As the Covid-19 infodemic has shown, business models in the global media and information space are not conducive to independent, fact-based journalism, but rather encourage the spread of misinformation, disinformation and propaganda.
At the same time, economic and technological pressures, coupled with a growing tendency of government control of the media through use of public funding, control of state media, politicization of the regulatory authorities and the takeover of private media companies, a phenomenon described by some researchers as media capture, endanger the financial sustainability of independent journalism. In some countries, independent journalism is only carried out by a few fringe media outlets. In others, it is on the brink of extinction as the government controls most, if not all, media outlets.
Hence, for media to be able to maintain independence and serve the needs of society, they must be financially viable. That means a diverse and steady flow of revenues, which are not solely dependent on donor funding or government cash. In developing countries in particular it is extremely difficult to achieve that as there are very few private sources of financing for independent media outlets.
Studies carried out by the Media and Journalism Research Center have shown that the most promising business models for independent media outlets are those that establish a connection with the audience. They range from subscriptions (where consumers of media pay a certain amount of money to have access to content produced by media outfits) to memberships (more complex forms of subscriptions where media users are paying a fee to become part of a club of supporting readers and viewers who not only have access to the content offered by the media outlet, but also enjoy other benefits such as access to events organized by the outlet, discounted tickets to cultural events, etc.) to crowdfunding (where citizens donate sums of their choice to media outlets to keep them in business or help them run specific editorial projects).
In contrast, forms of funding such as government subsidies, state advertising or informal payments (sums of money paid by private companies or officials to individual journalists to influence their editorial coverage) are hugely detrimental to the independence of the media as they make journalists highly dependable on institutions and powerful businessmen or officials who seek to control the media narratives.
Revenues from the audience, however, are generally not sufficient to ensure the financial sustainability of the media. With advertising dollars increasingly going to tech companies and governments all over the world stepping up their financial spending in the media companies they want to control, independent journalism is faced with a financial predicament.
In this rapidly changing media environment, the role of the private businesses is more important than ever. Businesses that want to behave ethically and operate in a highly competitive environment know that this is possible only in countries with a healthy media sector.
The CEO of a mobile telephony company in the Czech Republic said in an interview with our center back in 2016 that companies simply can’t thrive without media freedom. “If you don’t have independent media, then companies stop being ethical as they have to ensure, through whatever methods possible, including bribes and other forms of influence, that their message is prominent in the mainstream media,” he said. Another businessman, the CFO of a large foreign retail chain operating in Hungary, said in an interview conducted in 2017, that good, unbiased media helps their company decrease regulatory costs. “Like any other company, in almost any sector, we have to comply with rules and regulations and that carries many costs. If you have independent media that watch out for illegalities or wrong, biased decisions of regulators and rule makers, they actually provide us with an extremely valuable service: keeping regulatory authorities in check, something that otherwise we would have to do ourselves by paying, for example, lawyers or lobbyists.”
Many companies are aware of the advantages brought about by independent, factual media coverage. Some of them work on protecting that environment by supporting media outlets to be able to do their job through advertising spending or sponsorship of special editorial projects. Others fund programs aimed at improving the capacity of journalists or media literacy projects that help improve the overall information and communication space, but also investigative journalism projects that help unearth major problems societies are grappling with such as corruption or wrongdoing.
In the past decade or so, researchers specialized into media systems have devoted much of their time to mapping the structures of various media environments to understand where the pressures on editorial journalism come from. These studies offer incredibly useful insights into the mechanisms of editorial control specific for each country. However, little research has been done to date to understand the incentives and barriers private sector actors face in investing their advertising dollars into reputable, independent outlets that may not have the most traffic or largest footprint. There is also limited research into how the private sector can support independent media and counter disinformation through their CSR and ESG commitments, collective advocacy, or other kinds of financial contributions. As such, there is limited information to help guide private sector engagement and encourage productive relationships between companies, civil society, and media outlets that improve the financial environment for a healthy info- sphere.
Our Media Sustainability research is focused on the following topics:
How the Business Community Can Support Journalism
This project maps approaches by businesses and corporations to supporting media outlets with a view to identify good practices and tactics that can be replicated elsewhere.
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Rewiring the Advertising Model
This project documents models of advertising spending aimed at supporting media outlets and journalistic initiatives for the public value they create.
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This project maps funds that have been established since 1990 with the aim of supporting media and journalism. The project’s goal is to identify good and bad practices as well as to offer practical advice and support to private businesses and philanthropies interested in setting up such support mechanisms.
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Profitability in the Media
This project focuses on analyzing the structure of costs and income in media enterprises with a view to understanding the main trends in profitability. The project collects case studies from a diverse range of countries to identify the most common forms of income that media outlets have been generating during their transition to the digital economy, but also the evolution of costs incurred. So far, media companies from Czechia, Poland, Romania, Myanmar, Bolivia and Indonesia have been included in the study.
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Luis Miguel Carriedo
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