Huffington Says The Internet Isn’t Killing Newspapers At Senate Hearings

Wednesday, the US Senate Committee on Commerce, Science, and Transportation held a hearing on “The Future of Journalism” with testimony from experts on new media and the newspaper industry. Committee Chairman Sen. John Kerry called for the hearing to examine what, if anything, the government can do to save the newspaper industry from seemingly unstoppable decline.

Many of the day’s speakers had ideas for improving the state of print journalism. They also seemed ready to take on news aggregators like Google and the Huffington Post.

In his opening statements, Kerry called newspapers an “endangered species.” Kerry said the “important question” is “whether online will journalism sustain the values of professional journalism the way the newspaper industry has.” For this to happen, Kerry says “new media is going to require a new economic model.”

There seemed to be a consensus among those at the hearing a government bailout would be an unacceptable blow to journalistic independence. Though direct financial assistance isn’t likely to become an option, Kerry said the plight of newspapers was an appropriate issue for the Senate examination because the press is the “foundation of our democracy” and Congress has “a responsibility for the regulatory oversight of ownership of cable, satellite, other issues with respect to communications.”

Maryland Sen. Ben Cardin spoke in support of his Newspaper Revitalization Act, which would let newspapers operate as nonprofit organizations, making it possible for newspapers to receive charitable donations.

Others who testified on behalf of print media, including former newspaperman turned TV producer David Simon, expressed support for enabling newspapers to explore a nonprofit model. Ex-Washington Post editor Steve Coll and Alberto Ibarguen, President and CEO of the Knight Foundation, additionally called for the government to expand the Corporation for Public Broadcasting so that it can make up for some of the lost reporting caused by newspaper cutbacks. Coll and Ibarguen also suggested providing increased funding to organizations that give grants to journalism programs.

Dallas Morning News publisher and CEO James Moroney said questions about the future of journalism are “really not about saving newspapers per se, but saving the scale of the newsrooms that newspapers employ across this country.” Because of this, Moroney believes there are “limited opportunities for nonprofit help.” Moroney also said that the current online business model won’t be able to support the industry because content aggregators don’t give newspapers “a fair return on the investment we’re making on the content that we publish digitally.”

Taking on aggregators was a major theme of the hearings. Several witnesses asked Congress to relax antritrust prohibitions so that, in Simon’s words, “newspapers can openly discuss protecting copyright from aggregators and plan an industry-wide transition to a paid online subscriber base.” Moroney said he believes this would put publishers in a stronger position for negotiations with new media companies.

At the hearing, Google VP Marissa Mayer and Huffington Post founder/namesake Arianna Huffington represented new media companies that aggregate and summarize newspaper content on their sites. Mayer defended Google by saying that “web search acts as a conduit for journalism.” According to Mayer, Google News and search merely show “snippets” of stories from other news organizations driving to their pages “at a rate of more than one billion clicks per month.” Moroney noted legal arguments for “a quasi-property right to breaking news” and challenged Google’s use of news story excerpts because the “different atomization of news” online means that even “the first four lines” of an article can be valuable.

Mayer also argued that newspapers aren’t maximizing potential revenues from online advertising. She said newspaper companies need to focus on organizing their digital content into “single authoratative pages” like Wikipedia pages rather than “parallel” articles that compete against each other for traffic.

Huffington echoed Mayer’s point that newspapers need to do a better job monetizing digital content. She said her site helps newspapers by because “hundreds of millions pageviews are generated because of linking.” Huffington pointed to embeddable players as an example of how publishers can benefit from the “link-based economy.” Both Huffington and Mayer said they believe newspapers are in a transitional period before they figure out how to thrive online.

Addressing the effect shrinking newsrooms has on communities, Huffington claimed that along with 60 employees and the 10 reporters in a newly-established investigative unit, her site uses “hundreds of freelancers.” No one at the hearing pointed out that this vast network of Huffington Post “freelancers” are largely unpaid.

Mayer seemed open to the possibility of negotiating with newspaper publishers. When Kerry asked he if Google would find it “onerous” to make a deal with newspaper companies, Mayer responded, “We think that journalism is very important and that we need to find business models that can sustain it… so we would welcome something that makes the business model more robust.” Huffington seemed more resistant to the idea of newspapers putting content behind what she called “walled gardens,” claiming newspapers aren’t losing money to aggregators, but “they’re losing their revenue base because of Craigslist, because advertising is down because of the economic crisis, and because of the changes in consumer habits.”

Time will tell if Congress will act on any of the suggestions made at the hearings. If not, Huffington may get her way and newspapers will be forced to continue struggling to figure out how to monetize web traffic. Newspapers might also start charging for access to their web sites even if they can’t meet with each other about the decision. In an earnings conference call on Wednesday, News Corporation chairman and CEO Rupert Murdoch said his company will start charging for access to the web sites of their newspaper group, which includes the Wall Street Journal and New York Post, within the next year.