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FTC talks: Public- and Foundation-Funded Journalism

This is a coverage page rough, contemporaneous notes of the second day of the U.S. Federal Trade Commission workshop: "From Town Crier to Blogggers: How Will journalism Survive the Internet Age," held Dec. 1-2, 2009, in Washington, D.C., at the FTC's 601 New Jersey Avenue offices. Your scribe is Bill Densmore, a fellow at the Donald W. Reynolds Journalism Institute at the Missouri School of Journalism. Of course we've tried to provide accurate quotes and summaries. But the FTC has stenographers recording all of the testimony and that should be your definitive source. The home page for this coverage is http://www.newshare.com/wiki/index.php/ftc


The FTC's Tom Krattenmaker / 202-326-3517 moderates this panel

Vivian Schiller, CEO, National Public Radio

What are they doing:

  • First, we will build on balanced, serious, original reporting on serious themes and at the national and international level.
  • Build on local news in partnership with affiliates, with Project Argo and other initiatives, and with new nonprofits.
  • Make their content universally accessible. 18 months with an open API. They now will broaden it into a larger "public-media API." It is NPR organized but is to the benefit of all public media including many of the not-for-profit startups.

They are counting on public funding to support these initiatives. Conclusion: "This is not your grandfather's public radio."

Joaquin Alvarado, Corp. for Public Broadcasting

He's senior VP for innovation and diversity.

John McTaggart: Senior VP and COO, American Public Media

Yesterday there were 30 people talking about the business of journalism. "For American Public Media, journalism is not a business, it is a public service ... we don't serve shareholders, we don't even serve consumers. We serve citizens."

We don't trust the free market for education, public safety or health. APR believes information necessary for a democracy should not be left only to a free market. They have created an infrastructure with public funds that has the capability of providing free and public access to media for everyone across the nation.

"We have a sustainable business model." All government funding amounts to less than 8% of their total funding. Digital startups have to build infrastructure. "But public media is 40 years ahead of that with a sustainable business model, with audiences that are already stable and relying upon us." Better public media organizations are ready to create more content, in partnerships.

= Eric Newton, vice president, Knight Foundation journalism program

"I'd like to tell you about Cicero." Cicero was unhappy with the commercial news packets set out from Rome. He needed to know the votes of the Senate, but he was getting wierd stories about gladiators and ostrichs. "Cicero is not alone."

He cites statics showing that there are far fewer newspapers than government entites. "All that government is not being watched over by the Fourth Estate. And it wasn't before the Internet, either . . . the market has not suddenly failed. The market has always picked and chosen what it has done."

"Journalism does not need so much saving as it needs creating," says Newton, echoing the report of the Knight Commission on the information Needs of Communities. "We need 20-times more flow."

"For most part our nation's policies, when it comes to creating new and innovative media, are just in the way," he says. CPB funding is for old media. The rules need to be changed.

Non-profit news organizations don't get equal access to press galleries, and can't write editorials without threatening their tax status.

If college students spent 10% of their time doing journalism, it would replace all the journlism we have lost. But they aren't treated as journalists.

He says the biggest playing field that needs to be leveled is getting universal broadband access across the nation.

Charles Lewis, Investigative Reporting Workshop

Lewis' workshop is at American University. He was a founder of the Center for Public Integrity, also.

"What is happening now is nothing short of thrilling ... we are witnessing the dawn of a investigative reporting ecosystem across America." There are now dozens of "innocence projects" across the nation, 15 investigative reporting operations, and more than 20 associated with universities (I may have reversed those numbers).

In July, an Investigative News Network was formed and is being incorporated. It will become 50-100 groups nationwide by the end of 2010. The Associated Press has asked that the content be transmitted to their newspaper clients.

"There is something going on here that is growing and changing in response to the hollowed newsroom phenomenon we have been living through," he says. "I find it quite exciting."

Mark MacCarthy: Georgetown University's Communication, Culture and Technology Program

Charging for access to news just won't work -- it would produce only $750 million.

They system of public media exists, it just needs to funding to hire local reporters. The Corporation for Public Broadcasting should fund local news gathering.

Concern: Would government control the agenda and point of view. He doesn't think so. That hasn't happened in Britain and there are rules in place create a wall even in the United States.

He suggests news-gathering grants would not preclude other revenue streams. He doesn't think all news can be supported by public grants. He doesn't know the right mix, "but I do think that public funding is an essential element of the mix" and it is time to get started on it.

Tom Leonard: UCal-Berkeley Journalism School librarian

His speciality is the history of journalism. He says we have vivid impressions of the history of the 20th century as well as the funk media is in today. Missing is a perspective on the 19th century. How did we get a prosperous media?

In the hardscrabble part of the 19th century, you will find voices very much similar to voices we hear today. Horace Greeley called the field in the mid-19th century "nothing more than an assemblage of pains." He was thought he would never get any money from his paper, and at that time, only 5% of the writers who wanted to write could every hope to earn a living.

Three factors:

  • Copyright protection then was of very little help. They benefited from its absence. They pirated British material until the 1890s. Local papers were printed freely from one another through a system of exchanges. "It's almost enough to say that 19th century journalism was built on plaigerism, it is certainly fair to say it was built on aggregators."
  • There was a paywall in the 19th century. Nothing was published with the intention that it be free. Americans ignored it, laughed at it. Nothing is more common in the 19th century press then rhymes about "owing the printer and won't pay."
  • Governnment subsidies were the third factor. Legal notices mattered. There was impressment of childen to work as newsboys which was allowed. And broadcasting licenses handed newspapers enormous benefits in the early 20th century.

"If you want prosperity in media today, remember these three things:

"It didn't happen because the press was protected by strict rules about intellectual proprety, it didn't happen because of strict payment schemes and it didn't happen because the government stayed out of the picture," says Leonard.

Josh Silver: executive director/ FreePress.net

He argues "there is simply no choice" but to have the government involved in funding journalism. If not, we will see significant erosion of the Fourth Estate. He thinks there needs to be a commensurate "psychic shift" to see subsidizing news as the same as subsidizing health, education and public safety. "The government is going to have a role in it."

Some statistics cited by Silver:

One company, AIG, has received 175 times more money in bailouts than the Corporation for Public Broadcasting received last year. Total financial industry bailouts are 1,023 times higher than the CPB's annual budget. Congressional earmarks in one year -- 41 times more than CPB. the U.S. government spent 3.5 times more money on office furniture than the CPB budget.

"We have to move from platitudes to policy," he says. Key issues to focus on:

  • What is it that communities really need?
  • Get down to brass tacks: There will inevitably be a political fight.


Soundbites requested by the moderator.

Mark MacCarthy: He emphasizes how traditional government involvement in content is. Museums, public-concert venues, government-funded events, funding for scientific, artistics content. "This not some alien intrustion ... this is how we do these things in this country."

Charles Lewis: We spend hundreds of millions of dollars to fund media in other countries. He is fascinated by the percentage of public money going to media in other parts of the world. News organizations are not famous for biting the hand that feeds them. He has some ambivalence about that.

Eric Newton: Tax laws matter a lot on the commercial side. Suggestion: Drop state sales taxes on news and information, double it on chocolate doughnuts!

Joaquin Alvarado: We are putting a lot of money into broadband. We should be about the innovation of public content on that. When the national broadband plan comes out, speak to that issue within that plan.

Vivian Schiller: She has convert syndrome (she used to be in private media). We have a strong, powerful infrastructure. We have a strong system and other revenue streams. An increased investment into public media will go farther than any other bailout -- of the commercial newspaper industry or any others.

Josh Silver: To skeptics of government subsidy he reiterates: There is not enough private money to support the local journalism that our participatory democracy requires. It's critical "that many of you leave your comfort zones, and embrace that there may be a role for government."

Tom Leonard: He seconds the idea of looking at libraries. They could not have prospered without strategic philanthropy -- from Carnegie in the early 20th century, the Gates Foundation today. Library bond issues continue to pass because many public libraries are a place for home-schooled children to get together. "There are more libraries than McDonalds in the United States, and if you begin to count school libraries there are 10 times as many as MacDonald's right now."

Jon McTaggart: He thinks private media will continue to innovate. He says it was innovative for them to choose FM when everyone else was on AM. He talks about Public Insight Journalism: The believe that someone in our audience knows more about the news we are reporting than we do. There are now 80,000 of these experts and a growing network of news organizations that are partners. Legacy organizations -- even legacy radio organizations can and will innovate.

PEG, technology and innovation

Discussion of PEG access operations. Joaquin Alverado says "triple play" is discombobulating the PEG function. "They are the ones recording the city council meeting so the reporter can go back and look at it."

Schiller: Technology is the key to everything. Formation of a public-media platform is critical. If we can't have the power of all our content available and accessible to select what the need and provide to our users -- then NPR will have failed to be relevant. "It's at the center of everything we do," she says.

Mark MacCarthy: Says all CPB funding has to be platform neutral.

Eric Newton: Traditional media that survives will be those nimble enough to create cultures of continous change -- it means new technology all the time. How do you create that kind of a learning organization and a constant stream of innovation. Many will survive into the 21st, but it will be the nimble ones, not necessarily the big ones.

Alverado of CPB: He has been surprised there are many local news initiatives that radio stations are bootstraping because they feel compelled to do so. The stimulus bill is a key to melding social networking with broadband. "We've got to make sure we don't have any more panels where there are only two software developers in the room."

Josh Silver: There is an age-based divide. There's a parallel challenge. How do we subsidize national broadband. In nine years, the nation has slipped form 4th to 27th worldwide in national broadband deployment.

What if any changes in law are needed?

Eric Newton: He does not have the mythology that the government has never been involved in media. The challenge is maintaining the firewall between that content and involvement.

Schiller: Need a rexamination and re-authorization of the Public Media Act. it was last authorized in 1992 and funding ran out in 1996.

Alvarado: Addressing what the re-authorization should look like given everything else going on is one challenge. Need to decide what needs to be done in terms of changes in language. How do we make the innovations sustainable over time. "If we can get a ramp there and preserve the species of journalist before we lose it, like the California condor, just get together species, mating pairs."

Mark MacCarthy: Diversity of funding is important. Funders always want to have their impact -- advertisers have do. Funding has to be broad enough so that no one person calls all the shots.

Tom Leonard: Access to knowledge needs not to be priced out of a person's capacity to pay. PubNetCentral -- anyone can see what public research was and use it. "The content providers are not so happy with this reform. They would like to role back that access. These are companies with 34% profit margins in some cases."

What about government/foundation funding as opposed to private markets?

Moderator: Even if you run a paper in your basement, copyright, tax laws, and the transportation network all help you. No business exists entirely without the help or effects of government. If you are going to be a critic of government, how do you criticize one that funds you?

Vivian Schiller: "The proof is in the pudding." "This is not a new concept. Advertising appears in newspapers. Advertising subsidizes journalism in all newspapers. Does that mean the newspapers pull their punches with respect to those advertiser?" Is there any instance of NPR where a story has been favorable to a foundation funder. "We do plenty of criticism of the U.S. government and any government institution and there is no reason to believe that would not happen." the instinct of most journalists is to look deeper at funders. The mechanism of all funding is the same.

Eric Newton: Hundreds of major newspapers have fantastic codes of ethics. It's the same thing in libraries and schools, keeping their speech free. It's the building of firewalls. Using that as an excuse not to increase funding is like saying this will harm the schools, or we shouldn't have schools teaching news literacy because it will hurt the kids. "It is a bogus argument that keeps us from doing the right thing."

Josh Silver: Three things should be done:

  • Abandon the appropriation process. It is too politicized.
  • Change the public broadcasting board away from a presidential appointment.
  • Bolster the role of the ombudsman at the CPB.

He thinks it is absurd that revenue form the auction of public airways doesn't go to public media. It should.

  • He suggests a device tax on electronic devices.

Charles Lewis: Creating walls between the fundraising part and the staff doing the journalism.

Tom Leonard: We need to take another look at the ombudsman or the public editor. That airing of different points of view and the transparency of sufacing the criticism and seeing what the facts are is important.

Eric Newton: The funding situation is temporary. The relationship needs to be between the news organization and and people. If advertisers, private or government funders are involved it doesn't work.

Jon McTaggart: Diversity of funding is important, as well as accountability to the community. A demonstration of support from the community for the journalistic organization that justifies or leverages support from the government. The funding should flow to news organizations that then employ the journalists.

Alvarado: CPB chair Pat Harrison says this is the time, we need these discussions. It's a question of the timeline, the critical path and how many agencies need to be involved. "We keep having this conversation about what's going away, not what's before us."

Alvarado: "You are not going to get the American public excited about caring for the dying patient, you've got to get them exciting about birthing the baby."