FCC report on state of local journalism suggests some federal advertising be moved to local outlets

The recent Federal Communications Commission report about the state of local journalism included an interesting nugget spotlighted by Megan Garber of Nieman Journalism Lab: a suggestion that the federal government steer more of its advertising to local news outlets. She cites this passage:

"In 2005, the amount spent was $1 billion, according to the General Accounting Office. Currently much of this spending goes to national entertainment media. Some local broadcasters have argued that this could be targeted to local news enterprises without undermining the cost effectiveness of the campaigns, and perhaps even saving taxpayers money. We agree. Targeting existing federal advertising spending to local news media could help local news media models — both commercial and nonprofit, online and off-line — gain traction and help create local jobs, while potentially making taxpayer spending more cost-effective. In the past, it may have been more cost effective to buy national rather than local, but technological improvements have made it possible to easily buy local media placements on TV, in print and online — so that shifting ads to local news media could prove more cost-effective for taxpayers."

Garber's piece includes several links to related articles and reports.

NRA ad vs. Obama latest case of truth being stretched to breaking point; both sides flawed

As a presidential election nears, candidates' advertising often stretches or distorts the truth, and it can get really bad when ads come from lobbying interests, which voters find difficult or impossible to hold accountable for their actions.

In a new ad campaign the National Rifle Association falsely accuses Barack Obama of wanting to "ban use of firearms for home defense, ban possession and manufacture of handguns, close 90 percent of gun shops and ban hunting ammunition," reports FactCheck.org, a bipartisan effort to expose false statements made by both campaigns.

Much of the ad "is actually contrary to what he has said throughout his campaign: that he 'respects the constitutional rights of Americans to bear arms' and 'will protect the rights of hunters and other law-abiding Americans to purchase, own, transport, and use guns.' . . . we find the NRA has cherry-picked, twisted and misrepresented Obama's record." (Read more)

FactCheck has found fault with several Obama ads about John McCain's plan for Social Security, funding of education, and regulation of health care. It has found shortcomings in the McCain campaign's ads on Obama's tax plan, his stance on sex education and one distorting FactCheck's findings. We encourage newspapers, broadcast stations and bloggers to use FactCheck.

FactCheck has also found fault with an interest group backing Obama, the AFL-CIO, and its advertising accusing McCain of costing politically crucial southwestern Ohio 8,000 jobs. The labor federation and an Obama ad claimed McCain helped pave the way for DHL, a German based delivery company, to take over Airborne Express by voting against an amendment to stop the takeover. Airborne had already laid off 2,000 workers before the merger was announced and McCain claimed he did not vote for the amendment to stop the takeover because it was inserted into an unrelated special project bill, a move endorsed at the time by the Teamsters Union. "it's implausible to suggest that an Arizona senator's vote in 2003 is directly responsible for the business decisions of an independent company five years later," Joe Miller of FactCheck writes. (Read more)

Ark.-based newspaper chain wants its classified ads taken off Wal-Mart's Web site

The biggest newspaper company in Arkansas, WEHCO Media, owned by the Walter E. Hussman family, has asked Arkansas-based Wal-Mart Stores Inc. not to put classified advertising from the company's 11 daily newspapers on Wal-Mart's Web site. The nation's largest retail chain has complied.

Wal-Mart put a "classifieds" link on the site in the last week of May "in what has been described by the Bentonville-based retailer as a test program," Stacey Roberts of WEHCO's Arkansas Democrat-Gazette reported. "It takes visitors to lists of advertisements that can be searched according to location, product or service offered." The newspaper said its management was surprised. (Read more) For Roberts' latest update, via the Southern Newspaper Publishers Association Bulletin, click here.

"Wal-Mart noted that WEHCO's ads would be exposed to a larger audience, and it was possible to direct a inquiry back to the newspaper's Web site," the Bulletin reported earlier. "WEHCO noted that users could review the content of these ads on the Wal-Mart site without being directed back to the newspaper's Web site. It also noted that, unlike some classified sites which concentrate on bigger cities, or certain categories of classifieds, the ads on the Wal-Mart.com site are listed for virtually all towns in the U.S., regardless of size, and all categories, from employment, real estate and autos to merchandise for sale."

Classified sites such as Craigslist and Career Builder, which is owned by major newspaper companies, have concentrated on larger markets. WEHCO is concerned that the move by Wal-Mart, which has most of its stores in rural areas, "could be a significant threat to smaller market newspapers and their classified ads," the Bulletin reports. "While WEHCO realizes it must compete for classified ads and audience, the company says it does not see the advantage in helping classified competitors, especially since classified content is a major reason for reading a newspaper or its Web site, and classified revenues are a major source of funding news gathering, reporting and journalism." (Read more)

Judge triples damages chain-owned weekly must pay independent for undercutting it with ad rates

A victory for independent weekly newspapers was amplified this week when a California judge said a chain-owned weekly in San Francisco had to pay triple damages -- $15.9 million -- for trying to put the independent San Francisco Bay Guardian out of business with subsidies and bargain advertising rates. Superior Court Judge Marla Miller also slapped SF Weekly with an injunction barring it from selling ads below cost for 10 years. Both papers use free circulation. The ruling followed a jury verdict in March.

"Although offering a lower price is the golden rule of good business, it can be illegal in California if a company purposely undercuts a rival with the specific intention of bankrupting the competition," Meredith May explains in the San Francisco Chronicle. "SF Weekly has vowed to appeal. Its lawyers argue the Guardian lost money due to outside forces, including the dot-com bust, Craigslist and lagging reader interest." SF weekly is owned by Village Voice Media, based in Phoenix. (Read more)

West Virginia wildlife agency buys editorial control of 'news' segments on Sinclair stations in state

"West Virginia Wildlife" is a recurring segment on WCHS-TV and WVAH-TV, and it won a regional Emmy in 2007 in the category of "Health/Science/Environment - News." The weekly segment, however, is not news. It's sponsored — and controlled editorially — by West Virginia's Division of Natural Resources, reports Andrew Clevenger of The Charleston Gazette. WCHS-TV and WVAH-TV both broadcast to the Charleston and Huntington markets.

Sinclair Media, which owns the two stations, "receives $90,000 annually to produce and air 52 90-second 'West Virginia Wildlife' segments, as well as 30-second ads that lead into the segment," Clevenger writes. "In return, the state agency maintains editorial control over the final product." The agency's Wildlife Resources Section must approve scripts and the promos ahead of time, and it provides segment topics and interview locations. The contract also includes the provision that the stations cover National Hunting and Fishing Days celebration at Stonewall Jackson Lake State Park and the West Virginia Trophy Hunters Association Hunt Show in Charleston.

"While the station does acknowledge the sponsorship, there is no indication during the news broadcast that 'West Virginia Wildlife' is any different from other news segments," Clevenger writes. "But unlike other advertisers, who might sponsor the station's weather coverage every night, DNR dictates its own coverage."(Read more) According to the Web site of WCHS-TV, the station "has teamed exclusively with the West Virginia Division of Natural Resources, who will be our guide to the West Virginia's wildlife programs and activities." To watch archived segments, go here.

Jury says chain illegally undercut weekly, must pay

This isn't a rural story, but it's about a victory for community-based journalism. A jury decided yesterday that a chain-owned alternative newspaper, SF Weekly, must pay millions of dollars to the locally owned, award-winning San Francisco Bay Guardian for undercutting it with bargain advertising rates and subsidies from the 16-paper chain, Village Voice Media of Phoenix.

The verdict of $6.39 million could grow to as much as $15.6 million because the state-court judge in the case can triple the award, reports Meredith May of the San Francisco Chronicle. Guardian Publisher Bruce Brugmann, in photo, "said the battle was a classic case of a national chain trying to squeeze out the little guy, and the competition was so unfair it could have pushed his paper, which he founded with his wife in 1966, out of business," May writes. "Although offering a lower price is the golden rule of good business, it can be illegal in California if a company purposely undercuts a rival with the specific intention of bankrupting the competition." Other states have similar laws.

Guardian Executive Editor Tim Redmond told May, "It's a victory not just for the Guardian, but for small business and independent publishers in California and everywhere because it shows that a small business has a right to a level playing field when competing with a big national chain." SF Weekly's attorney lawyer said the paper would appeal. "I do not think the evidence supports the verdict," H. Sinclair Kerr Jr. said, "and I'm confident we'll prevail in the California Court of Appeals." Village Voice Media has owned SF Weekly since 1995.

May reports, "In court, Kerr argued that outbidding your competitor is not illegal, and that Brugmann had failed to see his paper's decline was part of a national newspaper revenue slide brought on by the Internet, the dot-com bust and Sept. 11. All those factors make the competition for readers more intense for everybody, not just the Guardian, he said. Since 2000, the Guardian's annual revenue has dropped from $11 million to $6 million. The Weekly has dropped from $9 million to $6 million over the same period." (Read more)

For the Guardian's edgy coverage of the verdict, click here. For the Weekly's corporate press release, presented as a blog item, click here.

Obama advertising heavily on local news sites

Presidential campaigns have spent relatively little money with newspapers in recent years, but the new technology of videostreaming is bringing political advertising to some widely viewed newspaper Web sites in the critical March 4 primary states.

Erik Sass of MediaPost reports that Barack Obama has "sliding billboard" ads "with an embedded 30-second video across 26 high-traffic local sites in Ohio and Texas," where he could put Hillary Clinton's campaign into a tailspin with victories in primaries Tuesday. "Clinton has also utilized online efforts, but not on this scale."

Sass writes, "The campaign will run 39 different creative versions of the ads, including three different videos touting the candidate's various positions. The embedded video ads are re-purposed spots that are also running on TV in the same local markets. When users click on the ads, they are taken to a landing page with a personalized video message from Obama. This includes, for example, Spanish-language messaging on some sites in Texas." (Read more)