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Read this: The Cairncross Conundrum

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The Cairncross Conundrum…

BBC sounds music Radio podcasts and this is the media show from BBC Radio 4 it's a Conundrum at the heart of the news business demand for new users never been higher get the number of people prepared to pay for it is at an all-time low so without any money.

How do you fund Jones that's a question that Govern ask Dame Frances cairncross to answer a reviews we publish this week and she's one about yesterday Francis good to see you are also join us live today.

Jane martinson is a professor at city university department of journalism and a columnist for the Guardian Daniel ionescu, who is the publisher of to regional titles in East Anglia the Lincolnite and Lincolnshire reporter Paul Staines is best known as the man behind website guido Fawkes I walk Anglo is the president of condie nast international having previously been at Deeside and the Guardian Wolfgang are we gonna talk about the grim realities of the news business papers closing down advertising revenues drying up.

Yeah, I read this month's you're launching a new magazine.

Relaunching wired Middle East yes and we are launching Vogue Greece soon and will launching boat Hong Kong have lunch about Poland to guess we launch new magazines.

I mean how many of these are print publications the all print applications and social and web of coaching business which is a digital babacad is additionally product and dad is more geared towards the business community which is global by nature if you launch a small passionately believe in London you have to think global from Day 2 on ok.

See you going to try and persuade as the future's Roses it's going to be fun and interest will come back to you shortly.

Let's return to our big question today Dame Frances cairncross your report then the King Cross have you a sustainable future Fortunes and has published yesterday 157 pages months of research your aim was to advocate measures to ensure an efficient market in use and defend those bits of the industry that promote democracy before I was the others let me ask you have you succeeded pretty hello for a very long time.

When will you know why I suppose I might need five years time but it was very hard to know what would have happened without the things that I've suggested.

I haven't made it clear in the report that I don't think that's newspapers.

Declining in weed in leadership and that local papers in particular will continues disappear.

I'd like to see most of all because it was the thing that be emphasized again and again in the review and is what we call public interest news the news about how democracy works which are published here in a veterinary day reporting into the news industry of which they have been a few and what's your reaction to Frances recommendations.

I mean it's incredibly detailed 257 pages lots of different things to discuss nine very detailed recommendations about different.

Various everybody is looking at the duopoly online advertising and batumi what striking and is the heart of the report is the market failure the extent of market failure for high quality local news if you think the historic Lee an industry.

That has heated any sense of government control is actually being asked to consider and there's been no massive reaction against the idea of Direct funding from the government.

That's pretty incredible and it's a sign of the market failure that we've witnessed.

Look at the local level titles all about good afternoon with the company.

I run is called stumble media and we have to local news websites in Lincolnshire in the Midlands one of them is called the Lincolnite and we cover quite a granular lead the city of Lincoln and the other one is called Lincolnshire reporter where we take a wider view on the big news across our county ok, and how many readers you have a we have over half a million monthly.

Readers across both our websites again, how many staff roughly do you have how big is your operation and there's 8 full-time staff in total and do you make money and yes, we are sustainable company to how much manager mate? That's not something.

I'm ready to disclose on there, but enough to keep ourselves going this is our night if you're in business.

Ok? What's your reaction then to the recommendations in Dame Frances cairncross is review what there are a few key elements of the review which are you really welcome the proposal to lower the VAT rate for digital publications to zero as it is for print will definitely put independent digital publishers on an equal footing with the old print.

God even though that would be only a modest.

I am also glad the report agrees that statutory public notices are ineffective Direct subsidy for print publishers and in Lincolnshire alone that amounts to some 1 million pounds per year which is the equivalent of around.

What is that? So, can you explain that so so?

The last year we've done a freedom of information request to all the district and County Council and unitary authorities in Lincolnshire to find out how much do you have to pay and statutory notices the public notices for planning transport housing excetera that councils have to do and they have to pay print newspapers to do that and that equates to about 1 million pounds per year to the big to publishers operating in our region.

Ok? Is there anything that you would have liked to have seen in the king cross with you.

That wasn't there is anything that's annoyed you about it, but I wouldn't like to see is further Direct or indirect subsidies to the big for local publishers as they've been retreating form.

So many patches in order to maintain healthy profits.

So they left behind Communities which are now served by hundreds of independent mainly digital publication, so I think that funding and support should be given to small-scale news publishers to develop their operations basically there's an opportunity here to truly reboot local Media

And this country although the review doesn't always seem to fully acknowledged ok.

That's for that Francisco cross local democracy reporting service is one way of putting money into local reporting and maybe have noticed that the report does say that it should be reviewed to make sure that small papers startups digital operations are getting their share in this respect.

This is the lowest the BBC Pudsey reporters into a local papers and Daniel it's worth mentioning that Daniel's got two of those are ready yet.

Need good.

I'm glad to hear that unusual.

I think I'm being in having two of them.

That's great and secondly the Institute for public interest news that the reviews suggest is a body which would hope coordinator bring together all the different work that people are trying to do to support local papers.

Don't recognise your unusual in having those local reporters.

We are one of the very few independent publishers who have managed to say.

Definitely bid for the local democracy scheme we have two of them and they produced some 1000 stories from across the 13 authorities recover and we show that independent digital news outlets can make a significant contribution to local democracy Now many of the stories we would have covered anyway, but not to the wider scope as having to dedicated reporters right now although the consumer appetite for local democracy reporting.

It's probably not as high as some would assume that we put that if roses yeah, this is there no problem now that you can actually see who reads Watton for how long is possible to see that coverage of local councillors and of what little girl is get up to on the whole is not as popular as many of the other stories exactly who should give me to move on to pull States Daniel thanks the timing I'll come back to you shortly, but I do want to move on to this question of the market in news what there is demand for all your publisher of the guido Fawkes website I started by asking Daniel to explain what his.

Business model is that what she was well.

I guess Her hyperlocal website focused on SW1 Westminster we still have tizen we deal with the big advertising a website Google they probably just about cover the basic salary and what we get for men and we sell direct sales which is probably about 8 and I'll review and there's a lot of people who want to reach are all it's because our audiences small but runs the country and we get advertising and make profit chaos Jana dead of their reaction to the cake review what's your some interesting ideas, but one I particularly objected to was the idea that we have an institute of public Jones puppet interest news.

I'm going to skip over the idea of the public on interested in what you think is public interest news and say we do have a publicly funded body beginning billions.

That has a rationale that supposed to be about doing public interest news Gathering it's called the BBC why do we need another one? I didn't think the BBC has much experience in running newspapers and news at the kind of news.

Digital news sites are the local level does a Dying why are you trying to keep my life? I'm not making newspaper tonight.

I'm trying to keep local news alive.

That's very different BBC has 46 local radio stations, but they do a part of the reason you said you just call you came on the show you post on your blog the BBC Astarte finding a local democracy reporting service is the net as an admission that the BBC's part of the problem the BBC's lavish funding enables it to suck up the audience that otherwise would go to Independent news sources that undermining their viability weapons be up for that.

I live in Ireland and RTE has a similar model for BBC lot smaller it gets a licence fee and but it doesn't have 46 local radio stations and there are a thriving local newspapers.

I know I think there's relationship between not having a local news source that crowds out the commercial sector which is what I think local radios doing for the ins.

Sink counter view that of Enders analysis was the government's green paper on charge when you asked whether the BBC news is crowding out commercial new supplies and if so whether this is Justified our research shows that UK newspaper publishers have been damaged by the internet their face inherent challenges in monetizing online audiences in common with other news publishers to be blunt the BBC plays no role in exactly challenges the BBC has the most popular website for news in the country, and it does local reporting and one of our recommendations one of the reviews recommendations was the off, should take a look at the accusations that the BBC is credit card other other nuisance organisations, can I can I just say I mean one big argument against this it's the BBC that does he know those killed local news quality high quality.

Local news is America the number of newspapers that have they have also have local news in America has halved so it's digital advertising that has crucified is taken away the biggest way that these organisations are funded.

And every time there has been an early if you've recommended another review that they did the charter review directly looked at market impact of the BBC which then led to the local democracy scheme so it's somebody isn't always BBC porn it can't protect my second objection to the BBC's expansion into local news is that it's quite dangerous to have a monolithic news source that we have the BBC it's 76% of news on radio is BBC Top 46 percent.

I think something like that was online is BBC News if we end up with a monoculture of BBC News dominating our Society completely that's tamar's with the rock and yet Frances cairncross rights in the review from this reviews perspective containing the BBC's news offering would be counterproductive my Francis because the BBC is very good at producing the kind of public interest news that seems to us beneficial to the country are beavers create your website uses it.

In a different form a completely different forms of indifference standpoint, but if you look at it if you look at some of the other newspapers was very little of it.

I think I think the unpopular press always something popular on Pinterest news and the popular press the tabloid newspapers.

Don't do puppies Shih Tzus but that's not true.

That's the kind of elitist top-down kind of BBC World viewport.

Do you think there is some news that the market cannot and has not provided which they should be a role for a public service organisation to step in and provide anything.

I do think I would something I seem to know Pete in America and quite a big way is dinner tropic support for news Gathering also over here.

You have Greenpeace funding doing the Guardian for incident in hit jobs on big oil, so there is a different model for at 8.

I just wanna come back to the question about whether or not you think all that there is some types of journalism public interest is France can cross recording that the market has not provided and cannot provide to speak with Pinterest Pinterest you know you've made a microscope interesting that you use the Arts Council as your analogue the Arts Council takes money from all of us to go to the opera and spend it all on the Opera that's what you're doing for new that's what you're proposing to for news and I've cancelled that most people don't care about prosecco cross-eyed people don't read it's true as a problem with public interest.

Do you spell one of the reasons for supporting? It is not whether people read it or not, but whether it has an impact on.

How local authorities around and the evidence from the United States strongly suggests that if you don't have local reporters following what local government darts you get worse local government that Daniel Craig Daniel Ryan again.

Sorry to

Ring you in on this specific point about were not the BBC is having an impact on you.

What's your senses as Paul stairs mentions there are lots of BBC local services huge amount is the BBC's online Rachel Community Radio reach affecting your business well.

Not necessarily.

I'm currently speaking from our the office of our good friends at BBC Radio Lincolnshire which I just have Hill are you reading about the BBC got working for you and someone else presents on the BBC is the key element of fair sharing between all the partners in the project.

So you see even if report has employed by us through the BBC scheme produce the stories and we stop them and we give it to tauriel guidance they all go out on a clothes dryers with partners before with partner seeing them before they are published on our website.

So they have time to react and here lies one of my criticism with scheme such as the

One from Facebook with their community reporters initiative that has been done behind closed doors with the big for local publishers and none of the content will be shared across the board similarly the millions Google put fluids digital news innovation fund benefited only the bed winners rather than the wider ecosystem, and that's just one of the floors that identified with that particular package.

I want to come onto the take somebody said something to entertain and then I will bring Wolfgang things Daniel mentioned the big four and I know Paul the idea that the BBC is this what a bogeyman and listen you know the publishers.

I know the publishing industry is always said it's the BBC's fault as crowded as house, but the fact is the big for local newspaper publishers were earning profit margins of 35% and they slashed journalist.

There are thousands of Dollars out of jobs.

They stopped reporting on local democracy on things that mattered on the ground we were they call it public interest or not.

It's a democratic deficit if it isn't written about brother don't give it.

Just a those big Uno advert.

Size of funded groups that actually managed just to give their money to their shareholders and pretty much all local newspaper groups were making profits and were as you say we make a profit margins for tea is good for years.

That's that's been a large part of the problem was going to buy you expect you about your career in Germany you've worked at the Guardian out Conde nast international.

Where do you stand on the principle that there are certain types of journals in which are good for democracy, but which the market has not provided and cannot provide and therefore this Republic subs completely agree with that.

I've always been a staunch supporter of of the idea of public broadcasting.

I want to say a few words about this this review This industry review of course.

I'm applied the intention and I see it has been a huge amount of work, but I have to say it reminds me of these many journalism conferences if you never touch the newspaper and will try to understand what a newspaper is only bass.

Somewhat you hear a journalism conferences are what you reading these reviews you would think every newspaper up until recently has been filled with investigative accountability reporting page 1 to page 1 or Saturday for about three decades as a genus including at your for our march of the Guardian so I don't think it's going to be France I can speak for herself, but she's coming through is is already a preemptive nostalgia about how wonderful and democratically relevant newspapers were as a juror which has simply don't agree with similar the issue of fake news on so-called fake news on social media platforms.

I don't increasingly don't find as dangerous as the issue of fake news on established news organisations mean.

We might not consider the Daily Express in the newspaper to to reckon with look at their social footprint.

Look at how they are framing of perception of the United Kingdom internationally due to their size and their enormous Facebook following so that's that's an element.

I'm missing.

There are many things to like about where I'm challenge the most is a find many of the practical suggestions to be impractical for instance a commitment by the search engines to index only a certain amount of publishers content we are now that we spend a huge amount of money on optimising or software of our site and on training our editors to maximize the amount of stories that are being indexed.

I don't understand what that means a commitment from platforms not to impose their own advertising software.

I understand that's an issue with m.

These are simply suggestions of issues that the platforms and the publishers might wish to reach an agreement that do not realistic in in Indiana will be there.

They will know what happened to be a third party ad server simply loan.

Won't load fast enough so you have a fast loading page and no ads because you use something other than than Google dfp.

A pleasure to work collaboratively with publishers in determining how news content is.

Did on their platforms that carries the assumption that the platforms are there to carry media content we are just guests in a social ecosystem, and there's is egocentricity of publishers and how they deal with the platforms that doesn't help and I think the biggest risk for for journalism in for the media industry is our own complacency and in our attempts towards bringing back the good old advertising business if we can only time or break up Facebook and WhatsApp and what have you there is no return of the advertising business and dad is an underlying assumption.

I think is missing person directly well.

I won't I won't do a lot of them, but everyone is the sense that this is unrealistic because it is assumes a certain situation exists.

I don't assume.

This is going to continue to fit the situation in five years time.

I think one of the huge problems is that this is an industry which is in the throes of tremendous transition we don't know where it's going to go all as I think he's really important is that?

Continues somewhere to report on the the areas which are important for the survival of a healthy democracy.

Don't let step away from the practical Solutions the idea of a publicly funded institutions deciding what is a credible source and what is not is probably the the the biggest issue.

I have with this report.

I do not want the government away government funded institution to decide what is credible and what is not not only for reasons of fat bastard not something reviewers recommended there are various areas where there have been to that.

There are some suggestions about things that might be part of a conversation, but the recommendations are not trying to say or do you just came to really not the advertising is crucial to your business you in the World magazine culture sector yesterday now.

It's at the competition and markets authority will investigate where the Google and Facebook are two dominant in advertising that follows a recommendation that Frances cairncross made are there any of you?

Pseudomonas is gonna come back to that finds a news quality application.

How are you enforcing a quality application without deciding? What is quality asking the platforms to say what they are doing to make sure that people see what they judge to be good quality news for happy to have them platform is happy to see that forms change it to be and don't say don't see so much news that is misleading miss misinformed.

It's a very it's a very difficult one to call back for making the decision or what is some initially refund identity making the initial initial e the platform with the make a phone case of Facebook? School cameras are these companies to dominate in advertising do we want them to be making editorial decision to that kind we want them to have a discussion with a regulator about what they're trying to do and why they're trying to do it we don't want to do is an isolation.

That's that's what?

Call stegs you not think the consequence of her asking the platforms to regulate themselves an editorial will mean I just think this is too expensive to convey that we can get out of it and Zuckerberg has basically retreated a lot of from District news on on Facebook if you out of them at the pizza age is programming head for instant publishing for our publishers because it was just too much hassle you going to do is take away a key distribution mechanism for publishers.

Well that depends how fiercely that whole provision is interpreted really I've been quite careful and most of the press attacked me for not being fierce enough trying to demand this on that from the from the platforms in the way that happened in Germany that didn't seem to me to be very sensible we're going forward but I think this is this is the most difficult part of what I was trying to do trying to get.

The platforms to consider that they had some sort of responsibility for the quality of what appeared on their sites.

It's a beginning.

It's not an easy option, but it's beginning to think on the difficulties here which walking has tops 12 is trying to find an answer and where I think it would have been good to see that there is stuff in it about the young the innovation fund I think the difficulty is trying to look out what happened in the past which is gone and not being able to see what the future is an trying to get there will never tablets in a public subsidy.

Is it as I said at the front you know it's at the idea that public subsidies sort of leading to news coverage is such a difficult one when historic Lee entire industry has been church and state so we need to sort of work out a way of making sure that you know the public isn't missing forms that says that's a big recruiting.

We can't talk about the largest the largest funding measures recommendation is actually getting rid of VAT on digital applications.

That's the biggest fan that that handed out across the board of publication 3232 where I mean local press a lot of it free.

There is no VAT charged to the consumer.

Is that you know business about but I don't see what difference I make well.

I think it would make any difference to any difference will make a big difference to them.

They do not ask for game at magazines got the invoice magazines need to be heard in this was almost futurism should talk about future magazines at Wincanton has Britain won last year from 6.6 million lb profit to a 40mm lost that included some exceptional expenditures the attitude may be in one off but you did have a decline of 6.6% in your revenues.

That's that's a lot of people like terminal decline do we need a kick out of you looking the future of magazines the entire separation between

News publishers in magazine publishers in the digital space makes very little sense, I'm just coming back from Italy where we announced a new chief editor of Vanity Fair which is a weekly publication.

They are filling a void that bed ladder public eye has left behind with political journalism, so that separation that I think is outdated digitally of course.

I'm about the numbers you mentioned are coming last international as a group has been highly profitable again in 2018 so of course we are not exempt from what is happening to newspapers, but they are countries with magazines are doing well.

If they have a clear brand of the up-market answer for the full support to make live for those who don't know Condon s.

International is different condenast the American company sister company and your launching is magazine called Vogue business is the fact that its launching digital-only imply that the distribution and production costs of glossy magazine to becoming untenable.

No, it is relaunching this digitally because that's how we develop products were not ruling out that one day.

We might not have a print version of it, but this is a global product from the start this as readers around the world currently in 42 countries.

I will do business.

Have a type of critical journeys with a fashion world that normal fashion magazines such as Vogue may not so can you see 2000 words of o business criticising some advertised at your dependent on absolutely Rizzoli and Isles I want to say that this is this is important to pay tribute to what the magazines have been doing if you look at other magazines are covering issues of racial diversity.

How they are covering issues of climate change how they are covering issues of slavery in the textile industry that they might be this perception that that doesn't fit a glossy magazine if you look how Edward enninful has position British Vogue you find these issues in the magazine have to pull you got person large print edition anytime soon.

I think we did it once just for fun and we gave away for free.

It wasn't a good model.

Why when you do it for commercial reasons.

The regulators and liver when is not remember when I always think in his lot with his two week out of date moves, you know I feel sorry for being a magazine Still Breathing if you would you got a 45 second White Wedding do you suggest that publishes conjoined you negotiate with the platforms because that's what we need and that's not in there.

We didn't do it because when we discussed it and see who has seen them in the report and it was the publishers were very keen to being allowed to sit down together and negotiate in order to be paid person from this with that is that if you have a regulator behind them the reggae.

You can't decide on WhatsApp a proper commercial return for a particular piece of copy very difficult for a regulated coming to a pricing discussion about kind the other was just what happened in Germany and in Spain when they have been attempted and out where they pulled out and they were treated just as good as usual Paradise

Sorry, but you have to leave it.

It's so annoying at after which the show is much longer has the I'm sure how many volunteers at James Martin Dame Frances cairncross Wolfgang Paul stainsby known as good afternoon.

It's beautiful and Daniel ionescu.

Thank you very much indeed for your time and thanks to all of you for listening at home.

We're back at the same time next week for 30 on Wednesday thanks for listening and goodbye.

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