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TIME FOR A "FOURTH ESTATE" TAX?

By Alan Behr

NEW YORK, 8 SEPTEMBER 2009 - Most of the running commentary about the precipitous decline of the daily newspaper is available on the Internet and for free - which helps mold the dialogue about the problem even as it exemplifies the cause of it. Many of the commentators are old enough to remember when daily newspapers were the most consequential medium for presenting the news - so important that children were routinely warned by their parents, "Don't believe everything you read," to guard against undue influence by shady journalists and other writers.  

As the senior news medium, print journalism developed an infrastructure that remains unequaled. Major newspapers established expensive printing plants and distribution systems. More important, along with news organizations such as The Associated Press and Reuters, they opened numerous bureaus - offices staffed at considerable expense in places often far from home and sometimes at no small amount of personal danger to those assigned to them. The bureaus became the journalistic equivalent of the military's "boots on the ground." The infrastructure was too complex and expensive to be put into the hands of amateurs, and their relative monopoly over newsgathering assured that professional news organizations with the capability of understanding and distilling the news got it first, usually before it was corrupted into rumor and fear.

It was with the advent of the Internet that the world of journalism turned upside down .

Size, at least when it comes to commercial enterprises, is one of the most frequently disparaged attributes. Not only did the term big business and even the word corporation become epithets, but the owners of daily newspapers once labored under the pejorative of press barons. When you consider that, except for the owners, almost no one ever got rich working with newspapers and that The Associated Press isn't truly a business (it's a not-for-profit cooperative), when seen through the rearview mirror of history, the imputation to newspapers of pervasive economic nastiness starts to sound almost naïve

It cannot be denied that the record shows that, on many occasions, big news misused its position of trust, that it got important stories wrong and that it sensationalized trivial events and trivialized important ones. But as government expanded throughout the past century into big government, it was big news that had the power and the ability to serve as its counterpoint, and it fulfilled that vital role with courage and, not infrequently, at economic sacrifice. Information fuels the engines of governmental power; by disseminating information independently of governmental supervision, big news served its civic role of helping keep government honest and of preventing governmental manipulation of public opinion and public will.

The first electronic media used by journalists to deliver the news were linear and programmed. Radio and the newsreel, followed quickly by television, attempted to emulate the newspapers. Television news organizations from the broadcast era, staffed in large part by former newspapermen, opened numerous bureaus, and they tried to imitate the investigative capabilities of major daily newspapers. The medium, however, quickly revealed some inherent limitations. A well-presented half-hour of evening news could only provide about the same information as a well-written front page of broadsheet. Broadcast news, with its cumbersome film crews and a news gathering and reporting cycle largely confined to daylight hours, could not benefit from much of the craftsmanship of journalists who worked in print. There is just something about having a television camera stuck into your face that makes you reflect more carefully about what you might say than if you were asked the same questions over coffee by a man or woman who might, at most, be recording your responses in a spiral notebook. At its best, the craft of the television correspondent can be something like that of a documentary filmmaker; the craft of the newspaperman can sometimes be more like that of a spy.

For all its limitations, television won out as newspapers lost ground to broadcast and then cable news; but it was with the advent of the Internet that the world of journalism turned upside down. For the first time, anyone who could type could theoretically provide news to those who could read. Some of it was good, some of it was brilliant, and some of it was insubstantial, unimportant and just plain wrong. But most of it was free, which then created the obvious question that would come to the mind of any consumer: if I can get my news for free, why should I pay for it? The initial reaction of daily newspapers was to provide their own news for free (back when dial-up-based Internet service providers drew in decent subscriber revenue and passed some of that along to news sources that licensed content). There is much lamentation now about the decision to provide news for free, but the public sees the Internet as a free facility, and the architecture of the Internet is so configured that, what one person may charge money to present, another person may simply offer for nothing, and any good search engine can quickly point you to where you can get something for nothing.


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What has not changed is that neither the radio, television nor Internet news delivery organizations that have arisen since newspapers began to wobble and fall have developed the kind of investigative, analytical and reporting infrastructures of the now-shrinking daily print media. It is an open secret among journalists that television has always followed print, that television producers in search of news often do so by reading the wire feeds or the morning daily newspapers to see what is happening - in acknowledgement that traditional news media, with their long and sophisticated traditions of information gathering, could and would be there first.

There is much to be said for the instant delivery of news, and it has changed the way that print stories are composed. The New York Times updates its free website every few minutes, refining the text of stories that sometimes start as simple stubs until, as the print edition is about to be put to bed, the stories arrive at their final, we might even still say "official" forms - and the presses roll.

Thus far, few have chosen to charge for Internet news by subscription or single copy delivery, so the only remaining practical means of generating revenue is through advertising. Because studies have shown that Internet advertising is not particularly effective relative to print advertising, electronic advertising space has to be sold relatively cheaply, with the result that all that newspaper infrastructure needs increasingly to be supported by that single, thin source of revenue, which is why daily papers are going bankrupt and many talented journalists are out of work or are working for peanuts.

Television news, meanwhile, caused a different problem for itself. In the broadcast days, television would shut itself off sometime after midnight and quietly go to bed for a few hours, waking again for early-morning programming. With the advent of twenty-four-hour cable news, we can get all news all the time, even when there isn't much news to report. News on television has to compete with entertainment, and because the cheapest television entertainment is itself unscripted (those so-called reality shows that yet remain more show than reality), news is increasingly televised for its own entertainment value. Cable news has therefore taken on the characteristics of the tabloids - those newspapers historically delivered to a less-discriminating but often loyal readership. They play on emotion at the expense of knowledge, reflection and debate, but in fairness to the cable networks, no one after its earliest days ever accused television of serving as a breeding ground for intellectual vigor. We all watch it, and we all know that, if we want something deeper, that's what libraries are for.

There is nothing wrong with the news coming from small and diverse sources, of news made entertaining enough for people to enjoy it, or of news made available for free so that all can experience it - unless the result is that the press can no longer stand as effectively as a civic force in opposition to governmental power.

A potential solution would be a surcharge per electronic device capable of receiving news, payable either at the point of purchase or on an annual basis .

The number of solutions being offered to "fix" print journalism nearly equal those offered to fix the Middle East. Micropayments have often been proposed: just as you pay for a song on iTunes, you would pay for each article you read prior to reading it. The problem is that people don't like poking through websites and stopping to pay money - even small amounts of money - in order to proceed. What looks acceptable when purchasing a license to a Mary J. Blige or John Mayer song seems like an insult when preparing to read an obituary. Even if you use a prepayment plan, like those electronic passes that get you through tollbooths quicker, resentment would likely remain a factor, helping to limit the number of those who sign up.

A potentially better solution would be a surcharge per electronic device capable of receiving news, payable either at the point of purchase or on an annual basis. The pool of funds so paid would be split among professional news organizations based upon numbers of unique hits experienced by each organization for its content or some other tolerably fair apportionment method.

That solution and almost any other that presumably could work would likely require legislation. In the meantime, news organizations will probably be increasingly compelled to use the methods employed by entertainment providers that have seen their own revenues decline: litigation and cajolery. The former method has become part of the American experience: in the United States, litigation is seen as negotiation by other means. Suing your way out of a predicament brought on by changes in technology and behavior can be expensive and slow, however, and may well prove partially effective at best; you can only sue based upon the laws that you have, hoping to stretch them farther; but laws built for the technology and behavior of a prior era often prove stubbornly inelastic. Whenever a law fails to do what is needed of it, the law is telling you that it needs to be changed. Cajolery can sometimes work (to a point), but you can't stake an essential institution's future on it. However it happens, one thing is clear: it is in the news organizations' best interests that something works and soon, and until some form of journalism comes along that is as capable as the daily newspaper, for democracy as we have come to know it to work, it is in all of our best interests as well.

Alan Behr, a partner of Alston & Bird LLP, is the head of the firm's Electronic Entertainment Group and its Fashion & Luxury Goods Practice, and a member of the IP & Technology Transactions and Trademarks Groups. He has also worked as a freelance journalist since 1987.

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