Righteous indignation is not a sustainable business model

There was more than a whiff of righteous indignation on display in the Meatpacking District of New York last night as the city's media elite gathered to listen to a debate hosted by The Guardian and chaired by CBS' Charlie Rose.

There was more than a whiff of righteous indignation on display in the Meatpacking District of New York last night as the city's media elite gathered to listen to a debate hosted by The Guardian and chaired by CBS' Charlie Rose.

Most of the opprobrium was aimed at Fox News' Juan Williams, who joined Guardian editor Alan Rusbridger, The Nation's Katrina vanden Heuvel, Reuters' Felix Salmon, and BuzzFeed's Ben Smith on the panel to ponder the topic of ‘Commercial Pressures versus Journalistic Standards.'

Every time Williams spoke, there were knowing looks and tsks of disapproval from the predominantly left-leaning journalistic and media types in the audience. It was even suggested that state-funded broadcast operations similar to the BBC, ITV, and Channel 4 in the UK should be considered to improve standards - something I just don't think would fly in the US.

The Guardian gained kudos for its commitment to investigative reporting, especially the recent high-profile exposure by its journalist Nick Davies of unethical behavior by Rupert Murdoch's News International. It has already garnered 24.1 million unique browsers in the US, out of a global total of 71 million, making it the third-most-read online newspaper in the world, behind fellow British outlet The Daily Mail and The New York Times.

This was compared starkly with Fox News' concentration on opinion-led, personality-dominated news and political coverage, which whether you like it or not has attracted a large and loyal audience and substantial profits.

But the fact is The Guardian is losing tens of millions of dollars every year. Its unique ownership structure – the paper is owned and funded by The Scott Trust, which was set up to support the paper in perpetuity – means it doesn't have to make a profit in the same way as its pure commercial rivals. But even its coffers are running dry and by current estimates it will drain its well of money within five years if it doesn't sell other chunks of its media portfolio.

For her part, vanden Heuvel conceded that The Nation had only made a profit about twice in its 140-plus year history, and that both of those were “in the low two figures.” As Rusbridger pointed out, “investigative journalism is expensive.”

So is it possible to combine quality journalism with a sustainable business model? And if not, what does this mean for the future of the media that PR pros still rely on to some extent to tell their stories?

Many of the new media outlets are accused of being “bottom feeders,” aggregators, and plagiarists, and there is a lot of truth in this. But, paradoxically, the Pulitzer Prize has recognized “new” media outlets in recent years, with both The Huffington Post and nonprofit ProPublica winning in 2011 and 2012 respectively, which suggests digital media and quality are not complete oxymorons.

I liked a lot of the contributions to the debate from BuzzFeed's Ben Smith, recently profiled by PRWeek. Smith seemed less tied to ideological dogma than the “traditional” journalists on the panel and more attuned to the realities of the social web and the way content is being consumed nowadays.

However, BuzzFeed itself is still very much in development mode as it burns through its VC funding by acquiring lots of expensive journalistic talent. It also is still in search of a sustainable business model.

As The Guardian debate drew to a close, a questioner from the audience expressed dismay at the development of owned media such as “Taco Bell's health channel” competing with “legitimate” media outlets.

But that ship has already sailed. No one has a monopoly on being a media owner anymore. And no amount of righteous indignation or navel-gazing debates are going to hide the fact that media has fundamentally changed forever. If anything, brands and corporations have caught on to this faster than the media.

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