Page 141 - Critical Political Economy of the Media

120 Critical investigations in political economy

also illustrates the broader problem with incumbency/newcomer phraseology: it
applies to some market conditions but downplays the way dominant market
players adapt to sustain market share.
At the heart of claims for an emerging ‘new economy’ was a ‘mystical core’
positing that the Internet would diminish the advantages of incumbent, large
firms and equalise the terms of competition between corporate giants and
entrepreneurial start-ups (Curran et al. 2012). The Internet would initiate a
powerful wave of dynamism driven by creativity and innovation. Ideas would
have advantages over the lumbering edifices of bricks and mortar that dominant
Fordist firms represented. The Internet lowers costs, creating global market
opportunities for low-volume producers and serving niche demands that were
neglected under the shelf-space and supply pressures of a shop-based retail
model (Anderson 2004, 2009). Yet, the central claim of the new economy thesis
failed to take sufficient account of the sustained advantages of corporate size
and reach.

Media economics and business analysis

Economics, business and marketing analysis can help us understand both the
challenges of digitalisation for mass media businesses and the advantages that
explain continuing patterns of dominance in the provision of public media
content.
The Internet and allied technologies profoundly challenged aspects of
analogue processes of production and distribution of content, with far-reaching
impact on business models of the established media firms. Those challenges
are well documented (Sparks 2004; Freedman 2006; Curran et al. 2012;
Hesmondhalgh 2013) and might be regarded as legacy concerns given that ‘mass
media’ today are thoroughly digitalised. Yet the nature of those challenges
remains critical to understanding the past, present and possible futures of digital
media. Internet delivery eroded earlier patterns of media consumption. The
Internet erodes advantages based on physical space and time, features that have
sustained local monopolies in media markets such as newspapers, radio broad-
casting and cinema exhibition. The Internet also erodes advantages of production
and distribution based on time. The advantages of market dominance in the
production of a morning newspaper or prime time news are eroded because
Internet content can be published at any time and remain available. Internet
services can compete as direct substitutes for ‘mass media’ content or services,
but an even more profound challenge is competition for the resource of
consumer/user time. While consumption patterns vary, time spent on search,
messaging and other activities challenged media dependent on direct sales and
also those dependent on advertising revenue where consumers fall within the
relevant market. Consumer/user time is also intimately connected with the
resource of advertising finance in so far as advertisers migrate from mass media
to alternative spaces.