Report: Media face ‘all news should be free’ problem
People value news, but it does not mean they are ready to pay for it, according to the European Media Industry Outlook May 2023 report, released on May 18 by the European Commission.
A survey done in nine European Union countries – including Bulgaria – found that when asked why they did not want to pay for news, and with multiple answers possible, 68.7 per cent of those polled said “all news should be free”.
“Consumers have a keen interest in different types of news and also are aware of how news has value for society as a whole. However, Europeans in general do not pay to access news content,” the report said.
“This gap between the value associated with news content and its monetisation represents a key challenge to the economic sustainability of news media outlets,” it said.
Free news is consumers’ preferred option online, on the grounds that news ought to be free, or is good enough, according to the report.
Online, a large majority of consumers still prefer to use free news content or news services online.
Digital subscriptions are the most popular method of paying for access of news content, but they are just used by 13 per cent of the respondents.
Conversely, those who do not pay argue that all news should be free, that free news covers their expectations or that they want to avoid the hassle of paying for news.
The report said that 83.8 per cent of the consumers consulted agreed with the statement that “some sort of accurate news should be available for free to everyone”, underlining respondents’ expectations on news availability.
“In this context, advertising remains key in the financing mix, but it does not benefit news media as much as it used to,” the report said.
Altogether, the EU advertising market (online and offline) has grown in the last years (69.2 billion euro in 2021, up from 64.1 billion euro in 2016), with the fast-growing segment being internet advertising.
In 2000, just one per cent of the advertising went to the internet against 91 per cent of expenditure in the news media sectors (radio, TV, newspapers and magazines, including outlets’ digital versions).
Yet, by 2021, internet had captured 43 per cent of all advertising spending, against 51 per cent spent in the news media sectors.
As a result, advertising revenues, while remaining an important source of income for news media, is on the decline (down 23.3 per cent between 2016 and 2021). This is more acute in the print news sector, where these revenues fell by nearly one-third over between 2016 and 2021, mostly caused by shifting consumption habits and decreasing circulation.
Online, platforms such as Facebook or Google have managed to capture major shares of digital advertising revenues, especially in the case of programmatic advertising. Under this form of advertising, just an estimated 40 per cent of ad revenues go to the publisher (compared to 85 per cent in traditional advertising), with the remainder going to global platforms and digital intermediaries.
In addition, online platforms have become an important driver of consumption of news, but also of traffic to the websites of news media providers.
Distribution of news content online through online platforms is affected by their use of automated content moderation and news personalisation technology, to the benefit of certain types of content and certain news providers.
“On the one hand, this might drive up revenues but on the other hand news media may become dependent on platforms, their distribution mechanisms (e.g. algorithms being used) and monetisation models,” the report said.
Revenues have dropped for the printed press in recent years whilst rapidly increasing for digital news media and gradually increasing for TV and radio.
The decline of the printed press (from 22 billion euro to 16.1 billion euro, a drop of 27 per cent from 2016 to 2021) has been only partly compensated for by moderate growth in TV and radio (5.5 per cent, from 64.5 to 68 billion euro) and strong growth in digital news media (from 2.5 billion euro in 2016 to 3.7 billion euro in 2021 – a growth of 60 per cent). Yet, the printed press sector remains four times bigger than the digital news media, according to the report.
Revenues are forecast to continue along existing trends, with the printed press further declining by 14 per cent, TV and radio growing by over 11 per cent and digital news media growing by 22 per cent by 2025, the report said.
Whether or not anyone believes “all news should be free”, running a news operation is not, and in supermarkets, journalists too are expected to pay for groceries. Please help keep The Sofia Globe’s independent journalism alive by becoming a Patreon supporter (see the button below) or donating via Paypal through the link on our home page.