Beyond Fixing

Facebook
How the multibillion-dollar business
behind online advertising could
reinvent public media, revitalize
journalism and strengthen democracy

By Timothy Karr and Craig Aaron

Free Press
February 2019
Contents

Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Online ads work — and that’s the problem
The Free Press proposal: An online-ad tax

Damage Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Too big not to fail
A formula for manipulation
‘Surveillance capitalism’
The race to the bottom

Confronting the News Crisis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Reinventing public-interest media
Righting the imbalance
Exploring tax options
Journalism’s ‘moon shot’

The Authors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Endnotes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

2
Introduction
2018 was the year Facebook had to face reality.

At the beginning of the year, Facebook’s civic-engagement manager declared the global online
platform was making it “easier for people to have a voice in government — to discuss issues,
organize around causes, and hold leaders accountable.” 1

But within months, the company was telling a darker story, having to defend itself before
U.S. and European lawmakers after news that data firms and troll farms, including Cambridge
Analytica and Russia’s Internet Research Agency, misused Facebook data to divide and
mislead U.S. voters and spread hatred and propaganda. 2

In April, Facebook CEO and founder Mark Zuckerberg was grilled about this by members of the
House and Senate. Facebook executives were back on the Hill in June and then again in the
fall to answer questions in additional hearings. In November, a New York Times investigation
revealed that Facebook executives had orchestrated a multi-year effort to cover up and deny
evidence of widespread abuse of their platform and enabled an anti-Semitic smear campaign
against the company’s growing list of critics. 3

Every week seems to bring another scandal. Privacy gadflies and opponents of unchecked
corporate power have issued warnings about Facebook for years. Now government officials, the
media and the broader public have awakened to the social network’s vast potential for abuse —
and people are clamoring to do something about it. 4

But what should be done to rein in Facebook? And what are the problems that need to be solved?

Here’s where the vision gets fuzzy. There’s now widespread acknowledgment of the threat
Facebook (and Amazon, Google and Twitter) pose to our politics, economy, media and attention
spans. But the levers for change seem inadequate or obscure. Too many policy proposals are
either weak tea or dangerous cures arguably worse than the disease they’re supposed to treat.
All the while our eyeballs stay glued to social media, and the number of people using these
platforms keeps growing.

3
This much is certain: Facebook’s vision of billions of people connecting to make the world better
and the powerful more accountable hasn’t come to pass.

Instead the company and other online platforms

have divided people into groups that are often
violently opposed to one another. 5 They’ve
hastened the spread of hate speech and propaganda
and exploited people’s personal data and private There’s now widespread
information in myriad ways with little accountability,
acknowledgment of the
transparency or consequence. Throughout the past
two decades, the platforms have transformed from
threat Facebook (and
disruptive startups to powerful conglomerates Google, Twitter and
dedicated to swallowing up or undermining their Amazon) pose to our
competition.
politics, economy, media
As much as anywhere, the platforms’ negative and attention spans. But
impacts are felt in journalism. As social networks the levers for change seem
and search engines dominate more and more of the inadequate or obscure.
online world, the independent and local journalism
that people need to engage in constructive dialogue
and participate fully in our democracy continues to
disappear from communities.

The business of journalism will continue to suffer from structural shifts in the media advertising
model. Without a new approach, we’re likely to see waves of newsroom layoffs continue
through 2019 and beyond — further weakening journalists’ ability to protect the vulnerable and
hold the powerful to account. 6

In this paper, Free Press measures the rise of the online-platform business model against the fall
of independent news reporting and calls for an economic realignment that recognizes the vital
role noncommercial journalism can play in a democracy.

Of course, the platforms alone aren’t to blame for journalism’s struggles. Many of the media
industry’s worst wounds have been self-inflicted: Consolidation has shuttered newsrooms
nationwide, and many traditional news outlets have failed to adapt their businesses to an online
environment or to stay connected to the communities they serve.

4
Yet as millions of us have grown accustomed to getting information about the world from online
platforms, these tech companies are doing less and less to direct their users to the types of
reporting that traditional advertising once sustained. 7

In this paper we look beyond Facebook to address

a deeper problem infecting the entire “attention
economy.” 8 This problem — the abuse of targeted
advertising — is linked to a revenue model that To confront the problems
generates hundreds of billions of dollars for online of online platforms, we
platforms. Such targeted advertising relies on
must look beyond fixing
data-harvesting regimes that individuals, groups
Facebook to understanding
and government actors have abused to promote
malicious and false stories, incite racists and the economics of targeted
manipulate voters. advertising that sustain
the sector.
We dig into these complex issues and offer a
novel proposal: the creation of a tax on targeted
advertising to fund a public-interest media system
that places civic engagement and truth-seeking
over alienation and propaganda.

There are many legitimate concerns about the largest online platforms. Many advocates are
rightly focused on improving user privacy. Others are calling for more aggressive antitrust
enforcement, including breaking up dominant companies like Amazon, Facebook and Google.
While we support many of these efforts, our focus here is on showing how to make the
economic engine powering these platforms more accountable to the public while addressing the
crisis in journalism these companies have worsened.

Online ads work — and that’s the problem

To confront the problems of online platforms, we must look beyond fixing Facebook to
understanding the economics of targeted advertising that sustain the sector.

5
This advertising is working as designed — namely, to target products to a market segment of
one. But internet and human-rights advocates have long pointed out that such finely focused
ad-based systems can be used to manipulate those who are most susceptible to the message
and inflame hatred and discord that can lead to real-world violence.

Baked into the DNA of these platforms is their

ability to gather personal data on their users and
group people into demographic and special-interest
categories the companies sell ads to. Research Platforms are too deeply
shows that one of the most effective ways to hold vested in data collection
people’s attention is by featuring content that puts
and targeted advertising
sensationalism before the facts, and that reinforces
existing beliefs even when they’re inaccurate. 9 As to address the multiple
such, platforms have a built-in market incentive to problems this economic
engage users with “low-value” content they can
model presents. It will
show these ads against — especially the type of
content that keeps eyes glued to the screen.
require public pressure
and government action
While financially successful, this economic exchange to hold these companies
— targeting low-value content and ads at highly
accountable.
specified audiences — is the source of many of the
platforms’ problems. It’s also hastened the collapse
of the traditional advertising marketplace that once
supported quality journalism.10 This collapse, in turn, has led to wholesale layoffs in newsrooms
across the country and a resulting loss of news production.

There’s also an unhealthy relationship between ad-targeting algorithms and organic content
curation. Rewarding the content that generates the most “engagement” — as defined by
Facebook — naturally influences the type of content that is created and shared.11

Those who have figured out how to game these algorithms don’t always have in mind the best
interests of the online community, which is why much of the damaging polarization we see on
platforms like Facebook is driven by organic content rather than paid ads.

6
Facebook is very quiet about the way the ad-targeting and News Feed algorithms are
interlinked. And Google doesn’t like to reveal how search-result customization relates to ad
targeting on a search page.12

Silicon Valley has proven incapable of fixing this problem. Online platforms are too deeply
vested in data collection and targeted advertising to address the multiple harms their economic
model presents. It will require public pressure and government action to hold these companies
accountable.

The Free Press proposal: A targeted-ad tax

While many in government, academia and advocacy have put forward ideas to respond to the
latest series of Facebook blunders, we need to step back to consider the role public-interest
journalism can play as an antidote to what ails social media.

Quality investigative journalism, local news and

independent reporting help foster what economists
call “positive externalities,” meaning the benefit
A sound approach to
to society as a whole is greater than the benefit
just to those who access or pay for the content.13 addressing this dangerous
Conversely, online hate, trolling, misinformation and system is an old one:
disinformation create “negative externalities” by
taxes. In this case, a tax
harming society in ways that don’t always directly
affect the content producer, consumer or platforms
would be levied against
that distribute this content. targeted advertising to fund
journalism.
Social-network algorithms gather people into like-
minded groups and promote to them the content
that will generate the strongest reaction. Attach a revenue-generating engine to these two
elements, and you’ve created an efficient machine for spreading misinformation and hate.14

Free Press believes a sound approach to addressing this dangerous system is an old one: taxes.
In this case, a tax would be levied against targeted advertising to fund the kinds of diverse,
local, independent and noncommercial journalism that’s gone missing, and to support new
news-distribution models, especially those that don’t rely on data harvesting for revenue.

7
Think of it like a carbon tax, which many countries impose on the oil industry to help clean up
pollution. The United States should impose a similar mechanism on targeted advertising to
counteract how the platforms amplify content that’s polluting our civic discourse.

Levying taxes on products like gasoline, cigarettes or lottery tickets, whose consumption may
harm parties other than the user, isn’t new to U.S. policy. The resulting revenue has helped fund
public health, infrastructure, education and welfare initiatives.

Unlike excise taxes on products, the tax on targeted advertising would be levied not against
individual consumers but against enterprises that profit from targeted-ad sales. The revenues
could be used to create a Public Interest Media Endowment, which would support production
and distribution of content by diverse speakers — with an emphasis on local journalism,
investigative reporting, media literacy, noncommercial social networks, civic-technology
projects, and news and information for underserved communities.

A tax on targeted-advertising revenues must

be structured in a way that doesn’t unduly
burden for-profit journalism institutions. This
concern can be addressed by establishing a A tax on advertising
threshold that targets the tax on outlets earning
revenues is a winnable fight
hundreds of millions of dollars in targeted-ad
and achievable through
revenues. These would result in the new tax being
imposed on large advertising-supported firms that an act of Congress. If we
produce little to no journalism while avoiding levies want to get serious about
on most for-profit ad-supported journalism outlets.
reversing local journalism’s

This isn’t a radical idea: A number of other countries downward spiral, this is
are weighing new taxes on platform giants, with where to start.
proposals currently under consideration in Australia,
Austria, Belgium, France, Italy, Malaysia, South
Korea, Spain and the United Kingdom.15

A targeted-ad tax in the U.S. would be a policy solution that doesn’t attempt to police content.
We explore this idea in more detail later in this paper, but a tax of 2 percent on targeted
ads could produce approximately $2 billion per year in revenue for a Public Interest Media
Endowment to support independent, community-based and investigative journalism, among
other innovations.

8
While this approach doesn’t pretend to solve all of the problems surrounding platforms or
journalism, a tax on advertising revenues is a winnable fight and achievable through an act
of Congress. If we want to get serious about confronting corporate power and reversing local
journalism’s downward spiral, this is where to start.

A targeted-ad tax would divert a small portion of the platforms’ earnings toward fixing the
broken model of digital journalism, giving people more of the news and information they need
to participate fully in democracy. We believe this proposal is a way to begin repairing the
damage the companies have done that would also improve the civic health of communities
and people’s lives.



9
Damage Report
When testifying before the U.S. Congress in April 2018 and the European Parliament in May,
Facebook founder and CEO Mark Zuckerberg repeatedly told of the modest beginnings of his
social network: “The history of how we got here is we started off in my dorm room with not a
lot of resources,” Zuckerberg told U.S. senators. “It was me and my roommate.”

His intent was to diminish the beast Facebook has

become. But the fundamentals tell a different story:
Along with Google, Facebook now controls nearly
70 percent of the U.S. online-advertising market.16 It If 2018 proved anything,
spends billions to buy up companies like Instagram
it’s that Zuckerberg’s
and WhatsApp that have established a foothold in
the social-media marketplace.
humble creation is now
too massive for Facebook’s
Facebook also boasts about having data profiles of leaders to govern.
the nearly 2.3 billion people who regularly use the
network worldwide. From a market perspective,
Facebook’s growth has been nothing short of miraculous.17 By the close of Zuckerberg’s April
congressional testimony, the company’s market capitalization stood at $480 billion; it has since
peaked above half-a-trillion dollars, or approximately the gross domestic product of Sweden.

And Facebook isn’t the only tech colossus: The top-five publicly traded companies in the United
States are from the tech sector.

Too big not to fail

If the past year proved anything, it’s that Zuckerberg’s humble creation is now too massive for
Facebook’s leaders to govern. The social-media giant has been wracked by scandal after wide-
ranging scandal, many of its own making. With billions of users regularly uploading and sharing
content, the company appears unable and unwilling to prevent future mishaps.

Other leaders and former executives of internet giants including Apple, Google, reddit and
Twitter have gone public with mea culpas about the ways their far-reaching products have
wreaked havoc on civil society, addicted users and undermined democratic culture.18

10
Less certain is their willingness to do anything about it.

Platform companies profit from collecting vast quantities of information about their users
based on their web browsing, media use, location, preferences, contacts, purchases and
more. Nefarious groups have used this data along with ad-targeting tools and algorithms
to stoke discrimination against people based on their race, gender, religion and
other identities.19

In Myanmar, the Philippines and Sri Lanka, Facebook has been used to inflame ethnic and
religious hatred and plot deadly attacks.20 Other unscrupulous third parties have misused social
networks to influence election outcomes worldwide; they’ve created fake online accounts to
spread disinformation, sow racial discord and divide communities.21

Given the many examples of abuse in the United States, the company announced it would
conduct a long-overdue civil-rights audit.22 The audit could help quantify the full extent to
which individuals and groups exploit platform algorithms to attack people of color and other
marginalized communities.23 But Facebook hasn’t committed to fully publicizing the audit or to
making any policy changes based on its findings.

The company did purge thousands they deemed bad actors from its platform in June 2018 to
ensure that it’s a “safe place for everyone.”24 It followed that with the removal of “pages” by far-
right conspiracy theorist Alex Jones for “glorifying violence” and “using dehumanizing language
to describe people who are transgender, Muslims, and immigrants,” though he later re-emerged
on other Facebook pages.25

Despite these efforts, groups and individuals continue to game Facebook and other online
platforms with worrying results. And Facebook, which tends to take confusing, incremental
action against such violations, is just as much a part of the problem.26

The company adjusted its policies to prevent discriminatory micro-targeting after a

2016 ProPublica investigation found it had allowed advertisers to exclude Black people,
Hispanics and other “ethnic affinities” from seeing ads (which amounted to illegal housing
discrimination.)27 But in October 2018, after a shooter murdered 11 people in a Pittsburgh
synagogue, The Intercept found Facebook was still selling ad space targeted to people
interested in the anti-Semitic “White genocide” myth.28

11
A formula for manipulation

Superficial fixes to company systems and standards are destined to fail. That’s because they
ignore one fundamental truth: The creators of the most coercive social networks designed their
platforms to work this way.

In other words, social networks function by gathering people into like-minded groups and
promoting to them the content that creates the strongest reaction. The platform then generates
revenue by targeting ads that appeal to these finely targeted communities. Combine these two
elements and you’ve created a billion-dollar formula for manipulation.29

Google matches online ads with demographic data

it gleans from users’ search histories and Android
mobile-phone activities among other things. It
employs a real-time auction model that places
Superficial fixes … are
display ads across several sites, a technique that destined to fail. That’s
has thoroughly undermined the business model because they ignore one
of ad-driven news organizations.30 This practice,
fundamental truth: The
along with the microtargeted advertising favored
by Facebook, accounted for most of the online ad creators of the most
revenues generated in recent years.31 coercive social networks
designed their platforms to
“The central problem of disinformation corrupting
work this way.
American political culture is not Russian spies or
a particular social media platform,” Ben Scott and
Dipayan Ghosh argue in their 2018 paper Digital
Deceit.32 “The central problem is that the entire industry is built to leverage sophisticated
technology to aggregate user attention and sell advertising. There is an alignment of
interests between advertisers and the platforms. And disinformation operators are typically
indistinguishable from any other advertiser. Any viable policy solutions must start here.”

At first glance, Facebook’s “News Feed” appears to give equal weighting to all postings.
A typical user might see a news item from the Associated Press mixed in with ads from
Mastercard and Walmart. Updates from high-school classmates stand alongside political
propaganda from unfamiliar sources. But there’s something more insidious at work here.

12
The entire network is predicated on its ability to identify users of specific interests and trigger a
response. That’s why more and more advertisers are turning to Facebook and other data-driven
online platforms as reliable and affordable ways to sell a product or idea to those most likely to
be receptive and willing to spread it to others.

The algorithms serve the advertising model. Platforms wouldn’t have it any other way. Their
executives are willing to fix certain aspects of their online creations — but not the targeted
advertising and related algorithms that drive the entire enterprise.

‘Surveillance capitalism’

Asking a popular online platform like Facebook to fundamentally alter its advertising algorithms
is like asking a tiger to lose its stripes.

“Facebook, as well as Twitter and Google’s

YouTube, have become the digital arms dealers
of the modern age,” writes veteran tech journalist
Asking a popular online
Kara Swisher.33 “They have weaponized social
media. They have weaponized the First Amendment. platform like Facebook
They have weaponized civic discourse. And they to fundamentally alter its
have weaponized, most of all, politics.”
advertising algorithms is

The danger isn’t just Facebook’s or Google’s

like asking a tiger to lose
unwieldy scale but the multibillion-dollar revenue its stripes.
model on which online companies have built their
businesses. It’s powered by a form of “surveillance
capitalism,” where digital platforms make money by profiling our activities online and then
selling our attention to political actors, commercial advertisers and others.34

This ad-targeting ecosystem benefits those that can vacuum up massive quantities of personal
information. It includes social-media platforms, but is fueled by a hidden network of data
brokers collecting and reselling our personal information.

These data merchants — and not Facebook users — “are Facebook’s true customers, whom
it works hard to please,” writes techno-sociologist Zeynep Tufekci.35 “A business model based
on vast data surveillance and charging clients to opaquely target users based on this kind of
extensive profiling will inevitably be misused.”

13
Indeed, surveillance capitalism has evolved to suit the needs of those whose product is
misinformation and manipulation. The platform users, on the other hand, are left without a way
to accurately assess how their data is transferred to advertisers and others every time they log
on to these services.

We can engineer the context around a particular behavior and force change that way,” one
engineer told author Shoshana Zuboff in her book, The Age of Surveillance Capitalism. “We are
learning how to write the music, and then we let the music make them dance.”36

In the hands of data analysts like those at Cambridge Analytica, this instrument was used to
“dance” people toward voting booths — or keep them away — and influence their choice of
candidates.37

To some extent, online platforms have become

more transparent about the ways they handle user
information.38
While thorough
But shortly after Zuckerberg told Congress that
transparency is
Facebook users have “complete control” over who
sees their data, the New York Times exposed details
important, there’s not
of the company’s data partnerships with Amazon, enough evidence to
Apple, Samsung and other cellphone, video-gaming suggest it would end
and television manufacturers, which exempt these
the dangerous types of
entities from the data-harvesting and disclosure
restrictions the company put in place in 2015.39 targeting profiled here.

For its part, Google announced that it would stop

personalizing Gmail ads based on its scanning of words in user emails. But the company simply
used its many other data-harvesting operations, including Google search and Android, to serve
up heavily targeted ads with much the same results.40

Last spring, the European Union’s General Data Protection Regulation, or GDPR, went into
effect, promising to give internet users more control over the ways online platforms use their
data, while forcing these companies to be more transparent about their practices. While it’s far
too early to render a verdict on GDPR’s effectiveness, some warn the rules have threatened free
speech and press freedom.41

14
Others say the measures don’t go nearly far enough. Many are hoping to learn from and modify
Europe’s approach as they ponder similar legislation for the United States.42

While thorough transparency is important, there’s not enough evidence to suggest it would
end the dangerous types of targeting discussed here. According to advertising-industry polling,
nearly three out of four consumers say they prefer personalized online advertising.43 A recent
survey by the Pew Research Center strongly suggests that an extensive public-education
effort might change that perception.44 At the moment, however, it’s not a leap to see how many
people would initially choose to have their data used in ways they might only later see
as harmful.

Like it or not, data harvesting and its complementary ad-targeting businesses will remain
fixtures of the online economy for the foreseeable future. As stories of misuse pile up, regulators
must come to grips with multiple approached to keeping this system in check.

The race to the bottom

Online-platform problems aren’t limited to the

mismanagement and misuse of user data. Too
much of the growing bucket of online-advertising A business built on
money flows to malicious, sensationalist or just plain
clickable metrics loads
false content — and too little flows to valuable news
and information.
the news cycle with
stories that scream the
In some ways, the system is simply responding to loudest at the expense of
a public taste for junk news. This is a phenomenon
accuracy and depth.
that’s true not only online but in traditional media. It’s
a quirk of human nature that has a predecessor in
today’s TV news, the tabloid journalism of the 20th
century and yellow journalism before that.

Disinformation and divisiveness attract. Looking at more than 1,000 posts from hyperpartisan
Facebook pages, BuzzFeed News found that misleading content that reinforced existing beliefs
was shared more frequently than accurate, factual content.45

15
Indeed, this kind of “news” generates significant social engagement.46 A 2018 MIT study found
that false news reports were 70 percent more likely to be retweeted on Twitter than accurate
news — and the effects were even more pronounced for false political news.47

In short, a business built on clickable metrics loads the news cycle with stories that scream
the loudest at the expense of accuracy and depth. Less measurable outcomes, like whether an
article inspires a person to get involved in their community or speak out against an injustice,
aren’t part of the platforms’ calculus for promoting stories.

It’s a system that rewards extremes, writes the New York Times’ David Streitfeld: “Say you’re
driving down the road and see a car crash. Of course you look. Everyone looks. The internet
interprets behavior like this to mean everyone is asking for car crashes, so it tries to supply
them.”48

To be fair, many online platforms have tried to

tackle misinformation. Facebook has employed
legions of fact-checkers to downgrade items they
deem false,49 and it attempted to block ads that link In reality, Facebook
to fake news stories.50 It also removed thousands executives are reluctant
of accounts it identified as using “coordinated
to determine which
inauthentic behavior” to attract a large audience
news sources should
of followers and drive them to websites that often
feature false and clickbait news stories but are be trusted and which
actually designed to sell ads.51 For its part, Twitter ones dismissed….
has removed tens of millions of suspicious and fake
Their reticence is
accounts from its platform, including so-called bot
accounts that are driven by algorithms with little to understandable
no human involvement.52

While Silicon Valley execs like to tout these efforts, they haven’t improved people’s newsfeeds:
On a day seven months after Facebook re-engineered its feed to promote more “trustworthy”
news sources, the top-10 most-engaged news stories on the network included a Nike boycott
story that Snopes later debunked as fake, a story from a hyperpartisan news aggregator
that featured no original reporting, and three posts by Ladbible, a social-media company that
spreads celebrity and viral memes.53

16
One of the fact-checkers that Facebook hired to tackle the deluge of misinformation on its
platform later gave up in frustration (along with fact-checkers working on the project from
Associated Press and Snopes), reporting that the task of truth-testing false posts was “like
battling the Hydra of Greek myth. Every time we cut off a virtual head, two more would grow in
its place.”54

Facebook executives say they don’t want to determine which news sources should be trusted
and which ones dismissed. During her testimony before the Senate in September 2018,
Facebook COO Sheryl Sandberg said the platform shouldn’t be “the arbiter of what’s true and
what’s false.”55

Twitter CEO Jack Dorsey told Congress his platform doesn’t block content based on “political
viewpoints, perspectives, or party affiliation,” acknowledging that relying on algorithms to flag
content for removal leads to “mistakes.”56

Their reticence is understandable. Though it’s not driven by a desire to protect free speech or
correct the record, but by an inability to manage the sheer volume of content that crosses social
networks. Tech companies have amassed a history of censorship misfires,57 blocking outlets and
reporters who are producing legitimate news.58

But if not on commercial online platforms, where can people go to find accurate and trustworthy
news and information?



17
Confronting the
News Crisis
Facebook’s growth as a social network has coincided with the collapse of the traditional
business model that once sustained the news industry, where declining ad revenues have
contributed directly to widespread job losses.

Between the beginning of 2004 (the year Facebook launched) and the end of 2016, the number
of U.S. newspaper employees dropped by more than half — from 375,000 to about 173,000,
according to the Bureau of Labor Statistics (see Table 1).59 During that same time period, print-
advertising revenue fell from a record high to a record low, and many large metro and regional
papers closed shop, followed more recently by a spate of closures by long-standing newsweeklies.

It’s not just newspapers — a wave of layoffs hit

prominent digital-only outlets like BuzzFeed,
HuffPost and Vice at the end of 2018 and
beginning of 2019, with more expected soon.60
‘The faltering of newspapers,

A 2018 study from researchers at the University

the consolidation of TV and
of North Carolina looked at the emergence of radio, and the rising power
“news deserts” — regions that lack local news of social-media platforms are
outlets — and found that the United States has
not just commercial issues
lost about 20 percent of its newspapers since
2004, leaving at least 900 communities without driven by the market. They
local news resources.61 are democratic issues with
profound implications for
Newsroom-job losses mean less of the political
our communities.’
reporting that an informed democracy needs.
Between 2003 and 2014, the number of full-time
newspaper reporters covering statehouses in the
United States fell 35 percent, according to the Pew Research Center.62

A similar study by professors from George Washington University and American University
found declining political-news coverage of congressional campaigns correlates with dropping
levels of civic engagement in politics.63

18
The loss of quality investigative journalism and independent reporting has far-reaching societal
harms. Josh Stearns of the Democracy Fund has catalogued the growing body of evidence
showing that declines in local news and information lead to drops in civic engagement. “The
faltering of newspapers, the consolidation of TV and radio, and the rising power of social-
media platforms are not just commercial issues driven by the market,” Stearns writes. “They are
democratic issues with profound implications for our communities.”64

Still, the platforms are only partly to blame for the news crisis. Many media-industry missteps
have contributed to journalism’s decline. Media consolidation has shuttered newsrooms
nationwide, while a large number of traditional news outlets opted for layoffs and closures over
adapting to the new realities of news consumption.

As platforms have become more dominant, many news outlets have become stuck in
a perpetual game of catch-up — slow to foster constructive dialogue online with their
communities and audiences.

Source: U.S. Bureau of Labor Statistics

19
Reinventing public-interest media

As targeted advertising becomes the revenue model shaping journalism or the lack thereof, the
problems inherent with this economic system need to be addressed at the most basic level.

U.S. regulators have long recognized the need for noncommercial alternatives to offset profit-
driven news outlets, fill information gaps, and reach communities the mainstream commercial
outlets overlook. From the nation’s earliest days, policymakers have enacted measures to
promote access to news.65

It’s been more than 50 years since President Lyndon Johnson signed the Public Broadcasting
Act of 1967, which established the Corporation for Public Broadcasting (CPB) and, eventually,
PBS and NPR. As the media landscape has undergone seismic shifts and audiences have
become more diverse, we must rethink public media’s mission and radically improve on the
policies that — to a limited degree — have supported noncommercial news.

Today, most of the CPB’s annual allotment

(around $450 million) goes to support local
public-television and radio stations, the affiliates
that often carry NPR and PBS programming. As the modern media
landscape has shifted from
Public polling has shown that most people in the broadcast to broadband,
United States believe taxpayer funding for public
from radio to reddit, we
broadcasting is money well spent.66 Yet funding
here pales by comparison to that in other advanced need a funding mechanism
democracies: While the United States spends that can keep pace.
approximately $1.40 per capita to fund public media,
Japan spends nearly $60 per capita, the United
Kingdom spends more than $80 and Denmark more than $100.67

The United States’ relatively paltry allotment has remained static for more than a decade despite
the strong history of public support for news distribution in the United States, dating back to the
Postal Act of 1792, which subsidized lower postage rates for newspapers, pamphlets and other
print media considered socially beneficial.68

20
As the modern media landscape has shifted from broadcast to broadband, from radio to reddit,
we need a funding mechanism that can keep pace. We must also adapt public-interest media to
the shifting dynamics of the U.S. population to reflect its diversity. This change means building
a public-media system whose practitioners look more like the people they report on. A lack of
diversity continues to plague newsrooms in both for-profit and noncommercial news outlets.69

If we don’t take action to reinvent public media now, the climate for all forms of journalism
will only get worse. A comprehensive analysis written for Columbia’s Tow Center for Digital
Journalism notes that online platforms “now control what audiences see and who gets paid for
their attention, and even what format and type of journalism flourishes.”70

And yet Facebook is increasingly downgrading access to news from outside outlets.71 The
company sees reading a headline and clicking through to the corresponding news site as less
engaging — meaning less lucrative for Facebook — than arguing in a comment thread with your
racist uncle, or piling on with others in response to the outrage of the day. The social networks
know that our conversations over their platforms cost them nothing to produce. The real value
is in keeping users on the platform, chatting with friends and family and not clicking away to
external sites.

Facebook’s new emphasis on optimizing against

clicks has undermined the interests of many news
organizations that had already reshaped their This is the damaging
editorial operations based on Facebook guidance for reality of the attention
generating traffic from social media that later proved
economy. It’s misaligned
false.72
the flow of advertising
This is the damaging reality of the attention money away from content
economy. It has misaligned the flow of advertising with high social value.
money away from content with high social value.
And in many instances it has molded the news
industry in its image.

It’s cheaper to repeat a story than to report one, to “share” something for free than to spend the
time and resources to uncover something new. President Trump knows this well and is able to
dictate the news cycle just by tweeting (or retweeting) something. Repeating what Trump says
in his tweets is cheaper than taking the time to discern whether they’re accurate, or exploring
how his policies are felt in communities where they have the most dramatic impact.

21
And yet it’s those stories from the field that often create benefits that spill beyond their
readers, viewers or listeners. It’s much more difficult — if not impossible — for a news
organization to monetize the positive outcome from deeper reporting that’s carried forward
to society as a whole.

Righting the imbalance

In his book Democracy’s Detectives: The Economics of Investigative Journalism, Stanford

economist James T. Hamilton attempts to calculate the larger benefit to society of such
investigative reporting. “I found that each dollar spent on stories can generate hundreds of
dollars in benefits to society,” Hamilton told a reviewer, “though gains are distributed in ways
hard for news organization[s] to translate into additional reporting resources.”73

The best way to right this economic imbalance is

to make the platforms pay to clean up the mess
they’ve made — and support the production and
Rather than attempting to
distribution of the kind of high-value content
Hamilton describes. police content, lawmakers
should tax the purveyors
Free Press is calling on Congress to create a new,
of targeted advertising to
multibillion-dollar Public Interest Media Endowment
funded by taxing the purveyors of targeted
support a Public Interest
advertising. Media Endowment.

Rather than attempting to police content, the

endowment would direct tax revenues to fund independent and noncommercial news outlets.
The money from the Public Interest Media Endowment could be spent in ways that preserve
editorial independence and protect grant recipients from political interference. The funding
could support local-news startups, investigative reporting, civic-engagement initiatives, public-
interest journalism and the creation of alternative platforms. It should emphasize operations of,
by and for diverse and underserved communities.

22
For example, the Public Interest Media Endowment could provide grants for projects to:

 Improve the quantity and quality of civic information in local communities.

 Give residents enhanced access to useful government data and public information through
innovative applications, platforms and technologies.74

 Fund new experiments in noncommercial investigative reporting and newsgathering.

 Support development of and innovation by noncommercial social networks that don’t rely
on data harvesting for income.

 Train more people in the practices of local journalism, fact-checking and production.

 Offer a state-level media-literacy curriculum for schools and communities.

 Better meet the information needs of low-income communities and communities of color
that have been underserved by commercial media.

 Promote tax credits and other incentives for news organizations that hire new and diverse
newsroom staff.

The endowment could also explore new ways to bolster community-engagement projects
and connect newsrooms with the communities they’re supposed to cover — to address local
problems like gentrification, under-resourced schools, political corruption and racial injustice and
how they’re covered in the media.

Funding could be weighted toward ensuring that the maximum amount of content is available
immediately in the public domain (instead of hidden behind paywalls). Projects to seed social
platforms that don’t rely on data-harvesting would also be of special interest.

The Public Interest Media Endowment would grant money to news-and-information initiatives
throughout the country or offer block grants to be redistributed by state and local institutions,
including those using similar approaches to New Jersey’s newly created Civic Information
Consortium.75

Alternatively, the funds could flow through an existing body like the Corporation for Public
Broadcasting — but with clear guidelines established and greater public input on how the
money should be spent.

23
The distribution of the funds — as well as hiring and evaluation — must be overseen by an
independent board of directors that represents the country’s geographic, gender, racial and
political diversity and includes experienced journalists, technologists, philanthropists and
members of the general public. Public engagement and ascertainment would be essential to the
project’s success and accountability.

Exploring tax options

To broaden the investment in public media, Congress would need to amend the appropriate
sections of the tax code with language that levies the taxable income of online platforms that
earn their revenues from targeted advertising. Congress would then need to redirect the money
to the Public Interest Media Endowment or other institution empowered to distribute the money
to support local-, independent- and noncommercial-journalism projects.

There are a number of options for collecting tax revenues for the Public Interest Media
Endowment, which are scalable depending on the endowment’s size and payout rates. The
three examples below would generate an annual allotment of approximately $2 billion:

Option 1: A 2 percent targeted-ad tax on all online enterprises that earn more than
$200 million in annual digital-ad revenues would yield more than $1.8 billion for the
endowment, based on 2018 ad sales. (See Table 2.) Commercial online publishers and
platforms making $200 million or less in digital-ad revenues would not be subject to the
tax to avoid harming smaller to mid-sized online enterprises, especially those engaged in
news production.

Option 2: A lower tax rate levied on all advertising revenues, including offline
placements, which increasingly draw on similar data profiles gleaned from online
activity. With projected U.S. advertising revenues for 2018 (both offline and on) at
approximately $200 billion, a 1 percent tax rate would yield approximately $2 billion for
the endowment.

Option 3: A tax equal to 1.5 percent of taxable income levied on any platform with an
annual taxable income of $1 million or greater if more than 60 percent of such income is
derived from the sale of advertisements presented to patrons or users. Based on 2018
revenues, this would yield close to $2 billion.

24
Other options include reducing the immediate tax deductions available to businesses that place
advertisements and redirecting the resulting tax income to the endowment; or creating a tax
on the average revenue per user on major platforms using targeted ads, calculated by dividing
a platform’s total revenues by its monthly active users. There are other workable formulations.
In any case, we should be careful to avoid taxing news production itself (see the carveout in
Option 1) as the goal is to revitalize journalism, not restrict it.

In addition, any tax should be based on the revenues — not the profits — of companies engaged
in online advertising. This approach would prevent these companies from concealing profits
through other means or routing them through other countries to avoid paying their full share.

Platform companies are experts at avoiding tax payments. Between 2007 and 2015, Facebook
paid only 4 percent in corporate-income tax, Amazon paid only 13 percent and Google paid
16 percent, according to S&P Market Intelligence. By contrast, the corporate-income tax rate
S&P 500 companies paid averaged 27 percent.76 The massive corporate tax cuts the Trump
administration passed in late 2017 allowed these behemoths to deprive the U.S. Treasury of tens
of billions of dollars more. Amazon, a company with $11.2 billion in profits in 2018, did not pay
one penny in federal taxes last year.77

25
It’s important to note that even $2 billion a year isn’t enough to meet the information needs
of local communities. It would take many billions more to address the crisis facing journalism.
We believe that taxing the platforms shouldn’t be the only source of new funding for local
or independent journalism, and such a policy must work alongside other measures and
funding streams.

While some critics may suggest we’re aiming too low given the size of the problem, we believe
our approach is ambitious but achievable in the next few years. To win we must invest in a
broad-based organizing campaign and push both journalists and politicians to expand their
narrow and cynical views of what’s possible.

Journalism’s ‘moon shot’

U.S. journalism needs a radical new boost of energy — one that reimagines the role
independent, noncommercial media can and should play in a healthy democracy.

It’s time to recognize that free-market economics alone have failed to sustain a news
ecosystem that serves all of the people. While this kind of endowment would not solve all of
the problems facing U.S. journalism, it would make a sizable dent and open the door to other
creative solutions.

We aren’t alone in seeing the need for new and

bolder actions. Emily Bell of Columbia’s Tow Center
for Digital Journalism has called for a “significant It’s time we recognize that
transfer of wealth” from Silicon Valley to support
free-market economics
independent journalism, though she calls for the
tech giants to fund a private foundation. It would be alone have failed to sustain
a “moon shot,” Bell writes, that could “write a better a news ecosystem that
path for the broken model of American journalism.”78
serves all of the people.

The major platforms are coming to terms with their

damaging impact on journalism, too. Facebook recently announced its intention to spend $300
million to support local-journalism projects. Google earlier announced similar plans, including an
initiative to fund several worthy efforts like Report for America.79

26
While we welcome any investment in good reporting, putting the fate of U.S. journalism in the
hands of Silicon Valley billionaires is a dangerous game. People would be much better served by
a publicly accountable system with a consistent funding mechanism. The Public Interest Media
Endowment we’ve proposed would help accomplish this. That said, we welcome debates on
ways to best achieve our goals that recognize the urgent need to address these challenges.

When the great American essayist Walter Lippmann wrote that the “crisis of Western
democracy is a crisis of journalism,” he couldn’t have imagined a world less than 100 years later
where misinformation spreads at light speed across social networks used by billions.80

That’s where we are today — facing not only a crisis of trust in the media but an attack on the
truth. At the same time, the traditional economic model for journalism has weakened to the
point of breaking. It’s a vicious cycle that won’t be reversed unless we address the problem head
on. And we can’t expect Mark Zuckerberg or Larry Page to do it for us.

It’s one thing for Silicon Valley execs to apologize (and apologize and apologize again) and
promise to fix things after yet another high-profile failure. But we can’t expect that tech titans
will figure it out. The buck stops elsewhere: With the American public and our elected leaders,
who must hold the targeted-advertising industry to account, and do what it takes to rebuild
trust and repair a broken media system.

The status quo is unsustainable, and we need to consider alternatives that actually meet our
societal and democratic needs. If we act soon, we have a real chance to create a healthier
information system, one that fosters journalism that holds leaders accountable and tells
people what’s actually happening in their communities. It requires newfound political will and
an expanded belief in what’s possible to address these huge challenges. But if we want to
revitalize the news and reinvent public media, we must start now.



27
The Authors
Timothy Karr is the senior director of strategy and communications at Free Press, where he’s
helped create and lead campaigns on Net Neutrality, internet freedom and press freedom. Karr’s
criticism, analysis and reporting on the media and media policy have been published in dozens
of publications worldwide, including TIME, MSNBC, USA Today, The Guardian, The Chicago
Tribune, The Jakarta Post, Al Ahram, The Japan Times, HuffPost and Bill Moyers & Co. Before
joining Free Press, he served as executive director of MediaChannel.org and as vice president
of Globalvision New Media. He’s worked throughout Southeast Asia as an editor, reporter
and photojournalist for the Associated Press, Time, Inc., The New York Times and Australia
Consolidated Press.

Craig Aaron is the president and CEO of Free Press and Free Press Action. For more than a
decade, he’s led major campaigns to safeguard the open internet, stop media consolidation,
oppose unchecked surveillance, defend public media and sustain quality journalism. Aaron
speaks often to the press and the public on media and technology issues. He’s written for The
Daily Beast, The Guardian, HuffPost, The Hill, MSNBC, Politico, The Philadelphia Inquirer, The
Seattle Times, Slate, USA Today and many other outlets. Before joining Free Press, he was an
investigative reporter for Public Citizen’s Congress Watch and the managing editor of In These
Times magazine. He’s the editor of two books, Appeal to Reason: 25 Years of In These Times
and Changing Media: Public Interest Policies for the Digital Age.

The authors wish to thank Free Press Research Director S. Derek Turner for his significant
contributions in shaping Beyond Fixing Facebook’s proposal and analysis.

28
Endnotes
1. S
 amidh Chakrabarti, “Hard Questions: What Effect Does Social Media Have on Democracy?,” Facebook Newsroom, Jan. 22,
2018: https://newsroom.fb.com/news/2018/01/effect-social-media-democracy.

2. Information Commissioner’s Office of the United Kingdom, “Investigation into the Use of Data Analytics in Political Campaigns,”
Jul. 18, 2018: https://ico.org.uk/media/action-weve-taken/2259371/investigation-into-data-analytics-for-political-purposes-up-
date.pdf. Also: Garrett Graff, “A Blockbuster Indictment Details Russia’s Attack on U.S. Democracy,” Wired, Feb. 16, 2018:
https://www.wired.com/story/mueller-indictment-russia-attack-us-democracy.

3. S
 heera Frenkel, Nicholas Confessore, Cecilia Kang, Matthew Rosenberg and Jack Nicas, “Delay, Deny and Deflect: How Face-
book’s Leaders Fought Through Crisis,” The New York Times, Nov. 14, 2018: https://www.nytimes.com/2018/11/14/technology/
facebook-data-russia-election-racism.html.

4. F
 or an exhaustive list of Facebook missteps, see: Mellisa Ryan and Alex Kaplan, “Facebook Has a Long History of Failing Its Us-
ers. The Massive Data Breach Is Just the Latest Example,” Media Matters for America, updated Dec. 20, 2018: https://www.me-
diamatters.org/blog/2018/10/12/facebook-has-long-history-failing-its-users-massive-data-breach-just-latest-example/221670.

5. “ How Social Media Fires People’s Passions — and Builds Extremist Divisions,” The Conversation, Nov. 13, 2017: https://the-
conversation.com/how-social-media-fires-peoples-passions-and-builds-extremist-divisions-86909. Also: Molly Wood and
Kristin Schwab, “How Social Media Exacerbates the Racial Divide,” Marketplace, Nov. 1, 2017: https://www.marketplace.
org/2017/11/01/tech/how-social-media-propaganda-exacerbates-racial-divide. Also: Henry Fernandez, “Curbing Hate Online:
What Companies Should Do Now,” Center for American Progress, Oct. 25, 2018: https://www.americanprogress.org/issues/im-
migration/reports/2018/10/25/459668/curbing-hate-online-companies-now.

6. N
 ic Newman, “Journalism, Media, and Technology Trends and Predictions 2019,” Digital News Project, Reuters Institute and the
University of Oxford, 2019.

7. E
 lisa Shearer and Jeffrey Gottfried, “News Use Across Social Media Platforms 2017,” Pew Research Center, Sept. 7, 2017: http://
www.journalism.org/2017/09/07/news-use-across-social-media-platforms-2017.

8. T
 im Wu, “Blind Spot: The Attention Economy and the Law,” Antitrust Law Journal, March 26, 2017:
https://ssrn.com/abstract=2941094 or http://dx.doi.org/10.2139/ssrn.2941094. Wu is a former Free Press board member.

9. W
 e explore this research in much more detail later in this paper. Here’s a good summary: Soroush Vosoughi, Deb Roy
and Sinan Aral, “The Spread of True and False News Online,” Science, March 9, 2018: http://science.sciencemag.org/con-
tent/359/6380/1146.

10. Michael Barthell, “5 Facts About the State of the News Media in 2017,” Pew Research Center, Aug. 21, 2018:
http://www.pewresearch.org/fact-tank/2018/08/21/5-facts-about-the-state-of-the-news-media-in-2017.

11. Adam Mosseri, (Facebook Head of News Feed), “Bringing People Closer Together,” Facebook, Jan. 11, 2018:
https://newsroom.fb.com/news/2018/01/news-feed-fyi-bringing-people-closer-together/.

12. For more on the mechanisms of advertising and algorithims see: Dipayan Ghosh and Ben Scott, “Digital Deceit: The Technol-
ogies Behind Precision Propaganda on the Internet,” New America, Jan. 23, 2018: https://www.newamerica.org/public-inter-
est-technology/policy-papers/digitaldeceit. Scott is a former Free Press staff member and the current chair of Free Press’ board.

13. For a detailed discussion on positive externalities and journalism, read Victor W. Pickard’s America’s Battle for Media Democ-
racy: The Triumph of Corporate Libertarianism and the Future of Media Reform. New York: Cambridge University Press, 2015.
Pickard is a Free Press board member.

14. Rebecca Lewis, “Alternative Influence: Broadcasting the Reactionary Right on YouTube,” Sept. 18, 2018:
https://datasociety.net/output/alternative-influence/.

15. Mark Skulley, “Advertising Dollars Turn to Cents for Online Journalism,” The New Daily, Nov. 25, 2018: https://thenewdaily.
com.au/news/national/2018/11/25/digital-news-part-two. Also: Tom Jowitt, “France, Germany Support EU Digital Tax On Tech
Giants,” MSN: Money, Nov. 12, 2018: https://www.msn.com/en-us/money/news/france-germany-support-eu-digital-tax-on-
tech-giants/ar-BBPClj8?li=AA54rU. Also: Alison Griswold, “France Will Tax Google, Apple, Facebook, and Amazon Starting
Jan. 1,” Quartz, Dec. 17, 2018: https://qz.com/1498356/france-will-tax-google-apple-facebook-and-amazon-starting-jan-1.
Also: Bhavan Jaipragas and Tashny Sukumaran, “Spending Cuts, New Taxes Likely for Malaysia in Mahathir Government’s
First Budget,” South China Morning Post, Nov. 1, 2018: https://www.scmp.com/week-asia/economics/article/2171266/spend-
ing-cuts-new-taxes-likely-malaysia-mahathir-governments. Also: Sohn Ji-young, “Lawmakers Propose Bill on Taxing Google,
Amazon on Earnings in Korea,” The Korea Herald, Nov. 11, 2018: http://www.theinvestor.co.kr/view.php?ud=20181111000180.
Also: John Harris, “Without a Fair Tax on Tech, It Could Be the End of the State as we Know It,” The Guardian, Nov. 11, 2018:
https://www.theguardian.com/commentisfree/2018/nov/11/tax-big-tech-companies.

29
16. Kurt Wagner, “Digital Advertising in the US Is Finally Bigger Than Print and Television,” Recode, Feb. 20, 2019,: https://www.
recode.net/2019/2/20/18232433/digital-advertising-facebook-google-growth-tv-print-emarketer-2019.

17. Michelle Castillo and Salvador Rodriguez, “Facebook Shares Whipsaw After Mixed Earnings Report,” CNBC, Oct. 30, 2018:
https://www.cnbc.com/2018/10/30/facebook-q3-2018-earnings.html.

18. Sara Salinas and Sam Meredith, “Tim Cook: Personal Data Collection Is Being ‘Weaponized Against Us with Military Efficiency,’”
CNBC, Oct. 24, 2018: https://www.cnbc.com/2018/10/24/apples-tim-cook-warns-silicon-valley-it-would-be-destructive-to-
block-strong-privacy-laws.html. Also: Nicholas Thompson, “Our Minds Have Been Hijacked by Our Phones,” Wired, July 26,
2017: https://www.wired.com/story/our-minds-have-been-hijacked-by-our-phones-tristan-harris-wants-to-rescue-them. Also:
Noah Kulwin, “I Fundamentally Believe That My Time at Reddit Made the World a Worse Place,” New York Magazine, April 19,
2018: http://nymag.com/intelligencer/2018/04/dan-mccomas-reddit-product-svp-and-imzy-founder-interview.html. Also: David
Streitfeld, “‘The Internet Is Broken’: @ev Is Trying to Salvage It,” The New York Times, May 20, 2017: https://www.nytimes.
com/2017/05/20/technology/evan-williams-medium-twitter-internet.html. Also: Noah Kulwin, “The Internet Apologizes …,” New
York Magazine, April 19, 2018: http://nymag.com/intelligencer/2018/04/an-apology-for-the-internet-from-the-people-who-
built-it.html. Also: James Vincent, “Former Facebook Exec Says Social Media Is Ripping Apart Society,” The Verge, Dec. 11,
2017: https://www.theverge.com/2017/12/11/16761016/former-facebook-exec-ripping-apart-society. Also: Ellie Silverman,
“Facebook’s First President, on Facebook: ‘God Only Knows What It’s Doing to Our Children’s Brains’,” The Washington Post,
Nov. 9, 2017: https://www.washingtonpost.com/news/the-switch/wp/2017/11/09/facebooks-first-president-on-facebook-god-
only-knows-what-its-doing-to-our-childrens-brains. Also: Nellie Bowles, “Facebook Made Him a Billionaire. Now He’s a Critic,”
The New York Times, March 21, 2018: https://www.nytimes.com/2018/03/21/technology/brian-acton-facebook-critic.html.

19. Sheera Frenkel, Mike Isaac and Kate Conger, “On Instagram, 11,696 Examples of How Hate Thrives on Social Media,” The New
York Times, Oct. 29, 2018: https://www.nytimes.com/2018/10/29/technology/hate-on-social-media.html. Also: Julia Angwin
and Terry Parris Jr., “Facebook Lets Advertisers Exclude Users by Race,” ProPublica, Oct. 28, 2016: https://www.propublica.
org/article/facebook-lets-advertisers-exclude-users-by-race. Also: Nicole Nguyen, “The ACLU Is Charging Facebook With
Gender Discrimination in Its Targeted Ads,” BuzzFeed, Sept. 19, 2018: https://www.buzzfeednews.com/article/nicolenguyen/
aclu-is-charging-facebook-with-gender-discrimination-ad. Also: Nathaniel Gleicher, “What We’ve Found So Far,” Facebook
Blog, July 31, 2018: https://newsroom.fb.com/news/2018/07/removing-bad-actors-on-facebook/#what-weve-found. Also: Margi
Murphy, “Facebook to Target People with Adverts Based on Their Religion,” Telegraph, March 1, 2018: https://www.telegraph.
co.uk/technology/2018/03/01/facebook-plans-target-people-adverts-based-religion.

20. Paul Mozur, “A Genocide Incited on Facebook, With Posts From Myanmar’s Military,” The New York Times, Oct. 15, 2018:
https://www.nytimes.com/2018/10/15/technology/myanmar-facebook-genocide.html. Also: Lauren Etter, “What Happens
When the Government Uses Facebook as a Weapon?,” Bloomberg Businessweek, Dec. 7, 2017: https://www.bloomberg.com/
news/features/2017-12-07/how-rodrigo-duterte-turned-facebook-into-a-weapon-with-a-little-help-from-facebook. Also:
Amanda Taub and Max Fisher, “Where Countries Are Tinderboxes,” The New York Times, April 21, 2018: https://www.nytimes.
com/2018/04/21/world/asia/facebook-sri-lanka-riots.html.

21. Zeynep Tufekci, “Facebook’s Surveillance Machine,” The New York Times, March 19, 2018: https://www.nytimes.
com/2018/03/19/opinion/facebook-cambridge-analytica.html. Also: Permanent Select Committee on Intelligence, Democrats,
House of Representatives, “Exposing Russia’s Effort to Sow Discord Online: The Internet Research Agency and Advertise-
ments,” February 2018, https://intelligence.house.gov/social-media-content/default.aspx. Also: Nick Penzenstadler, Brad Heath,
Jessica Guynn, “We Read Every One of the 3,517 Facebook Ads Bought by Russians. Here’s What We Found,” USA Today,
May 11, 2018: https://www.pressconnects.com/story/news/2018/05/11/what-we-found-facebook-ads-russians-accused-elec-
tion-meddling/602319002. Also: P.R. Lockhart, “Black Members of Congress Criticize Zuckerberg: Facebook ‘Does Not Reflect
America’,” Vox, April 11, 2018: https://www.vox.com/identities/2018/4/11/17226234/mark-zuckerberg-hearing-facebook-di-
versity-congress.

22. Sheera Frenkel and Katie Benner, “To Stir Discord in 2016, Russians Turned Most Often to Facebook,” The New York Times,
Feb. 17, 2018: https://www.nytimes.com/2018/02/17/technology/indictment-russian-tech-facebook.html. Also: Sara Fischer,
“Exclusive: Facebook Commits to Civil Rights Audit, Political Bias Review,” Axios, May 2, 2018: https://www.axios.com/scoop-
facebook-committing-to-internal-pobias-audit-1525187977-160aaa3a-3d10-4b28-a4bb-b81947bd03e4.html.

23. Anupam Chander, “The Racist Algorithm?,” Michigan Law Review, 1023 (2017): http://michiganlawreview.org/wp-content/up-
loads/2017/04/115MichLRev1023_Chander.pdf.

24. Nathaniel Gleicher, “Removing Bad Actors From Facebook,” Facebook Newsroom, June 26, 2018:
https://newsroom.fb.com/news/2018/06/removing-bad-actors-from-facebook.

25. “Enforcing Our Community Standards,” Facebook Newsroom, Aug. 6, 2018:

https://newsroom.fb.com/news/2018/08/enforcing-our-community-standards.

26. Max Fisher, “With Alex Jones, Facebook’s Worst Demons Abroad Begin to Come Home,” The New York Times, Aug. 8, 2018:
https://www.nytimes.com/2018/08/08/world/americas/facebook-misinformation.html.

27. See: Facebook’s Ad Policies: https://www.facebook.com/policies/ads. Also: Julia Angwin and Terry Parris Jr., “Facebook Lets
Advertisers Exclude Users by Race,” ProPublica, Oct. 28, 2016: https://www.propublica.org/article/facebook-lets-advertisers-ex-
clude-users-by-race.

28. Sam Biddle, “Facebook Allowed Advertisers to Target Users Interested in ‘White Genocide’ — Even in Wake of Pittsburgh Mas-
sacre,” The Intercept, Nov. 2, 2018: https://theintercept.com/2018/11/02/facebook-ads-white-supremacy-pittsburgh-shooting.

29. Rebecca Lewis, “Alternative Influence: Broadcasting the Reactionary Right on YouTube,” Data & Society, Sept. 18, 2018:
https://datasociety.net/output/alternative-influence. Also: Renée DiResta, “Of Virality and Viruses: the Antivaccine Movement and
Social Media,” Technology and Global Security, Nov. 8, 2018: http://www.tech4gs.org/uploads/1/1/1/5/111521085/rene%C-
C%81e_diresta.pdf.

30
30. Ghosh and Scott, “Digital Deceit: The Technologies Behind Precision Propaganda on the Internet.”

31. “Google and Facebook Tighten Grip on U.S. Digital Ad Market,” eMarketer.

32. Ghosh and Scott, “Digital Deceit: The Technologies Behind Precision Propaganda on the Internet.”

33. Kara Swisher, “The Expensive Education of Mark Zuckerberg and Silicon Valley,” The New York Times, Aug. 2, 2018:
https://www.nytimes.com/2018/08/02/opinion/the-expensive-education-of-mark-zuckerberg-and-silicon-valley.html.

34. Shoshana Zuboff, The Age of Surveillance Capitalism: The Fight for a Human Future at the New Frontier of Power. New York:
PublicAffairs, 2019.

35. Tufekci, “Facebook’s Surveillance Machine.”

36. Zuboff, The Age of Surveillance Capitalism, 2019, p. 295.

37. Tiffany Hsu, “Voter Suppression and Racial Targeting: In Facebook’s and Twitter’s Words,” The New York Times, Dec. 17, 2018:
https://www.nytimes.com/2018/12/17/business/russia-voter-suppression-facebook-twitter.html.

38. Kaya Yurieff, “Facebook Adds ‘Clear History’ Option Amid Privacy Scandal,” CNN Business, May 1, 2018:
https://money.cnn.com/2018/05/01/technology/clear-history-facebook/index.html.

39. Nicholas Confessore, Cecilia Kang and Sheera Frenkel, “Facebook Back on the Defensive, Now Over Data Deals With Device
Makers,” The New York Times, June 4, 2018: https://www.nytimes.com/2018/06/04/technology/facebook-device-partner-
ships-criticized.html.

40. Joseph Turow, “Google Still Doesn’t Care About Your Privacy,” Fortune, June 28, 2017:
http://fortune.com/2017/06/28/gmail-google-account-ads-privacy-concerns-home-settings-policy.

41. See Techdirt’s extensive reporting on GDPR: https://www.techdirt.com/blog/?tag=gdpr.

42. David Meyer, “In the Wake of GDPR, Will the U.S. Embrace Data Privacy?” Fortune, Nov. 29, 2018:
http://fortune.com/2018/11/29/federal-data-privacy-law.

43. Holly Pauzer, “71% of Consumers Prefer Personalized Ads,” Adlucent Blog, May 12, 2016:
http://www.adlucent.com/blog/2016/71-of-consumers-prefer-personalized-ads.

44. Paul Hitlin and Lee Rainie, “Facebook Algorithms and Personal Data,” Pew Research Center, Jan. 16, 2019:
http://www.pewinternet.org/2019/01/16/facebook-algorithms-and-personal-data.

45. Craig Silverman, “This Is How Your Hyperpartisan Political News Gets Made,” BuzzFeed, Feb. 27, 2017:
https://www.buzzfeednews.com/article/craigsilverman/how-the-hyperpartisan-sausage-is-made#.gbRwdrP72.

46. Nick Pezenstadler, Brad Heath, Jessica Guynn, “We Read Every One of the 3,517 Facebook Ads Bought by Russians. Here’s
What We Found.”

47. Soroush Vosoughi, Deb Roy and Sinan Aral, “The Spread of True and False News Online,” Science, March 2018:
http://science.sciencemag.org/content/359/6380/1146.

48. Streitfeld, “‘The Internet Is Broken’: @ev Is Trying to Salvage It.”

49. Katie Collins, “Facebook Is Hiring News Credibility Specialists,” CNET, June 8, 2018:
https://www.cnet.com/news/facebook-is-hiring-fake-news-fact-checkers.

50. Mariella Moon, “Facebook Will Also Cut Off Fake News Sites from Ad Money,” Engadget, Nov. 14, 2016:
https://www.engadget.com/2016/11/14/facebook-ad-network-bans-fake-news-websites.

51. Nathaniel Gleicher and Oscar Rodriguez, “Removing Additional Inauthentic Activity from Facebook,” Facebook Newsroom, Oct.
11, 2018: https://newsroom.fb.com/news/2018/10/removing-inauthentic-activity.

52. Emily Stewart, “Twitter’s Wiping Tens of Millions of Accounts from Its Platform,” Vox, July 11, 2018:
https://www.vox.com/2018/7/11/17561610/trump-fake-twitter-followers-bot-accounts.

53. For more on top social-media engagement-news stories see Newswhip: https://www.newswhip.com/.

54. Brooke Binkowski, “I Was A Facebook Fact Checker. It Was Like Playing A Doomed Game Of Whack-A-Mole,” BuzzFeed, Feb.
8, 2019: https://www.buzzfeednews.com/article/brookebinkowski/fact-checking-facebook-doomed.

55. Mallroy Locklear, “Sandberg’s ‘Alternative Facts’ Comment Won’t Help Facebook’s Cause,” Engadget, Sept. 5, 2018:
https://www.rollcall.com/news/policy/rubio-to-jones-ill-take-care-of-you-myself.

56. Twitter CEO Jack Dorsey’s Opening Statement to the Senate Intelligence Committee on Foreign Election Influence Through
Social Media, Sept. 5, 2018: https://www.realclearpolitics.com/video/2018/09/05/twitter_ceo_jack_dorsey_opening_statement_
of_elections_through_social_media.html.

57. Ahmed Zidan, “How Turkey Silences Journalists Online, One Removal Request at a Time,” Committee to Protect Journalists,
Aug. 13, 2018: https://cpj.org/blog/2018/08/how-turkey-silences-journalists-online-one-removal.php.

31
58. Ariana Tobin, Madeleine Varner and Julia Angwin, “Facebook’s Uneven Enforcement of Hate Speech Rules Allows Vile Posts to
Stay Up,” ProPublica, Dec. 28, 2017: https://www.propublica.org/article/facebook-enforcement-hate-speech-rules-mistakes.
Also: Keane, Sean, “YouTube Removes Putin Critic’s Ads Prior to Vote,” CNET, Sept. 10, 2018: https://www.cnet.com/news/goo-
gle-removes-putin-critics-ads-from-youtube-prior-to-vote.

59. Bureau of Labor Statistics, “Newspaper Publishers Lose Over Half Their Employment from January 2001 to September 2016,”
TED: The Economics Daily, AprIL 3, 2017: https://www.bls.gov/opub/ted/2017/newspaper-publishers-lose-over-half-their-em-
ployment-from-january-2001-to-september-2016.htm.

60. Laura Hazard Owen, “In the Latest Sign Things Really Are Dire, BuzzFeed Is Laying off 15 Percent of Its Staff,” Nieman Lab, Jan.
24, 2019, http://www.niemanlab.org/2019/01/in-the-latest-sign-things-really-are-dire-buzzfeed-is-laying-off-15-percent-of-
its-staff. Also: Natalie Jarvey, “Vice Media to Reorganize, Lay Off 10 Percent of Staff (Exclusive),” Hollywood Reporter, Feb. 1,
2019: https://www.hollywoodreporter.com/news/vice-media-reorganize-lay-10-percent-staff-1181785.

61. Penelope Muse Abernathy, “The Expanding News Desert,” University of North Carolina School of Media and Journalism, 2018:
https://www.usnewsdeserts.com/reports/expanding-news-desert.

62. Katerina Eva Matsa and Jan Lauren Boyles, “America’s Shifting Statehouse Press,” Pew Research Center, July 10, 2014:
http://www.journalism.org/2014/07/10/americas-shifting-statehouse-press/

63. Danny Hayes and Jennifer L. Lawless, “The Decline of Local News and Its Effects: New Evidence from Longitudinal Data,” The
Journal of Politics, volume 80, number 1, Oct. 18, 2017: http://dx.doi.org/10.1086/694105

64. Josh Stearns, “How We Know Journalism Is Good for Democracy,” Local News Lab, June 20, 2018: https://localnewslab.
org/2018/06/20/how-we-know-journalism-is-good-for-democracy. Stearns is a former Free Press staff member.

65. “Postage Rates for Periodicals: A Narrative History,” United States Postal Service:
https://about.usps.com/who-we-are/postal-history/periodicals-postage-history.htm.

66. Press release, “New National Survey Shows 73% of Voters — Including Most Republicans — Oppose Eliminating Federal
Funding for Public Television,“ PBS, Feb. 16, 2017: http://www.pbs.org/about/blogs/news/survey-shows-voters-oppose-elimi-
nating-federal-funding.

67. Derek Turner, Victor Pickard, Josh Stearns, Craig Aaron, Josh Silver, Lauren Strayer and Candace Clement, Changing Media:
Public Interest Policies for the Digital Age. Free Press, Washington, D.C., 2009.

68. For a thorough history of the public interest in media policy, including a passage on postal rates, read Victor W. Pickard’s Amer-
ica’s Battle for Media Democracy: The Triumph of Corporate Libertarianism and the Future of Media Reform.

69. Nic Newman, “Reuters Institute Digital News Report 2018,” Reuters Institute for the Study of Journalism, June 15, 2018:
http://media.digitalnewsreport.org/wp-content/uploads/2018/06/digital-news-report-2018.pdf?x89475.

70. Emily J. Bell, Taylor Owen, Peter D. Brown, Codi Hauka and Nushin Rashidian, “The Platform Press: How Silicon
Valley Reengineered Journalism,” Tow Center for Digital Journalism, Columbia University, May 26, 2017:
https://academiccommons.columbia.edu/doi/10.7916/D8R216ZZ.

71. Newman, “Reuters Institute Digital News Report 2018.”

72. Many news outlets were misled by Facebook’s claim that video generates significantly higher engagement than print, causing
many to shift already limited resources from reporting to video production to meet a high-audience metric that was later proven
to be wrong. See: Oremus, Will, “The Big Lie Behind the ‘Pivot to Video,’” Slate, Oct. 18, 2018: https://slate.com/technolo-
gy/2018/10/facebook-online-video-pivot-metrics-false.html.

73. Anya Schiffrin, “Book Aims to Pin Down Economic Return on Investigative Reporting,” Columbia Journalism Review, April 11,
2017: https://www.cjr.org/q_and_a/investigative-reporting-value.php.

74. For more on the need for new public spaces for civic discourse, read Ethan Zuckerman’s “We Make the Media —
A Recent Speech at Freedom of Speech Online 2018,” … My Heart is in Accra, Dec. 9, 2018:
http://www.ethanzuckerman.com/blog/2018/12/09/we-make-the-media-a-recent-speech-at-freedom-of-speech-online-2018.

75. “Proposal for the New Jersey Civic Information Consortium,” Free Press Action, April 2017:
https://www.freepress.net/sites/default/files/legacy-policy/proposal_for_the_new_jersey_civic_information_consortium.pdf.

76. Scott Galloway, “Silicon Valley’s Tax-Avoiding, Job-Killing, Soul-Sucking Machine,” Esquire, Feb. 8, 2018:
https://www.esquire.com/news-politics/a15895746/bust-big-tech-silicon-valley.

77. Laura Stampler, “Amazon Will Pay a Whopping $0 in Federal Taxes on $11.2 Billion Profits,” Fortune, Feb. 15, 2019:
http://fortune.com/2019/02/14/amazon-doesnt-pay-federal-taxes-2019.

78. Emily Bell, “How Mark Zuckerberg Could Really Fix Journalism,” Columbia Journalism Review, Feb. 21, 2017:
https://www.cjr.org/tow_center/mark-zuckerberg-facebook-fix-journalism.php.

79. Peter Kafka, “Facebook Made a $300 Million Pledge to Help Journalists — Just Like Google Did Last Year,” Recode, Jan. 15
2019: https://www.recode.net/2019/1/15/18182973/facebook-journalism-300-million-google-advertising-subscriptions.

80. Walter Lippman [1920], Liberty and the News, Princeton: Princeton University Press, 2008.

32