It is time to rethink the media sustainability model

Credit: Gage Skidmore from Peoria, AZ, United States of America, CC BY-SA 2.0, via Wikimedia Commons

In a nutshell:

• Donald Trump's signals to end USAID funding for international journalism come at a critical time when traditional media funding models are increasingly unstable, with both public funding and private philanthropy retreating from supporting journalism. New solutions are needed to sustain quality, public interest journalism.

• Paywalls are at odds with the goals of public interest journalism by creating unequal access to information and there are too few potential news subscribers to go around for every news organisation.

• Styli Charalambous of Daily Maverick argues that journalism should be treated as a public good, proposing government intervention through indirect subsidies in South Africa, including measures like tax credits for subscriptions and payroll rebates for innovation.

The full story:

As Donald Trump signals his intention to end USAID funding that supports, among other things, journalism in many countries, media professionals are grappling with an uncomfortable truth: the industry's financial foundations are increasingly shaky, and traditional solutions might not be enough to save it.

"It is not surprising that they are defunding media," says Anya Schiffrin, director of technology, media, and communications specialisation at Columbia University's School of International and Public Affairs. "Trump and people in power have no respect for media pluralism and free expression."

Schiffrin points out that this move could backfire on American interests. "What they are missing is that support for journalism around the world really contributed to US soft power."

The timing could not be worse. During times of crisis and financial constraints, public funding worldwide may be diverted towards health and other priorities, and journalism may not seem essential. As for the US, large investors may hesitate to support journalism for fear of administrative scrutiny.

Even private philanthropy seems to be retreating. "Major philanthropic donors are exiting journalism far faster than they are entering it," observes James Ball, journalist and political editor at The New European.

When money doesn't add up

The traditional advice to "diversify revenue" is starting to ring hollow. Ball argues that structural factors have worked against conventional solutions, and there might be too many organisations chasing too little money. Even membership and subscription models, once seen as potential saviours, are showing their limitations.

"Memberships and subscriptions are increasingly difficult as more places are chasing a dwindling pool of would-be supporters," Ball explains. "Even in a large, rich market like the UK, you have Substacks competing with every existing commercial outlet, competing with multiple not-for-profit newsrooms. Even the success stories do not look so great a few years on."

Styli Charalambous, co-founder of the Daily Maverick, says that the focus on business models might be misplaced.

"It is not the business model problem, it is the market context problem," he says.

"The solution for one publisher will not yield the same revenue in another country." He points out that while Scandinavian countries represent the most favourable sustainability market context, African media faces challenges eight times harder.

Radical change

Charalambous proposes a radical rethinking of how we view journalism. "We need to redefine the context: journalism is a public good but it is not funded like a public good."

"It is market failure - the product still brings value but does not produce revenue."

His solution? Government intervention through policy. Working with a government committee in South Africa, Charalambous and his colleagues have developed 17 recommendations, some tried before - like zero VAT on subscriptions and tax credits for news subscriptions - and others breaking new ground, such as payroll rebates to encourage media leaders to innovate.

Importantly, these proposals favour indirect over direct subsidies to avoid the pitfalls seen in countries like France, where direct subsidies have made some journalism organisations dependent on government support.

"No country has anything like this, so we hope South Africa will lead the way," says Charalambous.

• Read more: Daily Maverick closes down for 24 hours to protest against big tech's dominance

Publishing for peanuts

Meanwhile, journalists are not sitting idle. As Schiffrin notes, talking about the Publishing for Peanuts report she co-authored, "Journalists have already found many very innovative ways to make money, like partnering with other organisations, renting space at universities, pooling resources."

However, she acknowledges that these efforts might not be enough: "No one will save us and we will have to help ourselves."

Charalambous identifies another challenge: industry fragmentation. He says that despite having various bargaining councils and lobbying organisations, the media industry fails to leverage its collective power effectively, adding that if journalism is truly a public good, it must be accessible to everyone.

This raises questions about the role of paywalls in public interest journalism.

"The more true public journalism you do, the more your audience will grow because people want to know what impacts their lives and helps them navigate them," he says.

"If journalism is a public good, it must be accessible to everyone. If you put up a paywall, you’re not public interest journalism. The other characteristic is that multiple people can use it and it doesn’t expire after one use. The advantage of [public good] is that it works for you whether you use it or not.

"Paywalls need to come down. We need to fight for people whether they read the news or not. "

So where does this leave us? The old playbook is clearly not working anymore. Whether through government intervention, industry collaboration, or completely new funding models, something has to give. The real question is: will we find the answer before more newsrooms have to shut their doors?

As Ball says, perhaps it is time to stop recycling the same old solutions and have some uncomfortable conversations about what it really takes to keep quality journalism alive in the 21st century, regardless of what is going on in the White House.

I used Claude.ai to draft the first version of this article from my interview notes.

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