Denmark’s media storm

Danish newspapers are in a crisis which could get even worse when a parliamentary majority soon agrees on changes to state media support. 

So far danish newspapers have received 400m Danish kroner (€53.6m) a year from the state, but the government has announced a renegotiation of the support and says it is unsustainable to keep supporting the printed press. The government now wants to support editorial content and digital news distribution. 

The change to state media support will see the money being shifted from newspapers to online media. Newspapers and media experts warn this is another nail in the coffin of an already dying printed media industry and point out it is also a democratic problem because newspapers are the main providers of news. 

Lasse Jensen is one of the media experts who is worried. He is a grand old man in Danish journalism and the editor and presenter of Danish Radio’s magazine program ‘People and Media‘, hosting critical debates on new and traditional media.

“The daily papers are bleeding. It’s the same everywhere, but out of all the Nordic countries Denmark has so far been hardest hit. Danish newspapers have faced major redundancies and cuts, all excess fat is long gone. Many newspapers are reaching the limit of what they can take economically. Getting less state media support will be very serious for many of them,” he says. 

Support plurality

Dagbladet Information is one of Denmark’s newspapers which is currently the biggest recipient of state media support. It was founded as an illegal news agency during World War II. The paper is not part of a major media company. It is owned by a limited company whose small shareholders do not receive any dividend. In addition to state media support, Dagbladet Information also receive a special state diversity grant only awarded to a few, small national newspapers which would not be able to function without it. 

Information’s Director, Mette Davidsen-Nielsen, thinks the state media support should be used to secure future output of the kind of journalism which is lacking in today’s media landscape because it is heavy on resources. Dagbladet Information creates just that kind of journalism Mette Davidsen-Nielsen points out:

“90 percent of our content is produced in-house with unique journalistic focus on social issues, politics and culture. Ours is a considerable contribution to media plurality. That is why we get more state media support. Without it our budget wouldn’t add up,” she says.

Mette Davidsen-Nielsen feels Dagbladet Information has come far in its necessary transformation from printed paper to a modern multimedia company with a newspaper, a publishing business, a graphic production company, online services, a magazine publication and debating forums with readers’ contributions.

But nobody - including Information - has solved the Gordian knot: how to get readers to pay for online journalistic content.

“It’s a basic problem in the whole of the Western world: finding a way to make Internet users pay for unique content,” she says.

Free online news

News are moving online, it’s a global trend, and a clear majority of readers are not ready to pay for online news. 71 percent of readers of the Politiken newspaper answered “no” to the question “would you pay for news online?”. And when readers disappear, advertisers go too.

Lasse Jensen thinks Danish newspapers have been asleep at the wheel while the big Swedish and Norwegian media companies Bonnier and Schibsted have been quicker to adapt. 

“Many Danish newspapers were doing very well, so they were slow to start moving their business model in a more digital direction, and they have allowed readers to get used to accessing news online without having to pay,” he says. 

Meanwhile the media consumption among many, especially younger, people is to an increasing degree based around social media like Facebook and Google, which do not produce their own news. 

Lasse Jensen predicts the newspapers’ decline will continue and that quality journalism will suffer even worse conditions in coming years. He thinks this is a problem for democracy:

“There is good reason to be worried on behalf of democracy. Newspapers deliver seven in ten news stories and as such are crucial to the journalistic chain of life. But newspapers‘ resources have reached bottom and their ability to deliver the critical journalism which a democracy needs is much reduced,” says Lasse Jensen. 

The volume of news is exploding but fewer investigations lead to fewer scoops and readers don’t remember them as well as they used to. These are the preliminary results from a new study of Danish media carried out by Anker Brink Lund, professor of media management at the Copenhagen Business School, CBS. He shows how the volume of news has more than doubled in the past ten years, while more than three quarters of news stories are “repeats, theft and borrowing” - i.e. not unique news. 

When journalists must make twice as many stories as they used to plus new versions of other media’s stories, there is less time left to investigate your own news. 71 percent of original journalism comes from newspapers, the study shows.

Minister wants to support online media

That is probably not enough to convince Minister for Culture Uffe Elbæk (the Danish Social-Liberal Party) that newspapers should continue to receive the current 400m Danish kroner (€53.6m) state media support. The government and the Minster for Culture want to give digital media some of the money, and it looks like more and more media will have to share a little less money. The government has also asked media to pay 40m Danish kroner (€5.4m) more in so-called payroll tax - an industry duty for newspapers and other businesses - as compensation for being exempt from VAT.

“Some newspapers will manage and prosper. Others might go under and disappear. And new names will disseminate news in new ways which we can’t yet imagine,” the Minister for Culture wrote in a commentary ahead of negotiations. He recognises the crucial role newspapers play in Denmark’s media cycle by “making the first important dig of the news day” and by delivering at least two thirds of the news which make it into broadcast media. But he finds it unsustainable to support the distribution of printed newspapers. 

A danger of niche news distribution

The state support must go to the production of editorial content, says Uffe Elbæk. A committee appointed by the previous government to take a fresh look at state media support from a digital perspective came to the same conclusion. The committee recommended making future state media support a support for democracy. 

But while the committee wanted to support democracy by giving the big players in the newspaper business more or less the same media support as before, the Minister for Culture believes democracy is better served by making it easier for smaller online media to access the market place.

The minister highlights new American publications like the Huffington Post, Politico and Daily Beast which have emerged from nowhere to become important national players in a short amount of time, because the production and spread of news online is so easy and relatively cheap. 

Lasse Jensen does not have much faith in the Minster for Culture’s plans.

“We are five million Danes, there are 313 million Americans and they have an even bigger language area. Nothing points to Denmark being able to develop a national online news publication like the Huffington Post. Supporting small online media creates a narrow niche news distribution. It does not contribute in a comprehensive way to the public debate like newspapers do,” says Lasse Jensen.

Apart from direct state support, Danish media also benefit in other ways like not paying VAT. And public service TV and radio get billions of kroner every year from license fees. Parliament has just reach a wide agreement on the future distribution of the license money. The state broadcaster DR and the TV2 regions (eight regional non-profit TV stations) will receive 140m Danish kroner (€18.7m) extra, and the Danish film industry gets more than 100m Danish kroner (€13.1m) in the coming period.