CNN International segment on Murdoch, phone-hacking & tabloid tactics

Posted: August 7th, 2011 under New Marketing, newspaper crisis, Newspaper Deathwatch, Newspapers, television, Webconomics, Wrongheaded solutions.

The good folks at CNN asked me to appear on Backstory” to talk about the News of the World’s phone-hacking scandal.

I tried to oblige them with some insights onto why this kind of scandal keeps happening, and why. You can see the results of the interview in the segment below:

More on why the news business keeps getting hit with privacy scandals like this, and why it won’t stop after the jump…

I could tell in the pre-interviews that what CNN was really interested in was pretty much the same thing that the tabloids are: down & dirty tales about famous people doing Bad Things, and how tabloid reporters and paparazzi lie, cheat & steal in flagrant disrespect for the law.

Well, duh.

The deeper point, and one that it is difficult to do on television (although I did try to speak in TV-friendly sound bites) is that the real reason for the constantly recurring invasions of privacy, and for the generally rotten state of the news business (and not incidentally, society itself) is that the news business is no longer actually in the business of reporting news.

No, the business side of things now completely predominates, to the exclusion of just about every other consideration. This is because the last 30 years have seen newspapers, TV stations, radio stations and just about any other means by which reporters collect information and transmit it to the public at a large scale, bought up by increasingly larger corporations, who run things … well, pretty much the same way that every other Corporate America hellhole runs things. As cheaply as goddam possible, with utter contempt for the end consumers of their products (the whole “Make it just one tiny scootch about the level where people will vomit and refuse to buy it”) and complete & total hatred and fear of their employees and the (gasp!) prospect of those employees actually unionizing and demanding safe, sane and humane working conditions.

The fact that these statements are probably controversial says more about the nature of our denial of widespread reality than it does about the news business … although come to think of it, the fact that newspapers, network TV news (and the cable outlets that feast off them both) are so dysfunctional is probably in large part responsible for the “magical thinking” disease that has overrun politics and culture in America.

See, the problem is that every newspaper & TV station in existence (with a few exceptions) is part of a larger corporate behemoth. That corporate behemoth went deep, deep into debt to buy said newspapers and TV stations, back when the economy was sound and these media properties looked like no-brainer acquisitions. After all, newspapers had pretty much monopoly market positions in every city worthy of the name, while local TV stations were like owning your own mint. If you wanted to run a small-to-medium sized business in America, you had to advertise your products. And to advertise, you had to pay whatever the owner of the newspaper or TV station wanted to extract from you in this billing cycle. If you didn’t want to pony up … well, I’m sure your competitors did. And then they buried you, while your inventory grew cobwebs.

So with that long, flat, steady rate of return, all the projections for the future looked safe. And if there’s one thing that Corporate America loves more than anything else, it is the utter elimination of any hint of risk. A small rate of return over many years … well, they know how to make that dance. That’s how they turned home mortgages that pay 4-8% a year into financial instruments that paid 1,000% returns – by leveraging the living shit out of them. Borrowing huge quantities of loot, and putting it down on the Vegas craps table that is the U.S. banking system, meanwhile squeezing the budgets of these media properties to make the debt-service payments.

And to make those payments? Well, you gotta make sure that nothing disturbs that projected rate of return. That means for God’s sake, don’t do anything too daring or out of the norm. Second, bring in the efficiency experts to go over the budgets with a fine-tooth comb and start looking for any way possible to cut the budget. Fire people, delay buying new equipment, shrink the costs of the actual production of the news to the point that they can squeeze a couple more percentage points of profit out of the old Daily Beast.

These macro policies mean that the journalists who actually have to produce the content that goes into these media properties are running on the razor edge of make it/don’t make it; and the news editors are having to claw with every fiber of their being in the desperate attempt to make the quarterly numbers go up even a tenth of a ratings point.

And the way to do that … is to get the biggest possible audience. How do you get a huge audience without having to spend a lot of money on time-consuming, risky and potentially business-disrupting investigative reporting?

Why, lurid tabloid-style stories, of course.

That’s why the phone-hacking scandal at the News is only the latest iteration of what is a systemic problem. By that I mean, it is not the works of a few “Bad Apples.” It is the way that the whole goddam machinery is constructed. You could put the 12 Apostles into the modern Fleet Street newsroom and within a few months, they’d be doorknocking Amy Winehouse’s parents and rooting through Elton John’s trash. Or they’d be fired in favor of people who would actually do that.

The point is that the problems with the news business bear surprising resemblance to the problems of society as a whole. We’ve tied our fate to the unfettered free-market economic forces, without really taking notice of the fact that there are a few industries, at least, that are not prepackaged Cheetos. Where diluting quality and streamlining production schedules and all the other tricks of modern corporate management may work in the short term … but in the long term are not only killing the industry, but harming … well, basically putting Western Civilization in danger of collapse. If all we have are “Twinkie” news reports from chirpy, easy-on-the-eyes blondes, and the only way for politicians to prosper is to get on TV … and the way to get on TV is to spout lunatic jackassery … then we wind up talking about destroying the basic financial security of every person in the United States because a bunch of nitwits on talk radio need to keep their numbers up for Q3. 

 

 

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