The news media industry contributes more than £5bn to the UK economy, according to a new report out today. But the sector is at risk of being “fatally undermined” by digital giants that benefit from its content without contributing to the costs.
The study by Deloitte, commissioned by the News Media Association (NMA) and published today, also highlights the “cultural and social value” of the industry.
The news media industry is estimated to have generated £4.8bn in revenues from circulation and advertising in 2015, while a further £0.3bn came from other activities, such as news syndication and contract publishing.
This revenue, which is estimated to have halved since 2003-04, supports expenditure and employment across the UK, and Deloitte estimates the industry contributed £5.3bn in gross value added (GVA) to the UK and supported 87,500 full-time jobs.
Some £4.6bn and 72,600 jobs relate to the news media organisation’ impacts, while £0.7bn and 14,800 jobs come from newspaper retailers and wholesalers. GVA represents the sum of wages, taxes and profits a sector supports directly and indirectly.
The report, UK News Media: Engine of Original News Content and Democracy, also highlights other non-economic contributions the industry makes to the UK.
News media publishers account for 58 per cent of total investment in news production. Their journalism, the NMA noted, “has a unique and wide-ranging set of benefits such as boosting SMEs, improving literacy, enhancing community cohesion, and, crucially, underpinning democracy by holding powerful figures and institutions to account”.
Turning on Google and Facebook
The report is published at the end of a tough year for news publishers, with revenues, profits and headcounts suffering.
The news industry has increasingly turned against digital giants, such as Google and Facebook, which are seen to benefit from news content without investing in newsgathering.
In September, the NMA warned the government that the likes of Google and Facebook are threatening the UK’s democracy because they are taking advertising revenue share and making it “increasingly difficult” to fund quality journalism.
Commenting on today’s report, NMA vice chairman and News UK chief operating officer David Dinsmore said: “Urgent action must be taken to ensure that news media publishers’ ability to fund the original agenda-setting news and information our readers want us to produce is not fatally undermined by third parties who gain so much from our investment while contributing very little.”
Ashley Highfield, NMA chairman and Johnston Press chief executive, said:
The industry performs a unique democratic function by investing in agenda-setting investigative journalism which holds authority to account such as the Guardian’s Panama Papers revelations, the Sunday Times’ investigation into FIFA, and the Jersey Evening Post’s investigation into online child grooming which was praised by the NSPCC.
The report also presents the challenges the industry is facing. This highlights the urgent need for a fair and equitable regime in which news media publishers’ investment in news is appropriately acknowledged and rewarded, without the commercial benefits being siphoned off by digital platforms and aggregators.