THE BLOG
10/14/2013 03:30 pm ET Updated Jan 23, 2014

Managing Change and Safeguarding Journalism

For four centuries the people who publish information have played a central role in the development of modern civilization, first and foremost through newspapers. Today the digital revolution is pushing them to the side. How can we manage this tumultuous change and save journalism?

When a publisher takes the podium at an Internet festival, one might expect -- superficially -- him to start listing the problems that digital technologies have created, as well as their possible solutions. We'll get to that, too, but I believe that right now it's more important to focus on our specific problems as publishers -- including newspaper publishers! -- within the frame work of a true cultural revolution that all humanity is currently experiencing. We need to talk about the challenges this revolution is presenting not only to the so-called "media," but to each of us as aware, thinking citizens.

Let's be clear: Digital media is not merely a "new means" substituting other means like printed paper, the TV, etc. in part or in whole. Digital is a universe that exists according to laws that are as different from the past as modern physics is different from the way things were for Galileo or Newton.

The new laws of the digital universe have rendered all kinds of borders uncertain or at least mobile: those between producers and consumers, between information communicators and information users, between different products, between content and the means to communicate and broadcast it, even between the industrial and professional sectors as we know them.

So let's take the bull by the horns right from the start and ask ourselves an initial, radical question: within a universe in which the act of "publishing" has become a button that anyone can click -- a provocation set forth by American scholar Clay Shirky -- does it still make sense to even talk about a publishing industry, or publishing at all? Does it make sense to talk about journalism publishing? And if it still makes sense, what distinguishes it from the other intellectual and economic activities that can be run by anyone, from single individuals to enormous corporations with other core businesses?

The problem, one I would call "political," is that in the digital universe not all citizens can or want to actively inform themselves about issues they are interested in, or which are of interest to their community. In fact, there will always be a majority of people who will entrust -- in whole or in part - the selection of their information or part of their information supply to third parties. They want these third parties to be credible and authoritative. Who will these sources be, and what criteria will they use to govern the information they offer?

Personally, I'm convinced that newspapers will still play a fundamental role. In other words, I'm convinced that organizations that by profession search out, select, prioritize and proffer information according to criteria established as part of a relationship built on trust between themselves and their public.

The fact that this role is still essential, however, does not mean that it is inevitably essential. The digital universe has thrown all mass media into turmoil (printed newspapers are merely the first and highest profile victims), and especially the classic model of journalism media. In other words, the established economic sustainability model of newspapers is in crisis. Therefore we need to redefine the journalistic product and the organization of work necessary to create it.

First of all, there's good news: newspapers are suffering, but journalism is experiencing its best season ever. Thanks to mass technology, any fact or event can be documented and recounted in realtime: wherever there's a smart phone that can capture the event and its protagonists, someone who will tweet and retweet it, a journalist who will control the news and relaunch it, all in a matter of minutes.

Journalism investigations can talk about an event almost live, as it happens, and news that once would have been hidden and sealed are laid bare. Think about the Piano Solo -- a military coup planned in Italy in the mid-1960s, or the massacre at My Lai, or the Watergate scandal... All events that came to the attention of national and global audiences months or even years after they actually took place. Today access to shared information, the investigation of extremely deep source themes, the use of meta-data, the possibility of reaching everyone, everywhere, have all made things that were once difficult, arduous and time-consuming both simple and rapid.

The incredible success of the tablet computer -- Steve Jobs presented the first iPad on Jan. 27, 2010 -- is multiplying the number of readers who, in any moment of the day, access information. Whether written or in a video. One out of every three citizens in the U.S. and Britain owns a tablet computer. The numbers are slightly lower in Italy, but all you need to do is take a ride on a Frecciarossa high-speed train or sit down of an espresso in a Roman piazza equipped with Wi-Fi to realize just how many people are reading their newspapers on the iPad. Most of them aren't that young, either: more thirty- and forty-year-olds than teenagers.

But there's less comforting news as well: as with music and entertainment, many consider the universe of digital information to be a low- or no-cost commodity. At the same time, the costs shouldered by those who produce that information day in and day out remain extremely high. Just consider this example: the Italian newspaper Repubblica and its founder, Eugenio Scalfari, had the patience to put together piece by piece one of the most important journalistic accomplishments in recent history: correspondence and then an interview with Pope Francesco. Over the course of those pages, reason and faith engaged in a public dialogue to moving effect, and the entire publication was the result of an investment in terms of time and effort that our newspaper, its director and the publishing company made over decades. Almost four, to be precise. If we stop investing in quality, we'll never be able to achieve such extraordinary things in the future.

And unless we keep investing in research and technology, as the Group I head continues to do with great conviction, the same thing will happen. Because we would quickly become obsolete and be expelled from the flow of communications.

Therefore, we need to know how to blend quality journalism with a heightened presence on every platform -- paper, PC, video, radio, tablet, smartphone and anything else that may become available.

The issue of financing information is central. Allow me to backtrack and give you a little data. Up until just a few years ago, advertising was a secure revenue source for "traditional" publishers like us, making it possible for us to keep funding high-quality journalism and investing in new products. This reality is radically different today. In Italy and all over the world, we have witnessed an unconstrained depletion / transfer of these resources. For us, revenue from advertising has dropped every year since 2006-2007, while earnings from subscriptions and sales have suffered as well. In Great Britain, the industry moved from 100 percent of advertising investments collected by publishing houses in 2000 to 90 percent of the total in 2005, then down and down again to the 64 percent forecast for 2014. Today, in the UK 36 percent of the advertising pie goes to non-publishers.

In other words, nowadays revenue is booming for search engines, aggregators and social networks that use the products of other peoples' journalistic work to attract users who are immediately valorized thanks to the distribution of targeted advertising (as Google does by intersecting the data it obtains through a myriad of its own services). Let me say that again: a growing portion of advertising is already being given to people who are not publishers, in the sense that their mission is not to produce information. Their mission is e-commerce and the distribution of physical products, or organizing web searches like those provided by Google (which currently collects 800 million euro in Italy every year), or connect hundreds of thousands of people with one another, as Facebook does. At the same time, they collect advertising revenues. In order to keep the situation from becoming dangerously unbalanced, we need to act quickly to create norms and regulations that redistribute resources correctly with respect to the investments made to create content.

It is precisely here that we need to ask ourselves if the evanescence of borderlines and the hybridization of different sectors in the digital universe isn't saying something radically new to publishers like us as well. Does it still make sense to divide the cultural industry so obviously into "producers" and "broadcasters"? Into "content" and "distribution channels"? Does the distinction which, for example, Google continues to make by defining itself a "technology company," as distinct from a "content company," still make sense?

These are not mere philosophical musings, but rather concrete challenges that are an effective way to question the framework of certainties that the mass communications industry has relied on for some 200 years now. For us, these questions, however uncomfortable to confront, do not scare us, as is demonstrated by the fact that I'm standing here now, before you, talking about them.

But if this conceptual framework is to make any sense, the major players who define themselves as "technological" or "commercial" entities have to be subject to the same rules that apply to entities like ours, that still like to define ourselves as "publishers." This has been the impetus behind our efforts both in Italy and abroad to establish a "level playing field," in other words to create an area in which different entities can compete fairly with one another, without taking unfair advantage of their dominant positions in markets where even a classic publisher, once it has become digital, can emerge. We are asking:

-- equal conditions in indexing

-- freedom to engage in commercial relationships with our clients

-- equal regulations for the protection of personal data

... and so forth.

I understand that at times these battles may appear corporate, but they're not. The journalism industry is waging battles that are closely connected with the future of modern democracy. If new digital platforms are -- oh how they are! -- to be considered the new open plaza for public expression, the freedom for publishers to work in the digital context is not that much different from individual freedom of expression.

The transition to digital is, for anyone who comes from ancient histories and traditions, a complex affair. But if one is willing to grapple with the right questions, then he or she is already halfway to the solutions. We would like for all our interlocutors, whether professional, industrial and even -- why not? -- political, to accept sharing at least a portion of this journey with us. If we're willing to share at least the questions, then even eventual different responses would help us all search for the right solution. Better yet, the right solutions.

There is a rather special newspaper, one that has been published for 279 years, and which this year will become fully digital. I'm referring to the London Lloyd's List, which has been published continuously since 1734. The paper is rather special since -- as its director Richard Meade has stated -- its information is extremely specialized (and intended for freight, shipping and insurance companies), can be easily rendered digital and exists free of any serious competition. These specialized publishers have been able to pull the feat off, and so will so-called "generalist" publishers like us.

Go visit the website of the Gazzetta di Mantova, one of the newspapers in the Gruppo Espresso, and you'll be able to see the future of the oldest continuously-published Italian newspaper take shape before your very eyes. The Gazzetta was first established in 1664, almost three generations before Lloyd's List...

Pisa, October 11th

The Grand Lecture Hall at Sant'Anna High School

Keynote speech, Internet Festival 2013