So, I wanted to comment on this article about Paul Graham, about the dying of the print media. Unfortunately, his conclusions in the article are worthless because of a fundamental mistake he makes.
You see, he assumes that the customers of the media are their readers and/or viewers- that, by buying a New York Times, he is (one of) their customer(s). That the Newspapers are in the business of selling information (or at least paper).
They’re not. They are not in the business of selling information, entertainment, or even paper to readers, they’re in the business of selling audiences to advertisers. You are not their customer. You are their product.
Don’t feel bad about not noticing this before- the corporate media goes to some lengths to hide this fact from you. But many meat packing plants go to some lengths to keep the animals calm and unstressed up until the hatchet falls as well, but that doesn’t mean the meat packing plant is being run for the benefit of the cows.
Where they can’t hide the truth is in their financial statements. For example, in 2008, the New York Times made $1,779,699,000 from advertising sales, but only $910,154,000 in circulation- advertising made almost twice as much money as circulation did (see p.54 of their annual report for where I got that information).
Until you wrap your head around this basic fact, many of the things the corporate media does will make no sense. Like selling papers based on the marginal cost of production, and not based on the value of the information contained therein. This makes no sense if you’re thinking they are the selling information to readers- but if you’re selling readers to advertisers, it makes perfect sense. By charging the marginal cost of production, the paper is guaranteed not to lose money on the sale, the cost of producing the information in the first place isn’t effected, and an increased reader base generally translates to increased ad revenues. Note that this is why television and radio are free- the marginal cost of adding more watchers/listeners is effectively zero.
But again, although generally increased audience size translates into increased ad revenue, this is not always the case. What the media companies are trying to do is not maximize audience size, but instead maximize ad revenues. So increasing the audience size- at the cost of pissing off your advertisers- is a net loss.
This explains the recent “cease fire” between Keith Olbermann and Bill O’Reilly. This war of words (for details, see here) was helping both shows ratings. Which shouldn’t be a surprise, as grudge matches always draw crowds. But the grudge match had started hurting their corporate masters. Specifically, Bill O’Reilly started committing the sin of journalism and reporting on GE’s activities in Iran. At which point, even though the audiences were increasing, the ad revenue started being threatened, and the dogs were called off. Simply because it sells papers (or causes people to watch/listen) doesn’t mean that it’ll get publicized.
This explains why, even if you have the money to buy a superbowl ad, you don’t automatically get to. If your ad will annoy other, much more regular (and therefor profitable) advertisers, and thus drive down what these other, more regular, advertisers are willing to pay, it’s simply not worth it to run your ad. Sorry, MoveOn.org- freedom of the press only belongs to those who own one.
So who are these regular advertising customers? Returning the the New York Times’ annual report, over 50% of their advertising revenue across their whole company- and over 70% of the New York Times’ own advertising revenue- comes from national (that is to say, large) corporations. Large corporations who are- unsurprisingly- pro- large corporation and pro things that help large corporations and the insanely rich people who run them.
Note that I don’t need some massive conspiracy of the economic elite- I don’t need all, or even most, corporations to allow their political views to alter their advertising budgets. I just need some, possibly even just a few. Without any push back from the other paying advertisers, this leads to the corruption of the media from heroic watchdog of democratic freedoms to subservient lapdog of the corporate interests.
What’s happened with the media is two things. First, several, possibly even many, large corporations have long ago realized the influence they have over the media, and have been using it to shape the public discourse. But that’s been going on for decades- what has happened recently is that the audiences (or at least large chunks of them) have figured this out, and stopped trusting them. And second of all, an alternative has emerged. So the audiences have been “voting with their feet”.
Take me, for example. Both maternal and paternal grandparents subscribed to at least two news papers and one news magazine their entire lives, as did my parents (generally the Quad City Times and Des Moines Register for papers, and Newsweek as a magazine, my liberal roots go way back). I am very literate, highly educated, and very interested in news. I am the prime demographic for newspapers. And yet, I don’t subscribe to a single one- nor to any news magazine. Why is that?
The answer is: why should I? If I wanted biased information, questionable sources of news, and vitriolic opinion, I can get that for free on the internet. Yes, as a source of news, DailyKos is highly biased. But so is the New York Times. I still remember how the supposedly liberal New York Times sat on the warrant-less wiretapping story for over a year, until safely after the 2004 elections. And I still remember all those big, page-1 above the fold, articles on how Saddam had weapons of mass destruction. Both DailyKos and the New York Times are selling me a political line- but one of these two isn’t lying about whether they are selling me a political line or not, nor are they charging me for the privilege of being sold a political line. Is it any wonder the other is having difficulties?
Personally, I don’t hold out much hope for the corporate media, long-term. On one hand, they have the corporate oligarchs who are still demanding they try and shape public opinion, or suffer the financial consequences. On the other hand, their main product is wandering away in droves. Any solution to this problem has to take into account this basic reality.
My opinion? Let ‘em die.
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