Page 104 - Critical Political Economy of the Media

Concentration and commercialisation 83

The Asian Financial Crisis of 1997 damaged the global economy but it was in the
period 2000–2002 that a series of shocks particularly affected Euro-American
corporate media growth, notably the collapse in Internet stock value, a short world-
wide advertising recession and the impact of the 9/11 terrorist attacks. The dotcom
stock collapses of 2001 revealed AOL Time Warner’s over-inflated value (Cassidy
2002). The company reported heavy losses in 2002 for AOL, whose dial-up
Internet ‘walled garden’ service was obsolescent, and reverted to ‘Time Warner’
the following year (Motavalli 2002). The year 2001 marked a general slowing in
corporate growth and some spectacular failures (including several of the early
developers of digital television services in Europe), although this shakeout itself
gave rise to subsequent consolidation and acquisitions. In the early 2000s growth
picked up with the expanding market for digital devices and the corporate rush to
occupy new spaces of communication and congregation, such as social networking
sites MySpace.com, purchased by News Corporation in 2005 for $580 million, and
YouTube, acquired by Google in 2006 for $1.65 billion. Another surge of mergers
occurred in the period 2003–7, followed by the financial crash of 2008 and
subsequent Great Recession, affecting the US and Europe in particular.
After the 2008 crash, marketing spending was reduced, resulting in a cyclical
crisis in ad-dependent media sectors such as television, and marketing itself, but
adding to the structural crisis for newspaper publishing. The 2000s saw an
increasing presence of IT firms acquiring media content businesses but also
businesses that deliver and manage information about communications use by
consumers, for advertising purposes. Illustrating this trend was Google’s acquisi-
tion of DoubleClick and Microsoft’s purchase of aQuantive, both indicative of
the long-heralded convergence between telecoms, IT and cultural industries
(Hesmondhalgh 2013: 189).
Multinational communications conglomerates have developed in conjunction
with three key trends: deregulation, corporatisation and digitalisation (Arsenault
2012: 104). The liberalisation of (cross-)ownership accompanied and facilitated a
wider trend towards privatisation, monetisation and corporatisation of commu-
nications infrastructure and content. State-owned telecommunication systems
were privatised or part-privatised. Public service media faced pressures to operate
under market processes and disciplines (corporatisation) and release or monetise
assets. Digitalisation and technological convergence have increased the strategic
importance of connections between and across businesses formerly organised
around distinct market sectors and services. Rather than leading to more egalitarian
ownership and control, convergence ‘has empowered an ever-shrinking pool of
consolidated companies that have the ability to influence and control the
deployment of multiple communication platforms’ (Arsenault 2012: 105).

Globalisation and growth

A common factor reshaping media systems has been the growth and influence of
transnational media corporations in national markets. A transnational corporation