People don’t read the news like they used to. Not in the sense that people don’t sit around reading the paper anymore (although that is indeed true).
The news industry has been seriously changed (or, as many say, damaged) by the way that media is presented and consumed these days. The news industry is losing at a game of catch-up with the internet; technology is evolving faster than the news has been able to keep up. The decline in newspaper subscriptions and other traditional sources of revenue that the news industry relied on for so many years has caused the industry to have to reinvent its sources of income – with mixed results.
Additionally, controversy in the news industry around the 2016 US election has caused a wave of distrust in the industry. Studies conducted by Statista have revealed that “In light of the fake news scandal which overshadowed the 2016 Presidential Election and the early days of President Trump’s tenure, trust in the media both in the United States and worldwide has nosedived.”
There have been a number of technological and legal proposals to assuage this problem. Some of the strongest of these proposals have been put forth by blockchain firms – most recently, a platform called Civil has been making headlines. Twitter CEO Jack Dorsey even said that the platform was looking to blockchain to combat the spread of fake news. But can blockchain technology really save the press?
RT Hyperledger “Twitter looks to blockchain as it fights to combat fake news and scams https://t.co/7oBgAW6UuG“
— Maciej Jedrzejczyk (@mjedrze) September 12, 2018
Blockchain Platform ‘Civil’ is Having a Re-do on Its ICO
At the moment, the answer to that question is at best unclear. Civil and news of its ICO first began appearing in the news in September, when the platform was slated as a possible answer to the press industry’s problem. Civil’s platform has plans to introduce a new funding model and a “supporting ecosystem that enables journalist to focus on serving their readers above all else.”
“Journalism today is dying because no one has really figured out how to financially support it in a winner-take-all capitalist system.”#Journalism #NewsIndustry #RevenueDeclining #Media #ContentAnalysis #Personalisation https://t.co/PUkpkP7nLp
— Jay Shah (@jaywalkercc) May 3, 2018
All seemed to be going well – in early October, the platform clinched a partnership with Forbes. The company had been backed by a large investment from ConsenSys. But it quickly became clear that the ICO was not going to be able to reach its $8 million goal; after several weeks had passed, only $1.4 million had been raised.
On Tuesday, the sale was officially canceled, and participants were told that their money would be refunded.
It wasn’t entirely clear whether the failure of the sale was caused by poor ICO management and technical problems or by a lack of interest in the platform, although Civil co-founder and head of marketing Matt Coolidge believes it was the former.
“It’s safe to say that the success of the token sale and the lager success of Civil are not mutually inclusive,” he said in an email to Finance Magnates. “You mentioned interest – and that’s what we’re most excited about thus far.”
“Nearly 3,000 people have taken the series of non-trivial steps to signal their strong interest in participating in CVL — that’s a much higher rate than the majority of token sales in recent months, especially in this bear market for cryptocurrencies. We see that as a more than ample foundation for an active network of participants.”
Nearly 3,000 people were willing to jump through required hoops to buy CVL tokens. Yet the token sale didn’t succeed. Civil is here to stay, and will continue to host the extraordinary #journalism already being done by Newsrooms. What’s next? See here. https://t.co/V9VgRxdG2i
— Civil (@Join_Civil) October 16, 2018
Whether or not Civil’s second round will be successful remains to be seen. If nothing else, however, they have laid a clear path for ways that blockchain could be used to improve the media industry–and if they don’t manage to do it, someone else probably will.
A Deeper Look Into the Media’s Issues: Distribution
Coolidge said that Civil’s platform was designed to address “two twin crises: ownership and distribution.”
“With few exceptions, journalists have lost control of the model — the vast majority of daily newspapers are now owned by hedge funds, private equity firms or media holding companies, none of whom is incentivized to invest in quality journalism at the expense of returning profits to shareholders,” he explained to Finance Magnates.
“It’s this mentality that has led to the wave of endless layoffs and outright closings of newspapers around the U.S. and worldwide (the most sober stat we’ve seen that underscores this phenomenon: more than 200,000 journalists have left the industry since 2000).”
Algorithms on Platforms Like Facebook and Google Have Created Parallel Universes of Facts for Different Social and Political Demographics
In order to really understand whether or not blockchain could offer anything substantial to the media industry, it’s important to understand where the problems with the media really lie.
Coolidge told Finance Magnates that “Google and Facebook have effectively cornered the digital advertising market (they control more than 80% of digital ad spend worldwide). This means that two companies who own the dominant media distribution platforms (YouTube, in the case of Google) are able to exercise inordinate influence over journalists.”
— John Hall (@johnhall) July 22, 2017
How Synthesis Bank Brings the Benefits of Investment Banking to BlockchainGo to article >>
“Neither company is focused on serving ethical journalism if it comes at the expense of their ability to attract/retain users — and more specifically, their data,” Coolidge added.
Indeed, “Facebook doesn’t care about media sustainability,” said Jeff Koyen, publisher at ICORanker.com and career journalist, to Finance Magnates. “Given its way, every publisher would rely exclusively on Facebook to reach their audiences in exchange for a share of ad revenue.” ICORanker.com is an ethically-run ICO review website.
“Their efforts to curtail false news and misinformation on the platform are woefully inadequate. Rather than start with a fresh, down-to-the-bones look at the problem — which could jeopardize earnings — Facebook is putting band-aids on its existing algorithms and processes. For starters, they’re relying on the crowd (ie, their own users) to assign media trustworthiness. See any problem with this?”
— Arne Hessenbruch (@ArneHessenbruch) April 23, 2018
The problem is that this results in a total split in perception – and in the worst cases, totally varying sets of facts. ‘News’ sources that figured out that they would get more traffic if they put a particularly strong political spin (or if they made up facts outright) have plagued the internet, causing a massive web of misinformation and distrust of the media at large.
In other words, because advertising practices incentivize these kinds of platforms to only show people pieces of content that they are likely to click, ‘like,’ or share, people on different ends of the political spectrum are unlikely to see very many of the same pieces of content. In other words, people who like and share pieces of conservatively-framed news will see more pieces of conservatively-framed news; people on the left will see more left-leaning pieces of media.
What Can Blockchain Really Give to the News? “Radical Transparency”
How can blockchain address these problems? Let’s think for a moment. The buzzwords around blockchain are heard so often that they have essentially lost their meaning – decentralized, immutable, trustless.
But these qualities have a lot to offer the news industry – think of the Bitcoin network, for example. Even with privacy protections like CoinJoin put in place, it’s possible to trace a coin through its entire life cycle – every transaction that it’s ever been involved with. The same is true with public wallet addresses: all of the transactions made to or from a certain address are publicly available, forever.
This is what has made blockchain so suited to a supply chain. If a particular asset is tied to a token, it can be easily traced from beginning to end through an unalterable, fully-transparent, and decentralized ledger.
“To regain the public’s trust, the media needs to adopt radical transparency as a guiding principle,” Jeff Koyen said to Finance Magnates. “The media is really just a giant supply chain, and it must be treated as such.”
— SmartWall (@smartwall_ai) March 13, 2017
Therefore, “I believe it’s time for the media to be mapped and indexed as a global supply chain. Every article, every byline, every video, every editor — collecting, analyzing and indexing every important step of the media production process. This data, in turn, will be made available to all third parties who are working on the problem of false news and misinformation. (Yes, even Facebook is invited to layer data into their calculations.)”
Essentially, “building tools that will help news consumers make their own decisions about trustworthiness and media integrity is crucial.”
Such tools wouldn’t necessarily need to be blockchain-based. “Using blockchain technology to make this work? That’s actually the least interesting part of the story,” he added. “A supply chain platform that’s helping journalism save itself through data transparency at would be wildly important. I believe this is the absolute best use case for blockchain and media trust.”
Blockchain’s Capabilities for Verifying Identity and Content Authenticity Could Bring New Integrity
Alison McCauley, author of Unblocked: How Blockchains Will Change Your Business and CEO of Unblocked Future, echoed Koyen’s sentiments. “The same features used to track assets are the focus of startups looking to combat fake news,” she told Finance Magnates. Unblocked Future is a blockchain education and consultancy firm.
“Many of their approaches center on proven validation. There are two sides of validation: the contributor’s identity, and the content’s authenticity.”
In the case of contributor identity, “there are many emerging companies that are seeking to become a trusted third-party verifier and protector of identity. The user shares enough with the third party so that they can verify who they say they are.”
With regards to content authenticity, McCauley says that there are a number of different solutions. “Approaches include encrypting stories on the blockchain so they are more difficult to modify, verifying the authenticity of user generated content, or developing economic incentives and a transparent, auditable network to hold curators and the community accountable for the integrity of content.”
However, McCauley believes that this kind of a platform may not be the final solution to the problems that the news industry is facing. Rather, she told Finance Magnates that “this may be just the beginning of an arms race against fake news. There is a vast network of resources focused on generating and profiting from fake news today—and the rest of us haven’t had much of an arsenal to use in the battle.”
“Blockchains could make fake news more difficult to perpetuate, and less profitable. However, as AI, machine learning and the use of bots becomes more sophisticated, this will likely prove to be a long-term war.”