The Power Of One: Sheldon Adelson's personal fortune of $US20 billion allows him to subsidise the distribution of a free daily newspaper throughout Israel. Unable to compete with their far-right rival, Israel's left-wing newspapers face ruin. What would happen to New Zealand's mostly Australian-owned print media if the world's richest woman, Gina Rinehart, attempted to do something similar across the Tasman?
A FREE DAILY NEWSPAPER. Just imagine being able to walk into
your local dairy and pick up a big, fat, all-sections, all-subjects daily
newspaper without paying a cent. Imagine that newspaper being delivered
free-of-charge to your front door. Imagine its impact on newspaper publishers
who still expected you to pay for their product.
Impossible, you say. Sure, we have give-away newspapers now,
but they only arrive in our letter-box once or twice a week, and because
they’re paid for by advertising sales the editorial content is pretty thin. A
genuine daily newspaper, with all the editorial content that term implies, simply
couldn’t be financed from advertising alone. The revenue from advertising would
have to be augmented by over-the-counter-sales and subscriptions. So, a “free”
daily newspaper must remain a pipe dream.
Not necessarily. If you were on the streets of Tel Aviv
today you could pick up a copy of Israel
Hayom for free. The paper was launched five years ago as a five-days-a-week
publication, and in November 2009 added what it describes as “an expansive
weekend edition”. A free daily newspaper already exists.
But how? What’s the Israelis’ secret? How can such a
publication possibly break even? Is Israel’s economy really so buoyant that it
can sustain a daily newspaper funded exclusively from advertising sales?
Well, no, it isn’t. Israel’s economy, like every other
country’s, is feeling the squeeze of the global financial crisis. Not
surprisingly, Israel Hayom runs at a
substantial loss.
But who on earth has so much money that he can afford to run
a large daily newspaper at a loss? He’d have to be a billionaire.
Indeed he would, and that’s exactly what Sheldon Adelson,
the man behind Israel Hayom, is –
twenty times over. Mr Adelson made his fortune in the casino business and now
he’s using it to support his favourite right-wing politicians. Over the past
three or four months he has donated $US10 million to “Restore Our Future” – a political
action committee backing the Republican Party’s presidential candidate, Mitt
Romney. At home, through Israel Hayom,
his money is being used to promote the policies of Prime Minister Benjamin
Netanyahu and his right-wing Likud Party.
All a little unsettling. But, in a free country, doesn’t Mr
Adelson have every right to set up and run his own newspaper – even at a loss?
Well, possibly. Perhaps a more pertinent question might be: Does Mr Adelson, by
so ruthlessly under-cutting his competitors, have the right to drive them out
of business?
Israel, like the United Kingdom, is a country where most of
the daily newspapers take an openly partisan position. Mr Adelson, by
under-writing Israel Hayom’s losses
is putting this politically diverse media environment at risk. Slowly but
surely, the daily newspapers representing the Left of Israeli politics are
being driven towards insolvency.
According to McClatchy Newspapers’ Sheera Frenkel:
“Haaretz, Israel’s
most prominent left-wing daily, didn’t publish a print edition [last] Thursday
for the first time in three decades as layoffs threatened much of the staff. Maariv, one of the country’s largest
newspapers, has announced that it might switch soon to Web-only distribution
with a weekend print version; the alternative, the paper has said, is closing.”
All very sad. But Israel and its newspapers are a long way
from New Zealand. Our media environment is quite different. Surely, nothing
like Israel Hayom could happen here?
Not here – not yet. But what about across the Tasman? In
Australia (where most of New Zealand’s daily newspaper publishers are based)
another billionaire, the mining magnate Gina Rinehart, is locked in a very
public dispute with one of her country’s largest media corporations, Fairfax
Media. Ms Rinehart, currently a major Fairfax shareholder, is unhappy with the
corporation’s political and business coverage and is accused by her critics of
seeking to influence its newspapers’ editorial direction.
What would happen to Australia’s print media environment if
Ms Rinehart decided to adopt Mr Adelson’s strategy? How long could the already financially
fragile Aussie media survive the competition of a free daily newspaper,
subsidised out of the extremely deep pockets of the world’s richest woman?
And if the Sydney
Morning Herald, Daily Mercury and
Rupert Murdoch’s Australian were to
suffer the same fate that appears to be awaiting Haaretz and Maariv, how
would that impact the future of the Australian-owned mastheads dominating New
Zealand’s print media?
If the future of the print media belongs to those with the
deepest pockets, then perhaps it is time to start thinking about the creation
of a publicly-funded, editorially neutral (and that neutrality would need to be
guaranteed by statute) national (with a small “n”!) newspaper? Democracy requires
a well-informed electorate, which, in turn, requires a truly independent news
media.
New Zealand democracy is far too important to be entrusted
to newspapers wholly owned and influenced by right-wing billionaires.
This essay was originally published in The Press of Tuesday, 9 October 2012.
