By Armchair Mayor

ROTHENBURGER: News media don’t need handouts; they need a new business model

Nov 24, 2018 | 4:00 AM

THE NEWS MEDIA are about to get help from the taxpayer — it’s help they neither deserve nor need.

Federal Finance Minister Bill Morneau this week announced $600 million over the next five years in tax credits and incentives that will “protect the vital role that independent news media play in our democracy.”

There’s no question about the vital role played by mainstream media. Despite an unprecedented skepticism and sometimes genuine dislike of the media by the public, a free and professional media has never been more important.

Since the demise of the Kamloops Daily News, there’s been a major gap in the community information stream. But the sad death of the KDN is only symptomatic of the general anemia afflicting media across the country.

Still, we get the media we want. If we don’t want to pay to have a daily newspaper delivered to our doorstep, the paper goes bust. If advertisers aren’t interested in buying air time on radio and TV, newsrooms are the first thing that gets cut.

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Big media organizations have been lobbying for the last few years to get help from the taxpayers.

But there’s another way for news consumers to put up their money — voluntarily instead of via the coercion of taxes — and all it needs is some legislative tweaking.

After the Daily News shuttered its doors four years ago, I wrote a business plan for a group who wanted to fire up a news website that would help fill the void. It’s easy to start a news site; it’s hard to sustain one.

Since then, several other sites have come on the scene and I’m convinced there will be a day of reckoning — not all will survive, those that remain may or may not thrive.

At the time, there was an obvious opening for a new player, but it needed broad community support starting with a fast uptake from orphaned KDN subscribers supplemented by the tech-savvy 35-and-under demographic.

There was hope in a brand-new business model that had quietly been implemented by the provincial government. It wasn’t widely known because for whatever reason the government didn’t promote it, and no media outlets used it.

It’s called CCC or C3 for Community Contribution Company. It was created as a hybrid social enterprise structure.

The vision for a new C3 media outlet in Kamloops included management by a board of directors with an editor/ manager and executive manager looking after day-to-day operation. The directors would provide oversight with advice from a community news board.

There were some similarities to a co-operative (there are quite a number of co-op news outlets) but there would have been some key advantages to the C3.

Shares would be sold, dividends issued, and all profits after costs directed into designated community charities.

A limit would be put on the number of shares held by any one individual, including directors, staff and community news board.

The idea was to give the community ownership of the news outlet in a very direct financial way, and to make it answerable to the community and dedicated to the community good. For 25 bucks, anyone could have owned a piece of the media.

And that news outlet would pay taxes instead of sucking them up.

Alas, the best-laid plans. Getting details of the C3 model was like pulling teeth but, in due course, it became evident it wasn’t feasible due to restrictions on the issuing of shares and on charitable status.

As is sometimes the case, a good idea has been bogged down by red tape. There are now only a couple of dozen C3s, and, as far as I know, still no C3 media companies in B.C..

Media co-ops are an option and have their place but they have significant challenges that can’t be met without a more advanced business model. Creating a variation of C3 designed specifically for media could fill the bill.

The point is, mainstream traditional media can still flourish if given the right tools. Paying for them on our tax bills isn’t necessary. The Conservative whining about the media becoming beholden to the party in power is just whining. Love it or hate it, CBC does quite well remaining independent of political influence.

That’s not the problem with taxation. The problem is with the principle of a subsidized media.

Morneau’s $600-million bailout doesn’t take effect until the next budget and until a panel of journalists has had its input. Maybe everyday people should have some say in this, too.

The media don’t need a handout; they need a new business model. That should be the focus of government action on this file, rather than the easy route of reaching into the wallets of taxpayers.

The U.K., which developed the Community Interest Company structure (the template for B.C.’s C3) has dabbled in using it in the news industry, so it can be done.

Since there isn’t a lot of money to be made in the news business any more, it may as well turn its focus away from making its owners rich, and become a social enterprise. That would not only allow it to continue the “vital role” mentioned by Morneau, but it just might restore its tarnished reputation.

And maybe even printed newspapers would make a comeback.

Mel Rothenburger is a former mayor of Kamloops and newspaper editor. He publishes the ArmchairMayor.ca opinion website, and is a director on the Thompson-Nicola Regional District board. He can be reached at mrothenburger@armchairmayor.ca.