Why David Leigh's broadband tax plan is bonkers

Just a few of the reasons why this journalism subsidy wouldn't work.

I'm not sure if Guardian journalist David Leigh is being completely serious with his plan for a £2 a month levy on all broadband bills to subsidise journalism.

But here are a few reasons why I think the scheme is bonkers.

He proposes that the £500m a year windfall should be split between publishers depending on the size of their web audience.

So it means already highly profitable titles like the Daily Mail and The Sun would get £100m and £50m a year respectively in order to justify highly loss-making titles like The Guardian getting their beaks wet.

Under the Leigh system The Times - in my opinion just as fine and campaigning a newspaper as The Guardian  - would get nothing, because it has had the temerity to experiment with an alternative model and sought to charge readers to access its content online.

Regional newspapers, doing  the incredibly important job of holding local power to account, would get little - because reports of town and city council meetings are never going to drive as many web eyeballs as pictures of scantily-clad reality TV stars on the beach.

And while £2 a month may not seem like much, I suspect that many British households will take a degree of convincing that they should face a 10 per cent increase in their broadband bills to support a British journalism industry which still has something of an image problem following the hacking scandal and the Leveson Inquiry. 

That said, Leigh is right that something needs to be done and I suspect his piece is more about fostering a debate than anything else. Print circulations are plunging and while more readers are being found online, most titles are still miles away from finding an online model that pays anything like as much as the old print one did.

Without the work that national and regional newspaper titles do we would be left with a view of the world dominated by PR and advertising with some blogger propagandising thrown in for good measure.

So here's an alternative proposal: take on Google.

Currently UK publishers take a fairly relaxed view to the actions of the monopolistic US search engine giant because they love all the extra readers Google brings them.

But with Google UK ad revenues set to top £3bn this year the newspaper industry owners are increasingly looking like householders who, having been woken in the night by burglars, rush downstairs to make them a cup of tea before helping them into their van with the flatscreen TV and the silverware.

How well would Google do without all the free editorial content which it is indexing I wonder?

As the NLA versus Meltwater copyright case shows, UK publishers only have to say the word and they can stop Google reproducing their stuff. It’s a clear a breach of copyright if they want to stop it, a line of code inserted at the top of each website asking the Googlebots to keep out will suffice.

My alternative idea is for the Newspaper Publishers Association, the Newspaper Society, the PPA and the commercial broadcasters to get together and create their own news search engine. The accompanying search advertising could then be split between their members.

I suspect that professional publishers’ share of Google’s £3bn in UK advertising income would be more than the £500m brought in by the Leigh tax.

This article originally appeared in Press Gazette.

Photograph: Getty Images

Dominic Ponsford is editor of Press Gazette

Getty Images.
Show Hide image

Why relations between Theresa May and Philip Hammond became tense so quickly

The political imperative of controlling immigration is clashing with the economic imperative of maintaining growth. 

There is no relationship in government more important than that between the prime minister and the chancellor. When Theresa May entered No.10, she chose Philip Hammond, a dependable technocrat and long-standing ally who she had known since Oxford University. 

But relations between the pair have proved far tenser than anticipated. On Wednesday, Hammond suggested that students could be excluded from the net migration target. "We are having conversations within government about the most appropriate way to record and address net migration," he told the Treasury select committee. The Chancellor, in common with many others, has long regarded the inclusion of students as an obstacle to growth. 

The following day Hammond was publicly rebuked by No.10. "Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included," a spokesman said (as I reported in advance, May believes that the public would see this move as "a fix"). 

This is not the only clash in May's first 100 days. Hammond was aggrieved by the Prime Minister's criticisms of loose monetary policy (which forced No.10 to state that it "respects the independence of the Bank of England") and is resisting tougher controls on foreign takeovers. The Chancellor has also struck a more sceptical tone on the UK's economic prospects. "It is clear to me that the British people did not vote on June 23 to become poorer," he declared in his conference speech, a signal that national prosperity must come before control of immigration. 

May and Hammond's relationship was never going to match the remarkable bond between David Cameron and George Osborne. But should relations worsen it risks becoming closer to that beween Gordon Brown and Alistair Darling. Like Hammond, Darling entered the Treasury as a calm technocrat and an ally of the PM. But the extraordinary circumstances of the financial crisis transformed him into a far more assertive figure.

In times of turmoil, there is an inevitable clash between political and economic priorities. As prime minister, Brown resisted talk of cuts for fear of the electoral consequences. But as chancellor, Darling was more concerned with the bottom line (backing a rise in VAT). By analogy, May is focused on the political imperative of controlling immigration, while Hammond is focused on the economic imperative of maintaining growth. If their relationship is to endure far tougher times they will soon need to find a middle way. 

George Eaton is political editor of the New Statesman.