George Osborne, editor of the Evening Standard, has tonight delivered the 20th annual Hugh Cudlipp Lecture 2019.
In his speech, Mr. Osborne outlined why the media should “give power to the consumer not the producer”, and explained why he chose journalism and newspapers, not because he was “sentimental about their past; but because I [he] am optimistic about their future.”
Mr. Osborne went on to clarify why he thinks quality journalism needs a long-term source of commercial income, and encouraged the BBC to use its 25 million license-fee payers to turn itself into a subscription-based model, like Netlix.
The former Chancellor of the Exchequer also touched on the possibility of a ‘data dividend’ in the U.K, something that has just started to enter mainstream politics in California, and something he says would seriously consider if he was in Downing Street.
Highlights from the speech:
“Until now, there has been a contract that almost no one understands – even if we endlessly tick the box online that says we consent to it. The deal is this: we all get to use the internet for free, and do all sorts of things – from playing games to watching videos to looking up things on Wikipedia – that a previous generation would have paid for.
“Great. But in return, the data on everything about us that can be gleaned from our online activities belongs to the big commercial platforms through which we access that content. Those platforms know who we are, where we live, who are friends are, what we watch and how long for, what we buy and what we search for.
“For all that data helps them direct the right advertisers to you – and then take a big cut. And they don’t share the data with the producers of the content, like newspapers, that is drawing people to their platforms.
“But the data is generated by you – and you’re handing it over for free. And we’re providing the content, and we’re not told who is using it and how.
On data ownership:
“Now say you owned the data. Say you had the right to take your accumulated data from one producer and share with another that offers you something better in return.
“When I was at the Treasury that’s what we forced the big banks to allow, and it laid the groundwork for all the new digital banks you see being created. Or let’s think more radically. Say social media companies had to pay you for using your data. Say it became an asset, or perhaps even a reward for your labour.
“It seems strange that you should be paid for watching all those funny videos and wasting hours on those games. But people do pay to know what you’ve been doing with your time – they just don’t pay you.”
On why, if he was in Downing Street, he’d be looking at the idea of a ‘data dividend’ very closely:
“This idea of a ‘data dividend’ has been knocking around on the margins of Silicon Valley, but it’s starting to enter the mainstream of politics in – of all places – California.
“Why not here?
“It could be one of the solutions to the problem of too many people having too few assets; and an answer to the question: where will the incomes come from in the age of robots and artificial intelligence?
“It could help businesses other than the big social media and search companies – if the consumers owned their data, rather than one or two big producers, then we could all compete for their custom, and their data would follow. It sounds like a policy from the left.
“But breaking open monopolies, pricing a market externality, putting power in the hands of consumers and spreading wealth are pretty Conservative ideas. It’s not a magic bullet to the problems facing the newspaper industry. But it would create a more competitive, level playing field and dramatically change the economics of the online world.
“I can tell you that if I was still in Downing Street I’d be looking at the idea very closely. Instead, as a newspaper editor, I’m doing what I think the press should do: provoke the conversation, set out the ideas and lead the conversation.”
On why quality journalism needs a long-term source of commercial income:
“In the last couple of years, the digital presence of the paper has grown exponentially. 100 million page impressions and 29 million unique visitors in January alone. But still we need to do more. Events. Sponsorship. Working with partners on projects to improve the future of London.
“I am unapologetic about all of this. If you want quality journalism, someone has to pay for it. Newspapers are businesses not charities. They always have been.
“Pick up the front page of a nineteenth century copy of The Times and the whole front page was full of ads, not unlike when we wrap an ad round our paper today. A sustainable future cannot rely on begging for contributions. Nor would we ever want them funded by the taxpayer, like the BBC. We need to find a long-term sources of commercial income.
“It has been a hugely challenging time. Sales of national and local printed papers have halved in the last 10 years; print advertising revenues are down over two thirds; the number of full-time journalists continues to fall every year. But there is a glimmer of hope. It’s called fake news. Or rather the scandal about fake news.”
On how he thinks that money for journalism will be made:
“What encourages me is that people care. They care that Russian bots spread false information during the presidential election, and Cambridge Analytica did the same in our Brexit referendum.
“They care enough that their political leaders are hauling the big social media companies before Congress and the Commons and the European Parliament and demanding action to stop it happening again.
“So too are the big advertisers who generate their revenues. Reputable companies can’t afford to see their products placed alongside foreign subversion and deliberate disinformation.
“We should keep the pressure up on their boards and shareholders. Because the answer to all of this is to turn to an organisation that employs properly-trained journalists, thorough sub-editing and legally-accountable editors.
“In other words, you might receive your news via Facebook, but it’s supplied by a newspaper or broadcaster you can trust. When a revolution comes, it feels like all that is old is swept away and only the new has value. And then, as excesses that come with any revolution repel, and the novelty wears off, people start to remember the value of some of the things they discarded.
“I think that is what is happening now.
“People, and the advertisers who sell to them, are alert to fake news. They want reliable information. That’s why in America, which feels a couple of years ahead of us, the likes of the Washington Post and New York Times – which were written off not long ago – are enjoying a healthy renaissance.
It’s why here in Britain I believe people and businesses will more and more turn to established, reliable brands – like the 192 year-old Evening Standard. And if they do that, then there is money to be made. Money to pay for that journalism.”
On why he believes the BBC should offer a subscription based service, like Netflix:
“Accepting public money also smells of defeat. Using taxpayer subsidies to support what has until now been a commercial activity has never been a route to long term sustainability.
“Curbing the activities of the BBC is what lots of newspapers still cling to – and its true their website looks more a more like an online newspaper, with film reviews and cooking recipes and the like. But fundamentally our national broadcaster is part of the solution to providing quality journalism to the British public, not part of the problem.
“We should be encouraging it to use its 25 million odd license-fee payers and turn itself into something like a subscription service more akin to Netflix. That’s what underpinned the agreement I negotiated with them four years ago, changing the law so that you need a license fee to view the iPlayer – and giving them control over who paid that fee.
“It has set them up to navigate the future. Selling its best programmes to other distributors around the world made the BBC money in the short-term, but it turned out to be the same mistake that other content-providers made.
“The global collaboration with ITV and others on a Britflix is a welcome sign on new thinking. Cannibalising the BBC to sustain Fleet Street feels like a solution from the past. Today neither are strong enough.
“So it’s time to think bigger than this. We don’t want to end competition in the media industry – it’s ruthless competition that drove so much of the innovation we’ve seen, from Murdoch’s relaunched Sun newspaper fifty years ago to the FT app and Standard online of today.
“Nor do we want newspapers to become charities or dependents on public subsidy. What we want instead is to create fair competition, and break up the monopolies that prevent that.”