The American newspaper industry’s revenues peaked in 2005, at about $60 billion. In the next year or two that figure will have fallen to half of what it was then. Newspapers used to be one of the most profitable industries in the country, and now are going through a stunningly rapid economic decline. The number of journalists employed by newspapers has declined at roughly the same rate as revenues have.
As a lifelong journalist who has spent the last few years being primarily employed at a university, I have gotten into the habit of hectoring my academic colleagues who complain about the crisis in universities. You don’t know from crisis, I tell them. Can you think of a leading university, for example, where the faculty head count in a prominent academic department has been cut in half in the last ten years? I don’t think so. The equivalent experience has become typical in journalism.
On the other hand, when I am with my journalist friends, I often hear an embittered prediction that what happened to newspapers—“disruption,” in the current parlance—will happen next to universities.The argument is that new, or enhanced, online platforms will be able to offer what universities offer, except more conveniently, at a far lower price, and possibly even with higher pedagogical quality The argument is that new, or enhanced, online platforms will be able to offer what universities offer, except more conveniently.. And then university economics will collapse just as rapidly as newspaper economics did. The one anecdote most used to support the argument was the enormous global sign-up for Sebastian Thrun’s free online computer science course at Stanford in 2011, after which Thrun resigned to start Udacity.
The Social Science Research Council isn’t in the investing business, so its primary interest in the economics of both newspapers and universities is with respect to the economics’ effect on the production and dissemination of significant knowledge about society. But that effect is considerable—especially for the kind of journalism that social scientists would respect, because it has already been heavily reduced. What should we do about that? And will we soon see the same unfortunate dynamic in universities?
I am far more optimistic about the future of universities than I am about the future of newspapers. But let’s discuss newspapers first.
Almost all newspapers are for-profit businesses. At the dawn of the twentieth century, most big cities had several daily newspapers, primarily supported by single-copy street sales, who competed lustily and, often, comically (see The Front Page) with each other. By the end of the twentieth century, a number of forces—the advent of television and radio, suburbanization, the natural rhythms of economic competition—had reduced the field, so that most big cities had a single daily newspaper that was highly profitable, whose revenues came primarily from advertising and secondarily from subscription sales. Many of these papers were willing to invest in socially useful forms of journalism, like investigative reporting and foreign correspondence.
The Internet is what broke newspaper economics, in stages. The first source of revenue to leave the newspapers was classified advertising, which departed for websites like Craigslist. Next, newspapers began to offer free online versions of themselves, which in most cases undercut their subscription revenue. But the most profound problem was with display advertising. Google and Facebook have been able to establish themselves as the dominant receivers of online advertising revenues, because they offer advertisers a far better deal than newspapers—cheaper and better targeted to potential customers. And they have been able to do this without generating any original content of their own, by building vast audiences based on material supplied to them by others, including newspapers. That’s why, although news consumption is way up in the Internet era, newspaper revenues are way down.
The best immediately available solution to the problem—the problem of a decrease in socially-useful journalism, not the problem of newspaper economics—is the establishment of a network of nonprofit news organizations that specifically focus on generating the kind of journalism the market no longer supports. This is happening, to some extent. The sector is still tiny—one study estimated that in 2014 it had 5000 employees nationwide—but it is growing, and often producing very good work. Its most worrisome aspect is its near-total dependence on foundation funding, which can be episodic and can also impose editorial demands.
In retrospect it seems clear that newspapers used to assemble a highly diverse package of information that a lot of people felt they needed—not just news, but sports scores, movie times, horoscopes, weather forecasts, and so on—and then sell access to that audience to advertisers. Google and Facebook offer vastly more information, no charge to the user, and far more favorable terms to advertisers: game over. Universities (and for our purposes here, let’s stipulate that we’re limiting the discussion to universities that produce significant social science research) seem to me to be far less vulnerable.
First, research universities are public or nonprofit institutions that are designed to be somewhat protected from pure market forces. Their revenues come not just from earned income (tuition, mainly), but also from government funding, donations, and endowment returns. They are large but not mass-market institutions that are offering most of their strictly limited number of paying customers a lengthy, intense in-person experience that includes networking, credentialing, and late-adolescent maturation, in addition to pedagogy—not just pure receipt of information. The construct of a degree keeps a lot of disparate material in a single-price bundle, which allows for cross-subsidies of the kind that used to be possible for newspapers.
Higher education already has an established online sector, and its structure is substantially different from either research universities or the massive open online courses that are supposedly going to disrupt the more established players. Online education consumers tend to be nontraditional students who are looking for highly specific skills courses taught by hands-on (hands on the keyboard, anyway) instructors, and online providers are usually not interested in research.
If one wants to worry, though, at least about the future of social science research, one could find some cause. The number of full-time, tenure-track faculty, who are paid in part to do research, proportional to adjunct or contingent faculty who are paid (much less) with heavy teaching loads is shrinking steadily. Student interest in the social sciences other than economics is diminishing at most universities. So is the federal government’s financial support for research. And many of the university’s panoply of financial supporters—parents, donors, lenders—think of teaching, not research, as what they are paying for. One of the sobering lessons journalism’s last decade offers is that one should not mistake social value and peer-group esteem for long-term economic sustainability. We journalists used to feel that doing great work kept us safe. In universities, researchers have more firmly instantiated protections. What will keep social science research in universities safe is strong systems embedded in strong institutions, not goodwill.
Photo credit: iStock.com/Valeriy Kachaev