The FTC’s staff ignores the fact that most newspapers are profitable (the average operating profit in 2009 was 12%), but that their corporate parents are unprofitable because of high overhead costs and ill-advised debt loads taken on when advertising revenues were peaked at all time highs. It also fails to make adequate distinction between longer term trends affecting newspapers and the effects of the current recession. The staff thus blends the two together to give a skewed picture of the mid- to long-term health of the industry.
Policy alternatives suggested by the staff for consideration include:
- Limiting fair use provisions of copyright and providing new protection for “hot news,” which would give first news organizations to distribute a story a proprietary right to the facts in their article
- Providing a variety of types of subsidies for news providers
- Changing tax exempt status laws to make it easier to obtain not-for-profit status and funds from charitable donors
- Taxing advertising, spectrum, internet service provision, consumer electronics, and cell phones to provide funds for news organizations
- Creating new antitrust exemptions allowing price collusion and market division
If commercial news enterprises can’t effectively manage themselves, compete in markets for their products and services, or find effective business models for themselves, why does anyone think that bureaucrats in the government have any ability to solve those problems for the news industry?