Face masks, toilet paper and hand sanitisers are not the only things seeing a surge in demand globally in the wake of the COVID-19 pandemic — breaking news on the novel coronavirus is also highly sought by people all over the world as panic sets in, prompting people to keep abreast with the latest developments on the outbreak.
Philip M. Napoli, professor of Public Policy at the Sanford School of Public Policy at Duke University, in a recent article cautioned that journalism may be “facing a market failure” as the ability of news organisations to “monetize their product is declining”.
Citing BuzzFeed news reporter Craig Silverman, who remarked that “The coronavirus is a media extinction event”, Professor Napoli said that the pandemic has brought to light the economic crisis in journalism.
He observed that the consumption of news articles related to COVID-19 are increasing, as seen in an internal Facebook report, with a spike of over 50 per cent of its traffic to new sites.
Despite increasing demand for news, however, the press industries are adversely impacted due to the coronavirus crisis – seen in staff retrenchments and the cancellation of print editions.
“We should see a wave of closures rock the news industry very soon, compounding an already dire situation. How can this be happening at a time when the demand for journalism is at a peak?” Professor Napoli questioned.
News organisations are less economically equipped when making stories available free for readers
Professor Napoli mentioned that the readers’ subscription — other than advertising — is the other key revenue of news production.
The removal or reduction of subscription fees for coronavirus-related news in order to reach readers who cannot afford to pay but “desperately need information” will certainly negatively affect news outlets’ revenues, he said.
“Specifically, news is what economists call a public good, a type of product for which it is particularly challenging for the market to capture its full value. The price we pay for news and the price advertisers pay to reach news consumers doesn’t reflect the news’ full economic value,” added Professor Napoli.
“News organizations are less equipped economically to continue to produce this reporting that is in such high demand. And so we are again faced with market failure,” he warned.
Mitigating the problem of funding in journalism, said Professor Napoli, requires “more than a stimulus package”, as such moves will only “delay the inevitable”.
Citing Facebook‘s move to pour in S$100 million to help state news organisations as well as the proposal of Report for America to have the United States’ federal government spend S$500 million in public health advertising with local media outlets, Professor Napoli said that “if the political will were there to allocate the necessary funding”, a “robust public service media ecosystem” can be formed while the news media can “remain commercially viable”.
“It’s time for policymakers to act. Over the past few years, we’ve seen numerous calls for the government to address the economic crisis in journalism, and to begin building a more robust public media system that is less susceptible to market failure than our commercial media system,” he said.
“In the past, proposals to bolster our public service media system have gained little traction, perhaps because the realities of the market failure in journalism have, to this point, been hard to grasp. They’re not anymore,” added Professor Napoli.