As a companion to the story above about Game Show journalism, I thought you’d enjoy reading this report by one of my smart USC students, Jackie Cook.
The class assignment was to report on a news conference or a speech. Jackie chose the presentation below about how economics drive news coverage. I think you’ll find it intriguing:
THE MARKET FOR NEWS by Jackie Cook
James T. Hamilton, a professor at Duke University, spoke about economics and its effects on the media at USC’s Annenberg School for Communication Monday. With the trend from hard to softer news coupled with the dying age of the nation’s once-primary news source – the newspaper – Hamilton applies economic theory to possible reasons and solutions.What determines coverage is not the traditional five W’s journalists often use to draft a story – who, what, when, where, why. Rather, Hamilton states his “five economic W’s” can predict what will appear on the front cover of next week’s Los Angeles Times.
His five points are:
1. Who cares about particular piece of info?
2. What are they willing to pay to find it? What are others willing to pay to reach them?
3. Where can media advertisers or outlets reach these ppl?
4. When is it profitable to reach these people?
5. Why is it profitable?“News is a commodity, not a mirror image of reality,” said Hamilton, a professor of political science and economics.
News is often thought of as a representation of worldly events; however, Hamilton says news is defined by values and desires the public holds. That self-interest shapes the news market which then drives news coverage.
“More than ever before, Mr. Hamilton argues, hard news is not what fattens the newsstands or fills the airwaves,” Tim W. Ferguson told The Wall Street Journal. “Instead we have celebrity profiles, product hype or what we used to call human-interest stories.”
This trend towards soft news is reflected in Hamilton’s five W’s.“Hard news is much more costly to make than human-interest stories,” said Hamilton.
Therefore, the media tends to opt out of such news, exposing the public to less public affairs, and leads to a decreased desire for hard news. Because forms of media are diverse, it caters to specific public opinions causing a shift from political news to softer topics like entertainment.“We are busy people these days, with so many options, and we have to decide what to do with our time,” said Hamilton. “We often choose to read things other than governmental affairs.”
Aside from the lack of such coverage, Hamilton attributes this disinterest in politics to rational ignorance.
Public policy scholar Anthony Downs coined the term, which explains how the public can know little about important information having to do with elections. Downs says when the perceived benefit of information is relatively small to the costs, the case in governmental affairs, people exert little effort in finding or consuming the information.
Hamilton also says hard news is not valued as much by advertisers, which is also one of the attributes leading to the decline of newspapers.
“If my sons said, ‘Dad I want to enter an industry where price is equal to zero and the advertising base is collapsing’ I’d strongly suggest to look for another option,” said Hamilton.
In economic terms, price is zero because the marginal cost of producing one more page of news on the Internet, for example, costs nothing to the consumer. The Internet is quickly gaining precedence over tangible publications, which do cost money, because it is convenient, fast and limitless.
Hamilton says another downfall of hard news, as reflected in the newspaper decline, is in the paper’s ownership. Newspapers were once a family-dominated industry and the Chandler family is one of the few examples today.“As consumers, we don’t demand public affairs much,” said Hamilton. “In a family, some would advocate for it.”
Certain family members were more willing to cover politics despite risking the loss of consumers with different political views.
The industry is now dominated by corporations wanting to maximize profits, an economic goal, causing less hard news to be created since consumers are demanding softer stories.
“This is a market failure,” said Hamilton. “Not only is coverage of public affairs lacking, but newspapers change ownership so much under corporations.”Hamilton offers solutions to boost the amount of hard news in the media. He says the government should lower the access cost of governmental information and subsidize information creation to maintain a well-informed country.
He also stresses a greater role for non-for-profit organizations to fund journalism, like the St. Petersburg Times, which may develop a norm stressing hard news reporting.
In an age where technology is dawning a new era for media, traditional news sources like newspapers are suffering; however, Hamilton says defining Internet property rights will encourage the flow of more balanced news.
Hamilton says news is defined by values and desires the public holds.
I disagree, because Hamilton extends it too far. News is generally defined by the values and desires held by publishers. This goes right to the heart of “journalistic ethics”–profit, ideology, and influence go before total truth.
Now, a publisher may say that he is motivated by the values of the public, thus increasing profits, but that is rarely the case, especially with older, established outlets. An an example, The NY Times continues to hemorrhage subscribers rather than change its left-wing, agenda driven, one-sided stories.
In the past it didn’t matter to the establishment press, because of limited or no competition. Now that there are alternative sources of news, especially through the internet (and FOX), people have choices and are rejecting the old sources of one-sided liberal bias.
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Hamilton offers solutions to boost the amount of hard news in the media. He says the government should…
Aggghhhhhhh. The government should do NOTHING. In fact, getting rid of PBS and Bill Moyers would make me feel just fine. And, leave the internet alone.
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…defining Internet property rights will encourage the flow of more balanced news.
Who is to define “balanced news?” Maybe it doesn’t seem balanced to the same stiff and pompous elite media who have been out of touch with mainstream life for a century. Freedom of speech, encouraged by an open internet, is the best way to achieve balance, as it allows every segment of society to contribute rather than just those with the resources to disseminate news–in other words, completely free enterprise with competition.
If you want an example of “balanced news” as determined by those in control, consider China’s government-regulated news and access of the internet. No thanks. I’ll take free competition.
Today’s Animal Tales:
Black Bear Breaks Paw
Crocodile cost boy his arm, but saved his soul
Knut the cute polar bear
Pets on lap while driving may soon be a no-no in California
Class Assignment. Describe how painting newspaper vans a different color will help circulation.
Yeah, that should do the trick for turning around the problems of the Los Angeles Times. Forget about addressing such issues as biased reporting or using incorrect facts as has been chronicled extensively in NewsBusters. Just change the color scheme of the vans and boring their readers by endlessly bragging about being green over and over again. More comedy gold is provided by Abrams in his psychobabble about attracting “cult” and “fringe” readers….