Over the past decade, the mass-ness of media has been kept on life support through social media distribution and private equity investment. Now, those bubbles have burst.
It’s the hard truth behind most media stories floating around at the moment: from the entertaining — such as the Fox implosion — to the conflict in the writers’ strike in Hollywood.
Some go largely unreported, only found deep in corporate reports, like the tapering off of digital subscription growth. Others are just sad (for journalists, at least), like the failure of what we once hoped were the big digital plays for the future, such as Buzzfeed News and Vice.
Stand back and squint a little; now you can see what’s really going on. Mass media — as it’s existed since the invention of the linotype machine — is finished.
We’re at a long-expected moment, predicted by Professor Clay Shirky back in 2008. “If the old model is broken, what will work in its place?” he asks. “Nothing,” he answers himself. “Nothing will work. There is no general model for newspapers to replace the one the internet just broke.”
Shirky was writing at a time when printed papers were staggering through their last days as the dominant medium for news. Fourteen years on, we can see it’s true, too, of both the traditional media we inherited from the 20th century and the new forms developed by wannabe start-up players.
It’s not for want of trying. We’re coming up to 30 years of mass media trying to colonise the new world of the internet with their understanding of the old. All that effort, held up by the twin pillars of social media and private equity cash, has pushed Shirky’s “nothing” moment to the current era.
Death of the unicorns
Traditional media has enough weight to survive, for the time being at least. It’s the start-ups that are feeling the most pain.
Buzzfeed was an early winner in gaming the Facebook algorithm, commercialising the viral hit (including early cat videos), innovating the listicle, and driving journalism towards the interests of the millennial market. It recognised that piggybacking off the big platforms meant growth had to be global, launching Buzzfeed News in Australia as an early off-shore franchise in early 2014, before closing in 2020 as it withdrew to its US base.
But who was gaming whom? Was Buzzfeed meeting real demand from actual people, or were they just riding the tide of algorithmic choices that Facebook’s programmers designed to boost time spent on the platform?
The giveaway should have been that Buzzfeed’s growth was bought as much as earned, with cashflow drawn from large equity infusions, most famously $50 million from Silicon Valley’s Andreessen Horowitz in 2014, which boosted the start-up to the much sought $1 billion “unicorn” status.
It had followed the path of the now near-bankrupt Vice (until recently a key program provider to SBS). which had relied on a $70 million injection from Fox Corp in 2013 to unicorn its value to US$1.4 billion. It gave Fox a 5% stake, and James Murdoch joined the Vice board.
The Fox shareholding was handed on to Disney as part of the sale of the company’s entertainment assets in 2018. Disney wrote the value of its share down to zero, but just the following year, James was back, putting his own money into the company. (Maybe Kerry Packer was wrong: some people do get Alan Bonds twice in their lifetime.)
A new menu
In the streaming wars, Netflix used private equity to build global mass in a steady 20-year rise. Now, traditional studios and broadcast networks reckon they can weaponise against Netflix by drawing on their internal resources and brand strength.
Maybe not. Just last week, Ten-owner Paramount reported a US$511 million loss in the first quarter of the year, largely off the back of the money it’s spending on building its own streaming service, Paramount+.
The streaming wars have spilled onto the industrial front, with the Writers Guild of America striking for a better sharing of revenues.
Fox Corp, meanwhile, is discovering that mass audiences can become remarkably un-mass remarkably quickly. Since the defenestration of Tucker Carlson last month, its after-dark audience has slumped by almost a half, particularly in Carlson’s 8pm timeslot.
So what will replace the void left by mass media’s “nothing” moment? Maybe “everything”: a diverse news ecosystem that lets the reader, viewer, listener pick and choose from a wide menu regarding what — and who — they reward with their attention.
Maybe that’s the way it will turn out, but I’m wondering if there is an alternative: that the days of the internet as a cultural/social phenomenon are coming to an end and people will start turning away from it altogether.
No matter what you do on the internet, a certain degree of trust is essential. Trust that the person or entity you are interacting with is genuinely matches who or what they claim to be. I suggest that trust is slowly being eroded, to the point where the whole system will no longer be viable.
In the case of news media as discussed in the article, I think it is this destruction of trust that is the core problem. To a large extent, that destruction has been willfully brought about by the commercial media interests themselves. When you consider the perpetual outrage machine of Fox News and many others, the algorithmic distortions of Facebook and other social media platforms, the false news implants of commercial lobbyists and possibly even foreign governments … why would you even bother going to the internet for news anymore? (With all due respect to sites such as Crikey, of course.)
As far as streaming services are concerned, sure they generate a lot of content, but the quality of that content barely qualifies even as pap. If you can’t trust your streaming service to entertain you, why continue to subscribe?
In the area of interpersonal communication such as email and text messages, between scammers and AI it is becoming increasingly difficult to trust that person you are communicating with is actually who they say they are. To do so is to place yourself at greater and greater risk.
Perhaps most damaging, though, is the destruction of trust for commercial transactions, because it is the profit generated from these that keeps the internet afloat. In the early days of the internet, a merchant could establish the bona fides of a potential customer just by asking for some verifiable information that they could reasonably assume that only the customer would know. Date of birth, or driver’s license number, for example. However, with all the hacking which has taken place recently, especially here in Australia, a merchant can no longer be confident that, just because the entity they are communicating with knows this information, that they are who they say they are. At the moment, the solution is to ask for more and more levels of detail in this information, by implementing security protocols such as two-factor identification. However, there is a limit to how many layers you can put in before the system becomes just too difficult or inconvenient to use. As soon as this trust disappears and merchants start to lose revenue, everything falls apart.
I’m not sure how we could go back to life without the internet, and neither do I think it will disappear altogether. The use of the internet for business-to-business communications will probably continue, for instance, because I think these kinds of communications are inherently more securable than open community ones. However, I am starting to question if the days of the internet as the online equivalent of an Ancient Greek agora are coming to an end.
A similar story pertains to Australia’s university system. Over many decades it built a “high trust-low surveillance” self-managed ecosystem that flourished to the advantage of the society it served. Excellence was maintained via meritocratic principles and the well established peer-review system of new knowledge. Corporatisation of the sector in the 1990s imported a generic “low trust-high surveillance” monoculture which fosters cronyism, privileges over-administration and has gradually driven down academic and teaching standards.
Well argued!
What about facial recognition or other bio measurements. Not that I think it’s a good thing, necessarily, but it’s hard to fake.
Thank you for a balanced reply, I agree the destruction of trust has been eroded by MSM for commercial transactions and influence. Please don’t break that bond Crikey, and a few likeminded others, because we love your work.
The concept that people are evolving and becoming more savvy/are less prone to manipulative tactics.
The future that Christopher Warren hints at in his last paragraph, wherein thousands of freelance journalists can have their stories selected by individual consumers in a smorgassboard of freedom, may flourish when two conditions are met:
A world without gatekeepers?
Careful with that talk, you’ll disappear in a black van.
You could just check out the zillions of people writing stuff on Substack to see what this would look like.
I’ve read essays, creative writing, and opinions on Substack. Is anyone using it as a breaking news platform?
Mr Carlson’s experience is instructive. As I understand it, he realised in early 2021 that, however popular he thought he was, continuation of that popularity depended on telling the audience things that were consistent with their pre-existing faith, namely that “the election was stolen”. Whatever he thought privately. He was thus a medieval preacher, well-regarded for his sermons perhaps, but unable to depart from the articles of faith that his congregation bore witness to.
Neoliberalism as a business model will always buy space for advertising its brand and shaping election outcomes via media ownership.
It isn’t going to go away as it continues redirecting the flow of the rivers of gold meant for egalitarian democracy and remains an integral tool in asserting power and gaining wealth for the privileged few.
I don’t understand this article is it suggesting Neoliberalism is finished?
The article isn’t talking about all of neoliberalism — just the (news) media creation, distribution and payments sub-system.
Point taken thanks, more about the vehicle[s] it uses to create the subversion.
Commerce and politics are transforming the media landscape in our Pacific neighbourhood, opening the way for more social media misinformation. For example, the closure of New Caledonia’s only daily newspaper comes at a delicate point in the debate over the French territory’s future: https://insidestory.org.au/death-of-a-newspaper/