“We’ve been funding this radio station for four years now. Both your own evaluations and our own assessment make us conclude that it’s achieved far more than we could possibly have hoped. For the first time, people really feel that their elected leaders are answerable to their citizens in this region. By a large majority, they say that they feel they understand the policy choices they can make when it comes to an election and it was marked that last year’s election results were so much closer here than anywhere else in the country. And the station’s role in defusing the truly terrifying level of mutual suspicion, misunderstanding and – well hate – that used to exist between the two main ethnic groups in this region has made this one of the best investments we could possibly have made in the country. But we’re sorry – we’ve been saying from the outset that we can’t just keep on pumping money into this forever and we’ve concluded that now is the time to stop our support. Your sustainability strategies have not been as successful as we hoped. We know that while cost recovery has been increasing you never promised that the station would be self sufficient. We know too that the station may have to be either closed down or sold – probably to someone closely connected to the government or opposition – but that’s just the way it is.”

This is an imagined conversation, but it is one which will probably resonate with most people who depend in any way on funding to support their work with media and with those from donors who support the media.  I can probably think of dozens of really useful media initiatives that have died or – worse – become appropriated on behalf of some narrow religious, ethnic or political interest once the funding has run out.

It’s understandable. An important reason why donor organisations are often reluctant to get involved in media development is because they fear entering into an open ended commitment from which they can’t extricate themselves without real harm being done. They can’t see the sustainability strategy or the exit strategy.

Donors, development agencies and others with money have another problem in sustaining funding of this kind. They generally know that media is really important to democratic development. However, they have very few tools at their disposal to assess how important, or to enable them to decide when the market is simply not going to provide what they value from the media.

One way of addressing this is to keep on coming up with imaginative ways of being sustainable, and there are good examples of this, especially from, for example, various media development loan funds. Despite this, and despite many innovations over the years, there are just a lot more really good public interest media enterprises which die because they cannot find funding to support them outside of an often extremely small advertising market.

Is there another way of looking at this?

Well first of all, let’s acknowledge this problem is not unique to media in resource poor countries. In my own country, Channel 4 was set up 20 years ago as a public service broadcaster designed as a complement to the BBC. It would get some public subsidy but it was designed to become increasingly sustainable from the income it derived from advertising. Two decades on it faces unprecedented financial crisis and is lobbying strongly for a share of the BBC licence fee to keep it going. The BBC itself has depended on year-on-year subsidy for more than three quarters of a century!

Indeed, virtually all non publicly funded mainstream news media enterprises in the West are in the throes of transformational crisis, with many arguing that the likes of the New York Times, the UK Guardian and many others are only likely to survive in the long-term with some form of subsidy or philanthropy.

This sustainability problem seems to be increasing, not decreasing. What might another approach look like in addressing it?  Might it be useful, for example, to find a way of placing a more explicit value on the good (or bad) that media brings to society, rather than simply on how professional or investigative or popular the media itself are?  And can we put another value on the cost to society of such media not existing.

Throughout modern democratic history, the media are assumed to deliver a series of social benefits: more accountable government, an informed citizenry, a platform for public debate and dialogue, a means of communication and opinion exchange across political, religious, ethnic or other fracture lines in society, for example. Perhaps these social benefits can prove a starting point for finding different ways of placing a more specific value on the good that media can do. Or, for that matter, a social cost on the harm media can do when captured to incite tension or hate, for example.

I would make a case that the value of these social benefits to democratic society is increasing, especially in fragile states. For example, in poor and fragile democracies, other forms of ensuring that states are accountable to their citizens – such as elections – are not working very well. I’ve highlighted elsewhere how media seem in much current policy discourse to be increasingly valued – and looked to - for their potential role in delivering greater accountability.   I would argue that the more fragile the state, the greater the value of such benefits.

Furthermore, I would argue that the cost to democratic societies of these benefits not being delivered is growing. Uninformed citizens are less able to make electoral decisions based on a policy choice and more susceptible to being dragooned into voting based on affiliation to a particular ethnic, religious or political dynastic identity. Citizens who are never exposed to perspectives or experiences or stories from those who are of a different ethnic, religious or political community are probably more likely to be encouraged to hate or violence. The costs – actual and potential - of all of these benefits not being provided seem to be growing, especially in fragile states.

The provision of social benefits in society is often stressed when markets fail to provide them.  The market failure in the provision of these benefits (such as an informed citizenry) also seems to be growing. It almost certainly is in the West, but even in much less mature media markets in developing countries, and especially in fragile states, the advertising base simply seems unable to support the kind of professional, investigative and trusted media capable of providing these benefits(let alone the community media that we know can be so effective in enabling dialogue in society). The ever greater fragmentation of the media, the ever growing number of media actors appears to be simply dividing a small advertising pie into every tinier slices making serious private investment in the socially beneficial aspects of media actors ever more difficult. It seems increasingly important to address this.

So would it be possible to place a value on these benefits, and also to place a cost on these benefits not being provided? I am not sure but I think there may be precedents. Professor Paul Collier in his remarks made to the Salzburg Seminar on media seems to suggest that media might be almost as important as elections in providing a mechanism of accountability on executive authority (I have not discussed any of this with him). That seems to be coming quite close to putting a value on the media compared to another key accountability mechanism.

The British political system seems to go much further. The UK government and UK parliament has agreed that the value of the BBC to the domestic democratic good of the country is £142.50 per household per year – the cost of the annual license fee. It values the international public good that the BBC provides at over £200 million per year, the amount provided by the UK Foreign and Commonwealth Office to the BBC World Service. Social benefit calculations around the role of the media seem, in fact, to be quite common. Presumably, if the BBC (on whose behalf I'm not in a position to speak), becomes less good at enabling an informed citizenry, accountable government and the platform for a national (as well as international) public conversation – not to mention a key source of national identity - then there will be less justification for this kind of subsidy. All these benefits in the UK also seem more, not less, valuable at present.

If a value can be placed on the social benefits that media are generally supported to provide, then there can be a better, more insightful assessment of whether media are - or are not - effective deliverers of these benefits. In some circumstances and in some countries there will be other actors or mechanisms that might be more effective in enhancing accountability, ensuring an informed citizenry, acting as a platform for public debate or enabling communication across fracture lines in society. In others, media will be absolutely essential to their provision.

All this is an attempt to address a key problem confronting donors when they consider support to the media. They generally know that media is really quite important to the functioning of democratic society. The problem is they have no way of knowing how important. If a better value can be place on the social benefits that media provide, then the costs of media not providing those benefits can be much better assessed.

My guess is that if this approach was followed, the arguments around sustainability of media would become very different. Rather than the decision being focused on pulling out of funding a radio station, the cost benefit analysis is flipped around to focus on what happens when the radio station stops providing the public goods that it has been, and whether there is any guarantee that other mechanisms in society will take up this role as a public good provider. If not, then the consequences could be major, possibly catastrophic. Given the amounts of money involved, which are often in the scheme of things quite small, the value for money argument – which is now around the value of the social benefits (or the social costs) rather than the simple operational efficiency of the radio station – may become much more compelling.

As will be very obvious to those who are, I am no political scientist or political economist or economist or much of anything which might make me qualified to make these arguments properly. I know there is a huge amount of literature that exists around the public value of public service broadcasters in the West, but much less that takes a broader social benefit analysis of media in developing countries, and espeically fragile states. There are, in particular, very few tools which enable a donor or anyone else who plans to fund or invest in the media to work out what the social benefit, or avoidance of social cost, will actually be and therefore what kind of social return on their investment will be.

If what is outlined here is an interesting line of enquiry, however it is framed, it would be fantastic to see some serious research being done into it. I know of very little that is being done at present.

What might the end result be? Well the story will be the same, but the ending just might be different.

“We’ve been funding this radio station for four years now. Both your own evaluations and our own assessment make us conclude that it’s achieved far more than we could possibly have hoped. For the first time, people really feel that their elected leaders are answerable to their citizens, people feel they understand the policy choices they can make when it comes to an election. And it’s role in defusing the truly terrifying level of mutual suspicion, misunderstanding and – well hate – that used to exist between the two main ethnic groups in this region has made this one of the best investments we could possibly have made in the country.

"We’ve carried out our own assessment of just how important these social benefits of accountability, an informed citizenry and communication across the deep fracture lines that exist in this society are. Our analysis shows that the social costs of these benefits not being provided will be immense, and possibly devastating.   We’ve concluded that the continuing supply of such social benefits is essential if our other investments in the country are to be safeguarded.

“We’ve also done an assessment of how effective your radio station is in delivering these social benefits, and whether alternative market mechanisms will come anywhere near providing them. And we’ve looked at whether civil society and other non state actors have been better at providing them. The answer – at least on this occasion - is an emphatic endorsement of your strategy. In the long term we’re going to have to find other ways of supporting the kind of thing you do – perhaps some kind of endowment fund, or a re-examination of licence fee models or other forms of domestic subsidy. In the meantime, we’ve formed a new group of donors to support not only your station but to come up with a long term strategy of media support across the country.

“Be warned however – if we think these social benefits are diminishing in value (perhaps the government is getting more honest anyway and elections are working better), or market failure elsewhere in the media appears to be less pronounced (perhaps because of the growth in an advertising base), or better mechanisms of providing these public goods emerge (the growing ubiquity of mobile telephones seems an intriguing development as does the growing blogosphere), then we’ll be withdrawing our funding.

Until then you should take this as an acknowledgment that the sustainability problem is not just yours – it’s ours too.”

Please Note: This is an amended version of an earlier post.