On June 22, the Apple Daily, one of Taiwan’s major Chinese-language newspapers, announced that it would lay off 140 employees, saying that “although online news subscriptions are still new to Taiwan, and people do not tend to subscribe, we will continue to promote the subscription system and improve our service to provide paying subscribers a better experience and a diverse selection of value-added services.”
Less than 10 days later, the newspaper announced that it would resume free online access from Wednesday last week.
Subscriptions are regarded as one solution to the news industry’s financial problems. The idea is to turn loyal readers into subscribers and use this new source of revenue to make up for funds lost from traditional advertising.
However, social media and mobile devices have created an environment that gives users too many options, so when news groups try to recapture their customers, they are not only competing with other news companies, but also content producers on social media platforms. What should the news industry do to attract subscribers? Offer more violent or exciting news?
Even more damaging is that the money and time consumers could have spent on news are being divided among Web portals, social media platforms and telecoms. The result is a dead end, leading to a sharp decline in news subscribers and advertisers.
The remaining large news outlets can no longer survive solely on advertising and circulation — both at retail and through subscriptions. Instead, they have become gateways to a composite group of companies that collect data from users and use it to sell goods and services.
News companies cannot survive on merely producing news, and enterprise groups do not expect to make money from their news content.
Take Eastern Broadcasting Co (EBC) for example: Despite having more Facebook followers and unique visitors on its EBC News Web site than other news companies, its annual report for last year revealed that it suffered a NT$285 million (US$9.63 million) net loss.
The company outlined its plan for this year in the report, saying that it would “use the operational resources and advantages of new [not news] media, supplemented by offline physical channels and events ... to promote the integration of cross-platform advertising and marketing.”
The state of the media paints a pessimistic picture. With total dependence on market logic, even large news companies are no longer able to survive on their own.
It is not that there is no demand and that Taiwanese do not consume news. Instead, as the Taiwan Network Information Center revealed in last year’s Taiwan Internet Report, user demand for online news services is as high as 87.9 percent, second only to that of instant messaging at 94.8 percent. The difficulty is in finding ways to turn news into cash.
The free-market mechanism is increasingly detrimental to the survival of news organizations, and there seems to be no end in sight. As news companies are a cornerstone of democracy, it is unacceptable to simply sit back and let them fend for themselves.
Finding ways around the current market mechanisms to provide quality and diverse news content with greater reach — such as increasing the Public Television Service’s news viewership and creating a platform to improve the visibility of independent media — is becoming an increasingly important part of the urgent effort to maintain democracy.
Chang Yueh-han is an adjunct assistant professor in Shih Hsin University’s journalism department.
Translated by Lin Lee-kai
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