English version of “The Best Media in the World–and why they are about to change”

Below is a magazine article I wrote for the Helsingin Sanomat that was published Sunday December 9. With permission from my editor, Laura Saarikoski, I’m posting the English original (my Finnish is not as good as it ought to be, and maybe others might find this easier too). The translation has been slightly shortened but below is what I wrote.

I’m from Denmark myself and claim no special insight in the qualitative dimensions of Finnish journalism. But looking at the institutional pre-conditions for journalism in place across the Nordic countries, my view is the region is blessed with some of the best media in the world in terms of (a) their capacity to produce news, (b) the diversity of provision, and (c) the reach and dissemination of news across the entire population. Things are not perfect, but they are in a comparatively good shape, an argument I’ve also made about the situation in Denmark.

They are also about to change, because the economic models, political compromises, and forms of journalistic practice that define the model are all under pressure. Beyond issues over journalistic quality (diversely defined, but generally in opposition to “churnalism” and mindless chasing of minor breaking news-items with very limited shelf-life) the current generation face at least a three-fold challenge to ensure that Nordic media of tomorrow are as good as, if not better than, the ones of today.

1) Can historically successful and diversified newspaper companies manage the transition to a new media environment in which they remain important but do not have the market power of yesterday? (Because of their (dwindling) subscriber base and ancillary business activities many Nordic newspaper companies are in a much better position to do so than for example US newspapers.)

2) Can the political compromise behind strong public service broadcasting be renewed for a new era of cross-platform public service media in a way that does not lead to PSBs crowding out private sector news providers and thus undermining the diversity of provision? (While still allowing PSBs the resources to compete with pay TV and global entertainment giants.)

3) Can a way forward be found that ensures news coverage not only of select part of national politics, business, and other public affairs, but also of regional and peripheral public affairs? (The region has a tradition of quite strong regional news media, the private ones are having a hard time reinventing themselves and the local PSB offerings are often merged into larger and larger regional services in danger of losing their local connection.)

The full magazine article is below the jump. If you want to know about my imaginary sister in Turku, you’ll have to read the whole thing…

The best media in the world—and why they are about to change

Every country in the world would count itself lucky to have media like the Finnish media. Strong and widely read newspapers across the country. Several profitable commercial broadcasters that provides news as well as entertainment. Well-funded, widely used, and politically independent public service. High levels of broadband access and smartphone usage. Even a handful of interesting online-only news media—all combined with high levels of journalistic professionalism, well-guarded media freedoms, and transparent regulation of media ownership and media markets. Finland today may have the best media in the world.

They are also about to change, because even small, wealthy and homogenous Nordic welfare states are not immune to the structural transformations that media around the world are undergoing. It is no secret that the twenty-first century has shaken the media world we have inherited from the twentieth century. The single most important trend changing the media is the continued expansion of the number of options available to audiences and advertisers. This expansion originates in political, economic, and technological developments that gathered pace in the 1980s and 1990s with deregulation of the media sector in many countries, the growth of multi-channel television, the launch of an increasing number of free newspapers, and the spread of first-generation internet access via dial-up modems. It has been vastly accelerated by the spread of digital television and broadband internet in the 2000s. The rise of the “mobile web” accessed via smartphones and tablets points to a further increase in the number of options. It is impossible to say with certainty how much each of us has to choose from today, but researchers have tried anyway. One team working the United States estimates that the average American in 1960 had about 82 minutes of media content available to choose from for every minute in the day, mainly from books, magazines, newspapers, radio and television. By 2005, the same average American had an estimated 884 minutes of media content to choose from for each minute in the day—and that is counting the entire internet as one (1) minute competing with 884 minutes’ worth of other options, so the real figure is, given the vast number of site on the internet, much, much higher.

The move from the comparatively low-choice environment of the 1960s to the high choice environment of the 2000s has intensified competition for audiences’ attention, for the money people spend on media, and for advertisers’ budgets. Even though they still loom large in our media landscape, the relative losers in that intensified competition are the legacy media organizations—newspapers especially, but increasingly also television broadcasters—who dominated the twentieth century media world but have to get used to a new twenty-first century reality. Every time a reader leaves the Helsingin Sanoma or their local newspaper for a specialized website, every time a viewer clicks away from MTV3 or Nelonen to one of the countless niche channels available to more and more Finns, resources shifts away from the traditional twentieth century incumbents, putting pressure on their business models, because ultimately private sector media organizations depend on people spending their time and money with them to survive. This in turn necessitates cuts in newsroom and elsewhere in the organization.

This move, away from a limited number of mass media competing for our attention to a world in which a few giants like Google and Facebook and a growing number of smaller providers play a much larger role, has been underway for more than a decade. Despite increased competition from both the new giants and the new smaller providers, legacy media organizations coming out of broadcasting and newspaper publishing remain absolutely central to news provision in most Western democracies. New online and mobile media have created opportunities for interpersonal communication and for sharing, remixing, and producing digital content. But, so far, the internet has not provided much support for ongoing professional journalistic work, and the hopes associated with “citizen journalism” in the mid-2000s have turned out to have been misplaced. To see just how prominently legacy media figures in underwriting news production, consider data from the Finnish Union of Journalists—their figures suggest that newspaper companies in 2011 employed almost 9,000 journalists, radio and television broadcasters about 5,000, and new media companies 56. Yes, fifty-six. And it is not clear that this is about to change. Together with a colleague, I have examined a selection of nine of the most important and editorially successful online-only journalistic start-ups across a range of European countries. All of them are struggling to break even. As small content-producers based on large part on advertising income, they are under immense competitive pressures on the one hand from the giants of the online advertising market (Google and Facebook) and on the other hand from newspapers and broadcasters that still dominate the market for online news content. Even as new forms of content production and distribution are clearly on the rise, news is still primarily produced by legacy media, especially newspaper companies, and is still primarily disseminated by legacy media companies, especially broadcasters. These “old” media have also found large audiences—though little profit—on the internet. When they suffer economically, as they do today, their ability to underwrite journalism also suffers.

So far, the impact of the digital revolution on legacy media has differed greatly from country to country, even within the world of similarly affluent Western democracies. Finnish newspapers are feeling the pinch but have so far withstood the transition much better than their counterparts elsewhere, in part because many of them still have the resources to produce relevant, quality content that appeals to their readers, in part because they are an integrated part of many peoples’ lives—subscribing to a newspaper has for a long time been something you “just do” if you are a certain kind of person. The development has been most dramatic in the United States, where, by contrast, almost all major news providers have lost revenues, seen their profit margin shrink or disappear, and have cut their investment in journalism. From 2000 to 2009, print newspaper circulation relative to population declined 25% in the US, total industry turnover fell by 36%, and the total journalistic workforce shrank by 17%, leaving especially local and state-level political issues subject to less and less journalistic scrutiny. In Southern European countries like France and Italy, many newspaper companies are also struggling as challenges associated with the rise of the internet threaten their already weak commercial foundations, forcing some to rely on cross-subsidies from non-media businesses or financial support from their owners. (The Mediterranean countries never really had the kind of widely-read subscription-based newspapers common in for example the Scandinavian countries. You didn’t get Le Monde or La Repubblica delivered at home, you bought it from a newsstand on your way to work.) In Northern Europe, including Finland, newspapers have so far held their own to a much greater extend. Obviously newspapers like Rheinische Post in Germany or Aamulehti in Finland and many others like them feel the pressure too as their print circulation drops every year, undermining both sales and advertising revenues without the growing number of new online readers making up for what is lost. But newspapers in countries like Finland still have more subscribers and more advertisers than their counterparts in many other countries, and thus more resources to invest in navigating the digital transition ahead. This does not mean that they won’t have to do it. Despite the many important differences between, say, American, Italian, and Finnish media, one aspect of the challenges they face with the digital transition is the same—very few legacy media companies have convinced significant numbers of people that their online content is worth paying for, and because the online advertising that can be sold on websites generates only a fraction of the revenue generated by for example print advertising. In the US, the saying is that print dollars is replaced by digital dimes. The digital content business is a very tough one where very few companies have succeeded, and many more failed.

That’s bad news for media owners, media companies, and for those who work for them, who will ultimately lose their jobs unless the industry finds its footing in a new digital world. Does it matter for anyone else? There are reasons to believe it does, because professional journalists, working for precisely the kind of companies that are now rattled by the digital transition, play an important role in keeping an eye on people in positions of power, publicizing different views on the issues of the day, and keep ordinary citizens at least somewhat informed about public affairs. Journalism is certainly far from perfect, and all too rarely lives up to its own lofty aspirations, but no other profession does as much to provide the proverbial man on the street with relatively accurate, timely, and accessible information about what is going on beyond his private sphere. Social media and new ways of sharing information via increasingly ubiquitous and mobile digital and networked technologies have enriched our personal lives in many ways and given us new ways of forwarding information about politics and the like, but most of the news we share, comments on, and discuss on Facebook and the like is still produced by journalists working for legacy media companies that make their money primarily of offline platforms like printed newspapers or television broadcasting (leaving aside public service media). There will be fewer of these journalists in the future, most of them will work for weaker organizations, and many of them will reach fewer people with most of their work.

At least that is the direction of travel we see across the world of affluent Western democracies. Though license-fee funded public service broadcasting and, in some countries, a few exceptionally successful commercial news media companies provide important counterpoints, the general trend is one towards a diminished journalistic profession as more and more different media offerings compete for people’s attention and advertisers’ budgets, but fewer and fewer of these offerings are built around professionally produced news. It is a world in which fewer news organizations have the resources and will to challenge people in positions of power in government, the private sector, or elsewhere, as the balance of power between journalists and the armies of PR specialists and lawyers they face changes. It is a world in which the remaining mass media audiences that continue to draw a socially and politically diverse audience day after day erodes even further as more and more people drift away to more specialized news offerings or abandon the news altogether in favor of entertainment or social media. It is a world in which, as a consequence, there will be a growing gulf between the few who will in all likelihood be more informed than ever before, and the many who will find less and less news produced for them. This is not where Finland is today in terms of media, but it is the direction Finland, like most other Western democracies, is heading in.

If you are a regular reader of the Helsingin Sanomat, odds are you will do just fine in this new world. You will probably still get the paper in some form, perhaps digitally. In any case YLE will still provide news and other programming for people like you. New commercial niche offerings might very well try to appeal to you too, since you probably have a higher-than-average income and thus represent an attractive advertising demographic. And if you want an international perspective, you probably speak at least one other language, so you can consult the New York Times, Le Monde, or Spiegel if Finnish offerings occasionally seem too provincial. In addition, you can get all this stuff cheaply, at your convenience, on your mobile digital device—and share it and discuss it with your friends.

But imagine, if you will, that you have a sister who has not gone to university, who is a single mom, and who works behind the till at a bank in Turku. Thirty years ago, it would have been a given that she subscribed to a newspaper. Today, less so, especially if she is young. First of all, it is expensive and she doesn’t always get around to reading it. The copies just pile up all week and then she has to throw them out on Sunday with that sting of bad consciousness all newspaper subscribers feel once in a while. Second, when she does flick through the newspaper, much of the news inside is depressing or incomprehensible, men in suits arguing over things she can’t relate to in terms she don’t understand. Third, there are so many other things on the television and on the internet that is more attractive, and besides, she gets a bit of news from the radio every morning over breakfast and sometimes in the evening on TV—so why bother?

Public service broadcasting, mass-oriented commercial television news, and a proud tradition of populist tabloid journalism means that many more people in Northern Europe gets at least some news on a regular basis, also people like your imaginary sister in Turku, but in the United States, where public service is very weak, the mantra of commercial television is “define your niche”, and only a couple of cities have genuine tabloid newspapers, about 1 in 5 adults no longer get any news on a regular basis. Though nothing prevents them from perusing the free websites of newspapers like the Washington Post, television broadcasters like CBS or cable channels like CNN, or the hundreds of online-only start-ups trying to compete with them, more and more Americans, even amongst those who have internet access, get no news at all. High choice does not entail widespread use, as people go for the things that interest them most, and that does not necessarily involve news.

Thus, from a democratic perspective, we live in an increasingly Dickensian media world—it is the best of times, it is the worst of times. The best journalism today is arguably better than it has ever been, even in the United States where news media have faced their deepest commercial crisis since the great depression. Though coverage of local and state-level politics has suffered, the coverage of the 2012 Presidential Election has, at its best, been more detailed, informative, and up-to-date than ever before, impartially covering the candidates’ and their campaigns, but also challenging them when they play fast and loose with the facts or shifted their positions on important issues for tactical advantage, offering more context and historical perspective, especially on ever richer and more interactive websites, than ever before. There has certainly also been endless “churnalism”, journalists hoodwinked by candidates’ spokesmen, uncritically disseminating the spin of campaign surrogates, or covering bloviating pundits as if they knew what they were talking about, but for those with an interest in politics, discriminating taste, and perhaps the willingness to pay a few dollars for online access to high-quality products like the New York Times or the Wall Street Journal, this election has been eminently well-covered. And yet something like fifty million adult Americans have paid it little attention to journalistic campaign coverage.

The vast majority of the coverage of the election was produced by professional journalists working for legacy media organizations. Much of it was disseminated via legacy media, with television the most widely used source of campaign news, and about one in four Americans still reporting that they regularly read printed newspapers, despite about eighty percent being regular internet users. But more and more has been disseminated online. The internet (in practice overwhelmingly content from the websites of legacy media) was the second most widely used source of campaign news, used by one in three adult Americans. Using one platform does not preclude using others. Often, the same people are following the news on both television, online, and in print, while others get no news on either of these platforms. Few rely on only one platform. The same is the case in Finland. Despite having one of the world’s highest levels of internet use, broadband access, and smartphone pick-up, people read both printed newspapers and online news. As Valtteri Niiranen from the Federation of the Finnish Media Industry pointed out in an interview with my colleague Kari Karppinen from the University of Helsinki, “Around 60–70% of the readers are ‘mixed users’, 20% read only the printed newspaper, and 20% read online newspapers only.” This is the case in many other countries too. Thus, most media users continue to mix and match ‘old’ and ‘new’ media on the basis of their personal preferences and the options available. Today, as before in media history, new media have supplemented old media much more than they supplant them. The paradigmatic form of media use in the Western world today may well be someone watching television while checking their Facebook account on their laptop or smartphone, or someone flicking through a newspaper or magazine after a long day working in front of a computer.

To thrive in this world with increasingly intense competition from multiple offerings for people’s attention and more and more different places advertisers can place their money, journalists and news media organizations have to think much harder about how they remain relevant to people, distinct from the competition, and deliver a quality that merits the time spend with it—and perhaps even a modest fee to access it in the first place. Private sector news media that have to cover their cost and deliver a reasonable return on investment to investors (like any other business) will have to think about how they can do this on a budget that is much smaller than what they have been used to, and will in the case of newspapers probably be even smaller in the future—perhaps half or even a third of what they were used to in the 1990s. Because for all the drama of the last decade of change, the bigger transformation is ahead of us. First of all, legacy media are still propped up by the inherited media routines of millions of people who grew up in a low choice mass media environment and continue to use television and printed newspapers much more than digital offerings when it comes to news and entertainment. But as media executives are well aware, younger generations are growing up accustomed to a very different media environment and it is far from clear that they can be lured in as loyal subscribers who pay for the news they read or can be enticed to patiently watch the advertising that pays for the programming. Every time a Finn dies, odds are that a newspaper loses a subscriber. But there are no guarantees every baby born will become a newspaper subscriber. This demographic change has only just begun and will unfold over the coming decades. Second, though many audiences have moved online at a slower pace and less wholesale than some observers sometimes assume, many advertisers have been even more conservative. But ultimately, as people migrate from offline to online offerings, advertising budgets will follow them. A rule of thumb often used by media analysts is that the percentage of advertising expenditures that goes to a particular media platform is broadly the same as the percentage of their time using media people spend using that particular platform. This is sobering news for for example newspaper companies. Take again the example of the United States, where newspapers have, as mentioned, already suffered through the worst commercial newspaper crisis since the 1930s as literally billions of dollars in advertising has shifted away from print to other platforms. And yet a much bigger shift lie ahead—as of 2011, the media analyst Mary Meeker estimates that newspapers in the United States accounted for about 7% of all the time Americans spend with media, but still drew about 25% of all media advertising. Ultimately, those two figures will reach some sort of parity, so unless newspapers can massively expand their audience and lure people to spend more time with them across their multi-platform offerings, they will lose much, much more advertising over the coming years, further exacerbating their already serious economic difficulties. This is why more and more newspaper companies, now including the Helsingin Sanomat, are introducing various kinds of paywalls. Global flagship titles like the New York Times and specialist niche publications like the Financial Times in the UK are already building significant digital subscriber bases and thus moving towards a more diverse and robust revenue base to continue to bankroll professional journalism. It remains to be seen whether national and regionally oriented general interest newspapers can do the same.

It is sometimes said that people get the politicians that they deserve. Perhaps the same could be said about the media, that in affluent, democratic countries, we get the media we deserve. Finland has after the end of the Cold War had some of the strongest, most diverse, independent, and wide-reaching news media in the world. These media are changing. Clearly, Finnish media are not in a situation comparable to that in the United States today, and they won’t be tomorrow. Finnish newspapers still enjoy wide readership and a considerable degree of trust and loyalty earned by serving their communities over the years. Finnish commercial broadcasters still draw audiences and advertisers. And license fee funding for YLE ensures that public service media supplements and competes with privately produced media content. Furthermore, many Finnish media companies are of course to some extent protected against competition from outsiders by the language barrier. Finally, more Finns follow the news than in almost any other country, as a long as they do that, commercial news media in Finland will do somewhat better than their counterparts elsewhere. But these important advantages will not shield Finnish media from impact of the most fundamental change in the media world these years, the ever more intense competition for audiences’ attention and for advertisers’ budgets. Google and Facebook dominate online advertising in Finland as they do in most other countries around the world. Finnish incumbents are strong in the declining (newspapers) and stable (television) media sectors, less so in the growing ones, like online. As long as this is the direction we are moving in, the commercial underpinnings of professional journalism in Finland will continue to erode and private sector news media companies will have to think about, in that management cliché, how they can do “more with less”—or at least how they can, with fewer journalists, continue to produce distinct, quality content that appeals to people and keep them informed about their town, their country, and the wider world. Real-life journalists have rarely been the heroes of popular culture and the profession’s own imagination, the brave Bob Woodwards and Carl Bernsteins of Watergate fame speaking truth to power and bringing down Presidents, or the courageous Jan Guillous and Peter Bratts who gained Scandinavian renown for their reporting on the clandestine “Information Bureau” in Sweden, exposing the lies and abuses that have sometimes thrived at the heart of idyllic Nordic welfare states. But even ordinary journalists, conscientious hard-working professionals who get up every morning to cover everyday affairs, in the town hall, in parliament, in Brussels, covering what are private companies or trade unions up to, play a less heroic but ultimately crucial rule in contemporary democracy. They keep an eye on people in positions of power, present different viewpoints on the issues of the day, and allow ordinary citizens to remain at least somewhat informed about public affairs by providing timely, relatively accurate, and generally accessible news. Leaving aside those who work for public service media like YLE, they can only do this because the private companies they work for are profitable enough to pay their salaries. That profitability is under increasing pressure in an ever-more competitive media economy. Finding a niche where they can stay relevant in this environment is the central challenge facing media managers and journalists. If you value what these journalists do—for all their faults, shortcomings, and occasional missteps—and hope they will be able to do it in the future too, I have only one recommendation. Renew your subscription.

Rasmus Kleis Nielsen is assistant professor of communications at Roskilde University in Denmark and research fellow at the Reuters Institute for the Study of Journalism at the University of Oxford. He recently published “Ten Years that Shook the Media World”, a report on developments in commercial news media around the world.