Inquirer

• Most spectacularly, the Los Angeles Times recently slashed more than 20% of its newsroom.
• Yet, as we’ve previously argued, relying on the benevolence of billionaire owners isn’t a viable long-term solution to journalism’s crises.
• In what we call the “oligarchy media model,” it often creates distinct hazards for democracy.

Systemic market failure

• Rather, it’s a systemic market failure with no signs of reversal.
• As print advertising continues to decline, Meta’s and Google’s dominance over digital advertising has deprived news publishers of a major online revenue source.
• The advertising-based news business model has collapsed and, to the extent it ever did, won’t adequately support the public service journalism that democracy requires.
• But they’re outliers; in the end, billionaire owners can’t change these inhospitable market dynamics.

The way forward

• That’s why we believe it’s urgently important to grow the number of outlets capable of independently resisting destructive market forces.
• Billionaire owners willing to release their media properties could help facilitate this process.
• Its nonprofit ownership model has enabled the Inquirer to invest in news at a time when so many others have cut to the bone.
• However, most struggle mightily to generate enough revenues to even pay themselves and a few reporters a living wage.

Donors can still play a role

• A 2023 Media Impact Funders report pointed out that foundation funders once primarily focused on providing a bridge to an ever-elusive new business model.
• The thinking went that they could provide seed money until the operation was up and running and then redirect their investments elsewhere.
• However, journalists are increasingly calling for long-term sustaining support as the extent of market failure has become clear.

The limits of private capital

Still, philanthropic support for journalism falls far short of what’s needed. Total revenues for newspapers have fallen from a historic high of $49.4 billion in 2005 to $9.8 billion in 2022.

• Philanthropy could help fill a portion of this deficit but, even with the recent increase in donations, nowhere near all of it.
• Nor, in our view, should it.

Public funds for local journalism

• A strong, accessible media system that serves the public interest will ultimately require significant public funding.
• Along with libraries, schools and research universities, journalism is an essential part of a democracy’s critical information infrastructure.
• It’s worth noting that U.S. investment in public media is a smaller percentage of GDP than in virtually any other major democracy in the world.
• Under these plans, news outlets prioritizing local journalism receive various kinds of public subsidies and grants.

The authors do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.