Say what you want about Free Press. The media reform group is not afraid to launch long shot crusades on a dime. What's the latest? Expanding the government's commitment to public broadcasting, or as Free Press wants us to call it, "public media," given the extension of television and radio to the Web.
"There is no longer enough private capital—in the form of advertising, subscriptions, philanthropy and other sources—to support the depth and breadth of quality local, national and international news reporting that our communities need to participate in a 21st-century democracy," the latest call to arms insists (we get about three a week from them).
"In sum, the need has never been greater for a world-class public media system in America."
Well, maybe, but there are just a few gigantic hurdles to be overcome to get there.
Blurring the lines
First, the environment on Capitol Hill towards public media isn't as bad now as it was five years ago, when Congress tried to defund the Corporation for Public Broadcasting, but it's still pretty bad. There's the matter of a $1.3 trillion deficit with which to reckon.
And there's the even bigger question—what the heck is public media anyway? Is it that public radio station that tells you that this hour of All Things Considered was made possible by a generous grant from Megacorp and the D.H. Dunwoody Family Trust? Or that Friday night public television lineup that includes old classic movies you can rent for peanuts on Netflix or watch on the 'Net for nothing?
Free Press has heard these complaints a million times. Thanks to funding cuts, public TV and radio stations are "blurring the lines between public and commercial media," the report concedes. "Public broadcasters seeking more sustainable forms of income and have become increasingly reliant on support from corporate underwriters and character licensing."
Still, National Public Radio is one of the most popular services on the FM dial, the survey notes (not to mention your laptop and iPhone), with listening up at 20.9 million per week in 2009, while radio's overall audience is declining. That's a pretty fair accomplishment considering that the United States dishes out 1.43 public broadcasting dollars per capita, in contrast to Denmark and Finland, which annually allocate 70 and 80 times that sum.
Bottom line: one-third of journalism jobs have disappeared over the last decade. Newsweek, now up for sale, is the latest poster kid for the crisis. So the need to do something is urgent. "While we might imagine a future 20 years hence in which some new business model emerges to make up for what we're losing right now, the interim period may be marked by a potentially severe crisis in meeting the public’s information needs," the group warns.
We're confident that most of Free Press's funding proposals will draw howls of protest from many stakeholders, but that might not be such a bad thing. The actual prospects for most of these ideas are another matter. In any event, here goes:
Spectrum rent
When Congress passed the Public Broadcasting Act in 1967, the idea was to set up a system of financing for public TV and radio stations that protected it from the annual whims and rages of Capitol Hill. That never happened. Instead, the Corporation for Public Broadcasting receives a new allocation every two years—these days something in the neighborhood of $420 million per annum.
Free Press wants that number multiplied by a factor of five to ten, but more crucially, the group wants the funding to come from more predictable and less political sources. The first of these would be a license "spectrum usage fee" on broadcasters, who "should be treated like any other business that uses public resources," Free Press says. "They should pay rent for the spectrum they use." The money would go to a "public media trust fund."
The gist of the idea seems to be that since so many commercial broadcasters have largely abandoned any public service mission, such as meaningful coverage of their local area, they should pony up cash to those who will. Free Press's 20-year plan involves upping that annual revenue tithe from one to five percent over five years. Ninety percent of that money would be deposited in a trust fund for the first ten, the rest going to public stations themselves. On the eleventh year, all of the money would be directed to the fund.
"After the 20th year, the public media system would be solely supported by interest from the trust fund, and annual appropriations could be terminated," Free Press explains. Were this system launched now, the group estimates that public media would enjoy annual funding of $800 million in ten years, and an annual budget of $2.5 billion after 20.
Spectrum auctions
Another prospect is spectrum auction revenue—taking a cut of the money that the Federal Communications Commission raises from its spectrum sales and passing that over to public media. This would have been a sweet deal for public stations had it been in effect in 2008, when the Commission raised over $19.5 billion after selling off the 700MHz band. But as Free Press notes, it's a less reliable option now, since most of the spectrum has been sold.
Still, there is the possibility that the FCC's proposed plan to encourage TV broadcasters to relinquish some of their spectrum for the wireless industry might pan out. If it does, Free Press estimates that the process might fetch 111MHz of UHF band spectrum generating about $41.6 billion in revenue. The group proposes that about half of that go to a public media trust fund, generating about $1,078,566,131 for public media at an annual five percent interest rate.
Other scenarios include a tax on advertising revenue, the base of which Free Press "conservatively" estimates at $190 billion in 2010. But "opposition is sure to be powerful" to this proposal, the report acknowledges. So another approach would be to reduce the tax deduction that businesses can take on advertising expenses (100 percent at present) and siphon the treasury revenue gained from that shift to public media.
Finally, there's a BBC-style approach—a tax on consumer electronics devices. A one percent tithe on gadgets over a decade would produce sufficient cash for a $20 billion trust fund, able to fund public media at $1 billion a year.
Can it be done?
Free Press acknowledges the pervasive nervousness about expanding the government's role in media. But its not like Uncle Sam hasn't been involved in the media sector's furtherance over the last two centuries—creating a nationalized postal system with cheap distribution rates for newspapers, a copyright system that (originally) facilitated publishing by putting lots of content in the public domain, and setting up libel laws that protect newspapers from big brother. In fact, commercial broadcasters today already receive a huge government subsidy—their "must carry" right to be streamed on cable systems, worth billions to them.
And lots of other countries subsidize their media far more than does the US, the report notes, without any civic losses. The report cites The Economist magazine's Democracy Index as an example. Countries that rank far higher on the index than the US (which comes in at number 18) such as Denmark and Finland, also fund public media at much higher rates.
But the chances of any of this getting into a bill that reaches the White House's desk seem pretty daunting to us. No doubt commercial broadcasters and electronic device makers will protest these ideas early, often, and very loudly if any of them actually surface in a Congressional bill. They'll note, legitimately, that their ad revenue has dramatically declined over the last few years.
And Free Press is a much better booster for public media than it often is for itself. Public television in particular has sunk into a comfortable malaise of genteel poverty and compromise with the very commercial practices it was originally designed to transcend.
But the core question that the report raises seems pretty compelling. Where is the funding for journalism—the reporting of events and facts—going to come from? The Internet advertising model? Cable TV talk shows? Bloggers and anonymous commenters? Really?
Tough choices ahead. Best to keep all options open.
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