May 04, 2020
Early last month, Amy Brothers was busy at The Denver Post covering the most significant news event of her career: the fallout across Colorado from the rapid spread of COVID-19.
But on April 17, without warning, the Post let the video journalist go. She was laid off with 12 other newsroom colleagues in response to the plummeting ad spending that has struck local-news operations across the country.
"I really loved my job," Brothers tweeted later that day. "Going out into our community and telling your stories, on your best days and your hardest always inspired me."
Brothers later told me that her workload had increased significantly during the crisis: "I want to keep telling these stories, but I'm also tired. I was working really hard before I was laid off."
Brothers is not alone. Since the pandemic hit the United States, news outlets have fired, furloughed or reduced the pay of more than 30,000 employees. The Poynter Institute is keeping a grim daily toll, tracking the shuttering of weeklies, suspension of print operations and other cutbacks.
Without relief to keep reporters on the job, each local-news closure will cut into our democracy in ways that may prove fatal.
Members of Congress are scrambling to put forth measures to help. Some proposals involve increasing stimulus funding for the Corporation for Public Broadcasting--the entity that filters government funding to NPR and PBS stations--or shaking loose federal advertising money targeted to broadcasting and print news outlets.
But U.S. lawmakers may be leaving another major source of journalism funding on the table: The hundreds of billions of dollars in advertising revenue raked in by Big-Tech companies.
Making Amazon, Facebook and Google Pay
Over the past 10 years, the advertising industry has undergone a major transition from ad spending in media that employ journalists to spending in media that don't.
Of the top-five firms for digital-ad spending, only one, Verizon Media Group, is in the business of news production, and then only marginally so. The others--Amazon, Facebook, Google and Microsoft--don't directly pay journalists (Amazon's founder and CEO Jeff Bezos owns the Washington Post, but it's not held under Amazon's corporate umbrella).
Lawmakers around the world are coming to realize that for journalism to survive during and after the COVID-19 crisis, we need to rethink and rebalance the economics that once sustained the enterprise.
In April, Australia announced that it's finalizing a new "mandatory code of conduct" whereby a portion of the advertising revenues of large online platforms would be diverted to support local journalism. Treasurer Josh Frydenberg called for the code in response to collapsing advertising revenue since the pandemic.
Already, United Kingdom lawmakers are moving forward with new taxes on tech-company revenues. Earlier this month, the National Union of Journalists (NUJ) called for a 6-percent revenue tax on platform companies to create a news-recovery fund to "support and protect jobs and quality journalism now and for the future."
To underscore that point, the NUJ's Michelle Stanistreet said the fund isn't meant to prop up the existing news model. Rather, it's an "investment in our future to transform the media industry, make it fit for our collective purpose and truly serve the public good."
A number of other countries--including Austria, Belgium, France, Italy, Malaysia, Singapore, South Korea and Spain--are weighing digital-service taxes on platform giants. The intergovernmental Organization for Economic Cooperation and Development is working on a uniform tax structure that would be applied among all member nations.
Many of these countries have yet to devise structures to funnel resulting tax revenue to journalism jobs. Though the crisis may compel them to follow the lead of Australia and the U.K. and use the capital to bolster news production at a time when timely information can save lives.
Rethinking the Economics of News
This new global approach to taxing tech platforms echoes recommendations that my Free Press Action colleague Craig Aaron and I made in Beyond Fixing Facebook, a report that proposes a U.S. tax on platform-ad revenues to "reinvent public media, revitalize journalism and strengthen democracy."
A 2-percent tax on a digital-advertising marketplace dominated by Amazon, Facebook and Google could produce approximately $2 billion per year in revenue for a public-interest media endowment to support the independent, community-based, and investigative journalism people rely on during a crisis and its aftermath.
Under our proposal, the endowment would help support reporters at local, locally-owned and ethnic media outlets that cover people of color and other communities suffering the most from the coronavirus. Free Press Action expanded on this concept with additional measures in a subsequent article for the Columbia Journalism Review. The Seattle Times is leading a promising initiative with similar ideas.
The concepts here aren't radically new. Democratic governments have historically played affirmative roles to support a functioning and independent press.
In 1966, the Carnegie Commission on Educational Television recommended a single-digit tax be placed on the sale of television sets to create a trust fund for public broadcasting. Carnegie's report heavily influenced the Public Broadcasting Act of 1967, though this specific tax proposal wasn't included.
Under our proposal for the United States, a tax would be levied against revenues from the micro-targeted digital advertising perfected by Facebook and Google--and used to fund the kinds of journalism that are rapidly disappearing. This transfer of capital to journalists would serve as an antidote to the online spread of disinformation and propaganda that pollute civic discourse, especially during times of national emergency.
As there's growing interest in and out of Washington to include additional journalism support in future congressional stimulus legislation (a $75 million boost was provided to the CPB in the last go-around), we need to ensure this money gets to reporters who are telling the stories of those most devastated by COVID-19.
Any support for journalism tied to the pandemic must also foster a more resilient model for news production and distribution, one that invests in diverse, hyperlocal and community reporting that serves people who are especially vulnerable.
Putting reporters like Amy Brothers back to work is a start. But we need to dramatically rebalance the faltering economics of news to ensure that journalism has a future at all.
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