Public trust in the media has hit an all-time low. Common explanations for this crisis of credibility include bias, polarization, and fake news, but these causes are themselves effects of the tectonic, and generally overlooked, shift in the media’s business model. Throughout the twentieth century, journalism relied for its funding predominantly on advertising. In the early 2010s, as ad money fled the industry, publications sought to earn revenue through subscriptions instead of advertising. In the process, they became dependent on digital audiences—especially their most vocal representatives. The shift from advertising to digital subscriptions invalidated old standards of journalism and led to the emergence of post-journalism.
Everything we once knew about journalism depended on the model of the ad-funded news media. Advertising accounted for most of the news industry’s revenue during the twentieth century.
This business model provided a selective advantage to certain kinds of media. Since the revenue from copy sales was not sufficient to maintain news production, news outlets needed to attract advertising. As a result, media that relied mostly on the reader’s penny, such as the formerly influential working-class press, eventually lost out in the marketplace. The mass media that oriented themselves around the “buying audience”—the affluent middle class—received money from growing advertising and thrived.
In political economy, this selective effect is called “allocative control.” The ad money did not tell the media what to do; it just chose the media that encouraged its audience to buy goods. Media critics Edward S. Herman and Noam Chomsky argued that it affected the mechanism of discourse formation, as the media maintained a context favorable for consumerism and political stability, and thereby “manufactured consent.”
This business model was extremely successful. By the end of the twentieth century, the news media had reached the apex of their 500-year history. Even regional newspapers such as the Baltimore Sun possessed several well-staffed foreign bureaus. Never were the media as rich and influential as in their golden age, just 25 years ago. Plenty of journalists still on the job remember those glorious days.
Under the ad-based model, media capital represented a significant social force. It protected its interests, its market value, and therefore its independence. The abundance of money enabled newsrooms to develop an autonomy secured by the division between news production and ad-sales departments—a “glass wall” between ads and news. Preselected by ad money, news organizations geared toward affluent audiences became influential to the point that their autonomy determined their market value.
Ad money carried the risks of advertisers’ pressure in news production, which would have undermined newsroom autonomy, a source of reputation and therefore capitalization. So professional standards were elaborated to protect journalism from advertisers and establish the credibility of news coverage. Credibility was seen as a professional virtue but also as a commodity. “The theory underlying the modern news industry has been the belief that credibility builds a broad and loyal audience, and that economic success follows in turn,” declared the American Press Association in its 1997 “Principles of Journalism” statement.
Thus, paradoxically, the allocative control of ad money determined the allegiance of mainstream media to corporate elites (hence, “corporate media”) but also sustained high-quality journalism. Newsroom autonomy was protected by the standards of objectivity, nonpartisan and unbiased reporting, attention to the arguments of all parties involved, investigative rigor, the separation of fact from opinion, and other guarantees enshrined in the ethical and professional codes of news organizations.