Impact Of Regulations And Technological Changes On Mass Communication Industries

History of Newspapers

Discuss the impact of regulations and technological changes on the Mass Communication Industries in the last three decades looking at the TV OR Newspaper industry?

Newspapers are still far from the dead, but the language of the obituary is creeping in. The present status of the industry in the UK is strong enough to give a candid proof of a fact that this ink-on-publishing tradition is being ruthlessly suppressed by the accelerating innovations in the digital world. The newspapers, from a very long time, have been considered as the most reliable information to the readers. The industry has been establishing a sound information background of the people and has constantly been aiding in delivering the most justified form of local and international news to the ones to whom the issues are mainly concerned. The newspapers are considered to be far more effective than all the other sources of information cum entertainment as it provides a much easier way to its readers to explore about public affairs in a much more detailed and manner. The complexity of the society could be well understood only when this ink-on-publishing tradition has been well appreciated by the readers and if along with democracy the people are provided with an immensely rich and pluralistic information environment which invigorate a sense of awareness among people (Grahama & Hilla, 2009). The technology has always been an integral element to face the dynamics of the evolving world and its demands. But as the technological reforms have dominated the society in the few decades, it has posed a great challenge not only at the level of production and delivery of information but also the industrial level. With the incorporation of myriads of technological reformations, the newspaper has eventually started losing its grip over its readers as the readership habits are under a great change as the consumers are turning their interests towards the free internet services for a variety of information and news related to current topics (Stephens, 2010).

When defined in its simplest form, then a Newspaper is a publication that occurs frequently and regularly and carries information about a wide variety of current events. The Newspapers began to circulate around the 17^th century and the first newspaper was printed in England in 1641. However, till that time, the word “Newspaper” was not so prevalent. The first successful daily newspaper in Britain was printed and circulated in 1702. In Britain, the first Sunday newspaper, the “British Gazette” and “Sunday Monitor” were published in 1780. The “Daily Universal Register” (published in1785) was renamed as “The Times” in 1788. It was in the year 1814 that the newspaper industry was revolutionized with the introduction of the Steam-power press and “The Times” was the first newspaper, incorporating this innovative technique in its printing using a rotator printing press with the printing face wrapped around a cylinder for the first time (AJR Team, 2008). “The Observer”, “The Daily Telegraph” and “The Guardian” were respectively founded in the year 1791, 1855 and 1821. It was in the late 19^th Century that made the newspaper industry far more common among the people. During this period, the Government began to charge Stamp Duty on the printing of the newspaper which further made them more expensive. The year 1855 was marked a yet another important year in the history of newspaper, as the stamp duty, that was imposed in the previous years, was abolished to make this easiest way of publishing information, more cheaper than always. In 1962, the Sunday Times became the first newspaper to publish a color supplement of the newspaper on weekends.

Existing Newspaper Business Model

At the beginning of the 20^th Century, most of the work related to newspaper printing and publishing, had been carried out in the Fleet Street and subsequently it became the center of the British Newspaper printing. However, with the end of this century, most of the newspaper owners began to move away from this center. The 20^th Century was marked by the introduction of Computers and hence the obsolete labor intensive techniques were replaced by the new and innovative Information technology tactics. To address the issues of the press and to invite innovative suggestions from the participants, a Press Complaint Commission was created in 1990. The Newspaper industry adopted a new innovative idea to attract the commuters by introducing its first free newspaper named “Metro” in 1999 (Kirchhoff, 2010).

The newspaper industry is characterized by a high sunk cost as a great investment is needed in implementing a printing press, ink and paper and of course in hiring and retaining the labor. This high sunk cost is supplemented by a low marginal cost and therefore this gives a chance for the market entry barriers to expand and curb the entry of the press in the potential market segments. The existing business model of this industry works on a strategy that is designed to operate in the two-sided market (Norris, 2000). Under this model, the industry is involved in selling news to the readers and simultaneously in selling advertising space to the advertisers.  Although, the concentration of newspaper publishers is ongoing with time, yet the newspaper publishers are having an immense problem in sustaining their business as a standalone, individual business.

Revenue Structure

In the decade, from the year 1997 to 2007, the firms involved in the newspaper publishing industry increased to around 9,000. This was accompanied by an average declination in the number of employees with a steep rate of around 15.9%. Looking at the current statistics, in 2013 the newspaper market was expected to generate revenue of $169.9 billion, which was around 2.2% less as compared to the revenue generated in 2012. The conventional newspaper business is considered till now as the primary contributor to the income of the newspaper industry, contributing up to 78% of the total revenue. The UK newspaper publishing market has a medium level of market share concentration. This fact is further strengthened by a statistic that reveals that only the top four players in the industry has accounted for around 54.1% of the industry revenue in the year 2014-2015. These major companies, ruling the newspaper industry at present includes News Corporation, Daily Mail, Johnston Press and Telegraph Media Group (Izquierdo-Castillo, 2013). The economic turmoil, the country is facing at the present, predicts that there’s a bleak future for the newspaper industry and the industry is definitely going to decrease its value in the coming years as the sales and advertising expenditure are going to decline. Talking about the recent year, 2015, the year had been a brutal one for the industry as the print advertising in the country fell by £112 m which was nearly equivalent to half Fleet Street’s Profit and even with the combined wage bills of the leading newspaper in the UK, including, the Times, Sunday Times and the Daily Telegraph (Dodge, 2006).

Revenue Structure

Cost Structure

As already mentioned in the earlier section, that the maximum investments in a newspaper industry are needed in implementing and operating the printing press and in manufacturing and buying the ink and the paper, hence it is proven that the in a typical operation, the maximum portion of the investments is utilized at the industrial level. Of the total cost, around 25- 35% is utilized in buying and manufacturing the paper and implementing the printing press. Around 30- 40% is used in distribution and 18- 25% is utilized in editing. The left over 10- 15% is utilized in meeting the administrative and marketing expenditures (Nworah, 2012). The Circulation sales and billing together with fleets of trucks and delivery employees throwing the papers from door to door accounts only to the 10% of the total costs. However, this percent is a part of the distribution section only. Talking about the significant incomes of the industry, so, the major sources of the income are distribution services and the free advertising papers in the average company (Lilistrucchi, 2005). 

Impact of Technology

The earliest newspapers were simply hand written documents posted in public. With the invention of the printing press by Johannes Guttenberg in 1440s, a revolution in the print culture began. Advancements in electronics led to another revolution in which the newspapers are printed and published. Technological reformations, including the invention of computers and its associated softwares equipped the newspaper industry with an ability to produce a relatively larger number of newspapers in a very short time. The software technology, named as Desktop Publishing, added another remarkable reformation in the printing techniques (Salman, et al., 2011). With the introduction of this technological software, the industry began to publish the newspaper layout in a more innovative and appealing manner. Talking about peculiar softwares, then Adobe Page Maker, Quark express and Microsoft Publishers are some of the leading softwares that have made the printing and publishing work easy and interesting. Another interesting advancement in technology is the introduction of digital photography with includes use of a wide range of digital cameras. The inclusion of photos with the information has always given a better understanding to the readers. The digital photography has aided the industry with an increased speed of newspaper printing by directly including the clicked photos from the camera to the page to be printed. The above mentioned softwares have accompanied in this work a lot.

Cost Structure

The internet has proven a crucial element that has a both positive and a negative impact on the growth of this sector. A number of newspapers have turned towards the internet exposure to increase their popularity and expenditure (Fan, 2012). As this element has been accepted globally by a number of users, hence the newspaper industry has started using it as a medium to reach the remotely placed readers and even to target the new potential target market segments. The internet is not only regarded as a medium of quick information, but side by side is a pivotal element that could be effectively used in business and advertising and has proven a boon for the newspaper industry. The Electronic Ink technique effectively amalgamates the essentials of electronic and internet to deliver quick services to the readers by improving the speed of distribution and cutting the major costs of printing. While most of the newspaper publishers consider internet technology as a boon to the industry, the others recognize as a major challenge to the industry, which has an enough capacity to give a potent threat to the popularity of printed newspapers. According to Reid Goldsborough, “The relative cost of including internet in place of printing press is quite low and hence has effectively taken over the old-media institution.” This has not only threatened the popularity of printed news, but has also left a majority of labors unemployed (Ifra, 2006).

Impact of regulation

In the year 2013, the government of UK published a Royal Charter accessing its control over the newspaper industry. This formal document consists of a number of recommendations that were regarded as lame and unworkable by the newspaper society. Hence, the members of the society stood together in against of the government’s proposal and curbed the idea (Rosenstiel & Jurkowitz, 2012). The regulation of newspaper, being a sensitive issue to handle, holds a critical importance in the newspaper industry. But, when the regulation is exercised through external agencies then it gives undue advantages to the politicians to have an unacceptable degree of interference in the working of the press. Self Regulation has become a solution to all the evolving issues of regulation and its ill effects. The Press Complaint Commission (PCC), being an element of self regulation, works efficiently to provide a central benefit of combining the highest standards of ethical reporting with a free press. The statutory controls and privacy controls only works to undermine the freedom of the press. These regulations are only used by the rich and the powerful to who ultimately involves courts to exert their pressure on the freedom of speech of the publishers. The regulation exerted by the external agencies is sometimes misused by corrupts to obstruct the reporters to publish articles that are concerned with the public interests (Africanus & Diedong, 2013). Hence, with unworkable regulations, this medium of reliable information becomes a mere puppet in the hands of the rich and powerful. 

“Newspaper in the today’s era is not dying, they are committing suicide.” The declining phase of the newspaper industry is suggesting that the Internet and other powerful information source are together responsible in destroying the ink-on-paper publishing. Philip Meyer has studied the newspaper industry for almost three decades and has suggested that if the current readership trend continues in the future, then it will be the year 2044 when the reader will get to read the last printed newspaper. In his latest book, titled “The Vanishing Newspaper: Saving Journalism in the Information Age”, he has candidly said that the declining number of the readers is really a bad sign for the newspaper industry and if the trend continues then the industry will have to face a great turmoil in the future. The major point of concern for the industry is relatively quite shocking as the researchers say that the today’s young generation won’t grow into future readers (McClymer, 2010). A present research has unveiled that the time spent by the adults, under the age of 30, in reading daily newspapers has dropped to only 16% which is yet another concern for the industry.

The declining phase of the industry has created an urge to find an alternative business model. Although the process of searching a new business model requires continuous efforts with several layers of reporting and a number of research instruments, yet once an effective model is generated then the industry can recover back to its older popularity era. There are a number of suggestions regarding the new business model for the newspaper industry. One such model, being a bit experimental and innovative in nature, has suggested a concept of “Crowdfunding”. In this model, the readers could make the payments to a journalist so that he can write a particular story or cover a peculiar beat (Liew, 2016). The reader’s donation being an innovative concept will not only raise an alternate source of funding for the industry, but also promises to increase the involvement of the local public in the working in the industry and hence make them more closer towards the print culture. The fund given by the people can support a journalist on an individual level or can even directly aid the industry on a whole. The representative journalists, gathering information on the basis of the financial aid provided by the people, can later be presented to the newspapers as the fresh talent or can work for other media outlets. Another innovative model that the industry could follow to overcome this declining phase is the “Customization of Papers. With this idea, the technology would be used in printing customized pages incorporated and illustrated with lots of ads for the readers or just printing hyper-local editions of their papers in regions where the newspapers are greatly acknowledged. The industry adopting any of the new business models should also adopt a system of self regulation in its working. The self regulation being free from any sort of legal problems and political interference, grants the industry with a supreme power to express the views, but also a set of rules that keep the editors highly committed to the highest possible ethical standards (Leurdijk, et al., 2012).

Conclusion

In the midst of the crippling value of newspapers and declining numbers of the readers, it is quite pivotal that the industry adopt a number of measures to attain its position back in the society. Newspaper, being like a guiding light to the igniting minds of the young generation and the most affirmative source of reliable information for the ones who cannot afford the other exorbitant sources, has got a lot of potential to get back to its readers. Although, technology has revolutionized the printing and publishing sector both in quality and speed, yet it is posing a major threat to the future of this industry. The regulation to the press is only tolerable when it is up to the words, but when the government and other external agencies began to regulate the ideas of the publishers then the existence of democracy is being questioned. Hence, both technology and regulation should only be incorporated when they are proving as a beneficial asset to the industry.

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