Can Lebanon construct a multi-channel digital future for serious journalism?

Seeking real digital entrepreneurship in quality content

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The tech entrepreneurship landscape in Lebanon is slowly producing more colorful and fragrant blossoms —more prosaically known as startup ventures. Also, the country’s entrepreneurship ecosystem, after some years of incremental progress by trial and error, appears to be heading in a direction where it can deliver on two important asset categorizations and ecosystem requirements: generating more diversity overall; and fostering more concepts with potentials for producing good value-added in the context of the national economy today and its needed digital transition, such as Fintech, Blockchain and AI/Big Data-related startups.

But this is not how the presence and future look for all entrepreneurs who seek to innovate and create Lebanese startups from which the economy could greatly benefit. Specifically, many media startups are looking like ships that have no wind in their sails. Even worse, it seems that serious journalistic projects in this country are embattled by digitization-obstructing tornados in comparison to which the headwinds encountered by Fintech startups feel like a gentle summer breeze.

Banking and media

Stakeholders in the society and economy of Lebanon might feel it is counterintuitive to examine financial and media services in Lebanon today, because the banking industry is the domestic superhero and the media looks rather like Clark Kent after an injection of kryptonite. However, there are elements that the two can be said to have in common: First, both draw their existential energy from the trust that people have in them. Secondly, both were pioneers of quality services, thriving on freedoms and a knack for adaptive innovation that helped Lebanon to gradually develop its competitive edge over other Arab countries after the territories in the Levant emerged from the suzerainty of the Ottoman Empire at the end of World War I.   

On the other hand, important differences between Fintech and media outlooks in Lebanon are the current standing of the banking sector, which by its strength towers head and shoulders above every section of the economy, and publishing industry companies, from venerated newspaper houses in the throes of economic death to some new online ventures that fail to impress either in terms of economic performance or even their fundamental approaches to authenticity and content distribution.   

When thinking of banking and media in Lebanon dialectically and not just digitally, however, both have an opportunity to leverage their inherent potentials for generating trust and delivering genuine quality in the emerging Arab digital environment today, even as the digital development and entrepreneurship trajectories of Fintech startups and serious journalism projects have been very different over the years.

Media actually can be seen as one of the earliest industries that were existentially challenged by proto-digitization when newspaper publishers in developed economies were faced with strikes and labor action in the 1960s and 70s because printers, typographers, photo-engravers, and newsroom staff feared job losses from emerging technologies for anything from newsroom work to the layout and pre-print processing of pages. For the five decades since the heydays of mass media in the middle of the 20th century, media have been battling with various waves of digitization. Notably, while commercial organizations on the advertising side of the media industry were in the avant-garde of digital adoption and exists today on basis of having integrated Ad tech into all its processes, the journalistic media and serious news organizations to this day have yet to succeed in the full transition to business models that include digital pillars in every segment of the content acquisition, refining, customer distribution, and satisfaction journey.      

Developing quite differently, the digitization of finance, as opposed to the earlier computerization of banking from the 1970s, has peaked in a short new economy rush of digital disruption before subsiding again in the 2000s. Local bankers with extensive experience recall how the international banking industry used to talk excessively about their eagerness to try online-only instead of operating just as brick and mortar lenders. But they are equally vocal in pointing out how this eager wave ebbed totally and reversed into a race to solidity and traditional banking virtues on safe grounds of high streets and conventional banking districts. However, the development started progressing at accelerating speed after the world was shaken into new financial alertness by the Great Recession of 2008/9, and today it is simply the future of banking.

Bankers in Lebanon, while usually not appearing to be at the forefront of digital thinking, are not at all oblivious to the changes that the digital transition might impose on them in the next two, five, or ten years. But conventional wisdom in the sector is that the transition will not be as radical and fast as some evangelists of the digital banking future are preaching today, such as British consultant and blogger Chris Skinner who enthused in a recent book that banks with “zero technology vision” will have “zero future” and that only those banks that within the next 10 years can embrace micro-service architectures and open market, digitally focused structures will thrive.

“The predominance of digital banking in the future will happen,” comments BLOM chief economist Ali Bolbol before specifying: “But this is a very long-run process. In the short to medium term, the process will be determined by contingent demand and supply factors.” Such factors reflect digital agility and trust in the non-personal aspects of digital banking in a bank’s client base on the demand side, while the factors on the supply side comprise the respective legal environment and central bank’s aptitude to provide effective regulation of digital finance in a given market, along with the willingness, or resistance, of banks to adopt open technological platforms.

Given the regulatory and cultural bulwarks standing in their way in Lebanon, new Fintech startups in the Lebanese ecosystem, such as Rumman, Juno, and Anachron (see November 2018 issue for profiles) have by no means an easy road to success in front of them, but their markets and methodologies have clear potentials, and their challenges, such as winning approval from the central bank of Lebanon, are also quite precise. The budding Fintech acceptance in Lebanon is furthermore proven by the fact that business propositions of Fintech startups have been able to attract interest from accelerators in the ecosystem.     

On the media side, commercial organizations in Beirut—digital agencies and media planners for example—have been thriving in the local entrepreneurship ecosystem even before the Beirut Digital District came into existence. But to say that in search of serious new entrepreneurs the pickings in the Lebanese ecosystem are slim would be a charming overstatement. Of course, there are new media platforms with enticing slogans and exciting concept ideas, and the good part is that there are increasing numbers of digital startups as well as more digitally mature enterprises that have found access to funding. This is observable internationally, but not locally, or even regionally.

Media startups

For a few examples from 2018, the Tortoise Media “slow news” venture in the United Kingdom–motto: ‘slow down, wise up’–succeeded in attracting more than GBP 539,000 ($677,000) from over 2,500 funders on Kickstarter in a month-long campaign in October/November of 2018. Five-year old Dutch member-funded media concept The Correspondent–motto: ‘unbreaking news’—at time of this writing had reached over $2 million (from nearly 35,000 founding members) of a $2.5 million crowdfunding goal sought by the organization in order to branch out into the United States (the campaign was to terminate on December 14, after Executive went to print). And in the more mature startup sphere, 11-year old Danish-founded platform ISSUU, which relocated its headquarters to Palo Alto, California, claims continuing growth after two successful Series A and B funding rounds in 2007 and 2014 which resulted in over $20 million in total investments.

Compared to such magical media stories, the state of journalism startups in the Lebanese media landscape is hardly impressive. However, one hopeful example is Daraj, the investigative journalism venture by three seasoned Arab-language journalists with experience in print and television. Daraj was established in November 2017, and co-founder Diana Moukalled tells Executive that the platform, which currently claims to publish four to six authentic and independent journalistic stories per day, has seen quarter-on-quarter increases of its audience by double digit percentages.

Speaking to Executive in November 2018, Moukalled says the figures are 230,000 unique visitors per month and 350,000 page views. She explains that the platform has established itself as a partner in global investigative journalism with the International Consortium of Investigative Journalists (the ICIJ of Paradise Papers’ fame). Today Daraj has today–including the three founders–human capital of 11 staff members covering operational needs from accounting to graphic design and social media, plus freelancers based in 21 cities. This, according to Moukalled, translates into a network strength of 80 quality contributors who are published on Daraj with different levels of frequency. 

While the startup had initial funding in form of grants by pro-media and pro-democracy entities in Europe and also managed to channel profits into their venture from a documentary that the founders produced at the time of Daraj’s formation, the first year of operations has been a slower than expected process toward a profit-making venture while maintaining independent views and high journalistic quality standards.

“We created a hybrid model where we launched with funding money until we would reach a point where we are solid enough so that we can move to advertisement [revenue models] and try to generate money through either subscriptions or other resources,” Moukalled explains. The startup explored options of getting investments from venture capital firms in the Arab world, and even outside of the region, but is still forced to operate on a tight monthly budget on basis of funding that, unless new revenue sources are activated, will overall last a few more years.

Meanwhile, the three founders of Daraj juggle exhausting, overlong workdays amidst aggregations of risk from commercial pressures, the imperfect state of digital and cybersecurity infrastructures, the experience of being possible targets for personal slander and online trolls, autocratic governments in some Arab countries that could be offended by serious and honest investigative pieces on the platform, and weak legal protection for journalists in Lebanon.

Promote the positive

Still, Daraj keeps going out of the conviction that serious journalistic ventures in Arab countries cannot continue to denigrate themselves as mouthpieces in service of special interests and moneyed powers. In Moukalled’s words: “We think there is room to do good journalism and have a profitable media platform to preserve editorial independence. When starting Daraj, we thought it is now or never. It is our challenge not to repeat the journalistic mistakes of the past two and a half decades, namely to not become mouthpieces or practice white-washing journalism.”

For Samer Shoueiry, the chief digital officer of Publicis Communications MEA—a unit of Paris-based Groupe Publicis, the third largest communications conglomorate worldwide—it is painful to witness how some time-honored Lebanese media organizations had to close their newspapers and also painful to see how poorly local organizations are faring in the digital space, even as the Lebanese cultural and technological prowess could be favorable for digital communication ventures and quality journalism.

That this is not happening–most startups and platforms in digital journalism are on the level of “experiments” to Shoueiry—is to the detriment of this country. In Shoueiry’s view, a key problem in the reporting, production, and dissemination of journalistic content resides in news organizations’ focus on the negative—something that by impressions at the end of 2018 in coverage of Lebanon is even more pronounced in foreign than in locally produced content.

“Lebanon is at a point where we need to promote the positive. A large threat consists in the fact that the reputation of Lebanon and the Lebanese has shifted from a country and a people that are achievers with their skills and talents, to the image of a people and country that are failing and unable to change, year after year. If you want to create a successful story from a media standpoint that starts from Lebanon, you have to focus on making Lebanon look good in order to make the Lebanese story look good,” Shoueiry exclaims.

Roula Mikhael, executive director of the Lebanon-based NGO Maharat Foundation that is dedicated to press freedom and journalism development, likewise sees the situation of digital media startups and Lebanese media in general as worrying to the point of being shamefully poor. “From recent media studies that we did this year, it seems that there are not many media startups in Lebanon while the existing media outlets are not really rethinking their business models, which have resulted in a crisis of content due to the way in which these outlets were earning money,” she tells Executive on the sidelines of a conference on internet governance.

“In the past, Lebanese media was a leader in Arab journalism, but today we cannot talk about a leading role for Lebanese media. It seems that journalists often want to do something different but they don’t know how to run a media outlet or a news website. You need a new business model,” Mikhael adds. She says that Maharat Foundation in 2017 began offering a media management course for publishers and journalists, and that the foundation hopes to incubate a digital media startup in the coming year.

If they attempt to embark on to developing their digital future, journalists and publishers in Lebanon are confronted by many barriers–from old mindsets and their own bad habits to knowledge barriers and cybersecurity issues —Mikhael confirms, before emphasizing how the pitiful state of media regulation and protection of journalists’ legal standings exacerbates the problems of Lebanese journalism. “The law on the freedom of expression must be revised and we as Maharat Foundation drafted a [proposal for a media] law. It has been with the parliament for eight years,” Mikhael says. She explains that the draft calls for more transparency and protection of journalistic work along with unambiguous definitions for defamation, libel, and similar.

The future is digital

Indeed, one can hardly deny the impression that in Lebanon’s present media landscape, an overwhelming number of journalists are given bits of financial incentives to behave not as the fourth estate, or watchdogs and muckrakers vis-a-vis the ministries, but mainly as note takers, yes people, propagandists, and spin doctors for the member of the political class that they are affiliated to.

The way forward to better Lebanese digital media would quite certainly have a better foundation if a modern legislative infrastructure for journalism and numerous important freedoms can be implemented alongside construction of better financial and technical avenues that would enable tech startups in media and digital journalism ventures to play their important role as guardians of trustworthy information. Trustworthy analysis and information is something that is getting both ever more important in the context of the emerging digitized knowledge economy that is the future of societies worldwide and, at the same time, there are ever increasing waves of fake news and propaganda that can very negatively disrupt entire nations and their economies.

Today it is still a wild dream to see the formation of integrated digital journalism institutions that produce non-zero-sum outcomes across their four core content processing layers of sourcing: high-quality journalistic content; editing, fact-checking, and refining this content into a value-added product; distributing it via platforms that offer good win-win-win monetization for journalists, publishers, and distributors; and achieving true digital customer-centricity.

However, there is no point in sitting around in newsrooms, or cafes and pubs—which journalists all over the world are so fond of frequenting—and wait for a better digital media world. There are steps that media organizations can take, suggests Publicis’ Shoueiry, such as “democratizing the way in which people can subscribe,” by offering multiple options to people for acquisition of media content through SMS, apps, coupons, or even loyalty points from merchants or frequent flyer points from airlines (as demonstrated for example by the partnership between Emirates Airlines and the Wall Street Journal that ran from November 2016 to November 2018).

International content partnerships with emphasis on co-creation of quality stories, dedication to improve the deployment of artificial intelligence and data analytics to achieve top-notch customer centricity, and customization of media content offerings are, according to Shoueiry, other approaches that Lebanese media could pursue. “The power of newspapers and magazines lies in the fact that they have meaningful stories but in a very condensed manner,” he says, adding: “People who might buy a book on the Lebanese economy over the past decade, but do not want to read all of the book or who do not need all the content of this book, could be target customers for buying a custom publication of the exact content they are interested in buying and willing to pay for. You have to really rethink custom content delivery without interruption and give value for money to people who want this content.”

Whatever roads media organizations in Lebanon—startups as well as existing players in online, audiovisual, and print—could pursue on the basis of their strong cultural adaptability and communication skills, there is no doubt that much more digital entrepreneurship in the Arab world is needed for value-added, serious and investigative journalism, and the more Lebanese that enter the startup journalism arena with serious principles, the better. The common headline for the future of banking and journalism, along with everything else, is digital.

Thomas Schellen

Thomas Schellen is Executive's editor-at-large. He has been reporting on Middle Eastern business and economy for over 20 years.