Posts Tagged ‘journalism’

Canada’s Wireless Wars: Bell Media Exec’s Memo to News Directors

Since reports in mid-June that Verizon might be poised to enter the Canadian wireless and mobile phone market, Bell, Rogers and Telus have fought tooth-and-nail against that happening. That opposition, as this post shows, not only includes the full-on public relations assault, but a series of emails from Bell Media President Kevin Crull calling on the telecom and media giant’s news directors to cover a report favourable to the incumbents’ main arguments as well. 

Key elements of this summer’s wireless wars are well-known: Telus has launched a lawsuit against elements of the Government’s wireless policy that prevent the incumbents from acquiring Wind, Mobilicity and Public. Rogers, Bell and Telus have held private meetings with Industry Minister James Moore to plead their case that the Conservative Government’s wireless policy is chock-a-block full of loopholes that give unfair advantages to foreign telecom giants such as Verizon at the expense of Bell, Rogers and Telus — and Canadians. Full page adverts taken out by the incumbents are appearing daily in newspapers across the country in a bid to convince Canadians of the same points. 

BCE CEO George Cope penned an open “Letter to Canadians“; BCE Director Anthony Fell excoriated the Harper Government for its supposedly unfair wireless policy; the Globe and Mail and Toronto Star have editorialized in support of the big three telcos’ position as well; the Canadian Council of Chief Executives took the unusual step to write the Prime Minister in order to do the same. The Communications Energy and Paperworkers Union, the largest union representing telecommunications workers in the country, is also singing from the same page as the big three on this issue. The Canadian Wireless Telecommunications Association (CWTA) — the industry association that represents the collective interests of Bell, Rogers and Telus — has been selectively plucking evidence about cheaper wireless rates in Canada relative to the U.S. while distracting attention from the fact that, relative to the rest of the worldprices for nearly all cell phone service plans in Canada and the U.S. are high. 

So far, however, these tactics appear to have backfired. Prime Minister Stephen Harper and Industry Minister James Moore have lambasted the companies’ campaign as dishonest, while pledging to stay the course. The Conservative Party has launched a website to counter the incumbents’ public relations campaign and trumpet the Government’s position. Views opposing the incumbents’ position have also been getting some play as well (see here and here). Canadians also appear open to the idea of a new player such as Verizon entering the market (here). 

While there is certainly room for debate, by and large, Harper, Moore and the incumbents’ critics are correct, and Canadians’ sentiment in the right place. The rules the incumbents are grousing about are neither new, novel, nor filled with loopholes. For well-over a decade the consensus in international circles has been that the more competition in wireless, the merrier. The policy at home has taken some time to catch up with this reality, but the rules now being cast as unfair have been the cornerstones of the Conservative government’s wireless policy since 2007.

The only real differences are that Canada embraced these ideas late in the game relative to others, no doubt due to the incumbent’s intransigence, while foreign ownership rules continue to be far more restrictive in Canada despite last year’s decision by the Government to relax them “for companies that have less than a 10 percent share of the telecommunications market”.  The basic ingredients of the international consensus are straight-forward, although everywhere their introduction has been fiercely contested by incumbents bent on maintaining their dominant market positions:  spectrum set-asides for new entrants, reduced foreign ownership restrictions, network tower sharing agreements and open interconnection rules.

To get a glimpse of the vintage of these basic principles and rules, take a look, for example, at the OECD’s Communication Outlook from 1999 (p. 28), and every volume since then, or the authoritative collection of chapters in William Melody’s edited Telecoms Reform from 1997. I will write more about the finer points of wireless policy in the near future. The point that I want to stress for now, however, is that the big three’s scorched earth approach on this issue is leading to other interests and important principles being thrown under the bus.

Some employees at Rogers and Bell, for instance, report being brow-beaten by managers to email a form letter in support of the companies to the government. More troubling, and a point that has not yet seen the light of day, is a chain of emails originating from Kevin Crull, the President of Bell Media — the largest media enterprise and one of the largest news organizations in the country — calling on news execs and journalists across CTV, CTV2 and local TV channels and radio stations across the country to cover a study that suggests that the state of wireless in Canada is not as bad as its critics claim. A copy of the emails, with the names of non-executives removed, can be found here.

The emails begin by setting out a couple of definitional issues and then distill the two key talking points to be covered: (1) that cellphone rates in Canada have fallen in recent years and (2) that they are generally cheaper than in the US. By the end, the message is clear: “Kevin Crull our President wants us to give this report some coverage….” and “Kevin is asking if this report can get some coverage today on Talk Radio. National news is covering for TV”.

By the time the chain of emails is done, a veritable whose who of BCE’s executive suite have been brought into the loop:  Wendy Freeman, President CTV NEWS; Richard Gray (Head of News, CTV2); Ian Lurie (COO Astral Radio); Kevin Bell (General Manager/Sales Manager CTV Vancouver Island/C-Fax and KOOL FM); Eric Proksch, (VP and GM for Bell Media Radio); Charles Benoit (Astral); Chris Gordon, (President of Radio and Local TV news); Mirko Bibic (Executive VP and Chief  Legal and Regulatory Officer).

Perhaps this is not all that surprising. The stakes are high, given estimated wireless revenues of over $20 billion in 2012. Moreover, with the combined market capitalization of Bell, Rogers and Telus tumbling by roughly $8.4 billion (from $85 billion to $76.6 billion) between June 17 when Steven Chase and Rita Trichur at the Globe and Mail first broached the possibility of Verizon entering the Canadian wireless industry and yesterday, August 26th, the companies are doing whatever it takes to preserve their entrenched dominance of the Canadian wireless market and the bloated market capitalization levels that go along with a cozy oligopoly.

While it is understandable, perhaps, that BCE would deploy its journalistic resources to protect its place within the wireless oligopoly, this is not good for journalism or Canadians. It casts a cloud over the independence of CTV national news as well as news programs across the CTV2 network and Bell Media’s local tv and radio stations across the country. While we know of this particular instance, how many other directives from on high have been sent over not just this issue, but other ones in which Bell sees its interests at stake?

Ultimately, the problem is this: with revenues from wireless, wiredline, Internet, IPTV, cable/satellite services at BCE in 2012 of $17.4 billion, nearly eight times its $2.4 billion in revenues from TV and radio, news is a minor cog in BCE’s corporate machinery. Journalism, in other words, is subservient to the company’s attempts to prop up the value of the ‘transmission’ and technology side of its business.

Perhaps the fact that journalists and the news divisions of such TMI conglomerates will be deployed to protect dominant market positions and capitalization might not be all that surprising, but it should still be concerning to journalists and the rest of us who need them to offer views of the world unvarnished by their corporate overlords. That the execs at BCE and Bell Media news divisions went so cheerily along with Crull’s memo serves neither journalism nor the public well.

Jeff Bezos Buys the Washington Post: The New Philanthropy, or Power and the Press in the New Gilded Age?

Jeff Bezos, the CEO and controlling share-holder of internet giant Amazon bought the newspaper last weekend that broke the Watergate story, published the Pentagon Papers (along with the New York Times) and, in June of this year, helped to break the story on the NSA’s mass surveillance practices: the Washington Post. He paid $250 million for it, 1/100th of his net worth ($25.2 billion) in 2012.

Most commentators appear hopeful that Bezos will use his enormous personal wealth — he is the 12th richest person in America and 19th in the world — and business acumen to turn the floundering Washington Post around and chart a renaissance for the beleagured press in the United States more generally. Most seem to think that he will operate the paper in a way that is consistent with the traditions and requirements of a free press.

Indeed, in the press release announcing the deal on Monday he said that is exactly what he will do:

“I understand the critical role the Post plays in Washington, DC and our nation, and the Post’s values will not change . . . . Our duty to readers will continue to be the heart of the Post, and I am very optimistic about the future.

Donald Graham, the CEO and Chair of the Board at the Washington Post Company, summed up the mood in the press release announcing the deal:

”Jeff Bezos’ proven technology and business genius, his long-term approach and his personal decency make him a uniquely good new owner for the Post”.

Bezos also undoubtedly won favour in the executive suite by agreeing to bring several senior executives at the Post with him to the new company he will set up independently of Amazon: Katharine Weymouth, the current CEO and Publisher of The Washington Post (and heir to the Graham family that currently holds the dominant stake in the paper’s parent company, and niece to family patrician Donald Graham); Stephen Hills, President and General Manager; Martin Baron, Executive Editor; and Fred Hiatt, Editor of the Editorial Page, will all retain their jobs. For how long, however, he did not say. His pledge to the newspaper’s 650 journalists that there would be no lay-offs for a year also no doubt helped to allay whatever concerns might have arisen among journalists.

The journalistic rank-and-file in general seem to be on board with Bezos’ acquisition of the PostCarl Bernstein praises him as “exactly the kind of inventive and innovative choice needed to bring about a recommitment to great journalism on the scale many of us have been hoping for.”

Fred Hiatt, the editorial-page editor who will stay with the Post under its new ownership arrangements, put matters thus: “We’ve all been looking for a way to marry quality journalism with commercial success in the digital era, and it’s hard to think of anyone better positioned to figure that out than Jeff Bezos”. Columnist and editor of Wonkblog, Ezra Klein: “For now, I’m hopeful.”

Bob Woodward distinguishes good moguls like Bezos from bad ones: “This isn’t Rupert Murdoch buying the Wall Street Journal, this is somebody who believes in the values that the Post has been prominent in practicing, and so I don’t see any downside.” James Fallows goes a step further, hoping that Bezos acquisition of the Washington Post “signifies the beginning of a phase in which this Gilded Age’s major beneficiaries re-invest in the infrastructure of our public intelligence.”

This is Bezos as the 21st century version of the Carnegies, Rockefellers and Fords. Whereas they built libraries, foundations and schools, he is revitalizing a landmark press institution in the U.S., the Washington Post, and, if all goes well, lighting at least part of the path to recovery for the rest of the newspaper business.

Economic Woes at the Post, Malaise Across the U.S. Press

The Washington Post is in financial trouble. Revenues for the newspaper segment at it’s parent company, the Washington Post Company, peaked at $961.9 million in 2006. By last year, they had plunged to $581.7 million. The division has not turned a profit since 2008, either (Washington Post Company’s Annual Reports).

Declining advertising revenue has led the way; paid weekday circulation has declined sharply from 768,000 copies in 2002 to around 450,000 today (Steve LadurantayeAnnual Report 2012, p. 21). Online revenues have grown greatly, but from a low base and are nowhere near covering the losses.

The paper’s role within the overall Washington Post Company has shrivelled as well. Whereas it accounted for a quarter of total revenues in 2006, by last year it accounted for just 14%. The education division (55%), cable television (20%) and other activities (10%) accounted for the rest. 

The company as a whole continues to be profitable, however, and even during the financial crisis years of 2008 and 2009, it turned profits between 5-6%. Profit levels have been in the 10-15% range for most of the years before and after that, but last year they fell to under 4% — half the rate of the year before (Annual Report 2012, p. 1). They are down further yet this year, with newspapers and broadcast television the biggest drags on the company’s balance sheet (Ladurantaye). 

Of course, the woes of the Washington Post reflect the woes of the US newspaper industry in general. The U.S. and UK press have suffered the most amidst the ‘crisis of journalism’ afflicting much of the Euro-American world. A 2010 study by the OECD indicated that the woes of the press set in earlier in the US and UK than in most countries, 2005-2006, and have been unrelenting since. The growth of internet advertising relative to other media also started earlier and tends to account for a bigger share of all advertising spending in both countries as well (see Ofcom, International Communication Market Report, p. 187).

U.S. newspaper industry revenues peaked in 2005 at $61.2 billion. Last year they were $32.8 billion — a fall of almost half (46%), according to the Pew Research Centre’s Project for Excellence in Journalism.

Figure One below shows the trend.

US Newspaper Revenues (1979-2012)

The toll on the number of working journalists has also been grim. Figure 2 shows the trends.

PEJ Total Newspaper Workforce

While there is no doubt, then, that both the Washington Post and the U.S. press in general are in dire straights, the idea that Amazon CEO is the white knight he is being made out to be is questionable for at least three reasons.

1. The Return of the Mogul and the Quest for Political Influence and Power

Bezos purchase of the Washington Post puts him amidst the swelling ranks of uber-rich individuals who have stepped in to scoop up newspapers that have fallen on hard times. Just days earlier, hedge fund operator and owner of the Boston Red Sox, John H. Henry, acquired the Boston Globe from the New York Times.  

This revival of the new breed of billionaire newspaper owners also includes real estate tycoon Sam Zell, who scooped up the LA Times and Chicago Tribune in 2007, only to drive them further into the ground (see here). It also includes partisan zealots like the Koch brothers, David and Charles (tied for sixth on the Forbes’ list of billionaires worldwide with a network of $34 billion each), who are circling newspapers in distress in the hope of taking them over and harnessing them to their right wing conservative causes.  

The hopeful, however, appear to divide the new breed of press mogul into “bad” and “good” capitalists, with Bezos apparently firmly in the latter camp. Like Warren Buffet, the folksy investment guru of Omaha, who acquired Media General’s 63 dailies and weeklies (except for The Tampa Tribune and its weeklies) and several other papers last year, Bezos occupies such a place because he says he values the role of daily newspapers in the communities they serve and because he has supported some progressive causes, notably gay marriage, and operated Amazon as an open bazaar when it comes to books and literature, while refusing to buckle to censorious moralists.  

According to Eli Noam, in Media Ownership and Concentration in Americathe number of owner-controlled media firms fell from 35 percent to just 20 percent between 1984 and 2005 (p. 6). The revival of the press baron in the past few years reverses this trend of the last half of the 20th century when media moguls were steadily being replaced by share-holder owned, managerially-controlled corporate media.

The problem with moguls, however, is that the drive for profits are often tempered by the personal quest of newspaper owners for political influence and power. This clouds the independence of the press and turns journalism into the plaything of the rich and powerful. Like other internet giants, Amazon’s annual lobbying budget has risen steeply in the past few years. In 2008, for instance, its lobbying budget was $1.8 million; in 2012, it was $2.5 million. It also doubled the number of lobbyists from 12 to 25 over the same period.

While still modest compared to Google ($16.5 million in 2012) or Microsoft ($8.1 million), the fact that Amazon’s lobbying budget is high relative to other companies, and that it has risen steeply in recent years, suggests that its appetite for influence over politics, policy and public opinion is growing. Bezos acquisition of the Washington Post could add to that mission.

2. The Content Industries are Being Subsumed by the Tech and Internet Industries

There is a fundamental difference between the press barons of the 21st century and those of the past, however. Unlike the Pulitzers, Hearst, Browns, McCormicks and so forth who made their fortunes in the newspaper business, Bezos, Buffett, Zell and Henry have made their’s from the internet, finance and real estate, as Dean Starkman and Ryan Chittum have observed.

The press is being sucked into the orbit of far larger enterprises as a result. The Washington Post case exemplifies the point given that not only is Bezos’ net worth a hundred times greater than the price he paid for the paperAmazon’s revenues in 2012 — $61.1 billion — were nearly double those of the entire U.S. newspaper industry ($32.8 billion). 

Newspapers, in other words, are no longer stand-alone operations. They are minor appendages in much larger business empires. The possibility that the component parts of these entities may not always be aligned raises the question as to how journalists will be treated when conflicts of interest arise. 

The Washington Post could benefit mightily from such arrangements if it is able to use Amazon’s hyper-efficient distribution infrastructure as a way to cut the enormous cost of delivering the paper to readers down to size.  However, this could also be another case where “content” is sublimated to technology and distribution, a mere tool used to promote the acquisition and use of technology, similar to how ‘free radio programs’ served such a purpose for the manufacturers of radio transmission and receiving equipment in the early days of radio history. As John Cassidy asks, is the Washington Post‘s new role primarily to prime the pump for the sale of more Amazon Kindle e-readers? 

Amazon’s clout in online book retailing illustrate the point even better. In this domain, Amazon’s ability to effectively set prices and rule the book publishing industry with an iron fist has put it at war with publishers. 

This is not hyperbole, but  the conclusion recently reached by Judge Denise Cote in a decision that found Apple guilty of colluding with the ‘big five’ book publishing giants in the U.S. — Harper Collins (NewsCorp), Simon & Schuster (Viacom), Hachette, MacMillan and Penguin — to form a scheme intended to break Amazon’s stranglehold in online book retailing. Indeed, the book publishers’ “abhorence of Amazon’s pricing” drove them to join forces (collude) with Apple to devise a plan that would “eliminate retail price competition”, raise prices, hold back books for online distribution, and establish a whole new business model. All of this was to be accomplished in an astonishingly short period of time — 4 months — to coincide with when Apple “launched the iPad on January 27, 2010” (p. 10).

Apple wanted a secure line of content from top publishers to help drive uptake of its new devise, the publishers wanted to regain control over their industry from Amazon (pp. 10-13). A win-win for them, but a loss for Amazon and consumers / readers because of higher book prices and the triumph of collusive behaviour over competitive market forces. Underneath it all, however, lays the idea that technology and capital are in charge, not content or even Bezos for that matter. 

Those who hold out Bezos as a saviour ignore all of this. 

3. Amazon’s Treatment of Wikileaks in 2010 does not bode well for the Network Free Press in the Days Ahead

Lastly, while many commentators point to Bezos’ liberal stance when it comes to gay marriage and his track-record of standing down pressure to censor books as a good sign for the values of the free press, it is essential to remember the entirely different stance Amazon took towards the whistle-blowing site Wikileaks.  In this case, Amazon’s web hosting service, AWS, far from standing up for the free press, banished Wikileaks’ content that had been stored on its servers. It did so the same day (December 1, 2010) it received a letter from Senator and Senate Committee on Homeland Security and Governmental Affairs Chair, Joe Lieberman (2010) calling on any “company or organization that is hosting Wikileaks to immediately terminate its relationship with them”.  That Amazon so dutifully and quickly did so raises questions about Bezos’ self-professed commitment to free press values (Benkler, 2011).

Given that dubious track record, we can also wonder about how supportive Bezos would have been in relation to the Washington Post’s ground-breaking coverage of NSA contractor Edward Snowden’s leaking of documents detailing the agency’s secret program of mass surveillance and metadata collection, worldwide and in the United States, over the past few months? (see here, here and here, for example). In the face of intense pressure from the U.S. government, would Bezos have stood firmly behind Washington Post journalists or buckled as in the past to protect the vastly larger interests of the company he created, leads and still controls? 

Journos as Megaphones: The Globe and Mail Covers Bell

Once again, yet another story in the Globe and Mail yesterday was out peddling a tale of doom and gloom about the state of conventional commercial television broadcasters in Canada. This time, the story came hot on the heels of a Supreme Court of Canada ruling Thursday that threw cold water on the idea that cable, satellite and IPTV services should pay broadcast tv companies — Bell (CTV), Shaw (Global), Rogers (CityTV), Quebecor (TVA), the CBC, and a smattering of smaller independents — to deliver their signals to the tv screens of Canadians across the country.

It was a small victory for the non-vertically integrated entities that have long been in the business of television distribution, such as Cogeco, Eastlink and other cable companies, as well as several telcos across the country that are trying to expand their IPTV services in order to break into this highly concentrated field: Telus, MTS Allstream, Sasktel. Even Rogers, given its relatively small place in the conventional tv universe, opposed the fee-for-carriage model being touted by Bell, Shaw and a few others.

However, rather than entertaining the idea that the Supreme Court’s decision might be a good thing because it means that there will be no new ‘fee-for-carriage’ charges on already expensive cable and satellite bills (i.e. a “TV Tax”), or that it could foster more competition in the anemic tv distribution biz, where the big four — Shaw, Bell, Rogers and Quebecor — control roughly 84 percent of industry revenues, the Globe and Mail article hands the narrative over to the loser in the case: Bell.

Instead of framing the victory as potentially a small victory for consumers, or examining the Supreme Court decision itself, the article rips and reads from Bell’s talking points. Of the 813 words in the article, 144 are direct quotes from Bell; the Supreme Court decision gets 37.

Indeed, Bell sets the narrative frame for the story from the get-go, not just in terms of the sheer volume of ink spilt transcribing and transmitting its view to readers, but by the fact that it is the first to be quoted, and extensively so, with paragraphs five and six completely handed over to the company’s talking points. Here’s Bell setting the stage in paragraph five, lamenting why the decision is bad, not for itself, but Canadians:

“TV viewers across the country would have benefited from long-term stability for their local television stations, which currently rely on an advertising market that has seen permanent structural change, and is no longer able to fund such a model on its own.”

A few paragraphs later, Bell locks down the frame that sticks for the rest of the story: “the ad market for local television is in permanent decline.”

But hold the phone! Are any of these claims true? Umm, there’s room for interpretation, although not in the Globe and Mail’s piece, but the answer is basically (i) mixed if we look just at broadcast television advertising revenue, (ii) no if we look at total revenues for broadcast tv and (iii) an even bigger NO if we look at advertising revenues for all tv services.

As the CRTC’s most recent Communication Monitoring Report shows, advertising revenues for conventional tv for the past four years have been basically flat, hovering between $2,320 – $2,350 million. Advertising revenues went to hell in a hand-basket in 2009, but have risen by nearly $220 million in the two years since (p. 73).

If we look at all revenues for conventional television, the picture is even clearer. While revenues plunged in 2009 at the height of the economic downturn, other than that they basically stayed flat between 2008 and 2010.

By 2011, revenues for conventional tv were up $86.3 million over the previous year and over $100 million more than they had been at the outset of the global economic downturn in 2008. They were roughly $315 million more than five years ago, i.e. $3,491 in 2011 versus $3,176.2 million in 2006 (all revenue figures can be seen here). Not bad, really, and hardly the picture of distress portrayed by Bell.

Every media economist knows that the fortunes of advertising supported media hinges on the state of the general economy. In light of that, the fact that conventional tv has weathered the economic downturn, and done so whilst so much else in its environment is in a heightened state of flux, is not a catastrophe, as Bell and the Globe and Mail would like us to believe, but quite remarkable.

Perhaps if we dig deeper to look at advertising revenues across all television services as a whole, we will see the deep structural shift that Bell claims is happening, and which the Globe and Mail simply transcribes and transmits, as dollars are forever siphoned away from television in favour of the internet?  Um, no.

The big picture for advertising revenues across all television services (conventional and pay/specialty) is even more unequivocal: television advertising revenues have risen steadily and substantially over past twelve years, as the following figure shows:

TV Advertising

Source: Interactive Advertising Bureau (2012). 2011 Actual + 2012 Estimated Canadian Online Advertising Revenue Survey; Interactive Advertising Bureau (2009), 2008 Actual + 2009 Estimated Canadian Online Advertising Revenue Survey.

While there is absolutely no doubt that all of the players are scrambling to come to terms with new realities and still moving grounds, it is precisely because conventional television is not in crisis that the CRTC decided earlier this year to phase out the much hated Local Programming Improvement Fund (LPIF) that it had put into place in 2008 when things really did look rocky.

Journalists do a disservice to their readers by packing stories and what purports to be analysis with talking points from Bell rather than doing the leg work needed to access readily available data that paints a fuller and, by and large, very different picture.

Of course, there is tons of room to argue over the evidence but the flat portrait of conventional tv in decline painted at the Globe and Mail obscures the terrain of debate. If this was just an isolated instance, then perhaps we could just move along, nothing to see here. My sense, however, is that it is not.

To be more specific, we saw exactly this kind of coverage by the Globe and Mail when the CRTC quashed Bell’s bid to acquire Astral Media (see here and here, for example). Bell was essentially given free reign to vent, to tell us why the CRTC decision was wrong, how the CRTC under new chair J.P. Blais had gone activist, how Astral’s market cap had taken an undeserved beating as a result, what George Cope and Kevin Krull planned to do about things, and finally, when Bell teed up a second bid for Astral its move was pitched as somehow being routine, just another kick-at-the-can, when it is anything but.

There’s two final points to be said on these matters, at least for now: first, the task of journalists is not to act as conveyer belts for corporate PR and a monochromatic view of the world. Readers deserve better.

Second, and in this particular context, the fact that the owners of the Globe and Mail, the Thomson family, have a significant equity stake in Bell, and Bell holds a 15% stake in the Globe and Mail, raises questions about the ability of journalists to cover this beat without serving on bended knees. There is no proof that Globe and Mail journalists are taking orders from headquarters on this stuff, and if they were, the chance that we could know about it are about zero since we have no access to the internal workings of the newsroom and the day-to-day routines of journalists.

The fact that researchers can seldom gain access to the internal working of media organizations is why I do not generally like to try to connect my analysis of the structure of the media industries with the quality of the content they provide, whether good, bad or otherwise. One thing that this means, however, is that we have to trust journalists and for that to happen they have to give us good reason to do so.

People who own stuff like to tell others what to do and certainly have the potential to do so within the media, so it seems to me that journalists must walk the extra mile to demonstrate their autonomy rather than serving up Bell’s view of the world in one case after another in which the company finds itself on the losing end of the stick. Two months ago, the context was Bell Astral, two days ago the Supreme Court. Tales of doom and gloom advance a policy agenda and in this case, that of Bell and a few others, and that is why it is so important not to parrot what they have to say.

With Bell Astral Round Two likely to be teed up in the New Year, we deserve better journalistic coverage of the media industries in this country and I sure hope we get it. The last thing we need is yet another rooftop from which the most powerful and well-endowed media voices in the land get to shout about their view of the world and how things oughta be.

Newspaper Killers and the “Death of Journalism”: Postmedia’s Attempts to Slash and Burn its way to Excess Profits

This has been another week of bad news about newspapers in Canada.

The largest newspaper group in the country, Postmedia, announced a set of deep cuts across its chain of ten major city daily newspapers and the National Post. The Montreal Gazette and Ottawa Citizen currently have about 105 staff each; after the cuts both will have twenty less. Three weeks ago, the company closed its national news wire service, shedding twenty-five news workers as a result. No foreign news bureaus were closed because other than the two it has in Jerusalem and Washington, there are none.

Postmedia’s CEO Paul Godfrey also announced that the company will no longer publish the Sunday edition of the Ottawa Citizen, Edmonton Journal and Calgary Herald, or print the National Post on Mondays. Production will be centralized at Postmedia Editorial Services in Hamilton, a company subsidiary shorn of pesky unions, where layout, editorial decisions and some printing functions will now reside. It’s the model pioneered in Canada by Quebecor in 2006.

Paywalls will be going up sooner rather than later, building on those already put into place last year at the Montreal Gazette and the Victoria Times Colonist (before the latter was sold last October), and already planned for the Ottawa Citizen and Vancouver Sun. While focusing on getting people to pay for news online, Postmedia will also focus on “reducing unprofitable circulation” – that is, shedding less well-off readers – states a memo from Montreal Gazette editor-in-chief Alan Allnutt.

Godfrey also railed against “foreign-owned and controlled 
digital companies who, without any regulation, are accessing Canadian
 audiences and eroding Canadian media revenues”. He was referring to Google, Facebook, eBay, Apple, Amazon, and others of this kind.

Godfrey may have legitimate concerns about these internet giants’ capacity to parlay their dominant positions in search, social and online retail and publishing into the ability to set the terms for the distribution of news and advertising revenue online. However, the claim that they are cannibalizing newspapers revenues is wrong (see below) and his not so thinly-veiled call for regulation smacks of the same tactics that commercial broadcasters in Canada have been pitching for years with little to show for their efforts.

The current round of retrenchment and cuts represent a continuation of woes that have beset Postmedia since it took over the troubled newspaper chain from bankrupt Canwest in July 2010. Immediately after taking-over the newspapers, Postmedia eliminated 750 jobs and has maintained standing buy-out offers for journalists across the chain ever since. Add the sixty-five jobs axed this month, and approximately 1,800 jobs have been eliminated since 2008.

To be sure, Postmedia is faced with tough times. Daily newspaper circulation in Canada fell to 3.8 million or so in 2011, a far cry from peak levels reached in 2000 when 5 million copies a day were sold. Industry-wide revenues have swooned as well, dropping from $5.7 billion in 2000 to an estimated $4.1 billion (in inflation adjusted “real dollars”) today. People are still reluctant to pay for news.

Nonetheless, Postmedia’s internet revenues are growing and last year they accounted for 9 percent of its revenues (p. 71), a respectable amount compared to Torstar (10.8%) and the U.S. average (11.7%). The problem, however, is that it only earns a single ‘digital dollar’ for every $4 it loses in traditional print revenue. While this is considerably better than trends in the U.S., where the ratio is $7.50 to $1, it is still not nearly enough.

Perhaps reflecting these uncertain prospects, the company’s stock market capitalization has plunged from an all-time high of $685.4 million in June of 2011 to roughly 1/10th that amount ($70.6 million) today. So maybe Godfrey is right? Perhaps there is no choice but to swallow bitter medicine in order to set things aright?

That times are tough for Postmedia and newspapers in general is beyond dispute, but there are a few surprising facts amidst this portrait of doom and gloom that have not received the attention they deserve. The two most important facts relate to profits and debt, and when we look at these factors, the consensus view of things begins to unravel.

You might be surprised, but Postmedia is a profitable company.  It operating profits in 2011 were 7.6%, just below the average for all industries in Canada (8.7%). In fact, over the past twenty years, the company has been very profitable, except for one year (2010), and well above the average for industry as a whole. The following figure illustrates operating profit levels at Postmedia and its predecessors in relation to Torstar and Quebecor as well as the average for all industries since 1995.

Postmedia Operating Profits vs. Torstar, Quebecor and Average for All Industries, 1995 – 2010  (%)

Source: Company Annual Reports;  Statistics Canada. (various years). Financial and taxation statistics for enterprises. Cat. no. 61 219-x. URL:

Given that Postmedia is actually profitable, why the insistence on the slash and burn approach?

While respectable by economy wide standards, and especially in light of the fact that the world of journalism is being turned topsy-turvy by digitization and the internet, profit levels at Postmedia are not high enough for one decisive set of interests: its owners. The hedge fund holding a 28% ownership stake in the company, Golden Tree Asset Management, illustrates the point, gloating on its website that its “philosophy” is that “double-digit returns can be compounded over market cycles”.

Double-digit returns in the newspaper industry, however, are the stuff of the last half of the 20th century, when newspaper monopolies held sway in one city after another and the overall media environment was a lot less cluttered than it is today. Those days are gone, and we ought not shed a tear, except for the fact that Postmedia’s owners are laying waste to scores of journalists and journalism in their pursuit of monopoly-era profits in the 21st century. In other words, excessive expectations regarding acceptable profits, not tough economic times for newspapers on their own, are behind the current round of slash and burn at the largest stable of newspapers in Canada.

That debt is an equally pressing problem can be seen in the fact that Postmedia paid out almost as much in interest on its massive debt in 2011 as it made in profit (see here, p. 71). Moreover, a great deal of that debt is held by Golden Tree Asseet Management, and paid at high levels of interest.

Some of the $663 million debt that the company assumed when it took over the Canwest newspapers in 2010 has been reduced, but remains stubbornly high: $544 million at the end of 2011, and about $516 million today. The mountain of debt is a legacy of a decade-and-a-half of consolidation, a period when the newspaper chain switched hands from Southam to Conrad Black’s fraud-riddled Hollinger Corporation (1996) and then to the vainglorious Aspers in 2000 for $3.2 billion at the height of the media empire building age.

Bloated on debt and hubris, the latter crashed and burned in 2009-2010, even though it too was profitable (12.7%) – but not enough to pay its bankers while staying within their rules on acceptable debt levels. That legacy still hangs like a dark cloud over Postmedia, and it is that reality, coupled with excessive profit expectations – and that profits and interest payments on debt both flow into the pockets of Golden Tree Asset Management — that is hammering away at the company.

That these factors deserve greater weight in explanations of Postmedia’s woes is also put into sharper relief once we realize that advertising markets are not shrinking, as Godfrey asserts, but have been growing at a quick clip for most of the past decade. To be sure, the pace has been slower for newspapers and might be best described as mostly staying flat over the past decade. Phases of contraction have been modest, not calamitous, as the figure below shows.

Advertising Revenues in Canada, 2001 – 2011 (millions $)

Source: TVB/IABCanada, 2011.

If newspaper revenue was being cannibalized by Google et. al, as Godfrey claims, we should see the size of the total advertising pie staying constant, and a fall in newspaper advertising as revenues are diverted to those entities. That has not happened.

Of course, the fact that newspaper advertising revenues remain essentially flat in absolute terms while total advertising revenues expand means that the relative place of newspapers in the overall mix is on the wane. Still, however, the growth of internet advertising in Canada as part of the mix pales in comparison to trends in the UK, Denmark, Norway, Sweden and Germany, for instance, as the following figure illustrates.

Source: IABCanada, 2011

The upshot is that whatever blows have accompanied the declining place of newspapers relative to the internet, they have been gentler than elsewhere, giving newspapers in Canada more time and room to adapt to the realities of journalism in the 21st century. That Postmedia has failed to do so says more about its own self-inflicted wounds under three different owners in the past decade-and-a-half than a death sentence imposed by the economic crisis, slumping advertising or the rise of formidable new players like Google, Facebook, Amazon, Apple, etc.

Other newspaper publishers in Canada have pursued a similar course, but Postmedia is only matched by Quebecor in the severity of the slash and burn approach that they have taken thus far. The Globe and Mail and Torstar – undoubtedly struggling at times as well – have been able to pare things back with a scalpel rather than a hatchet.

Ultimately, the days of newspaper owners reaping double-digit returns are gone. In addition, other than high-end business and financial intelligence, people have never been willing to pay for news, and this is still the case. Just how to return the press to a stable footing is still the million-dollar question. However, rather than trying to raze their way to the promised land, Postmedia’s owners must temper their desire for excessive profits and bring the legacy of debt — a problem that was created in just such an illusory pursuit over the past fifteen years — to heel.

Only then is it likely that the largest chain of newspapers in Canada will be able to regain its footing and contribute to professional journalism alongside new players such as The Mark, the Tyee, Huffington Post, the Dominion and so on that are beginning to make their mark on journalism in this country.

Open Letter: An Apology to Sheila Copps and the Bright Future of the National Press Club

Dear All,

In this letter I want to offer my sincerest apology to Sheila Copps, the President of the National Press Club, for comments made in my open letter to the members and directors of the NPC two weeks ago.

For those of you who read the letter, you will recall that I was deeply concerned about governance issues at the NPC and especially about the relationship between the executive committee and the rest of the board of directors.

At the same time, however, I realize that while my intentions were good, and the stakes important, I cast the net of my criticism too wide. Moreover, some additional facts have been brought to my attention that require that I set the record straight in terms of some of the points raised in the letter.

The most important of these matters relates to Sheila Copps, the President of the NPC. Since my letter, several people have reminded me that long before she established herself as a formidable force on the Canadian political scene, Sheila made a mark for herself as a journalist. I agree. She worked as a journalist for the Hamilton Spectator and the Ottawa Citizen before her political career took off and again as a columnist, at various times, for the National Post, Toronto Sun and other newspapers since leaving Parliament in 2004.

Regrettably, I did not delve into her background, and as a result let her role as a leading Parliamentarian and political figure in the past eclipse her past and current status as a journalist. I should not have and for this I apologize. Befitting the position of president of the NPC, Sheila has lent her formidable skills to the organization at a turning point in its history and has, like all members on the executive committee and board of directors, done so in good faith, voluntarily and without pay of any kind.

Several important steps have been taken in recent days to consider, among other things, the governance concerns that I outlined in my letter. A new committee has been struck to thoroughly review the rules and procedures that will guide the NPC into the future. The NPC co-hosted an event featuring the award-winning U.S. journalist and Wikileaks chronicler, Glenn Greenwald, this past week.

The NPC is now regaining its footing as a central institution in the practice of journalism and public life in Canada. In addition to Ms. Copps, the board of directors now boasts amidst its ranks a senior national journalist, a film producer, another who serves as the NPC’s institutional memory, an artist, a television reporter, a diplomatic statesman, a good financial manager, an academic and a few other talented people.

With these people and the recent steps taken, the NPC has turned a corner and the future of the organization is bright. In the next few months, further renewal will occur as a few spots on the board of directors that have recently opened up will be filled by election. For journalists, media practitioners or anybody else who wants to help chart the NPC’s role at the heart of journalism and public affairs in Canada, now is a great time to step forward.

All-in-all, I hope that this sincere apology to Sheila Copps and any other member of the board of directors who may have felt besmirched by my open letter will help to assuage hurt feelings. I also hope that it reinforces our ability to work hand-in-hand for common goals.


Dwayne Winseck

An Open Letter: Press, Politics and the National Press Club

Sometimes you work hard on things, throw your all into it, and hope that good things come as a result. For the last several months I’ve been doing this with the National Press Club, after being elected as member of the board of directors of the Club in October last year.

The National Press Club of Canada, as it is formally known, was at one time an illustrious organization, created in 1928 and serving journalists and other media professionals from its headquarters opposite Parliament in Ottawa until falling under bad leadership and hard times recently.

Some believe that in today’s context of relentless upheaval in the media world, and journalism in particular, that it is a good time to resurrect the moribund institution and put it back on the map. I agree, and this is why I decided to stand for election to the board of directors after being approached by one of my former students.

Part of putting the organization back on the map is good stewardship and carving out events that illustrate that the National Press Club has its finger on the pulse of important issues of our time. To this end I have been working with a few others in the Press Club to put a couple of events on the agenda

The first of which was intended to be held on the eve of the Government’s re-introduction of Bill C-30, you know, the internet surveillance bill notoriously pitched by the Government as the Child Online Predators Act (Bill C-30) and that was scathingly lampooned by Rick Mercer in one of his famous rants and loathed by people all across the country and all across the political spectrum before being yanked by the government, at least for the time being. Despite some good efforts, the NPC missed the boat on this one.

For the last month I’ve been working on another event that would feature Glenn Greenwald, a renowned journalist in the U.S. whose work appears regularly in the New York Times, L.A. Times, Washington Post and Slate and whose work on Wikileaks not only won him important awards for investigative journalism but also made him the target of a Bank of America-led dirty tricks campaign aimed at those seen to be overly sympathetic to Wikileaks and Julian Assange.

The first event was never held, a missed opportunity, let’s say. It is still too early for the final word on what role the NPC will play in the second event. Earlier this week, the ‘executive committee’ approved our sponsorship of it; yesterday, the same committee apparently reversed itself. None of the reasons for why the event was first approved then rejected have been given, and who was involved in both decisions remains unknown.

One thing is for sure, however: Greenwald’s talk will go ahead on April 12th at St. Paul University in Ottawa, with or without the NPC, at an event organized by Bill Owen, and sponsored by the School of Journalism and Communication, Carleton University.

While the NPC does embarrassing flip flops in the dark, Greenwald has been booked to appear on the Power and Politics show with Evan Solomon just prior to his speaking engagement. Other journalists are lining up for interviews while he is in town. Clearly, as other journalists’ indicate, the subject matter and the speaker are important and, shall we say, newsworthy. Why doesn’t the NPC see this?

Now I have relayed some of this stuff to you because in the hurly-burly of new boards we find a clash of visions between those striving to revive and restore the NPC to some of its former glory but in the context of the realities of journalism in the 21st century while others see opportunities for self-promotion and to shore up their own declining place in the sun.

That the NPC is in disarray, there can be no doubt. Two board of directors have resigned in the past two weeks. Another member who has served for decades and decades was unceremoniously thrown overboard by the President and so-called ‘executive committee’. No reason was given for such actions; inquiries as to the justification and basis for such actions have elicited no response among either the President or her hand-picked appointees that occupy most of the so-called ‘executive committee’.

Several other directors stand on the precipice, waiting to see how all this plays out. I am one of them.

However, rather than standing idly by, I have decided that the NPC is probably something worth fighting for. Hence this “open letter” to the current President of the NPC, the Honourable Shiela Copps.

This is indeed a struggle for the soul of the NPC. It will either be left to become the plaything of the President and her handmaidens or they will be removed and a new directors elected.

There are important first principles at stake. And one of those important stakes is that the President and her self-appointed members of the executive were not elected but appointed. The NPC is currently ruled as if this is a tinpot dictatorship, where board members are suppose to sit idly by waiting for edicts to come down from on high.

There are several problems in all of this, three of which I’ll outline before turning to the ‘open letter’ that I’ve sent to the rest of the NPC this morning.

First, as just indicated, without having been elected, the President and her self-appointed ‘executive committee’ lack legitimacy. These unelected positions are being used to create and fund new positions without proper quorum from a majority of the directors.

Second, given her far better known status as a key figure in the Liberal Party, and having just lost the leadership race for that Party, Copps’ position as un-elected president of the NPC stands at odds with the tenets of a free press which mandates, at a minimum, a separation of political parties and government, on the one side, from the press on the other.

I have criticized the extent to which former Cabinet Ministers, Prime Ministers and other politicos occupy places across the boards of directors at the major telecom-media-internet companies in Canada. I’ve called this crony capitalism and an affront to the ideals of the press.

That a representative journalistic organization like the National Press Club would similarly provide sinecure for a party stalwart who now dabbles in journalism is likewise problematic. Tell me if I’m wrong, but “the Honourable Sheila Copps” as a signature on NPC letterhead creates the wrong optics for a press organization that is in the early throes of revival.

Third, it is not just that the optics are bad, but the actual practices within the so-called leadership. The actions of the President and her ‘executive committee’ are opaque, lack the guidance of rules, procedures and principles consistently applied – the Constitution notwithstanding. Meetings are held without notice, minutes, or indication of who participated, etc. and decisions dispensed from on high. Such practices are not acceptable on any board, least not that of an organization that purports to representat the interests of media workers and journalists committed to a well-functioning free press within a democratic society.

As things currently stand, the NPC – at the direction of the President and the so-called executive committee – sells access to ‘newsmakers’ to the NPC platform. Got $650? Well, line up behind the NPC podium to have your say.

The upshot is that it is those who pay and have interests to flog rather than any sense of newsworthiness and journalistic or public values that determines what events will be held. This makes the NPC look like a shill for monied interests versus a platform for intelligent discussion of the issues that now face us, as journalists and as Canadians

With these points in mind, please have a look at the following letter, and feel free to let me, the NPC or the President and her select members of the executive committee know what you think.

Stepping outside the board of directors like this is neither easy or fun. However, once I decided to accept my position on the board, I committed to doing the best I could and “the right thing”.

In the face of intransigent stone-walling for several public events that had strong backing from a majority of the board versus the ‘NPC as paid shill for monied interests’ events that have been held, and in the face of an executive hell-bent on not addressing such questions and ruling by fiat instead of open conversation and a sense of democratic decision-making, I felt that this ‘open letter’ was the best way to accomplish what needs to be done.

I offered to tender to my resignation should the majority of the board so desire two weeks ago.  The offer still stands.


Dear Honourable Sheila Copps,

How unusual that you would convene a second meeting of the “executive committee” yesterday on the matter of the Glenn Greenwald event when one was just held on Tuesday by two other members of said committee to deal with the same matter. That two versions of the executive committee appear to have come to opposite conclusions is very odd.

May I also remind you that the executive comittee acting unilaterally to reverse the approval of what other of its members have approved is not only untoward, but it makes the NPC look amateurish and silly.  Glenn Greenwald is a renowned journalist in the U.S. whose work appears regularly in the New York Times, L.A. Times, Washington Post and Slate and whose work on Wikileaks not only won him important awards for investigative journalism but also made him the target of a Bank of America-led dirty tricks campaign directed at those seen to be overly sympathetic to Wikileaks and Julian Assange.

The significance of Greenwald speaking in Ottawa is obvious and so it was not hard at all to drum up sponsorship for the event. Notably, the School of Journalism and Communication at Carleton University — one of Canada’s leading schools of its kind in Canada, if not the leading school — has enthusiastically lined up as a sponsor of the event. The CBC’s Power and Politics have also lined up an appearance by Greenwald on the show prior to his speaking engagement at St. Paul University on April 12th. Other journalists have lined up for interviews as well. Do you have special journalistic insights unavailable to these entities?

The approach taken to this event by myself and others who have supported me is more legitimate than the model the executive is trying to foist on the NPC as the only model: i.e. the NPC sells access to its platform for $650, a model which is outrageously out of step with what a serious journalistic organization is about but which makes the NPC look like a shill for whoever has the coin to promote their interests. In our alternative model, we invite people based on their merit and newsworthiness, then figure out how to raise sponsorship and other funding for the event once the majority of directors have agreed on it in principle.

Back to the Greenwald event: there were no grounds given for the approval of the event after last Tuesday’s meeting and none given for yesterday’s reversal of that decision. Indeed, there was no notice given to others on the board of either meeting, or any attempt to canvas members views, despite the fact that 9 of 16 directors approved an earlier iteration of the event that would have seen it as a stand-alone venture organized by the NPC.

Please explain how it is that the so-called executive of the NPC can meet twice in one week with no prior notice given to other board directors, come to completely opposite conclusions, and all without any announcement afterwards of the results, minutes from the meeting, etc.  Also, pray tell, how it is that an illustrious institution that has been central to journalism in Canada for the last six decades — the School of Journalism and Communication — could see this as an event worthy of sponsorship, while the President of the NPC and a few of her hand picked nominees cannot?

May I remind you that you were appointed rather than elected as President of the NPC at the end of last year when the last person stood down, while many of the rest of us who are working our best to advance the rejuvenation and significance of the press club among journalists and other media professionals were elected. The National Press Club is not the plaything of either an unelected president or her handpicked appointees on the so-called executive committee.

The opaque means by which meetings are called, matters dispensed with and indeed who even attended such meetings is completely at odds with the values of an open press in an open society.  A National Press Club unable to embody those values in its own operations is a travesty and a farce.

It is problematic enough that a person of high rank in one of the central political parties of this country — the Liberal Party in this case — occupies the position of President within a press club, an obvious violation of the basic liberal principle that a free press should stand independent of the political powers that be.

That you ply the dark arts of party politics in the matters of the press is completely unacceptable. That you and your hand-picked maidens on the so-called executive are abrogating to yourselves the authority to make and pronounce decisions from on high as if the rest of the board should fall in line underscores the wisdom of the Party/Press separation principle. And what strikes me as especially unseemly is the way in new which new positions have been created and funds allocated to those whose main credentials appear to be some kind of connection to the President and her executive.

In your previous, very limited correspondence on this matter you have pointed to the need for internal discipline and suggested that the two recent resignations from the board are a consequence of ’email overload’. Nothing can be further from the truth. Instead, when you try to rule from the top without legitimacy, rules or procedure, you will beget backlash amongst those who care. Some directors will understandably want to avoid cross-fire between a President and appointed executive bent on dictating things from the top, on the one side, and those who think there are values, principles and potential future for a reconstituted NPC worth fighting for, on the other.

You have called these kinds of things upon yourself and the NPC. I act in the best interests of the NPC and in my capacity as an elected and independent director.

I call for a meeting of all the directors to be held as soon as possible and to address the following matters:

  1. The need for all members of the NPC board of directors to be elected;
  2. The need, if any, for an ‘executive committee’ and, if there is to be one, the relationship between the executive and the rest of the board;
  3. Determining the proper procedures for nominating, selecting and holding events under NPC auspices.


Dwayne Winseck

Politics and the Press: Counting Endorsements by Cdn. Press Group, 2011 Election

Well, you know what would be a lot of fun?  Counting up the number of endorsements each newspaper in Canada gives to each of the Prime Ministerial candidates.

There are roughly 100 daily newspapers in Canada. So far, four newspapers have registered their endorsements for Prime Minister: the Globe and Mail,  National PostTimes Colonist and the The Province. All have endorsed Harper.

On the one hand, one could say that there’s 96 papers to go. That would be a mistake.

The Globe and Mail and National Post are national papers and agenda setters. Besides, the last three on the above list all belong to one group of newspapers: PostMedia, the reincarnated Canwest.

Post Media still has ten papers to go across the country.  Will they all lean the same way, one city after another?

And how about Quebecor’s Sun Media, with its eighteen newspapers scattered in major and minor cities across Canadas, to say nothing of its much vaster holdings across the media?  Will they step on the scales in the same way, further proof that rather than a watchdog, Peladeau’s Quebecor Media (QMI) is the populist mouthpiece of Harper and Gang?

I think building such a list of all the newspapers in the country might be a lot of fun.  We can even work this stuff out together.

Here’s a handy list of all the major newspaper ownership groups and all sixty-one of the daily titles held under their respective umbrellas, most with links direct to each title. Pick your newspaper from the list, watch for the endorsement, then send it to me: presto, a national snapshot of whether ‘editorial opinion’ in the press corresponds at all to ‘public opinion’ on the streets. No prizes, no gimmicks, just a ‘crowd-sourced’ creation.

For the time being, I’ve created a simplified list below. It brings us up to date as of the end of April 29th and identifies the 9 major newspaper ownership groups in Canada that account for 61 daily newspaper titles just mentioned and roughly 95 percent of newspaper industry revenues.

As individual papers within these groups announce their endorsements over the next 24 hours or so, I will tally up the results. Again, it’ll really help if some people look at the ‘handy list’ above and send in a link to your local daily newspaper when it takes a stand. In the meantime, here’s how things stand:

Parent Group & Titles Mrkt. Share($ 2009) Dailies / Group CPC Lib. NDP Bloc Green
Post Media (former Canwest) 27% 12 3
Sun Media (QMI) 25.9 18
Toronto Star 13.9 1
Globe & Mail 7.2 1 1
Power Corp/ Gesca 9.8 7
TranscontinentalMedia 3.2 11
Halifax Herald 2.2 1
Brunswick News 2.1 4
9 Groups Total Tally  61 Titles 94.2% Market Share 4

Harper’s standing at a perfect four for four.

My point is not to fetishize numbers and charts but rather to set up a question, and it is this:

If, in a representative democracy, a free press is suppose to reflect a plurality of a society’s voices and political forces, shouldn’t we hope that the range of editorial opinion in the press comes at least somewhat close to matching up with public opinion?

If so, the fact that Harper is currently standing four for four suggests that we’re off to a bad start.

Voting’s a pretty good proxy for popular opinion, so let’s set out some standards using that measure to help us assess the relationship between ‘editorial opinion’ and ‘popular opinion’. When Canadians went to the polls for federal elections in 2008, they voted as follows: CPC 37.6%; Liberals 26.2%; NDP 18.2%; Bloc 10%; Green 6.8%.  National turn out was 58.6%

Now, three days before the 2011 election, the pollster Ekos says that public opinion is lining up this way : CPC 34.5; NDP 29.7; Liberals 20%; Green 6.9%; Bloc 6.3%. Quite significantly different, actually, on close inspection. Advance polls were up by a third over the last election. People are in, even if somewhat begrudgingly.

Harper’s Conservatives have stayed remarkably steady since the last election and Ekos polling of the last few days. One third of the voters dig Harper. Four seasoned editorialists of four who have spoken, however, are ready to hand him the reigns of power despite their own acknowledged lengthy and, truth be told, tawdry list of abuses.

Anyway, the point is not to make the case against Harper but rather to suggest that there’s room for dispute and it would be nice to see such divisions reflected in the range of editorial sentiment available. So far, it has not.

Moreover, the endorsements that are in are not just any endorsement, but from two of the major national agenda-setting papers — The Globe & Mail and the National Post (Post Media).

Only the Toronto Star, so far, has staked out an “anything but Harper” editorial on the 28th. It will announce its ultimate verdict tomorrow.  Liberal, Layton or Coalition?

Now, to be sure, editorial opinion is not the opinion of the press as a whole. Nonetheless, it is one critically important indicator.

It is also an important questions about the free press and journalism in this country to know whether or not editors have to tow their respective owners’ line. Will each pen something ‘unique’ for the city they serve or broadly endorse the same candidate for PM right across the chain of a dozen (PostMedia) to a dozen-and-a-half newspapers (QMI) in one city after another across the country?

Of course, there is more diversity across the rank and file journos that fill out the rest of the pages of the press, but it would be nice to know that there’s some diversity in the editorial ranks, and a least a slice of clear blue sky between editors and the 9 entities that own the newspapers that they have been appointed to run.

Wikileaks and the Digitally Networked Free Press

Yochai Benkler has just published a fascinating study of Wikileaks and what he calls the free and irresponsible press. The study’s focus is on WikiLeaks, the Internet-based ‘whistle blower’ site, but it is more than that; it is, as Benkler states, a battle for the soul of the networked fourth estate.

Benkler makes several key arguments.  The most important in my view is that WikiLeaks is part and parcel of a broader set of changes that, once the dust settles, will likely stabilize around a network media ecology consisting of (1) a core group of strong traditional media companies; (2) numerous small commercial media (e.g. Huffington Post, the Tyee, Drudge Report, Global Journalist, etc.), (3) non-profit media (e.g. WikiLeaks, Wikipedia), (4) partisan media outlets (e.g. Independent News Network,, Daily Kos, TalkingPointsMemo) and (5) hybrids that mix features of all the others.

Second, he argues that far from the Internet aggravating the ‘crisis in journalism’, it may in fact be improving the quality of the new media and journalism overall. According to Benkler, the current turmoil amongst traditional news outlets is the result of so many self-inflicted wounds that have festered for decades.  The rise of the internet and the changing technological and economic basis of the media magnifies these problems, but it is not responsible for them.

Instead of bemoaning the impending ‘death of journalism’, Benkler strikes a cautiously optimistic note. The blogosphere and Internet are undoubtedly bastions of vanity, personal opinions masquerading as fact, and where bellicose politics trumps civility. Crucially, they are also sites where new forms of journalism, new approaches to knowledge production and new kinds to creative expression are emerging that have the potential to make a mighty contribution to journalism and democracy.

Wikileaks is the poster-child for some of the potentials of non-profit, ‘crowd-sourced’, investigative journalism. More broadly, the poster child of ‘crowd-sourced’ knowledge is Wikipedia, a socially produced online encyclopedia that now ranks among he top 7 or 8 most visited websites in the world — except in countries such as China, where it is hard to access. Wikipedia’s credibility ranks on par with venerable entities such as the Encyclopedia Britannica.

Benkler is keen to show that unless we recognize that relatively new actors are making valuable contributions to the networked media environment, we will end up with impoverished journalism and weakened democracies. A key step in this process of recognition is to understand that outlets such as WikiLeaks are fundamentally ‘journalistic’ in function.

Third, to the question of whether or not WikiLeaks is a ‘news organization’ and its key players, most notably Julian Assange, journalists, Benkler offers an emphatic yes.

The first proof of this is that, since it began in 2006, WikiLeaks has received several awards recognizing it as such from Amnesty International and the British magazine, Index on Censorship. More recently, it has been nominated for a Nobel Peace Prize.

Second, it is a global news agenda setter. In 2010, it did this not just once, but four times:

(1) the release of the ‘collateral murder’ video in April;

(2) the release of the Afghan and (3) Iraq war logs in July and October, respectively, and

(4) the release of 1,900 diplomatic cables beginning November 26th.

This is no small feat. It would seem to indicate that Wikileaks is not marginal to journalism, but central to it.

Third, Wikileaks has worked hand-in-glove with the most prestigious news outlets in the world: The Guardian, the New York TimesDer SpeigelLe Monde and El Pais. Rather than simply dumping all of the 250,000 ‘embassy cables’ that it claims to hold into the public domain, only 1,900 or so have been released since late November. Its materials, at least after the problematic “collateral murder” video, have been selected, edited and presented according to professional news values.

Fourth, working with these news organizations has maximized attention for these stories. It has also allowed these news organizations to bolster their already strong positions in local and ‘global news markets’. The cables were leaked pretty much simultaneously by Wikileaks, The Guardian, the New York TimesDer SpeigelLe Monde and El Pais.  The benefits of cooperation cut both ways.

Fifth, this is better than the ‘old days’. For example, in the WikiLeaks’ case, the NYT consulted with the Obama Administration before releasing the ‘war logs’ or the ‘diplomatic cables’. Such deference might seem odd, unduly deferential perhaps, and it is. It was better than sitting on the material for a year, however, as the NYT did in 2005 at the behest of the Bush Administration in the context of the NSA/AT&T unauthorized wiretap case (see mea culpa by NYT public editor Byron Calame, Jan. 1, 2006).  As a non-profit source, and without the need to stay in good standing within the circles of political, military and corporate power, Wikileaks does not have to assume such a deferential stature.

Awards, agenda-setting, cooperation with prestigious news organizations, mutually beneficial arrangements, and no small degree of reliance on long-standing professional practices and some deference to state power, however, are still not enough, it seems, to prove WikiLeaks’ journalistic credentials.  Despite all this and the careful, indeed, responsible approach it took (i.e. as a free and responsible press), WikiLeaks’ actions led to paroxysms in some quarters.

Calls for execution, treason charges, and so forth would normally seem to fall beyond the pale of ‘normal democracy’, but in the WikiLeaks’ case they have heavily framed the discussion. The coverage of the press has been, at best, poor when it comes to specifics about the case. Two-thirds of news reports have mistakenly implied that WikiLeaks simply dumped everything it had into the public domain. Several members of the U.S. Congress called for Assange to be tried for treason; a common tactic was to label him a terrorist. This is not a political culture in which a free press flourishes.

Two Republican presidential candidates, Sarah Palin and Mike Huckabee, as well as some hard-line conservatives in Canada (e.g. Tom Flanagan and Ezra Levant) called for Assange’s execution. All of these actions were not just over-the-top; they are a threat to a free press and to democracy.  Just how over top they are is indicated by the measured response of the U.S. Defense Secretary, Robert Gates. As Gates put it,  “Is this embarrassing? Yes. Is it awkward? Yes. Consequences for U.S. foreign policy? I think fairly modest” (quoted in Benkler, p. 16).

Highlighting WikiLeak’s status as a journalistic organization reminds us that rather than being beyond the pale, it should be situated firmly within the parameters of the free press tradition. The collaborative venture exercised an editorial hand with a keen eye to minimizing threats to humanitarian workers and to military operational security. The WikiLeaks case offers a glimpse of a template for a ‘new cooperative model’ between established news outlets and new comers. It can help to move us beyond the snooty idea that journalism is whatever traditional media tell us it is.

‘Networked journalism’ and ‘crowd-sourcing’ are being rapidly integrated into the operations of well-established news outlets. Such activities are not just free-loading on the ‘content’ of the mainstream press, but rather sometimes function as rivals, while partners at others.  As the uprisings across the Arab world indicate, the network public sphere and crowd sourcing are fast becoming standard operating procedure in the global news system.

The history of cooperation between WikiLeak and the above news outlets has been far from smooth. It has been rife with tensions and personal animosities, especially, it appears, between at least one senior New York Times’ editor and Julian Assange. Beyond individual personalities, constant claims about ‘journalism in crisis’ have made it easy to cast the Internet in the role of villain. Yet, the bottom line in all this jostling between the ‘new’ and the ‘old’, is that members of the networked fourth estate deserve the full rights and protection of the ‘free press’ no less than ‘pamphleteers’ and well-established news outlets such as the Globe & Mail, New York Times or the Nation do.

Wikileaks sturdy journalistic credentials, Benkler argues, makes it all but impossible that any direct attempt by the U.S. Government to put WikiLeaks out of business could pass legal and Constitutional muster. The New York Times’ Pentagon Papers case in 1971 is, in fact, very instructive to the present situation, despite constant denials to the contrary.

The key figure in the Pentagon Papers case, Daniel Ellsberg, has already argued that Assange and WikiLeaks are no more treasonous and outside the scope of the free press protections of the U.S. Constitution than he and the New York Times were in the era of the Vietnam War. Benkler concurs, and walks us through the legal steps as to why this is so:

  • unless the government can show that publication will result in direct, immediate and irreparable harm to the U.S., or its people, any attempts to prevent publication will run foul of the First Amendment;
  • journalists cannot instruct their sources to steal documents, but they are not obligated to determine or reveal how the source obtained them;
  • in times of war, there is no better counter to ‘strong presidents’ than a free press.

The parallels between these two events have been obscured by denial and the tendency in journalistic and other circles to belittle Internet-centric forms of journalism and commentary in the blogosphere. Yet, investigative journalism and commentary are not the sole dominion of the traditional press. They are a signature feature of Internet-based news and commentary outlets. Those qualities are more important than ever in light of the constant erosion of these capabilities within the mainstream media over the past two decades or so. Hot heads and conservatives may not like dissent, but that’s why freedom of speech, press and association exists to begin with.

The fact that WikiLeaks is so solidly at one with journalistic and free press traditions helps to explain why neither it nor any of the five major newspaper organizations — The GuardianNew York TimesDer SpeigelLe Monde and El Pais – that it is working with have faced direct efforts by the U.S. Government to suppress the publication of WikiLeaks’ documents. Although, as the Twitter case indicates, this was not for a lack of trying (see here for earlier post).

The problem, however,  is that what the state has not been able to obtain by legal and constitutional measures, it has been able to gain with remarkable ease from private corporations and ‘market forces’.  Thus, buckling under the slightest of pressure, Amazon removed all of Wikileaks’ content from its servers on the same day (December 1, 2010) that independent Senator and Senate Committee on Homeland Security and Governmental Affairs chair, Joe Lieberman, called on “any . . . company or organization that is hosting Wikeleaks to immediately terminate its relationship with them”.

Two days later, the company everyDNS delisted Wikileaks from its domain name registry. As a result, Internet users who typed into their browser or clicked on links pointing to that domain came up with a page indicating that the site was no longer available (in addition to Benkler, see the Guardian’s timeline on the sequence of events).

Wikileaks quickly found a new home at webserver firm OVH in France. This connection, however, was also severed after the French Industry Minister warned Internet companies on December 4 that there would be “consequences” for helping to keep Wikileaks online. The Swedish DNS provider, Switch, faced similar pressure, but refused to buckle. It continues to maintain the address that Internet users still use to access the site. It is also under a constant barrage of Distributed Denial of Service (DDoS) attacks. The Swedish-based Pirate Party also stepped in on December 5 to host the “cablegate” directory after they were taken off line in France and the US. Twitter has also resisted strong arm tactics from the U.S. government (see Twitter does the Right thing).

While Amazon and everyDNS took out part of WikiLeaks technical infrastructure, several other companies moved into to disable is financial underpinnings. Over the course of four days, Paypal (owned by eBay) (December 4), MasterCard and the Swiss Postal Office’s PostFinance (December 6), and Visa (December 7) suspended payment services directed by donors to the site.

The lessons here are three-fold. First, that private companies all too often all too eager to comply with political directives from the state. Cutting Wikileaks off from the key technical and financial resources after coming under the slightest bit of pressure essentially means that several key private businesses willing served as proxies for the U.S. and other governments to do what they would otherwise be prevented from doing by constitutional protections for the free press.  This is a real threat to the networked free press. It is also one of the reasons that Wikileaks exists in the first place.

Second, efforts to suppress unwanted speech are never complete. The distributed nature of the Internet and dispersed actors committed to open media and a free press means that sites can and will be relocated elsewhere. However, that should not detract from the fact that fundamental open media principles have been seriously compromised in the meantime.

Third, the reticence to recognize new forms of journalism and to lash ourselves to the mast of the ‘old’ media is compromising the cultural foundations of the ‘networked free press’. A hostile political and cultural environment is not conducive to a ‘free press’. The response of traditional media organizations, in particular, in the U.S., and the New York Times especially, has been ambivalent on this point. By collaborating with WikiLeaks, they have polished the latter’s journalistic credentials. Just as importantly, they have also once again demonstrated that gaining access to attention in a cluttered media environment still requires ‘big media’.

As Benkler emphasizes, there are contrasts in how different news organizations see WikiLeaks. In contrast to the reluctance of the New York Times to treat it as anything more than just a source, and a mangy one at that, the Guardian sees its experience with WikiLeaks as a template for a ‘new model of cooperative journalism’.  In fact, the Guardian and BBC are way ahead of their North American brethren when it comes to using ‘crowd-sourcing’ and ‘user-created content’ in news coverage.

The trend was kick-started in the UK with the London bombings in July 2005, and has continued to play a strong role since. If the current uprisings spreading through the Arab world are an indication, this ‘hybrid’ genre of news is now  moving quickly from the margins to the mainstream.

The constant hand-wringing about the ‘crisis of journalism’ in the U.S. (and to a degree in Canada), and the tendency to lay this at the doorstep of the Internet, blogs and readers unwilling to pay or incapable of discerning good journalism from bad, has undermined the status of the networked free press in the culture at large.  This ambivalence, along with the hard rights ability to reach easily for the ‘terrorist’ trope and unleash a vitriol hard to imagine in ‘normal times’, further compromises the ‘cultural protections’ needed for a networked free press.

Ultimately, Benkler does a great job, as he so often does, in drawing our attention to not just how the technology and economics of network media are decisive, but also how constitutions and culture play a pivotal role in determining whether the contribution of network media will, on balance, be a boon or bust for democratic societies.

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