Monday 20 January 2020

State support for the Irish media industry can work

The possibility of the newspaper industry receiving some support from the State is welcome but first the industry needs clarity about its future

Communications Minister Denis Naughten
Communications Minister Denis Naughten

John McGee

Recent comments made by the Minister for Communications, Denis Naughten, that some form of State support for the Irish newspaper industry - possibly top-sliced from the TV licence fee - might be on the cards is likely to have been welcomed by newspaper groups throughout the country.

While the concept of State support for the newspaper industry may be new to Ireland, there is plenty of precedent in other European countries over the past 30 years. This is particularly true of the Nordic countries, where a mixture of direct and indirect supports for the industry have been deployed as a means of preserving plurality and diversity, as well as encouraging restructuring within the industry.

Unlike other sectors, however, the Irish newspaper industry - and indeed the wider media industry - has never worked to such grand plans as our European neighbours. Nor does it seem to have a collective vision of what could be a bold, brave and bright future.

Other sectors - such as software, IT and food and drink, for example - all have their own industry-led and State-supported masterplans. If ever there was a time for an industry-wide approach to tackling the many structural, financial and technological challenges that exist, that time is now.

But before the industry breathes a collective sigh of relief at the thought of Minister Naughten riding to its rescue, the reality is that he is about to open a Pandora's Box from which the many political, regulatory and financial complexities could, if allowed, overwhelm and stifle his best intentions.

Joining the newspaper groups in the queue outside his office will be the independent radio sector, which has been rightly banging its public service drum for a long time. The queue will also include broadcasters like TV3 and UTV - both of which have made legitimate claims for a cut of the TV licence fee in the past.

And it's entirely conceivable that somewhere at the back of the queue will be online-only publishers, some of which will claim that they are doing their bit to ensure media pluralism and diversity.

At the top of this very long queue is, of course, RTE - the biggest beneficiary of the licence fee. In 2015 its licence fee allocation amounted to €178.9m while at the same time it brought in €155m in commercial revenues. Even with this, RTE still turned in a loss of €2.8m in 2015 - and by all accounts this is likely to increase again to over €20m this year.

So where's the money to fund all of this going to come from? Or has Minister Naughten got a loaves and fishes party trick up his sleeve?

It is worth pointing out that nearly 60pc of the Department of Communications' annual budget of €399.9m in 2015 went to the broadcasting sector. Apart from the licence fee allocation to RTE, €33m went to TG4 - while another €14.7m went to the broadcasting funds managed by the BAI.

Assuming the Minister (and the public) does not have the appetite for an increase in the licence fee, or for asking Michael Noonan for a bigger budget, top-slicing from the existing pot of money is going to hurt somebody in the food chain. And badly. But it's also a short-term solution to a much longer-term problem.

But before Minister Naughten makes any decisions about robbing Peter to pay Paul, a good starting point would be to define what constitutes public service media in the digital age and decide how much we as a nation value the concept of public service media, and the benefits it bestows on society and democracy.

At a time when advertising money is deserting traditional media and rushing head-first (and possibly blindly) into the supposedly warm embrace of Facebook and Google, these are legitimate issues.

As a nation, do we really want to be informed and entertained by a news feed that is determined by an algorithm that serves somebody else's commercial needs? How would we feel if we woke up tomorrow and there was no such thing as quality journalism?

I think we all know the answer.

Clearly, national and regional newspapers, local radio stations and the national broadcasters all have a legitimate role to play in this debate. At the very least Minister Naughten should consult with them to identify the issues that need to be addressed before he divides up his loaves and fishes.

The big question, however, is how do we get to a point where the State can legitimately support the industry, help it build a better, stronger and more financially stable future? And all this, of course, without incurring the wrath of EU competition czars?

And if State support is forthcoming, what format should it take? In some countries where State support for the media exists, it's often a mix of indirect support - usually in the form of tax benefits or reliefs - and direct financial supports that are linked to innovation, technology upgrades, education and training or indeed content creation. Simply writing a cheque and sending them on their merry way would not be the best use of taxpayers' money.

So before the Minister does anything, some clarity would help. Only then can the industry can plan for its future

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