Chapter Two: Media Theory

Media economics Economies of Scale  Mass production and distribution  First copy costs  Low marginal costs

Ownership patterns What is the market structure?  Monopoly: One producer  Oligopoly: A few producers  Competition: Many producers

Monopoly - Oligopoly - Competition

What is a firm’s market power?  Smaller competitor?  Monopoly?  Economic monopoly  Monopoly on information  Oligopoly?  Shares dominance

Market Structure Examples  Local Telephone  Long Distance  Cable  Music  Software Monopoly Oligopoly Competition

The profit motive  Making a profit  Entry costs  how high is the barrier?

Sources of media revenue  From consumers, to  Taxes, donations, subsidies  Consumer goods purchases  Retail media distributors  Communications media, via subscriptions

Sources of media revenue Selling the audience  Direct sales  Rentals  Subscriptions

More sources of media revenue  Usage fees  Advertising  Syndication  Copyright royalty fees  Public subsidies  access fees, universal service fees

From mass markets to market segments  Narrowcasting  Identification of specialized interests  Relies on information technologies  demographics  profiling  IT lowers costs of production and distribution

Diffusion of Innovations  Explains the spreading of new ways of doing things in a social system  observability  trialability  compatability  affordability  supervening social necessity

Diffusion of innovations

Approaches to Media – Critical Studies Looks for relationships between  The media system  Media content  Audiences for media  Culture

Approaches to Media – Political economy  Politics, Economics and Communication intertwined  Focus on interests  Power relationships  Advertising  who’s selling; what’s being sold  Commercial interests and ownership  Ideology

Hegemony  An underlying consensus of ideology that favors a system that serves the interests of a dominant social group  Economic system preserves the interests of the ruling classes  Mitigating factors: Consumer needs, laws of supply and demand

Approaches to Media – Agenda Setting  The ability of the media to determine what is important  OJ Simpson and US race relations  Activism and media event creation  Political “horse race”

Approaches to Media – Gatekeeping and Framing  Gatekeeping: deciding what will appear in the media  Does a media message make it through the gate?  Who are the gatekeepers?  Framing: writing to tell stories  What makes the story? What is left out?  2 sides to every issue?

Approaches to Media – Opinion Leaders  People who try to influence media coverage (agendas & frames)  Diverse interests  spin doctors  Lobbying groups  Special interests, business constituencies

Approaches to Media – Textual Criticism  Electronic media as a new kind of “text”  Apply tradition of literary or cultural criticism  Genre studies  Semiotic analyses  Feminist, Gay/Lesbian, Race studies

The active audience  The media and audiences are both powerful  Media creators have a preferred reading

Approaches to Media – Societal Functions  Functions of the mass media  surveillance  interpretation  socialization  entertainment  Functions of new communications media

Approaches to Media – Social Learning Theory  Explains media consumption behavior in terms of  Expectations about consumption  Cognition, or how we learn through our own experiences  “Uses and Gratifications”