Economics and change in news I — Financial pressures on news

Economics and change in news I — Financial pressures on news

: At this week’s Harvard conference on journalism, citizens’ media, and credibilty, I’m emceeing, Oprahlike, a session on economic pressures on news and the issues that result. The official word from the conference is “ethics” but I’m not convinced that’s quite the right word. Here are some notes in preparation. This first post wants to be a catalogue of the economic pressures on the news business brought on by the internet, citizens’ media, issues of credibility, and more. I don’t plan to discuss this much, but I thought it was important to start with this background and perspective. As I said to someone about their company lately, “You need a chief reality officer.” This is an attempt to issue an economic reality check. Please add in more factors — or correct the ones I have here — in the comments. The second part of these notes, on the strategic and ethical issues all this raises — is the next post, above.

Strategic issues

: Thanks to the internet – and the consumer control and choice it enables – the mass market is dying, replaced by a mass of niches. See The Massless Mediain this month’s Atlantic (it’s not online; I’ll post quotes soon). See my First Law of Media: Give the people control of media, they will use it. The corollary: Don’t give the people control of media, and you will lose.

: All established news media face strong new competition for audience, attention, and ad dollars from the internet, cable, satellite radio and TV, and games.

: All established news media face growing competition for stories and attention from new sources of news, led by citizens’ media. These new competitors can serve niche markets large media cannot serve.

: The value of controlling distribution – printing presses, broadcast towers, cables – is torn apart by the internet. The internet is the network no one owns.

: Thus

  • Jeff,
    This is an outstandingly good overview of the issues. Here’s one addition that may be useful. There are three specific factors fueling the transition from “a mass media” to “a mass of niches”:
    1. the fact that Web sites are now so cheap and easy to maintain (think blogging software);
    2. the page-rank algorithms used by the search engines favor narrowly-targeted Web sites that are very frequently updated.
    3. RSS allows people to subcribe to a “mass of niche Web sites”, whereas when they needed to remember or bookmark URLs they would go to mass market publications.
    I agree with your negative economic prognosis, and have been arguing for my audience (investors in Internet stocks) that online media companies like CNET, YHOO and TSCM are threatened by the rise of blogs and RSS.
    David Jackson
    The Internet Stock Blog