Tag Archives | FTC

FTC on “saving” journalism: Disaster waiting to happen

Lest you think your government works for you….

The FTC released a “discussion draft” document [PDF] this week that outlines some of the challenges facing the newspaper industry. It goes through through the motions of evaluating all these challenges as if the FTC’s role is to prop up the news business, and this is the first stab at testing the waters.

Let’s be clear, starting off. The Federal Trade Commission is responsible for promoting trade and preventing anti-competitive trusts. Nowhere that I see does its mission include “saving journalism.”

Indeed, the doctrine of freedom of the press should prevent government from talking about this topic at all. But we’ll get to that.

Jeff Jarvis goes into some nice detail about how stupid the perspective on this project is — the FTC is writing about newspapers, as if newspapers represent journalism. So let’s also be clear that “newspapers,” the “news industry” and “journalism” are not necessarily the same thing. Journalism is primarily [but not completely] what we’re talking about when we talk about “freedom of the press.” We mean the investigating, reporting and dissemination of information to the public by independent and varied voices, outside the official government channel. We mean analysis and opinion about what government and industry and other forces in our society are doing. We mean investigation into practices that seem corrupt or detrimental to the public good.

Nowhere in any of that is it required that the practice of journalism be carried out by major corporations using newsprint. Journalism is platform-agnostic. Information can be — and today is — shared over multiple platforms.

I’m sure that the Gannett and other big news corporations would like for all of us to care about their corporate health, but my interest as a citizen is whether or not I can get information. And I can. And I haven’t taken a daily paper in years.

Now, there’s a side issue here that the FTC doesn’t appear to have the broadest perspective on, but I’ll mention just briefly. Jarvis talks a lot [not just in this post] about the disruptive technology and practices happening today in journalism. He’s positive about the disruption, as am I. But while we often assume that technology created the disruption, with the Internet putting publishing tools in the hands of the masses and therefore disrupting the news industry’s traditional business model, I think the technology opened a window near the door the news industry had been forcing shut.

When the news industry owned the means of news dissemination, it chose what to publish. And it chose what to ignore, cover up or devalue. And it turns out that disruptive technology has revealed that we as a public care about a lot of things that the news industry doesn’t want us to care about. If they’d been doing their job, it would have been a lot harder for the Internet to shake up the news industry the way it did.

But the FTC is not concerned about journalism, whatever it happens to say about that. It is concerned about the commerce of news. And it’s here that I think the FTC really goes off the rails.

Because if the FTC wants to ensure the survival of the news industry, it [of all people!] needs to recognize that competition fosters better competitors — and newspapers sure as hell could have used better competitors. So when we look at the changes happening in journalism today, we should all be excited. The technology that allows anyone to publish is creating a vibrant practice of journalism, some of which is also the foundation of new ways of practicing the news business.

The State of the News
The FTC’s document begins with 18 statements about the “current state of the news,” which cracks me up. Again, they’re talking about the news industry, not journalism. I won’t respond to each but I must bring a few to your attention:

3. They mention the dramatic decline in classified advertising revenues since 2000. Well, duh. We found out there’s a lot easier way to sell our unused treadmills than placing a tweet-length ad in a newspaper. Newspapers aren’t the best vehicle for most classified ads, so they shouldn’t be there anymore.

4. Advertisers don’t have to depend on newspapers to reach their customers anymore.
Well, since 1950 or so, they haven’t depended on newspapers, but it’s true that the Internet removes many more barriers between marketers and customers. This is a good thing. Until the Internet became popular, the owners of the printing press and the TV studios also owned your relationship with your customers. Now you and your customers own that relationship.

There’s also a lot of discussion about declining ad revenues overall and cutting staff, and the resulting change in news coverage. Here’s where the FTC starts thinking about the whole public-good aspect of this. They’re making the false assumption that if major news corporation aren’t employing millions of journalists, then the public isn’t being served with information that we need to support a free society.

Let me just say that I’m being served with plenty of information on a daily basis. More than I can handle. Do I have enough? Probably not. I could use even more hyper-local news than I actually get, honestly. But hyper-local is going to sort itself out and come up with a thousand different revenue models, only some of which may seem akin to our traditional concept of advertising-supported journalism.

I do think we should be concerned about national and international journalism, because these endeavors are expensive. It costs a lot of money to mount an investigative report into the corrupt practices of a federal agency, or to fly all over the world with the president, or to figure out how environmental disasters in the Amazon are affecting both the local population and the rest of the world. That’s worth talking about, how we sustain that kind of journalism. That’s really not discussed in this document, though. [Nor do I think the FTC should discuss it — but as a society we ought to be really talking about that.]

But overall this document is thinking about the daily local newspaper perspective, and it’s awfully shortsighted by doing that.

I’ve got to quote all of their 18th item, because I was just flabbergasted at the hubris:

18. In sum, newspapers have not yet found a new, sustainable business model, and there is reason for concern that such a business model may not emerge. Therefore, it is not too soon to start considering policies that might encourage innovations to help support journalism into the future.

Dear God, if you’re at all concerned about the future of journalism and that doesn’t have you running for your pitchfork, I don’t know what will. The last thing journalism needs is for the government to “support” it. It’s the surest way to kill the practice.

Copyright and Fair Use

The document also spends quite a bit of space talking about copyright issues. The authors do seem to recognize that the news industry really depends on the doctrine of fair use — the legal doctrine that allows the re-use of copyrighted material in certain situations when journalism requires it. I think most of the conversation in this section ranges from pretty absurd to dangerous, though. They talk about the “hot news doctrine” — established in a 1918 court case — under which some state laws still consider facts themselves as protected for a limited time period [a doctrine much-beloved by people like the AP and no doubt Major League Baseball and the Southeastern Conference, both of which have tried a heavy-handed approach to the management of information like answers to the question, “Who’s winning the game?” in the age of disruptive technology]. Federally, facts are not protected by copyright — just the way they are expressed [your actual video, article, etc.].

Some in the news industry dispute the fair use of information by search engines, like Rupert Murdoch pulling News Corp.’s content out of Google.

Here’s the intersection — no, the train wreck — of journalism and the news business. The news business puts a dollar value on information, but journalism wants to disseminate it as broadly as possible. Journalism wants credit, but more than anything, it wants you to know. We don’t live in Utopia, so money is a reality. But any “news” operation that goes around trying to limit access to its content is showing its hand, and [oxymoronically] devaluing its content. Its content is a factor of commerce, not journalism.

I don’t see how there’s a role for government here at all, really, but it’s an interesting discussion.

One problem with copyright law — as essential as it often appears to be to facilitate commerce in the creative industries — is that its consequences are poorly understood by the government and legal entities that create and sustain it. Copyright by definition stifles innovation for a period of time. The music industry has really had trouble wrapping its brain around this, and we’ve all seen the dramatic disruptions that continue to happen there. Laughably, the FTC document actually floats the idea of a music-industry-like copyright bureau to help “sustain” the news industry. Laughable if it weren’t so terrifying.

Because here’s where we get to a basic problem with most of the “solutions” proposed by this discussion: They all involve government certification of “journalism.”

The solutions range from increased postal subsidies to tech subsidies to copyright registries — all of which would be administered and doled out by Uncle Sam. You know what that means, right? Uncle Sam would get to decide who is and who isn’t a journalist. Thus abridging the freedom of the press. Which isn’t allowed. Thank goodness and James Madison.

So I’m hopeful that at best, this is an exercise in wasted time. But it could easily be an exercise in unintended censorship, years of litigation and a muted press.

Save journalism. Tell the FTC to quit overreaching.

Jeff Jarvis puts it nicely: “Get off our lawn.”

P.S. If the FTC would like to do something truly useful, I respectfully suggest it consider the plight of millions of Americans without reliable, affordable access to modern tools of communication, those hobbled by poor investment in local technology infrastructure and hamstrung by technology monopolies that drive up prices and drive down adoption. Fix the rural broadband problem. That would be a real aid to trade nationwide.

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Why the FTC's guidance about blogging product reviews is wrong

Today, the Federal Trade Commission issued new guidance about product reviews on blogs and on testimonials in advertising. The rules are scheduled to go into effect Dec. 1, 2009, and they have disaster written all over them.

I’m going to be writing here as if I thought the FTC really had a role in this area, even though I largely don’t. But even if we accept the FTC’s role as proper, we’re left with some big questions [that apparently didn’t occur to the FTC]:

  • How is a blogging reviewer different from a print-publication reviewer?
  • Why is the FTC issuing guidance on a largely journalistic matter [blog reviews] in conjunction with guidance on an advertising matter [the use of endorsements/testimonials in ads]?
  • What happens when a newspaper or magazine writer wants to blog about a book or product the publication received?

Michael Hyatt posted this link on Twitter, and it’s a great summary of a lot that’s wrong with the FTC legislation.

My big complaint here is that [as I said recently about the privacy legislation rumored to be coming in Congress] the FTC doesn’t actually have a clue what it’s talking about. Check out the interview with the FTC’s Richard Cleland and you’ll see exactly what I’m talking about. The FTC is assuming that say, a book sent to a newspaper writer and a book sent to a blogger come to fundamentally different ends [both the physical book, and the review that results from it]. They seem to think that somehow, providing a review copy to a blogger will more predispose that person to writing a favorable review than would the same publisher providing a review copy to a printed publication.

It would be laughable if it weren’t so serious.

Hey, FTC. Let me catch you up on a couple of realities. I’ve worked in both print and online media over the last 20 years, and I can explain this pretty easily.

1. Publisher sends a book, CD, whatever to publications and bloggers.
2. Sometimes, people in the mailroom, or the blogger, say, Hey, cool! A free book! That’s the end of that.
2a. Sometimes, the writer at the publication or the blogger looks at the book and says, What a waste of paper! and tosses it in the recycle bin. And that’s the end of that.
2b. Sometimes, the writer [print or blog] actually reads the book and writes up a review. I can assure you that at no time does the writer ever say, Well, that book sucked, but they did send it for free, so I’ll give it 3 stars instead of 1. Writers are a pretty cynical lot.
3. The book comes to one of two or three ends, generally: It gets donated in a large lot to the writer’s favorite charity, often after collecting dust for years on the writer’s shelf. Or maybe it gets sold on eBay. Or perhaps the print writer hands it to an assistant who, in turn, probably sells it on eBay.

Some serious outcomes here that I think are ripe for a court case — if not a favorable court decision. [Please, do not assume the courts are any savvier than the FTC or Congress.] Why is the FTC treating bloggers different from print journalists? I don’t think there’s sound reasoning behind that.

And if bloggers can be considered journalists, wouldn’t they be afforded the same First Amendment protections that presumably have kept the FTC from ever attempting to regulate printed product reviews?

I have more thoughts, but I’ll stop here for now. We’ll see what else happens over the next few days.

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Critical guidance issued by the FTC

The Federal Trade Commission today announced that it’s issued revised guidance on a couple of issues critical to the online world:

  • Product reviews/endorsements by bloggers
  • Testimonials in advertising/Celebrity endorsements

These issues are tightly related in some ways. I’m still reading all in the info out there this morning, but I’ll have a much longer post up tonight or tomorrow.

My short thought: It’s not a good regulation or a fair one for several reasons.

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