RELATIONS WITH REUTERS

The history of the Ministry's relations with Reuters is a long and detailed one which is quite worthy of separate study. In this note I am only giving a rough outline to explain the position that we have reached today.

To understand relationships with Reuters one must know a little of its background. It is an agency serving two purposes: (1) to collect foreign news for and to distribute it to the British Press and (2) to collect and distribute to Press customers all over the world not merely British but world news. It is obvious that the British Press is less concerned with the success of Reuters in its second purpose than in its first, though in fact the two activities are interdependent. It is a very long-established agency, having begun operations in the first half of the 19th Century, very largely as a purveyor of commercial information to business concerns in various parts of the world. Its original dominance and success therefore were based on the dominance of London as a world centre of exchange and mart. Its business as distributor of news was grafted on to this and in the course of time became its main avowed purpose.

During the War of 1914/1918 the British Government became deeply interested in Reuters as an instrument for securing the maintenance in the World Press of British news and world news edited from the British angle. After 1919, Sir Roderick Jones, who had then acquired the main proprietary interest in the agency, developed a scheme for securing for Reuters, through agreements with local agencies, the exclusive right of serving world news to certain countries and of allotting corresponding “spheres of influence” to other international news agencies who would join his scheme. For instance, Reuters agreed to resign to Havas, the French agency, the right of serving Latin America with international news in exchange for a resignation by Havas of its right to serve international news to certain other parts of the world. This scheme, whatever commercial advantages it may have had, aroused the enmity of the great American news agencies, the Associated Press and the United Press, who saw themselves excluded from the right of access to territories in which they felt that they should be at liberty to distribute at any rate American news and who were by training and tradition averse from any arrangement for recognising spheres of 13 - 12 -influence that did not actually bear the name of the Monroe Doctrine. The inter-war years is largely the story of the American agencies’ successful attempts to break down Reuters’ monopolies in the world news market and of decreasingly effective operation of their services by Reuters, who indeed found it difficult to maintain itself on a profit-making basis as a private commercial agency.

Shortly before the outbreak of war in 1939 the Foreign Office, concerned at the way in which Reuters was abandoning altogether the service of British news to parts of the world that it regarded as insufficiently remunerative, granted to Reuters a small subsidy of a few thousand pounds with the intention of enabling it to maintain these services. When the Ministry of Information came into existence it considered, rightly in my view, that a world service of news, collected and edited in this country, was a very important British interest for all purposes of overseas publicity and it set itself upon a course of rapidly increasing money grants to Reuters for the development and furtherance of its world services. There was no alternative instrument that the Ministry could use which offered anything like the same possibilities, but the result was that Reuters became throughout the war very largely the subsidised dependent of the British Government. This relationship was never avowed but I think that there is little doubt that it must have been generally known or suspected in Press circles that were concerned to enquire, since it must have been obvious to people in the business that Reuters could not suddenly make large extensions of its world services and very greatly improve its machinery of distribution unless large official support had suddenly been made available to it coinciding with the period of the war

Of course the fact that H.M.G. was making large contributions to Reuters’ expenses was one thing: the question how far it could make itself responsible for the content of Reuters’ services was another. This was a difficulty with which we struggled for most of the war. The Ministry was never quite sure what it was buying. Was it the overall benefit to the British cause of having a world service of news edited in London, effectively distributed about the world, or was it, in addition, the right to dictate the 14 - 13 -way in which that editing should be done? Sir Roderick Jones, I believe, did give some undertaking to the effect that the Government, in exchange for its monetary assistance, should have some right of control over the contents of the services. I always understood that this was one of the reasons why the Boards of Reuters and the Press Association subsequently quarrelled with him. Certainly after that time Reuters never formally accepted the idea that their news could be adapted to suit the British Government's requirements. On the other hand, it was not easy for them, supported generally by Government funds, to resist representations from the Ministry about points that might or might not be made in the make-up of the daily output. Add to this the facts that Reuters, who were short of highly qualified editorial staff, made quite obvious gaffes from time to time from the point of view of British interests and that protests from Ambassadors or High Commissioners overseas came in fairly regularly, and it will be seen that we had material for constant friction between the Government and Reuters.

In the end we came to see what we should have seen earlier on, that the business of an international news agency, which works under great pressure and to split seconds of timing, cannot be conducted efficiently under any system of remote control. If you wish a news agency to succeed in the highly competitive world market you must help it to get the best talent it can attract to its editorial desk and give its editors as much and as rapid assistance in the way of background news and information as they have time to ask for, but beyond that you cannot go. News has its own laws which determine whether it is a saleable or unsaleable commodity among the world's purchasers and to expect the agency to adapt to or modify its product to suit political requirements is both to outrage the traditions of good news men themselves and seriously to hamper the efficiency of the agency's service. In the end, therefore, we came to the conclusion that what our payment to Reuters entitled us to expect was the furtherance and development of the best news service that they could provide, taken with all faults, and not the conduct by them on our behalf of a service of propaganda news material composed to serve the purposes of H.M.G.

The change in the constitution of Reuters, which took place late in 1941, would have brought about this result in any event. The ownership passed into the hands of the N.P.A., representing the national newspapers, and the Newspaper Society representing the provincial papers, and it there upon ceased to be a private business concern and became the property of the British Press in co-operative ownership. Its position thenceforth was similar to that of the Associated Press of America and the purposes of the organisation as a non profit-making concern run for the benefit of the British Press were declared by a Trust Deed, the contents of which were published at the time. For such an organisation to be the concealed agent of the purposes of the British Government was clearly impossible and Mr. Haley's assurances on behalf of Reuters to the Associated Press during the long visit that he paid to that agency in the early summer of 1942 (assurances which Reuters subsequently repeated by public advertisements in America) made the position even more delicate than before. Although we might be blameless ourselves, and Reuters were certainly conscious that by this time we claimed no right of control over the contents of the Reuters’ service, the mere existence of the large subsidies and the close association that had existed since the early days of the war would have been quite sufficient for hostile critics of Reuters who might wish to prejudice its position in the international news markets. It became therefore a matter of long-term policy on the Ministry's part to find some way of withdrawing ourselves from this subsidy relationship with Reuters without wrecking the business of the agency in the process.

The realisation of this policy was bound to take time. The first branch of Government subsidy that was cleared up was a special arrangement under which the Ministry reimbursed to Reuters each year the amount of its deficit on Latin-American operations. Our obligations in this field arose from the fact that the collapse of France in 1940 brought about at the same time the collapse of Havas as the international news agency which, by agreement with Reuters, had held the European interest in the Latin-American news agency business. The Ministry decided that it must make an effort to restore this position, since otherwise the important field of Latin-America would have been left at the mercy of the German agencies, such as D.N.B. 16 - 15 -and Trans-Ocean, and the (at that time) far from friendly American agencies A.P. and U.P. I note in passing that even after America joined the war the attitude of A.P. and U.P. towards British interests, as displayed in their Latin-American Services, was often hostile. Accordingly, representatives of the Ministry and Reuters (Grubb and Chancellor) made a tour of Latin-America, as a result of which Reuters opened up offices in the principal states and began distribution, taking on a number of old Havas employees, while at the same time a new Free French agency, entitled A.F.I. was formed by French resistance elements in Havas and itself began to distribute a service from London in Latin-America. Both Reuters’ deficit and the whole A.F.I. expenses were paid by the Ministry and although we made efforts from time to time to see that they were not in competition with each other, and Reuters in fact distributed the A.F.I. service on their wireless beam, the policy of our assisting two more or less competing agencies in the same area proved in the end to be unworkable and we withdrew our subsidy to A.F.I. for Latin-America.

It was this special subvention to Reuters which Reuters first undertook to release us from after its reconstitution as the British Co-operative Press agency. Their notification to this effect was made, according to my recollection, about July 1942. But in taking on their own shoulders the burden of paying for the operations in Latin-America they were far from discharging themselves from all dependence upon finances provided by the British Government. The system that had grown up was this. Whereas in the early days of the war the monies provided by the Ministry had been intended as contributions towards the development of new services or the improvement of old ones, we turned ourselves into the provider of the wireless communications, the efficiency of which was generally responsible for the improvement of Reuters’ position as a competitor in world markets. Reuters’ wireless services, Globereuter as they were called, were an early innovation of Reuters own, the system of transmission provided being omni-directional. When Government assistance was put at their disposal the omni-directional system, which had many 17 - 16 -defects from the point of view of reception, was converted into a system of beamed transmission directed to the various parts of the world which Reuters wished to serve. The transmitters used for this service were provided by the Post Office but leased from the Post Office by the Ministry and not Reuters. Reuters merely continued to recoup to the Ministry an annual sum equal to the cost of its original and much less developed wireless service with the result that, as the years went on and the distribution system was continuously improved, there was an ever widening gap between the sums which we were responsible for to the Post Office and the sums which Reuters recouped to us. By the year 1944 that gap had come to exceed £80,000 per annum.

This was certainly a concealed subsidy and in view of the growing agitation in the U.S.A. about the importance of freeing post-war communications and news systems from Government controls, preferences or monopolies, we felt that it was essential to bring Reuters to the point and to secure that it was as much the independent and self- supporting agency in fact as it professed to be in public. After a good deal of negotiation this result, rather to our surprise, was achieved early in 1945. The arrangement then concluded contained as its main features that Reuters should enter into a direct lease of the wireless transmitters required for their service, taking this from the Post Office at a commercial rate, and that, as from April 1945, the only contributions that they should receive from us were sums that could fairly be described as payment for services rendered, such as the provision of the Reuters news service to Embassies and Legations abroad and the provision of special services and transmissions for material of which H.M.G. was the customer or consumer (Forcereuter and B.O.W.). In accepting this change Reuters have, of course, taken upon themselves a very large additional financial burden to achieve which they have had to increase considerably their assessment upon the British London and provincial newspapers upon whom they depend, and they have at the same time secured a larger contribution from the B.B.C. which is a consumer of Reuters’ services on a big scale. Whether they can carry 18 - 17 -this burden through the immediate post-war years remains to be seen. It is generally thought, at any rate, that the monies which they are now receiving from the Newspaper Society as representing provincial papers represent the limit that can be expected from that side. Provincial newspapers, which are necessarily parochial in their editorial policy, have not the same reasons for requiring a good service of overseas news as the daily London papers. The bulk of the provincial papers are weeklies who have little use for a fast service of international news.

We have thus achieved for the moment a satisfactory relationship between ourselves and Reuters. As a news agency it has been very greatly improved during the course of the war and there is little doubt that, but for the help we were able to give, it would not only not have improved to the same extent but probably folded up altogether. There is, under present conditions, no substance in any charge that Reuters is an organ of the British Government, since it derives no money from the Government other than for services rendered and it is no more under the control of the British Government in respect of editorial policy or content than is any British newspaper. On the other hand, the Ministry of Information is well aware of the very considerable importance to the maintenance of British interests abroad that this world news agency, which is owned by the British Press and edited and distributed from London, should be as successful and ubiquitous as possible. No other system can be a substitute for the work that such a news agency can do: not a Government news service nor overseas services of the B.B.C. We do regard it therefore as a matter of policy to keep in touch with Reuters on all levels and to do everything that we can to forward their interests so far as Government support and backing for their projects are required. I do not mean by this that it is or can be treated as a “chosen instrument” or that any general communication policy could be supported which secured for Reuters facilities not available on equal terms to other agencies, whether British, such as Exchange Telegraph or American such as A.P., U.P. or I.N.S.