In the 80ies and 90ies everyone could manage a newspaper
says renowned media economist Robert Picard, University of Oxford, Reuters Institute for the Study of Journalism, in his openingspeech at the Workshop Media Convergence & Journalism in Mainz. While traditional media outlets lost their monopoly in delivering news, they have not developed strategies on how to deal with that loss. One of the causes, says Picard, is that the industry was used to enormous growth as well as to huge revenues from the 1950ies to 2000. Advertising revenues accounted from 60 to 85 per cent of the income and were growing well above inflation rates.
Today’s media managers grew up in the „Golden Age“ of the 80ies and 90ies, „a wonderful time for big companies“, and do not see that these decades were the exception rather than the rule in the history of journalism.
According to Picard, the wealth of these years is one of the causes for today’s economic problems: The abundant structures that have been built up within this period cannot be kept up today. The more, success led to spiritlessness and little innovation. „But no Newspaper has a right to live and many deserve to die. If people are not using newspapers, how can they serve democracy?“
So how can journalism be financed, according to Picard?
– Smaller and more agile operations,
– more entrepreneurial approach,
– different types of news and supplemental news providers,
– more innovation in products and processes,
– alliances, networking, and cooperation,
– multiple sources of financing.
If traditional media outlets want to survive, they have to focus on the chances of digitalization, they have to change their attitude towards a much more customer oriented attitude, and they have to invest in R&D. While the average rate of R&D investment in all industries is 3 per cent, in high-tech industries 9 per cent, in the media industry it is about 0.1 per cent.
„Companies come and companies go, that’s the way it goes. For today’s media industry, change is not a choice, it’s a requirement.“
Robert Picard, University of Oxford, Reuters Institute for the Study of Journalism: Killing journalism? The economicsofmedia convergence. Workshop Media Convergence & Journalism, organized by EJO, Johannes Gutenberg University Mainz, MAZ and Medienhaus Wien, Mainz, Oct. 21th & 22nd 2011.