Markets Fail News

Thanks to Chris O'Brien's challenge, serious talk of business models for journalism have come to the IdeaLab blog.

Let's pause a moment for an overarching view. Turn off the bright lights and stare into the empty studio.

Markets – selling and buying at prices set by supply and demand – don't work for news and information.

Valuable news is a public good. All right, if you care about journalism, you already believed that. But news is also a public good in the sense economists use the term: once one person comes into possession of it, everybody can have it.

Expensive investigative reporting in particular is undervalued in the market compared to its benefit to people. Soft news features, pictures, video, comics, opinion and all that is more about the experience than the facts have fared somewhat better.

Although a networked digital world makes the picture starker, none of this is new.

The economic model of journalism has always been broken, and the business of selling news has always been one of hacks and workarounds.

Because information wants to be free, because market incentives break down for anything infinitely shareable, the public interest suffers from the underproduction and underdistribution of news. Perhaps even more so, the public interest has suffered from the subsidy of news – press releases, staged events, canned content, announcements, and access as much as advertising and underwriting itself – by corporations and governments that don't necessarily share the public interest.

The decoupling of news from its traditional means of support is an opportunity.

With raised stakes, vastly raised difficulty, and I hope a clearer understanding of what we're up against, I ask you to return to Chris O'Brien's challenge to come up with more new business models for journalism.

It's only the future of the world at stake. Have at it in the comments!

[Cross-posted to Idealab]


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