THE TWENTY-FIRST- CENTURY MEDIA INDUSTRY STUDIES IN NEW MEDIA Series Editor: John Allen Hendricks, Stephen F. Austin State University This series aims to advance the theoretical and practical understanding of the emergence, adoption, and influence of new technologies. It provides a venue to explore how New Media technologies are changing the media landscape in the twenty-first century. TITLES IN SERIES: The Twenty-First-Century Media Industry: Economic and Managerial Implica- tions in the Age of New Media, edited by John Allen Hendricks THE TWENTY-FIRST- CENTURY MEDIA INDUSTRY Economic and Managerial Implications in the Age of New Media Edited by John Allen Hendricks LEXINGTON BOOKS A Division of ROWMAN & LITTLEFIELD PUBLISHERS, INC. Lanham • Boulder • New York • Toronto • Plymouth, UK Published by Lexington Books A division of Rowman & Littlefield Publishers, Inc. A wholly owned subsidiary of The Rowman & Littlefield Publishing Group, Inc. 4501 Forbes Boulevard, Suite 200, Lanham, Maryland 20706 http://www.lexingtonbooks.com Estover Road, Plymouth PL6 7PY, United Kingdom Copyright © 2010 by Lexington Books Cover image copyright © 2010 by the National Association of Broadcasters. Used by permission. All rights reserved. No part of this book may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval systems, without written permission from the publisher, except by a reviewer who may quote passages in a review. British Library Cataloguing in Publication Information Available Library of Congress Cataloging-in-Publication Data The twenty-first-century media industry : economic and managerial implications in the age of new media / edited by John Allen Hendricks. p. cm. — (Studies in new media) Includes bibliographical references and index. ISBN 978-0-7391-4003-1 (cloth : alk. paper) — ISBN 978-0-7391-4005-5 (electronic) 1. Mass media—Technological innovations. 2. Digital media—Economic aspects. 3. Digital media—Social aspects. I. Hendricks, John Allen. P96.T42T89 2010 302.23—dc22 2010013283 ϱ ™ The paper used in this publication meets the minimum requirements of American National Standard for Information Sciences—Permanence of Paper for Printed Library Materials, ANSI/NISO Z39.48-1992. Printed in the United States of America As always, because of their continued love and support, my achievements are dedicated to Stacy, Abby, and Haydyn. Contents List of Figures and Tables ix Foreword by Alan B. Albarran xi Acknowledgments xiii Part I: Change: Technology, Economic Implications, and Consumer Behaviors 1 New Media: New Technology, New Ideas or New Headaches 3 Susan Smith and John Allen Hendricks 2 Media Management: The Changing Media Industry and Adaptability 23 Mary Jackson Pitts and Lily Zeng 3 DVRs and the Empowered Audience: A Transformative New Media Technology Takes Off 41 James R. Walker and Robert Bellamy 4 The Obstinate Audience Revisited: The Decline of Network Advertising 61 Douglas A. Ferguson 5 Going Viral: Mass Media Meets Innovation 81 Joan Van Tassel — vii — viii Contents Part II: Implications of New Media Technologies 6 The First Domino: The Recorded Music Industry and New Technology 109 Robert Bellamy and Robert Gross 7 Changes and Challenges in the Print Industry: The New Landscape of the Print Media 133 Steven Phipps 8 Challenges and Opportunities, New Models, and the Emergence of the Next Newsroom 149 Jen McClure 9 Broadcast and Cable on the Third Screen: Moving Television Content to Mobile Devices 173 Jennifer Meadows 10 How to Reach the Masses: Broadcasters’ Uses of the Internet and Cell Phones 191 Maria Williams-Hawkins 11 Making Money with Mobile 219 Maria Williams-Hawkins 12 Cinema in the Age of RWX Culture 235 Alexander Cohen 13 Local Market Radio: Programming and Operations in a New Media World 251 Tony R. DeMars Bibliography 269 Index 279 About the Editor 289 About the Contributors 291 Figures and Tables Figures 5.1. One-to-One: The Schramm-Osgood Model of Interpersonal Communication 83 5.2. One-to-Many/Few-to-Many: Schramm’s Model of Mass Communication 85 5.3. Exponential Connectivity of Networks 88 5.4. Mass Media and the Feedforward Path 88 5.5. Growth of the Internet 89 5.6. Individual Actions in MVC 92 5.7. Process of MVC, Initiated by a Message Generated by an Individual 94 5.8. Stages of the Individual Adoption of Innovation Process 95 5.9. Stages of Adoption Within a Population 95 5.10. Spikes and Chatter on Blogs 97 5.11. Theorized Model of Campaign Communication Mediation 98 5.12. Influence of Online News Use and Messaging Activity on Civic and Political Participation 99 8.1. 2009 Social Media Adoption Trends 164 8.2. 2009 Survey Findings 165 8.3. 2009 Survey Findings: Perceived Value of Social Media 165 8.4. 2009 Survey Findings: Perceived Value of Social Media 166 8.5. 2009 Survey Findings: Perceived Value of Social Media 166 9.1. Programming Path 177 — ix — x Figures and Tables Tables 5.1. Comparison of Modalities of Communication Flow 87 5.2. Characteristics of Messages That Enhance the Likelihood They Will Be Passed Along 100 9.1. Equipment and Content Pathways 183 9.2. Mobile Media Characteristics 185 Foreword HE PUBLICATION OF THIS EDITED VOLUME, entitled The Twenty-First-Century TMedia Industry: Economic and Managerial Implications in the Age of New Media, is an important step in the evolution of scholarship in the field of media management. The editor of this work, John Allen Hendricks of Stephen F. Austin State University, has assembled a strong group of scholars to offer some new perspectives and ideas on management in a changing media envi- ronment, involving both traditional and new media. Professor Hendricks and his collaborators are to be congratulated on their efforts. Media management is a sub-field of the broader field of management, but the study of management is relatively young, at least compared to other disci- plines. Management studies emerged slowly in the twentieth century, in large part due to a global shift from an agrarian to an industrial society in most developed nations. As the manufacturing of products became the primary activity in the Industrial Revolution, companies began to explore ways to in- crease productivity. In some cases, industrial psychologists were hired to help companies study and improve assembly plants and methods of production. These early efforts became known as the classical school of management. In the 1930s and 1940s the study of management began to shift by focusing on the worker and his/her motivations and needs. By the 1960s, the modern era of management was introduced, exemplified by such milestones as the in- troduction of management by objectives, and Theory X and Y approaches. In the 1970s and 1980s, Total Quality Management, Theory Z, strategic manage- ment, and the study of leadership would make new contributions to the study of management, with some of these applied to the media industries. — xi — xii Foreword It was during the behavioral era of management that research involving the media industries debuted. Most of the research on media management can be traced to the late 1940s with radio, followed by studies on newspapers and television in the 1950s. The introduction of cable television in the 1970s added a few books and studies on differences in managing a cable TV system. In the 1990s and the first decade of the twenty-first century, convergence be- came the buzzword and scholars began to examine the phenomenon mostly in newsrooms, where convergence was most likely to take place. The problem is that during the latter part of the twentieth century, the media industries began to experience fundamental change, but our study of management remained stuck in a 1970s model. Most of the management re- search focused on single industries or single levels, and failed to acknowledge the impact of technology, globalization, economics, and social forces. Media industries were forced to adopt the Internet in the 1990s, and were slow to recognize the importance of blogs, social media, and tweets in the twenty-first century. Contemporary media managers are scrambling to try and figure out what to do with a range of possible digital platforms available to distribute content, how to generate new revenue streams from these platforms, increas- ing fragmentation and declines in audience viewing and listening, and the best ways to brand and market content. The Twenty-First-Century Media Industry does not provide answers to all of the questions associated with this chaotic marketplace, but it does make an effort to explore some of the new management challenges that badly need to be addressed. Scholars in this volume look at a number of different industries including radio, television, newspapers, and music. Other chapters examine the impact of specific technologies such as the digital video recorder (DVR) and the mobile phone. Still other chapters address broader topics of change, adaptability, innovation, and distribution which can be applied to all seg- ments of the media industries. The Twenty-First-Century Media Industry is a welcome addition to the literature of the field as it attempts to deal with a fast-moving target—the evolving media marketplace. Students, practitioners and policymakers should find the content both compelling and thought-provoking, while presented in a format that is easily digested and understood. Let’s hope this work will be an inspiration and catalyst for more new explorations on media management in the twenty-first century. Alan B. Albarran The University of North Texas January 2010 Acknowledgments WISH TO THANK EACH AUTHOR WHO CONTRIBUTED an essay to be included in this I book. Without their diligent work and enthusiasm for seeking a better un- derstanding of the changing media landscape in the twenty-first century, this book would not have come to fruition. I am fortunate to have the support and understanding of an academic institution that values and promotes scholarly and intellectual pursuits such as this project.