Media Economics

Author: Zhang Huifeng
Publisher:
Publish Date: 2006-03-01
Features: This book is a new work on media economics. In it, the author provides a comprehensive analysis of the operations of the entire media industry. Many of the viewpoints presented are highly practical, and the author has made every effort to focus on the latest trends in media industry development. For those currently engaged in media economic practice, this is undoubtedly a valuable reference. The purpose of this book is to analyze and introduce the fundamental operating principles of the media industry, with a particular emphasis on providing guidance and reference for industry practitioners and students.
Section 1: Products of the Media Industry and Their Interrelationships
1. What Are the Products of the Media Industry?
The essence of media economics lies in the study of the media industry within the field of economics, or in exploring the operating principles of the media industry from an economic perspective. A key aspect of this work is the study of the products of the media industry. As an independent industry within the national economy and as a social subsystem with specific functions, what does the media industry produce for society? What are the characteristics of its products compared to those of other industries? This can be considered the starting point for constructing media economics theory, and a thorough understanding of it can also provide significant guidance for media industry practice. From an economic perspective, this book defines a product as an item produced to generate revenue, cover costs, and enable further production. The author believes that from an economic standpoint, the products produced by the media industry that bring it revenue and are determined by its own physical and technological characteristics are content products and advertising resources.
Content products are a synthesis of information provided by the media and its carriers. Examples include newspapers, magazines, books, radio and television programs, films, online information, electronic publications, and news articles. Advertising resources refer to advertising pages in print media, advertising time slots in broadcast media, and online spaces. Additionally, within the current media industry and among some scholars, there are many other views on media industry products, some of which have a certain influence. The author will three of the most popular perspectives here. They are: advertising services, attention resources, and influence.
First Perspective: Advertising Services
Those who hold this view believe that for media such as newspapers, journals, radio, television, and the internet, the sales of content products are insufficient to cover production costs. For example, the vast majority of newspapers worldwide are priced below their average production costs, a phenomenon known as "negative pricing," with total costs primarily covered by advertising revenue. Commercial radio and television have been broadcasting programs for free since the 1920s and 1930s, relying entirely on advertising and other operational income to cover costs. From this perspective, the media industry is more accurately described as an industry that profits by providing advertising services, and the "negative pricing" of content products is a production of the "advertising service" product. The overall losses incurred by the media due to "negative pricing" are actually the production costs of the "advertising service" product.
Second Perspective: Attention Resources
This perspective was first proposed by Canadian communication political economist Dallas Smythe. Its core idea is that the product of the media industry is the audience attentioned in its content products. Media attract audiences to read, watch, and click on content products as a "free lunch," and as audiences consume these products, they expend their attention. Attention is believed to have an effect on the promotion of advertisers' products, meaning that if an advertisement for a product is inserted into content that hased audience attention, it will have a certain promotional effect. Moreover, audience attention, as a resource in society, is also scarce. Due to its physical and technological characteristics, the media can to a great extent...