journalism’s problems. Not only do Google and Facebook dominate the online ad market—the two together make up nearly two-thirds of the market, but the social networks have played a huge role in the spread of online misinformation and the incentivizing of clickbait, which have been large contributors to the crisis of trust in the media. That idea has widespread academic and political support. In July 2018, a UK parliament inquiry into disinformation and fake news warned of social media’s effects on both the information and advertising ecosystems. Likewise, Facebook conceded—while under severe media pressure earlier this year—that the journalistic outlets which provide much of its content are in crisis.

RELATED: The platform patrons: How Facebook and Google became two of the biggest funders of journalism in the world

Meanwhile, big tech also faces bipartisan political criticism—and potential regulation—on a number of issues of global concern. These include the spread of online misinformation and so-called “fake news,” potential political bias, concerns about the market dominance, wages, and working conditions, and their competitive tax advantages. Executives from Facebook, Google, and Twitter have been called to testify in front of Congress, the EU parliament, and the UK parliament, in response to concerns around misinformation, bias, and advertising.

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The next step in the chain of logic is tempting: given that big tech now gets the ad dollars that media used to get, and it’s big tech that’s playing a role in online misinformation, then we should issue a levy on technology companies and use it to fund public interest journalism.

The idea has a long pedigree, and Facebook’s move is not unprecedented. For several years Facebook has been funding various journalistic initiatives, including launching financial relationships with fact-checkers to fight fake news on its platform and a £4.5 million scheme to fund training for local reporters in the UK. Last March, Google announced it would spend $300 million on journalism-related projects—including consolidating existing disparate projects—over three years: a significant spend, but less than 1 percent of its revenue, spent partially on improving its own services. At the time, Google’s Phillipp Schindler told journalists the company’s mission is “inherently” tied to “your business,” needing both information to serve and content against which to place adverts.

Critics are blunter, calling out such efforts as simple fig leafs or PR stunts, to distract or delay larger reforms—or as a way to appear that they’re tackling the issue of misinformation (including from Russia) on their own platforms.

In 2017, Emily Bell, the director of the Tow Center for Digital Journalism at Columbia University, called in CJR for tech companies to band together to create a billion-dollar endowment for journalism, over which they would have no control. Bell, who called for the companies to crate the fund out of enlightened self- and public-interest, not government intervention, noted that “if every tech billionaire bought a newspaper, we might achieve something similar. But then sustainability would rest on personal interest and wealth alone.”

Writing in April 2018 in The Nation, Victor Pickard, associate professor at the Annenberg School for Communication, echoed calls for tech companies to fund journalism, though did not suggest whether they should be compelled to do so. “Two intertwined problems—unaccountable monopoly power and the loss of public-service journalism—could be addressed,” he wrote, “through policy interventions that rein in Facebook and redistribute revenue as part of a new regulatory intervention against digital giants’ negative impacts on society.”

And the EU is already compelling tech giants to share funding with publishers, in limited ways. In 2018, it extended copyright law to require search engines and others to pay for the extracts they publish to drive content to publishers—a so-called “snippet tax.” In the UK, the newspaper industry has proposed a levy on tech giants to fund journalism, a scheme the government is considering.

The intention behind these proposals for tech intervention is good. But the journalism industry needs to accept that there is no injustice in much of the revenue we lost. For much of its history, journalism was supported by patronage: the golden era of vastly-profitable journalism which could still serve the public interest was a mere few decades, or a profession dating back centuries. Advertising allowed journalism to get away from that, but a return to patronage—via tech firms—isn’t the answer.

Neither are the financial woes of journalism solely the fault of any tech company. It is not unfair that the internet is simply better for consumers for finding these services than newspapers were, and it’s not the fault of technology companies that complacent newspaper groups didn’t spot the changing tide and invest in the next generation of such listings platforms. The honorable exception is the Guardian Media Group, which built up the Autotrader car sales brand online and eventually sold its stake for around £900 million, securing the newspaper’s trust fund for the future.

Furthermore, newsrooms are far from the only industry big tech has disrupted. The rise of Amazon has shifted taxes away from local governments—such as business rates in the UK, which fund local councils—and offered nothing to replace them. Social media networks may be linked to increases in mental health issues, imposing healthcare costs. It challenges logistics firms, it reshapes global supply chains, alongside mom and pop stores. And aggressive tax planning across big tech has deprived governments across the world of potentially billions in corporate tax revenues, at a time when many are making substantial cuts to public services.

This is one of the fundamental weaknesses of proposing a levy between big tech and journalism: it treats the media as an exception, a rare case of interplay between disrupted and disruptor. If we focus on our own industry, we risk missing a far larger picture—and risk creating the impression we are advocating for ourselves while everyone else just has to deal with it.

Tying the future of journalism to a tech or social media levy shackles the two even closer together, making a already dangerously codependent relationship even less healthy—and potentially compromising journalism in the eyes of readers. It would also let tech off the hook: one of the main justifications for corporate tax is making companies contribute towards the societies they live in, the infrastructure they rely on, and to offset the harms that they cause.

A social media levy is an attempt to duck difficult questions about how we fund public interest journalism, a way to ask government to step in and fund journalism without having the tough conversation of what that means and how it works. We need to hold big tech to account. We need to find a sustainable model for quality journalism. And to achieve either, we really should try to keep those conversations separate.

James Ball is a journalist and author based in London, UK. His latest book is Post-Truth: How Bullshit Conquered The World.