Media mogul

17Jul11

It is hard to know where to start in considering the impact of the phone hacking revelations. Like most people, I’m appalled by the intrusion into the lives of innocent victims of tragedy. I’m also not surprised by the depths to which a newspaper sank in order to obtain ‘exclusive’ reports.

One of the inevitable consequences of these events is that newspapers are going to get more expensive. I’ve often wondered why British newspapers were so cheap compared to their less sensational and less prurient counterparts in other countries. The reasons are becoming clear.

Most UK newspapers are run at a loss. The loss-making newspapers are generally owned by wealthy individuals or corporations which generate sufficient profit elsewhere to cover the losses made in newsprint.

Why would an intelligent, wealthy individual (or corporation) deliberately support a business venture which loses money and does not provide a socially useful service to the disadvantaged?

Wealthy people and corporations value power and influence. Power over public opinion can influence political decision makers. The political decisions can increase or decrease the wealth of the media owners in their other ventures. Politicians can benefit from media support and make alliances with the media owners. That is why wealthy people lose money by owning newspapers.

You probably know this and you probably know that this has always been true, ever since travelling merchants were paid to mention the good name of their patrons as they travelled from town to town with a donkey.

Today newspapers are the mouthpiece of a small number of wealthy people and their business interests. The editors of the newspapers know that they can only create value for their owners by gaining and retaining the attention of readers. Most people have a short attention span, so the editor has a constant appetite for new, interesting stories. Interesting stories involve “human interest” which generally means: heroism and/or sex and/or tragedy (see: Eastenders, Ian McEwan, Jane Austen, Charles Dickens, Shakespeare, Chaucer, Beowulf etc).

One consequence of the phone hacking scandal is that editors will be more cautious about how far their reporters can go to find “human interest”. Readers will be less frequently lured by lurid headlines and circulation will fall. The wealthy owners will find that their media mouthpieces will be less influential and so they will be less willing to subsidise the losses. Eventually the cover prices of the newspapers will go up – and so will the subscriptions to digital media in all its forms. As well as more expensive newspapers we will see paywalls appearing around digital content (snippets of the lurid elements will be free teasers to encourage purchasers) and paid-for broadcast media costs will also increase slightly.

Blogs will remain free. Their readership will increase as people scan the web for lower cost access to news and interesting stories. As readership increases, the bloggers and tweeters will start to attract advertising revenue and more attention from politicians (see: Mumsnet). Then the powerful and wealthy will start to take an interest. They will begin to pay more bloggers. The bloggers will begin to compete for readers by seeking increasingly extreme “human interest” stories… You can guess what will happen next.

Meanwhile I will continue to post ethically-sourced items of lurid human interest and salacious gossip… and washing line updates.

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