5th Week

• Who pays?

• What are the effects on the traditional press?

• Who controls news distribution?

• Are there competition problems?

• Traditional news media, just as digital ones, are two-sided platforms which derive a large part, or all, of its revenue from advertising

  -> digi ads more precise

• Ads in Newspaper huge part of the revenue

• The advent of radio and TV did not stop the rise in newspaper advertising (even less targeted)

• Online media huge influence

Can reach much wider audience – but will they pay?

Revenue Sources:

• Increasing share of online ads in total ad revenue (Toal decreases)

• Subscriptions (Freemium/ teaser model)

Newspapers cut costs or merge

• Many fire their full-time journalists and rely on part-timers or freelancers

Dramatic vicious cycle:

• Quality and investigative journalism become a niche occupation of a few highbrow outlets

• News articles are either copied from Reuters’ / LUSA etc., or clearly written by someone who has no idea what they are talking about

• Business newspapers often merely transcribe companies’ press releases, without doing background research and asking uncomfortable questions

• Pushes quality journalism online …

• Returns to scale

• Network effects

• Competition from “free” content

• Targeting of digital advertising

• Control of Gatekeepers

Attention: not all digital outlets are profitable

• Some big names in news publishing managed to make a successful transition to the digital realm, such as the

• Digital-native news outlets seemed to have found a successful business model, but lost out

  • Buzzfeed’s idea was/is to create viral posts to be shared via social networks

  • Put its fate into the hands of social networks and their algorithms

Remember that digital markets have features for exponential growth of a select few superstar companies:

• Zero marginal cost – no technological limits on distribution

• Network effects / reputation – growth breeds growth

• Indirect network effects – audience draws advertising which provides funding

• Add to this the fact that quality is costly, and you get a nice feedback loop

Outcome: a few national outlets can be highly profitable, but not smaller ones

• One way to make money is to cater to engaged political groups, e.g. Fox News

• Example NY Times

• Recipe: Quality journalism with a clear position + reasonable-priced subscriptions

  
  

Most news consumed online is “free”, i.e. paid with browsing data and targeted advertising

• This makes it hard for news outlets to follow

  alternative business strategies that charge readers

• Still, there is a trend towards outlets erecting

  “paywalls” (pay-per-view or subscriptions), and

  readers accepting these

• Exclusive or curated news

• Specific topics or investigative journalism

Once readers “learn” to pay for online news,

they are likely to stay

• Unlimited content (including archives) is a

  real draw

• Download and carry around with you

A generally held principle is that more information is better

• Better-informed citizens make better choices

• More information leads to more civic engagement

• Trust in information and transparency are essential for keeping democracies functioning

Last decade has shown that misinformation s as easily to spread as the verifiabls kind

Internet use in Europe has gone up strongly

• Increasingly not on computers but on mobile phones

• Almost all young people access the internet

Media Pluralism Monitor shows, among many other results:

• Media in the EU are getting more concentrated -> Even more so in smaller countries, due smaller audiences (remember: fixed cost to be covered)

• Online media access is even more concentrated than traditional media, especially because of information gatekeepers

Main digital risks:

• Online surveillance and weak net neutrality threaten journalists and free access.

• High market concentration among digital giants endangers the economic sustainability of quality journalism.

• Political independence at risk due to opaque online advertising.

• Online hate speech against vulnerable groups remains poorly addressed.

The Covid pandemic has led to increased interest in news sites

• established media has increased

• Rebound due to conspiracy theories, covid deniers and antivaxxers?

Increase in critical views is larger

• where the press is censored

• with rural respondents

• in countries that allow free web browsing

Television is still the most important source of news -> The rise of “news channels” certainly contributes to this

News websites have overtaken radio, But “broadcast” news is going out of fashion -> Users increasingly opt for channels with specific content

Print newspapers are losing their role as prime providers of information

• Have been overtaken by social media as news gatekeepers

• Social media plus news websites already rival TV in importance

• Older people prefer TV

• Young adults get most of their news from social media,

  but also watch news sites

As the time spent on social networks increases, especially with the young, so does their importance as gatekeepers

• sharing news

• automatic recommendation of news

“Facebook’s algorithms amplify partisan and especially right-leaning content because its business model prioritizes user engagement and advertising effectiveness, even if unintentionally.“

October 2018: “First worldwide self-regulatory set of standards to fight disinformation voluntarily signed by platforms, leading social networks, advertisers and advertising industry”

Take action in 5 areas:

• Disrupt ad revenues for accounts spreading disinformation

• Increase transparency of political and issue-based ads

• Tackle fake accounts and online bots

• Empower users to report disinformation and find reliable sources

• Enable researchers to monitor disinformation with privacy-safe data access

Created in June 2020, “European hub for fact-checkers, academics and other relevant stakeholders to collaborate with each other and actively link with media organisations, mdeia literacy experts, and provide suport for policy makers

“Serves to build EU's capabilities and strengthen cooperation between Member States by

• iimproving detection, analysis and exposure of disinformation

• stronger cooperation and joint responses to threats

• enhancing collaboration with online platforms and industry to tackle disinformation

• raising awareness and improve societal resilience”

• Enforced from Feb 2024, regulates online services and platforms

• Covers liability for content, market dominance, advertising, safety, and smart contracts

• Enables easier reporting of harmful content and hate speech

• Tech firms lobbied against stricter rules

• Example: France’s 2020 hate speech law (remove content within 24h) was declared unconstitutional

• Came into force: May 2024, fully applicable Aug 2025

• Goal: Ensure balanced, impartial, and transparent media across the EU

• Purpose: Safeguard democracy through plurality of views and reliable information

• Problems addressed: Media independence, journalist safety, hidden government influence

Main Measures:

• Protect editorial independence and journalistic sources

• Ensure independent public media

• Increase transparency of media ownership and state advertising

• Protect against unjustified content removal by large platforms

• Require impact assessments of media market concentration

• Support audience measurement transparency and user customization rights