Economic Pressures ANd Social responsibility Whitney Arthofer Elliott Davidson Stephen Liske

Economic Pressures versus Moral Obligations Some suggest that when profit motives compete against altruistic motives, commercial interests always prevail Profit is not immoral The problem occurs when commercial interests are allowed to dominate social obligations

Economic Pressures versus Moral Obligations Balancing economic pressures against duties to others Can’t always give way to noble causes like moral idealists propose Economic Pressures come from Financial Supporters The competition The public These are interdependent Economic concerns in one area can impact other areas

Economic Pressures versus Moral Obligations Media are in a unique position in the American economic system Advertising Constitutional Protection Viewed as servants of the public interest This role goes far beyond commercial interests However, media are big business and economic pressures influence their decision making

Media’s financial interests and public’s interests are reflected in three areas 1. Concentration of media ownership 2. Alliance of mass media and marketing 3. Advertising

Concentration of Media Ownership Many media outlets are owned by a few big corporations Newspapers In 1930, 84% were independent In 1998, 20% (of 1,500) were independent Gannett Company, Newhouse Newspapers, Tribune Company, Knight- Ridder, and Times-Mirror own most daily papers

Concentration Of Media Ownership Ideas vs. Profit & Loss statements In favor of media concentration Pooling of economic resources equals a better product Chain Ownerships has allowed many newspapers to stay afloat Against Media Concentration Obsession of cutting cost to maximize profits is hurting readers and viewers Stockholders trump readers Major TV networks are the properties of non-journalistic corporate enterprises Disney and ABC CBS and Westinghouse Electric

Alliance Mass Media & Marketing Mass media has adopted marketing/economic strategies Tension between business values and journalism values Mark Willes review To compete in todays economic arena a business must master marketing O.J. Simpson case/Carnival cruise stranded -The marketing concept holds that all departments, including news, must contribute to the financial well-being of the organization -Recent survey of 140 editors and news directors showed that more than 75 percent of the respondents believed that entertaining readers and viewers comes before educating them. -“Throughout the paper editors are sitting down with delegates from circulation, marketing, research, and advertising to develop new sections, to establish targets and goals for revenue and readership.”

Alliance Mass Media & Marketing Con side – marketing concept has “democratize” journalism Stations use consultants’ advice or audience survey data to determine content Audience receives what they want over what they need Seinfeld, The Apprentice, and Friends considered cultural phenomenon's Money must be generated Marketers fear that large numbers of low-income readers will undermine -”the fact that business decisions drive news decisions is a “virtue” because it gives the public a significant voice in shaping the news agenda. -TV Shows are cultural phenomenons and therefore newsworthy. -Money has to be generated in order for these stations to stay in business and for actual news to be publicized in the future. -marketing directors at many newspapers fear that large numbers of low-income readers would undermine the appeal of the demographics on which high advertising rates are based.

Alliance Mass Media & Marketing Utilitarian Pro’s vs Con’s Care Theory Take into account people who are vulnerable and dependent on his/her care

Challenges of Cyberspace Commercialization Search engines allow owners to pay for prominent placement Editorial judgment v.s advertising online Ads (banners to pop-ups now search engines) Novices can’t tell the difference Solution – listing labeled as “paid”

The Role Of Advertising Gives mass media financial independence from government and political interests Creates media dependence on commercial sector Economic pressures from advertising Quantity of ads determines amount of space left for news, entertainment There is ripple effects when advertisers cut budgets More money that is spent on cable ads means less money is spent on network ads News divisions are affected and the quality of content suffers because they don’t have resources

The Role of Advertising Direct pressure on media managers Advertisers don’t want unflattering stories They pull ads if they become targets of negative publicity Pressure may be subtle Women’s magazines rely on cigarette ads Study revealed less stories about hazards of smoking in these magazines Smaller organizations may succumb to the pressure Larger institutions can withstand advertiser onslaught because they have more money

Challenges of CyberSpace Utilitarian Pro’s vs Con’s Care Theory - Take into account people who are vulnerable and dependent on his/her care

Case Study GE is by no means a hands off owner of NBC. Lee and Solomon in their book Unreliable Sources have detailed how GE insisted on the removal of references to itself in an NBC program on substandard products. Todd Putnam, editor of National Boycott News, tells of how he was approached by the NBC's Today Show to do an interview about consumer boycotts. Their biggest boycott at the time was against General Electric and its nuclear defense contracts. The Today show was reluctant and unsure of whether or not to have him mention boycotts against any large corporation preferring him to rather talk about "a boycott that was 'small,' 'local' and 'sexy'.“