The Shattered Mirror: FAQ

The Public Policy Forum report looks at the state of a much weaker news media in a very different environment, severely disrupted by the digital age. For an overview of its key points and recommendations, read on.

THE SHATTERED MIRROR is the first major study of the state of the news media in Canada since milestone reports by Senator Keith Davey and Tom Kent in the 1970s and 1980s, as well as a Senate report in 2006, all of which were concerned about the concentration of ownership and its dangers.

This Public Policy Forum (PPF) report looks at the state of a much weaker news media in a very different environment, severely disrupted by the digital age. It is a forward-looking report, making 12 bold and specific recommendations that address two broad, key questions:

• Does the news media, and particularly the civic function of journalism — the coverage of the public institutions, public affairs and communities — need support?
• If so, how can we ensure it does not lock in privilege and stifle innovation, and how can accountability and commonweal be safeguarded without compromising the independence of the media?

FAQ

1. What should be the role of public policy in Canada’s news crisis?

“The question for Canadian policy-makers is not whether given news outlets are in trouble, but whether democracy itself has been placed at risk in the process,” states The Shattered Mirror. “To the extent public policy has a role to play, it should be focused on maintaining the flow of information essential to a healthy society and ensuring the development of the digital arteries of the new information system — not preserving the press as we know it. The digital revolution is real, but with it have arisen challenges: fragmentation, distortion and adjusting to new business and storytelling models.”

2. How does the rise of dominant digital platforms challenge democracy?

“Platforms, with daily audiences 10 times larger than those of major newspapers or TV broadcasters, are not just the new intermediaries of the public square but control the commanding heights of the marketplace of ideas,” the report says. “Their models are based on truth neutrality. Moreover, they only give the appearance of being a common space. Rather, they calculate and reinforce the prejudices of the like-minded, who either assign themselves to echo chambers or find themselves invisibly assigned by algorithms into filter bubbles. Both run counter to the concept of the media as an agent of common understanding.”

The dominance of Google and Facebook delivers another blow to Canada’s main providers of news: The loss of revenue with which to fund quality journalism at scale. “They pocket two of every three digital ad dollars spent in Canada and, in recent months, have generated 82 percent of the ads served up with digital news.”

“Google’s share of the Canadian digital market is almost 10 times that of the daily newspaper industry and 60 times that of community newspapers. A comparison of digital revenues for all newspapers and TV programs shows they bring in about one-seventh of the total of the two U.S. platform giants.”

3. Are new players filling the gap left by declining traditional news giants?

After nearly 15 years of digital news development in Canada, “we simply do not have a digital ecosystem in waiting that will be able to replace, at scale, the reckoning that is clearly coming in the traditional media space,” said University of British Columbia journalism professor Taylor Owen, a PPF research principal on this study. Despite a number of digital-only outlets doing admirable journalism, they are tiny in comparison with the traditional news outlets.

4. What has happened to news outlets and journalists as ad revenues decline?

“Since 2010, there have been 225 weekly and 27 daily newspapers lost to closure or merger in more than 210 federal ridings.” Small market TV stations have closed and many others, like surviving newspapers, have cut service and journalistic staff. Information supplied by Canada’s main media unions points to an estimated 30 percent reduction in journalism jobs since 2010.

5. How much of a factor is fake news in the current news crisis?

Canadians responding to a poll undertaken by Earnscliffe Strategy Group for this study “were very aware that ‘a lot of bogus and untrue news and information appears online’ (83 percent) and that ‘getting news from friends and through social media is alright, but sometimes I want news from organizations and journalists that I know’ (80 percent). Whereas seven out of 10 respondents completely or mostly trust their newspapers, radio and television, the figure drops to 15 percent for news acquired via social media.”

As chronicled by Craig Silverman, media editor of BuzzFeed, false news stories in the United States began to spike in August after the firing of Facebook editors, on top of the downgrading of material posted by established news organizations (the bitterness of the campaign and beginning of voting could have been factors as well). Between August and election day in November, stories from hyper-partisan and hoax sources actually pulled ahead of real news, registering 8.7 million acts of engagement versus 7.4 million, sparking a controversy that shook confidence in the Internet and its largest purveyors of information.

6. Do Canadians trust news?

Canadians trust news from traditional sources, no matter the platform: 69 percent of Canadians “completely” or “mostly” trust television news, 70 percent trust radio, 66 percent trust newspapers and magazines — and 65 percent trust news on the websites of newspaper, TV and radio outlets. The level of trust drops to 34 percent for online news organizations such as Huffington Post or Reddit and to 15 percent for news on social media.

Moreover, Canadians place so much value in trustworthy news that three-quarters of those polled said democracy would be threatened if news from TV, radio and newspapers disappeared.

7. In brief, what are the recommendations and what problems do they aim to improve?

The Public Policy Forum suggests that the Government of Canada adopt a dual action plan that targets the media’s economic straits as well as bolsters the supply of the civic-function news upon which the public depends.

This plan’s most prominent features include:

• A change to federal tax law that would level the playing field for Canadian companies
• A marked increase in the supply to Canadians of local and regional reporting, achieved

1. by creating a special branch of Canadian Press;
2. by making the (publicly supported) CBC’s online coverage available for publication by all news outlets;
3. by the establishment of a special fund to foster civic-function journalism and innovation in digital news; and
4. to promote research on the relationship between news and democracy

In all, the PFF recommends 12 actions on the part of government:

The first five are designed to improve the economic landscape:

1. Extend sections 19 and 19.1 of the Income Tax Act both to Internet advertising and to news organizations in Canada producing news primarily for Canadians.
2. Apply the GST/HST to all revenue from digital news subscriptions and advertising earned in Canada by companies that do not qualify under the new Section 19 criteria, and rebate the tax for those that do qualify.
3. Remove measures that inhibit the sort of philanthropic support for civic-function journalism seen in the United States.
4. Review the Copyright Act’s fair dealing rules and increase the control those who create news content have over what happens to their intellectual property.
5. Establish a Future of Journalism & Democracy Fund, an independent agency that will invest in digital-news innovation and civic-function journalism, with a special emphasis on early-stage, local, as well as Indigenous, news operations. It also will finance ongoing research into the relationship between news and democracy.

The remaining seven recommendations are measures to enhance and safeguard the supply of quality news:

1. Launch a service that provides much-needed legal advice to smaller outlets providing investigative and accountability journalism.
2. Draft a mandate for Canadian Press to create a dedicated service that supplements the waning coverage of civic-function news on a local and regional basis and to ensure that this news is widely available.
3. Launch, in keeping with a new era of reconciliation, self-government and nation-to-nation relations, a special initiative to augment and enhance coverage of Indigenous affairs.
4. Establish a permanent research institute (see recommendation 5) to study the impact of news on the state of Canadian democracy.
5. Help the CBC better fulfil the stipulation in its mandate’s to “inform” as well as “enlighten” and “entertain” the people of Canada.
6. Relieve the CBC of the need to sell online advertising in order to promote production of civic-function journalism over chasing clicks.
7. Apply digital-age thinking to public broadcasting by having the CBC publish its online content under a Creative Commons licence, which would allow other publishers to reprint it freely (with proper credit) and transform the public broadcaster from a competitor into a universal provider of quality journalism.

Read the full report and detailed recommendations at shatteredmirror.ca