All the news that's fit to print, plus ... slots!
On how, or if, future journalism shops will fund themselves. Plus, the weekly recap.
It is a blessing in life to be easily entertained. I'm not precisely known for my sunny disposition, but that doesn't mean I can't find pleasure in the absurd. Over a year ago, in the Before Time when we still worked in person, in groups, in offices, I was sitting in a conference room at Postmedia Place in Toronto, waiting for a meeting to start, staring at a white board with random words written on it in huge capital letters, each circled many times. And I was trying to figure out what the hell the words meant. The terms were things like, "HEALTH CARE" AND "BACK TO SCHOOL" AND "TOURISM" AND "PARENTING." All perfectly normal, benign terms, but ... what the hell were they doing on the board?
The answer is banal: the conference room had been recently used by the marketing and sales teams, and they had been throwing words up on the board that they thought could be the centre of upcoming ad campaigns. It was all very normal, typical stuff. But my absurdist brain kicked in and I began wondering what an alien visitor to Earth, who could understand our language but knew little about our society, would make of the words on the board. Or what a future archeologist would conclude the occupants of the room had been discussing before a cataclysm struck and froze it in place for history.
This is perhaps why meetings aren't my thing — my mind tends to wander a bit.
This came to mind this week when I saw that TorStar, the company that owns a series of media properties including the flagship Toronto Star and also the Hamilton Spectator, wants to open an online casino. That's a weird sentence to have written, but it's true: thanks to proposed provincial legislation that is broadening who can operate such ventures, the company is looking into establishing a gaming site to tap into the lucrative online gambling industry. If you're wondering why this brought to mind the random words on a white board, it's because both the words and TorStar's desire to open up a casino are products of the same massive problem: legacy media outlets are in deep, deep financial trouble.
The Line recently published a PSA that explains this in some detail; you should read it if this is an issue that interests you in the slightest. For our purposes here, suffice it to say that for most of the 20th century, and the early years of the 21st, most large, traditional media outlets were funded by advertising revenues. The newspapers (or magazines or TV shows or radio stations or whatever) drew in people's attention by offering them basically free news, opinion, lifestyle content, and the like, and advertisers paid huge money to place printed ads or broadcast commercials amid the content, so that the audience that came for the news (and the rest) were also exposed to the advertisers' messages. The emergence of the tech giants, largely Google and Facebook, destroyed this cozy, productive arrangement because the tech giants are better places for advertisers to put their money — the reach is larger and the demographic targeting spectacularly more detailed. The money migrated, fast, and the large media companies have been desperately trying to find a way to survive since.
Like I said, read The Line for a deeper dive on this, including the once-essential role of now-extinct classified pages, which I've totally glossed over here. But you get the big picture. So whether it's Postmedia ad people trying to think of very niche things to base campaigns around, or TorStar people trying to figure out an entirely new business that will presumably generate revenue that they can use to sustain their existing business, it's all the same thing: something has to pay for journalism, and in the absence of that revenue, what we get is deep layoffs, ever-smaller newsrooms and in many cases, newsrooms that are shuttered outright.
Both strategies are perfectly valid. But both present real dangers. If a news outlet develops a real talent for drawing advertising for niche topics — HEALTH CARE and TOURISM and whatnot — that's great. But if all the revenue those stories bring in is devoured by the conventional newsroom operations, there's a danger that companies will one day decide, you know what? We have a great business here telling stories about these discrete key topics, and we think we can find some more discrete topics with advertiser interest ... so why are we funding this general newsroom? Ditto, if a media company gets really good at running an online casino, you can easily see a day coming when it decides to just be an online casino, shutter the newsroom and pocket the bucks. And then we'd be right back where we are: still missing a way to fund essential journalism, which our society desperately needs.
To be clear, this isn't a criticism of either approach. Drawing in advertisers with targeted, responsive content is just good business. And as for the casino, media companies have long funded their operations using revenues from other businesses — TorStar itself benefited mightily from owning Harlequin, a book publishing company known for romantic thrillers, for many years. Indeed, putting a newsroom inside a larger money-making organization is basically exactly how network TV news works. CTV and Global, or NBC and CBS in the U.S., make their money by airing TV shows and selling the commercials that air during them. Some of that money is used to support their newsrooms (this is true at the national level and also for the local affiliates). A casino instead of a slate of prime-time dramas and comedies is mostly a distinction without a difference.
Oh, and for those who might sniff at the moral taint of using gambling revenue to fund journalism, just a reminder: in Ontario, booze, cannabis and tobacco are all regulated and taxed to fund every public service, and the province also runs its own gambling ops ... specifically so that it gets a generous piece of the action.
Oh, and also, well ...


Exactly. So I don't have any time or interest for moral arguments. I do have concerns, though. Newsrooms burn cash. A news-gathering organization is very, very expensive. There is no way around that. But choosing to run one out of the proceeds of a larger, cash-generating organization can still make sense for a lot of reasons. Owning a paper or news channel is prestigious (perhaps less so than before, but still). It buys political influence and capital. And there are, of course, simple true believers in the cause of journalism, who are OK seeing a share of the profits from their non-journalism business funnelled into news reporting.
But I still worry that in the absence of a thriving advertising market that allows journalist outlets to directly fund at least some of their work, there's a real danger that future business leaders will make the entirely justifiable and logical decision that, instead of running a profitable business to sustain a cash-burning one, it would be better to just ... run a profitable business.
The easy counterpoint to my argument is to note that it hasn't happened yet, and for the reasons noted above: owning a newsroom conveys real societal power. You are plugged into the power brokers, and even wield some power yourself. You get on the society circuit. You can champion causes near and dear to your heart. And you may indeed be a true believer in the importance of journalism. But I do worry that as the already horrifically grim advertising market gets even worse, and as new competitors to traditional media become more powerful and effective, the business case for traditional media shops existing within larger profitable enterprises will get worse and worse. I'm sure it won't go away, but any contraction is going to be painful, given the already lousy state of the media. We don't have much strategic depth left to absorb the hits of rich families or large companies deciding to cut their losses and get out.
That's what I worry we might have seen when Bell recently let go hundreds of journalists and shuttered entire newsrooms. Maybe I'm overreacting. Maybe it's just another bad day in an industry that's had a bunch of them. But I worry it might have been a precursor to an eventual decision by Bell to just focus on selling people internet, TV packages and cellphone plans, and screw these TV and radio stations.
I hope not. But I worry. And I don't see any reason why, a few decades from now, the people running TorStar's gaming decision may not feel exactly the same way about the Star and Spec.
On that cheerful note, let's round up my contributions to the media ... while we still have one.
For the National Post, I did two videos this week. The most recent is responding to the obviously worsening political scandal over allegations of misconduct aimed at senior — the most senior! — officers in the Canadian Armed Forces.
Earlier in the week, I was noting that improving news on the vaccine front — and it got better as the week went on — could mean trouble for the Conservatives. If their plan was for Trudeau to defeat himself by bungling the vaccine rollout, they may need a new plan.
Also in the Post this week, I wrote a column I think is important. And I don't think they're all important! A lot of daily media work is just "driving the bus," as someone smart once told me. You just get to your next destination (deadline) and then you do it again and again. But I would hope you'll take the time to read this week's Post column, on why Canada needs to either lower its expectations, or accept that we can't be half sovereign in matters of our own defence and security, and that very much includes on matters of public health. If the latter, we're going to need to spend some money. Noting the polite refusal of the Biden White House to share vaccine with Canada and Mexico before the U.S. campaign is complete (a decision I'm entirely OK with, as it's the only responsible decision Mr. Biden could make), I wrote, "It’s not that our overriding assumption underpinning so much of our national policy — the Americans will defend us! — is wrong, exactly. It’s just that that defence might not take the form we would like, or that we might have to wait for the help to come. And the wait could be painful."
Over at TVO.org, on Monday, I observed that the outlook on vaccine was improving for Canada. (As noted above, it improved more as the week went on.) Ontario needs to be damn ready so that we don't have them piling up in freezers, I wrote. It's time to get ready for the busy time to come. Please read that here.
I planned on writing more about vaccines for TVO.org to end the week, but an unfortunate, ahem, essay in the Globe and Mail took me down a different path. Instead, I wrote about a year of living during a pandemic, how we remember historical tragedies, and what we can — and should not! — draw from our past as we combat and analyze this very difficult last year for us all. Read that here.
And as always, you can hear me every weekday morning from 10-12 Eastern on SiriusXM's Canada Talks, channel 167. (Except today, which I took off to handle some family stuff.)
That's it for this week, folks. Thanks for this. Have a wonderful weekend and we'll talk again soon.
mgurney.responses@gmail.com
Twitter.com/MattGurney