The crisis in Hungary shows once again that independent media with investigative capacity are vital to development. Prime minister Viktor Orban's assault on democratic institutions began with a law muzzling the press. He is hardly alone. Gangster-funded “berlusconisation” of the media has become a structural feature in the Balkans and elsewhere, and the resulting information void enables theft of public and private wealth. Business has a major interest in creating a different scenario.
Particularly in the emerging markets, the key to media sustainability is to improve their quality, and financing that quality requires new solutions. It was believed until recently that some variant of the Western media business model could simply be imported into the developing world. But profit margins in the developing world cannot approach what media industries earned in the US and Europe over the last 30 years – and media investors from developed economies are looking for high returns from emerging markets to compensate for the downturn on their home ground. Further, in the developing world business environments are not regulated transparently, while advertising funds are used for “soft” censorship to an even greater degree than in mature markets.
Yet even in the smallest markets, capable and skilled individuals have produced great journalism and successful businesses, such as Indonesia’s “Jawa Pos” or KBR68H “Asia Calling” radio. To widen this movement new motors are needed, and businesses can provide several of them.
The first need is skills. Recent studies by the news industry trade group, WAN-IFRA, confirmed that media development assistance is overweighted toward journalism training, and underweighted toward essential business skills. Upgrades are needed in legal training (to help media withstand libel charges), lobbying (to change disastrous press laws like Hungary's), newsroom management, business and financial management, market research and marketing.
A second investment is required in business development. The key is to diversify revenue streams, especially in markets where Western-style sources of revenue have not and may never fully develop. (It can be done: For example, El Tiempo has developed winning multimedia strategies in Colombia.) New revenue sources could include content sales not only to media abroad, but also to NGOs or industry newsletters. Consulting and business intelligence are obvious opportunities. A further opportunity lies in translation services. There is a risk that media outlets will increasingly concentrate on activities that generate higher returns than watchdog reporting; however, media groups like The Economist have shown that diversification can be managed without lowering journalism standards. A further known risk is “false flag” recruitment of investigative journalists by government or private funders; such liaisons can result in disastrous damage to the brand of independent media. Journalism schools and professional associations can play a major role here in defining ethical guidelines that recognise these new dilemmas. A further necessity is to expand the public for independent news. One key will be to engage independent news outlets in media literacy programs, as a source of supplemental revenue for reporters, and as a way to recruit an informed and critical audience.
Financial investment is also essential. A growing financial flow from the BRIC countries into media elsewhere hasn’t visibly supported journalistic independence. Instead, investment in independent media has been undertaken mainly by foundations such as The Open Society Institute or International Media Support. More investment is needed from firms. Rather than ownership, it can take the form of sponsorships. They will have to be public and arms-length to mitigate the inevitable accusation that foreigners are meddling in the affairs of sovereign peoples. The return on these investments will include environments where legal rules and public opinion count for something. But it can also include brand value, access to key talent and change agents, and eventually dividends (as entities like the Media Loan Development Fund have proven).
There are no silver bullets that will kill the problem of creating and supporting independent media in developing democracies. But there is clearly room for deeper involvement by business. And it is clearly in the interest of the legitimate business community to support honest and independent media in emerging markets.