Political economy of the media and how it shapes the news

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Political economy of the media and how it shapes
the news
Anthony Cawley
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Definition of political economy Political
economy examines the production and distribution
of wealth in society The political, economic and
cultural factors that affect the production and
distribution of wealth Internalised political,
economic or cultural values or ideologies How
does this affect the production and distribution
of media?
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Emergence of the political economy concept Adam
Smith invisible hand of the market will lead
to a trickle down of wealth from richest to
poorest. Minimal role of state in the economy.
People act out of self-interest, the side effect
of which is the betterment of society. Karl
Marx free market polarises wealth, rich get
richer and poor get poorer. Communal ownership of
the means of production is the only way of
ensuring an equitable distribution of wealth.
People act out of solidarity and for the good of
society as a whole. Other thinkers Ricardo,
Malthus
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Political economic factors that shape the
news Political and economic systems of the
society in which the media operate Political and
economic status of the country Dominant cultural
and social values Cultural/national alignments
or conflicts allies vs enemies These points are
not mutually exclusive
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Political economic influences on the media The
American case Edward Herman argued in the early
1990s that there were five political economic
filters through which news passed before it was
presented in the mainstream American media. 1
Size and ownership of the mass media 2
Advertising as the primary income source of the
mass media 3 The dependence of the media on
information provided by government, business and
experts funded and approved by these primary
sources 4 Flak as a means of disciplining the
media 5 Anti-communism as a national secular
religion and ideological control
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Political economic influences on the media The
Irish case Political the British influence,
nationalism, the dying peasant society, Irish
Catholicism, authoritarianism, loyalty and
anti-intellectualism (Chubb, 1992) Economic
Free State, poor manufacturing base, dependence
on agriculture, protectionism and isolation. In
more recent times, membership of the EU, opening
up of the economy, attracting foreign investment
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The media in a free market A free market brings
with it a free press that supplies the diversity
of opinion and access to information that a
citizenry requires in order to act in a
democratic, responsible manner. The free market,
journalism and democracy form an interdependent
trinity of institutions in an open society. John
ONeill, Ethical issues in journalism and the
media, pg 15.
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Media in a free market Oligopolistic structure of
global media. A small number of
people/organisations have a disproportionately
high level of influence/control over the worlds
media Free market oligopoly bigger media
organisations take over smaller ones, fewer
organisations control more of the worlds media.
Media organisations abide by the same free market
principles media content as a commodity to be
sold. Diminishing importance of public service
media. State oligopoly state controlled media,
heavy censorship, dissenting voices found in
underground press
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Concentration of ownership vs need for
diversity General Electric ATT/Liberty
Media Disney Time Warner Sony News
Corporation Viacom Seagram Bertelsmann They are
not independent of each other ATT has stakes in
Time Warner and News Corporation. ATT and
General Electric both have stakes in CNBC. News
Corporation has at least one joint venture with
each of the other seven.
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Editorial independence vs proprietors
influence Do proprietors have the right to
interfere? In a free market, most media are
commercial (private) concerns, so should normal
property rights apply? If, in any other business,
an owner can influence output, why not in media?
The editor is usually just an employee of the
business Robert Maxwell guaranteed editorial
independence when negotiating to take over The
Mirror, but in a later interview admitted Im
not shy of interfering if I have toI could do
the editors job.
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Globalisation Move from national to international
media organisations American trans-national
corporations have been most successful globally -
their media content embodies many American
cultural, political and economic values that
might not be consistent with those of other
countries. The Hollywood studios and television
production companies now generate between 50 to
60 percent of their revenues outside of the
United States. Their tight grip on the means of
distributing media content, such as films,
protects their status in the world
market. However, local cultures can prove
resistant to the consumption of globalised
content.
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Concentration of ownership Irish Sunday
newspaper market Independent Group owns or has
interests in The Sunday Independent, The Sunday
World, The Sunday Tribune British Associated
Newspapers (Daily Mail) - Ireland on
Sunday Trinity Mirror - Sunday Business
Post Crosbie Media (Irish Examiner) recently
linked with a bid for The Sunday Business Post.
Irish Times Group has, for years, talked about
entering the Sunday market, but financial
difficulties at the company would suggest that
any such move is far off.
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Geo-political economic aspects to media There is
a simple rule of thumb the strongest media
groups have their home base in those media
markets which are not only the largest in their
category, but also the richest.Understanding
global news a critical introduction The
majority of news is reported from areas of
political and economic power, e.g. Dublin-centric
media in Ireland. In America, Washington and New
York are news centres, as is London in England.
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Ireland
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World
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Sources of revenue 1 Advertising can lead to
a conflict of interest do you run a story that
will cause a client to withdraw their
advertising? However, advertisers also need
media. E.g., Ryanair continues to spent heavily
on advertising in Irish newspapers, although most
of them have at some time written critical
articles about the company. 2 Subscription an
increasingly important source of media revenue
with the roll-out of digital television. Can
affect media content. In order to attract the
largest possible subscription base a digital
broadcaster might try to appeal to the lowest
common denominator, i.e. dumbing down of content.
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3 Cover-price concerns mostly the print media.
The higher the circulation a print publication
achieves, the higher its revenues from both
cover-price and advertising. High circulation
allows newspapers to increase their advertising
rates. General rule a broadsheet will derive 60
of its revenue from advertising and 40 from
cover-price. A tabloid will derive 60 from
cover-price and 40 from advertising. Although
tabloids tend to have a higher circulation
(though not in the Irish market), advertisers are
willing to pay more to advertise in a broadsheet
because its readers tend to have greater
purchasing power (ABC1s).
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4 Government/public funding concerns mostly
public service broadcasters. In recent years,
public service broadcasters have come under
increasing pressure, because their revenues from
licences fees are not sufficient to compete with
many commercial broadcasters. For example, the
BBC has found itself priced out of covering
sporting events. RTE has come under similar
pressure, but it operates a different public
service model to the BBC. As well as public
service responsibilities, RTE has commercial
pressures it relies on advertising revenues. In
recent years, advertising has been rising as a
percentage of RTEs overall income. The increase
in licence fee will re-balance the figures
somewhat, but advertising revenues have been in
decline since the economic slowdown began. Hence
the restructuring and job cuts at Montrose.
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5 Investment may come from a number of
channels private investment from proprietors is
one, but is more likely to come from larger media
organisations. E.g., Ireland on Sunday,
established in 1997 by private, independent
investment, was sold to Scottish Radio Holdings
in 2000, and passed onto British Associated
Newspapers (publishers of The Daily Mail) in
2001. 6 Share issue larger media
organisations raise finance through a share
issue, but this leaves them with responsibilities
to shareholders (dividends and voting power).
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