Discussion Mini-Essay Post #3 and Peer response: Complex and Interdependent Relationships

The mini essays posted in response to the discussion questions are part of the Gordon Rule writing assignments.  Each mini essay should contain 200 words for a total of 800 words toward the Gordon Rule requirements.

The instructor will post one discussion question that serves as our class discussion. This is where you will add your experiences as well as additional sources to the topics of the week. Each original post is worth 5% of your final grade.

These posts are to be discussions and NOT reiterations of the material. You should bring original thoughts to the conversation and NOT simply summarize the information. Think critically and bring to light ideas and/or concepts that are new and share a different perspective.

Discussion Post Question: With specific examples, explain and describe the complex and interdependent relationship between consumers, advertisers, media companies, and media employees.

Directions for each discussion mini-essay post:

• Think critically about your answers and write thoughtful and insightful sentences.
• Students are expected to: (1) originate their own post AND (2) respond to at least TWO additional classmate’s thread. Make sure you include the other classmate’s FULL NAME when responding.
• Original posts should be 200 words long. Responses to your peers’ posts have no word limit, but to receive full credit you must respond to specific ideas from their original post, not simply indicate that you agree or that you liked it. Good posts should be concise and to the point and should not ramble or deviate from your point. Posts that are way under or way over the word count will result in a loss of points.
• This is not a case of how much you say, but rather how you reason and support your argument.
• Proper grammar, sentence structure, and paragraph-format are required.
• Refrain from just “agreeing” or “liking” your fellow classmate’s response. 

Resources:

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9

Development of the Mass Media Industries

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Chapter 6 Part 2

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Current Picture

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Convergence
Change in perspective of elements of communication
Technological convergence
Change from analog to digital coding
Digitization primary
Tech 2025

These 25 Technology Trends Will Define The Next Decade

Technological convergence: refers to how innovations about storing and transmitting information have brought about changes to the mass media industries, like computer. But it is the software code that actually has brought about the change.
Change from analog to digital coding: The recording, storage, and retrieval of information that relies on the physical properties of a medium is analog coding. Example: use of vinyl disks in music recording studios. Digital coding refers to using a sequence of symbols or bytes (usually numbers) that are not dependent on the physical characteristics of any one medium. Digital code is standard and can be read by any medium. Also, the digital code can be compressed and stored.
Digitization primary: Switching from copper fiber to fiber optics, speed has increased. Advent of Wi-Fi and bluetooth increased speed of communication.
Technological convergence refers to how innovations about storing and transmitting information have brought about changes to the mass media industries.
Analog coding is the recording, storage, and retrieval of information that relies on the physical properties of a medium.
Digital refers to using a sequence of symbols or bytes (usually numbers) that are not dependent on the physical characteristics of any one medium.
With technological convergence, channels are much less important than are audience needs and messages.
One advantage is that a single message can generate many streams of revenue.
The second advantage is that when the message appears in one channel, it stimulates audience members to expose themselves to the message in other channels.

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Current Picture

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Convergence
Marketing convergence
Marketing strategy has broadened
Niche audience targeted
Advantages of generating same messages

Marketing convergence: changed the way media programmers regard audiences and how they develop their messages.
With marketing convergence, companies have broadened their marketing by thinking about all the ways they can distribute their messages across as many channels as possible.
Convergence has also changed the way media companies view audiences.
Media companies used to rely on the principle of lowest common denominator (LCD) which means that they tailored their messages to appeal to everyone.
Programming has shifted to long tail marketing which involves attracting the small, niche audiences at the end of the tail of a bell curve.
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Mark Zuckerberg, CEO Facebook talks about the evolution of digital marketing

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Current Picture

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Convergence
View of media altered toward audience
Long tail marketing strategy viable
Constant research and use of Internet

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Current Picture

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Convergence
Psychological
Eliminates geographical and sociological barriers
Interactive feature of media
People as contributors to media

Psychological convergence refers to changes in people’s perceptions about barriers that previously existed that are now breaking down or totally eliminated due to recent changes in the media.
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Current Picture
Special case of the computer industry
Development of hardware and software
Dominant in transmitting messages
Internet-based services
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Special Case of the Computer Industry
The computer medium is moving into dominance.
There are three categories of media businesses in this industry.
Developer of hardware and software (Microsoft, Apple).
Conglomerates that acquire many media companies (The Walt Disney Company, Time Warner).
Companies that provide Internet-based services (Facebook, Twitter).
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Fast Company Series Dives Into Work in 2040
https://cheddar.com/media/fast-company-series-dives-into-work-in/player?autoplay=false
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Current Picture
Profile of Mass Media Workforce
Increase in digital media; loss of print and broadcasting sectors
Number of people in media occupations
Journalism a popular choice
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Number of people in media occupations: Wide variety of options have come into being other than the traditional job profiles. Also, with small businesses searching for a way to make a name, they too hire people to work on publicity for them. The genre has widened with time. These people target audience for any said business and aid to develop positive review about your business. Along with the 2 million full-time advertising professionals, these people too use skills.
Profile of Mass Media Workforce
Mass media employ less than 1% of the adult population in the United States.
The largest employer within the media industries has been newspapers along with film and video production.
Demographic patterns show that more women are working outside the home.
Although 45% of the labor force is female, there are still many more men than women working in the mass media industries.
The media industries that have the highest percentage of women employed are magazines and books, where women make up more than 50% of the labor force.
Journalism is a popular profession within the media industries.
Most journalists are male, White, and young.
Most television writers are male and young.
Women account for 55% of the working population in the advertising industry.
Women who are employed in the media industries are usually in positions of lower status, earn less money, and have less education.

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The future of news media is in our hands | Rickey Bevington | TEDxPeachtree

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Summary
Pattern of growth of media
Channels of distributing messages
Change initiated due to convergence
Large-scale distribution gives way to niche audience
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Summary
The development of the media industries generally moves from the innovation stage to growth, peak, decline, and then adaptation. Remembering this pattern will help you understand how the media industries start, how they grow, and where they are today.
Historically, the mass media industries have been defined by their channels of distributing messages–book, newspaper, magazine, film, recording, radio, broadcast television, cable television, and computer. But over the past few decades, the mass media industries have undergone profound changes due to the forces of convergence–technological, marketing, and psychological. These forces of convergence have eroded the old channel distinctions and have shifted the focus away from the characteristics of distribution and onto the needs for media messages in distinct niches of audiences.
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Chapter 7
Economic Perspective
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Key Idea: The businesses in the media industries are in strong competition with each other to acquire limited resources, play the high-risk game of appealing to audiences, and achieve a maximum profit.
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The Media Game of Economics
The Players
You, the consumer
The advertisers
The media companies
The employees of media companies
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You, the consumer: pour in money, time and attention and seek to exchange money and time for entertainment and information. Largest group with almost 330 million people in the country and 7 billion worldwide. If consumers pull out, the game would collapse.
The advertisers: bring money to the game. They negotiate an exchange of their money for time and space in the media in order to expose their ads to their target audiences. Advertisers are very sophisticated in their economic exchanges, because they want to get access to their target audiences for the lowest cost possible.
The media companies: bring money, messages, and audiences to the game as they compete in three different markets simultaneously.
The employees of media companies: bring their time, skills, and talent to the game.

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The Media Game of Economics
The Players
Consumers’ resources: money, time, attention
Seek worthwhile exchange of resources
Advertisers’ resources: money, time, space in media
Concentrate on niche audience
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Consumers
We are the consumers.
Our resources include our money, time, and attention.
Advertisers
Advertisers bring money to the game.
They negotiate an exchange of their money for time and space in the media in order to expose their ads to their target audiences.
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The Media Game of Economics
The Players
Companies’ role: Talent targets audience using advertising
Employees’ resources: time, skill, talent
Distinction between below-the-line and above-the-line employees
Top executives have managerial talent
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Distinction between below-the-line and above-the-line employees:
Below-the-line employees:
The crafts and clerical people–such as a lighting technician, sound boom operator, copy editor, ticket taker, cable installer, secretary, or a receptionist–who apply fairly common skills in the performance of their jobs. These skills can be learned by many people and can be improved with practice.
Above-the-line employees:
The creative types, and this requires talent much more than training or effort, although training and effort are also important. These above-the-line people are the writers, producers, directors, photographers, actors, singers, web designers, and choreographers.
Media Companies
These businesses bring money, messages, and audiences to the game as they compete in three different markets simultaneously.
Media companies compete for the best talent.
Media businesses compete for audiences.
Media companies compete in the advertising market.
Media Employees
Employees bring their time, skills, and talent to the game.
Below-the-line employees compromise low-skill and low-paying jobs.
Above-the-line employees are the creative types, and this requires talent much more than training or effort, although training and effort are also important.
On average are paid twice as much as below-the-line employees.
Includes celebrities and media managers.

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The Media Game of Economics
The Goal
Maximize value for self: net winners and net losers
Computing value by businesses to understand profit or loss
Value for customers is quantitative (money), qualitative (satisfaction)
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Maximize value for self: net winners and net losers: difference between net winners and net losers. Net winners: The value of payoff is more than their cost. Net losers: Resources spent are of more value than the payoff earned.
 
The Goal
For all four types of players, the general goal is to maximize the value of the exchange for themselves.
Net winners have negotiated resource exchanges so well that their payoffs are of greater value than their costs.
Net losers give up more resources than the value they receive back.
Value is computed in very different ways for different players.
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The Media Game of Economics
The Rules
Presence of resources and willingness to exchange
Personal negotiation to maintain fairness
Need to attract consumers to stay in the game
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The Rules
The most central rule of this economic game is that to play, you must have resources and a willingness to exchange them for other resources
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The Attention Economy – How They Addict Us

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Characteristics of the Game
Importance of valuing resources well
Complex interdependency among players
Digital convergence
Nature of competition
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Importance of Valuing Resources Well
One factor in valuing a resource is making an assessment about how well the resource will achieve a particular goal.
A second factor that is important in valuing resources is to consider supply and demand.
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Characteristics of the Game
Importance of Valuing Resources Well
Consider supply and demand
Assess the utility of a resource to achieve a goal
Leads to better negotiations
Absence of knowledge leads to over-value or under-value of resources
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Absence of knowledge leads to over-value or under-value of resources: When resources are over-valued, people avoid making exchanges with the business. In the case of resources being under-valued, a lot of exchanges are made but they continually are shortchanged. Little knowledge of the value of resources can lead one to lose the game.
Indirect as well as Direct Support
Direct costs are the financial payments you make directly to a media company.
Indirect costs are typically payments of time you make when you expose yourself to media messages.
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Characteristics of the Game
Complex Interdependency Among Players
Individual exchange, simple
Complex interdependence
Characteristics:
Relationship between similar businesses
Dilemma of decision makers
Market dynamics
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Complex interdependence:
Involves multiple negotiations between many heads.
Example: Suppose a radio station wants to attract more advertisers. It cuts the price of its ads by 20% in its highest rated show. Advertisers want to buy those ad times, so their demand at this station increases. The station, which used to air 15 min of ads during an hour, decides to air 20 min of ads, thus increasing its supply to meet the increasing demand. The station likes this because even though it has cut its income per ad by 20%, it is now selling 33% more avails, and thus the station has increased its total revenue. But the audience notices this change and becomes upset that there are so many ads and not nearly as much music. Most of the audience switches channels during the ads and never comes back. The station’s ratings drop dramatically. Then advertisers become unhappy because it is no bargain to get a 20% discount on ads if the audience they expected to reach is almost gone. Advertisers begin feeling they are wasting their money, so they stop buying those ads.
Complex Interdependency Among Players
The economics of the mass media industries are complex; three characteristics make this interrelationship even more complex.
When a person at one media company makes a decision, it can often have an impact on other companies in the same industry and perhaps other media industries.
Sometimes decision makers are conflicted because they are experiencing cross-purposes.
Media vehicles compete in different markets.

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Characteristics of the Game
Digital Convergence
Wide distribution of content
Easy and quick creation and dissemination of content
Increase in entrepreneurs
Shift of focus to target niche audience
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Digital Convergence
Digitization has created many more opportunities to market content simultaneously across all channels.
The digitization of content has also lowered the barriers to entry for entrepreneurs.
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Characteristics of the Game

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Nature of Competition
Distinction between monopolistic and competitive industries
Monopolistic competition
Meeting unsatisfied needs of niche audience

Monopolistic competition: large firm as compared to market, aggressive competition. Easy entry to market followed by struggle which can be overcome when unsatisfied needs of niche audience can be met. If new companies can generate the satisfaction, then they will dominate the market.
Nature of Competition
Many businesses compete for few resources.
We have evolved into a situation referred to as monopolistic competition.
Media businesses do not really compete on product features as much as they compete on product images.
Advertising as the Engine
Advertising is important to our economy.
A decline in the proportion of farmers and blue-collar workers and an increase in the proportion of white-collar professional workers mean that people are not as self-sufficient and must buy their food and clothing.
There has been a high level of employment, which gives people the resources to buy goods and services.
Advertising makes it possible for new goods to enter markets and let us know immediately that they are available.
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Capitalism And Monopolies: How Five Companies Control All US Media

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Media Industry Perspective

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Overview of Success
Rise of digital technology in various sectors
Films generate huge revenue through collections
Digital music sales generate huge revenue
Digital technology has revolutionized music industry

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Media Industry Perspective

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Overview of Success
Book publishing capturing digital format
Largest market of consumer books
Video game sector on the boom

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Media Industry Perspective

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Advertising
Drives growth of industries
Awareness of new products
Exposure to ads leads to purchase
Flow of money in a cycle

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Media Industry Perspective
Media Strategies
Maximizing profits
Constructing audiences
Reducing risk
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Media Industry Perspective
Media Strategies: Maximizing Profits
Increasing ways to generate revenue
Minimizing expenses: less salary for below-the-line employees
Economies of scale
Economies of scope
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Maximizing Profits
Increasing Revenue Streams
Media businesses need to appeal to more than one audience.
Media businesses try to develop several ways to generate money from the same audience.
Minimizing Expenses
One of the largest expenses across all the media industries is personnel.
Companies need to pay the talent a lot, so they pay the below-the-line employees very little.
The media reduce expenses through economies of scale and economies of scope.
Economies of scale exist when marginal costs are lower than average costs, that is, when producing an extra unit of a good decreases as the scale of output expands.
Economies of scope are achieved through multiproduct production, that is, there are variations on the product produced.
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Media Industry Perspective
Media Strategies: Constructing Audiences
Using quantity audience strategy (large audience)
Using quality audience strategy (niche audience)
Attract niche audience against larger group
Niche audience value for advertisers
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Media Industry Perspective
Media Strategies: Constructing Audiences
Long tail marketing initiated
Buyers and sellers brought on same platform
Widespread use of technology, no limitations
Condition audience to keep up business
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Constructing Audiences
Attracting people to niches involves using a quality audience strategy.
Niche audiences are valuable to advertisers.
Special groups of people have special needs.
This niche orientation is called long tail marketing.
Long tail marketing relies on aggregators, which are platforms that bring together buyers and sellers of all kinds of products and services.
Long tail marketing is so successful because of the widespread use of technologies that many people can use to create products and messages, the removal of limitations in bottlenecks of distribution, and limits on product lines in stores.
Conditioning Audiences
Once a mass media business has constructed an audience, it needs to keep that audience, so it can continue to rent it out to advertisers.
Media companies must condition their audience members so that they develop a habit of exposure.
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Media Industry Perspective
Media Strategies: Reducing Risk
Use of prime-time slot by media houses
Marketing concept: identify audience, create specific messages
Examples of sequels or spin-offs
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Reducing Risk
Although all businesses face risk, risk is especially high for media businesses.
Less than 2% of films released each year in the United States account for 80% of box office returns.
Media companies reduce risk through the marketing concept.
Managers conduct research to find niche audiences.
Then, media messages are developed to meet previously unmet needs in those audiences.
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How The Super Bowl Became The Championship Of Advertising

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Consumer Strategies
Default Strategy
Follow preprogrammed habits unconsciously
Routine habits developed in the past
Gave us pleasure so became habit
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Default Strategy
The default strategy typically runs continuously in our unconscious minds.
We keep repetitive habits because they are easy to do and require little thinking and attention.
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Consumer Strategies
Media Literacy Strategy
Better negotiation for maximum satisfaction
Understand direct and indirect support to decide
Selling cost: addition of producer’s expenses
Personal locus helps make decisions
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Understand direct and indirect support to decide: direct support: financial payments made to businesses. Indirect support: time invested in comprehending a message.
Media Literacy Strategy
People who follow a media literacy strategy have higher expectations for a return on the resources they expend.
Individuals with a weak personal locus will not invest the effort needed to be a better player in the economic game
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How Instagram And Facebook Make Money

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Summary
Businesses aim to make larger profit
Reduce expenses, construct and condition niche audience, reduce risk
Strategy: default with habitual exposure and no risk
Strategy: media literacy with development of existing knowledge
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Summary
When you add the economic information from this chapter to your knowledge structure about the media, you develop a deeper understanding about how decisions are made. Remember that the media industries are composed of businesses that are run to make as large a profit as they can. Each of the media industries does this well, and each earns a profit much higher than the average of almost all other industries in the United States.
The media businesses play the economic game very well because they follow three strategies. First, they maximize profits by increasing revenue and decreasing expenses. Second, they construct niche audiences, then condition audience members into habits of continual exposures. Third, they reduce their risks by using the marketing concept.
We as consumers have two strategies available to us. One strategy is the default strategy, where we follow habits conditioned by the media. By following this strategy, we exchange our resources of time and money for a continual state of satisfaction with our habitual exposures; our focus is on keeping our costs low by limiting our exposures to content we have liked in the past and avoiding the risk of trying new content that would require more effort to find and understand. The alternative is to follow a media literacy strategy, where we expend more effort to develop our skills and knowledge structures so that we profit by using the media better to fulfill our own needs for entertainment and information.
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9

Development of the Mass Media Industries

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Key Idea: Historically the mass media industries have followed a life cycle pattern of development (innovation, growth, peak, decline, and adaptation stages) but now the most powerful force shaping its current nature is convergence.
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Chapter 6 Part 1

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Patterns of Development
Presence of old and new industries
Shaped by many factors
Life cycle pattern
Innovation (birth)
Penetration (growth)
Peak (maturity)
Decline
Adaptation
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Shaped by many factors: different historical influences, technologies, regulations, and audience needs.
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Development of Mass Media (1900s-1950s)

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Potter, Media Literacy, 9e. © SAGE Publishing, 2019
Patterns of Development
Innovation Stage
Technological: channel of transmission
Marketing innovations
Recognize needs and value of audience
Attract and condition audience to repeated exposure
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Marketing innovations: There have been many technological innovations for the dissemination of information but all have not been successful. Hence, in addition to technological innovations, marketing innovations too had been initiated that would use technology to deliver messages in order to garner audience and subsequently business.
Innovation Stage
The innovation stage of a medium’s development is characterized by a technological innovation that makes a channel of transmission possible.
Marketing innovations are strategic-type inventions that have created new ways to identify audiences and their needs, attract their attention, and present messages in a way that holds their attention and conditions those audiences for repeated exposures.
Technological innovations are engineering-type inventions that have created new ways to capture, store, and transmit information in print, graphic, photographic, audio, and video formats.

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Patterns of Development
Penetration Stage
New mass media channels need to appeal to a large heterogeneous population
Must satisfy needs of public in a better manner than existing media channel
Involves growing acceptance of a medium
Involves shift to a new medium from old
Affected by certain factors
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Shift to new medium from old: Television was deemed to be better than radio, because it offered pictures in addition to sound. Television garnered more audiences in return for the same attention. Television satisfied many people’s need for entertainment because television brought many hours of entertainment into a person’s home each and every day. There was no need to leave the house to enjoy a movie or show.
Factors influencing growth of media: Public’s need and desire for the medium, additional innovations brought about to alter the appeal of other competing media, political and regulatory constraints and the economic demands of the private enterprises that own and operate the mass media.

Penetration Stage
During the penetration stage, a media channel must appeal to a very large, heterogeneous population.
The penetration stage of a medium’s development is characterized by the public’s growing acceptance of that medium.
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Patterns of Development
Peak Stage
Garners maximum attention
Generates maximum revenue
Highest level of penetration
Influences audience and advertisers

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Peak Stage
The peak stage is reached when the medium commands the most attention from the public and generates the most revenue compared to other media.
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Patterns of Development
Decline Stage
Challenged by new medium
Loss of audience and revenue
Advertisers also diverted
Same needs satisfied by competing medium

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Same needs satisfied by competing medium: The advent of 1990s saw broadcast television experiencing a decline in audiences and advertisers with the increase in cable channels. People were watching particular kinds of content that they wanted such as news (CNN and Fox News), sports (ESPN), movies (TCM), comedy, (Comedy Central), and music (MTV and VH1). The time they spent watching generic programmes designed for all had reduced. Cable television was successful in creating and targeting niche audience.
Decline Stage
In the decline stage, the medium is characterized by a loss of audience acceptance and therefore by a loss in revenues.
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Patterns of Development
Adaptation stage
Repositioning of medium, identify new needs
Eliminate common elements
Creating and targeting niche audience
Expand on other advantages

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Adaptation Stage
A medium enters the adaptation stage of development when it begins to redefine its position in the media marketplace.
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Evolution of the Mass Media in the United States | American Government

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Comparisons Across Mass Media
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Comparisons Across Mass Media
Life Cycle Pattern
Presence of old and new mediums
Some trying to coexist amid competition
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Presence of old and new mediums:
Old mediums–print media like books, newspapers, and magazines
New medium–computers
Some trying to coexist amid competition: Except the cable TV and computers, all other mediums are in the adaptation stage. This implies that they are all trying to figure out how to coexist with the other up-and-coming media as well as with each other.

Life Cycle Pattern
The life cycle pattern is a useful template for showing patterns of development for mass media.
The life cycle pattern is not perfect; some media never reach their peak.

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Comparisons Across Mass Media
Indicators of Peak
Change in medium over time
A medium at peak is dominant medium
Is radio second most dominant medium?
Computers and Internet entering peak
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Is radio second most dominant medium?
People use radio as medium for background music and exposing themselves to other work at that time. Next, radio doesn’t generate much revenue.
Computers and Internet entering peak: audience control and variety increasing with computers. Content designed in specific way. Choices not restricted. Example: Amazon Prime, Netflix
Indicators of Peak
When a medium is at its peak, it is usually the dominant medium.
Broadcast television was in the peak stage for about 40 years but was replaced by cable television.
The medium of computers is well on its way to a peak because it can deliver many types of content through one medium.
The amount of money the medium generates.
The amount of time people spend with the medium.

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Is Print Journalism Dying, Or is it Already Dead?

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Comparisons Across Mass Media
Decline and Adaptation
Rise of one forces another to adapt
Growth of Internet, decline of traditional medium
Advent of smartphones initiates growth
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Decline and Adaptation
When one medium rises to its peak, it affects other media.
Television surpassed newspapers, but newspapers were able to survive because they adapted.
Newspapers began presenting longer stories with in-depth reporting.
The fastest growing medium is the computer/Internet, especially with the widespread use of mobile devices, like tablets and smartphones.
In the United States, 9 of 10 adults carry a mobile device, and by the eighth grade, 80% of kids have their own cell phone.
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Website
Technology that changed us: The 2000s, from iPhone to Twitter
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Journalism: Last Week Tonight with John Oliver (HBO)

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