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News Corporations Horizontal and Vertical Hegemonic Power
Introduction
Every student of political science, sociology, journalism or any other expression of the social sciences has been taught during its studies that the communication system among humans is the cornerstone of their building of society. From a political point of view, the communication system could either be used by parties to enhance democracy or it could even serve as a weapon of destruction for it. From a social point of view, the interaction of human beings through their communication system gives birth to many other social paradigms without which society as we know it would cease to exist.
But on the last century a new powerful relationship was born; that between the communication system and the business world. This new coupling continued to strengthen its relationship to such an extent that now it has become one of the most powerful forces within a society or among different societies. It is a well recognized fact among scholars now that only a few industries have been affected and changed so radically from globalism and capitalism as has the communication industry (McChensey and Schiller, III).
And this radical change was made possible thanks to the usage by the private sector of the communication system of society for profit purposes. This new combination has greatly enhanced the capabilities of the communication system itself and the impact it can have on the daily life of individuals as well as communities. Expressed through the words of authors McChensey and Schiller:
The dual role of the communication system, at once a pivot of the emerging global economy and a key foundation of political democracy, constitutes a vital tension on the world stage.
Here comes the main point of the research. The central issue of this short paper is to make an analysis of the News Corporation horizontal and vertical hegemonic power within the discussed media and communication industry.
We will try to do this analysis first, by assessing what this new media industry is, how was it born and how did it evolved to such a degree we find it today. Then we will discuss how the News Corporation used different techniques to gain majority, or at least a considerable part, of the market share. It ultimately offered its own business model which became then an example for other media corporations to follow. Basically, News Corporation was the first media company to really treat communication as a product or service offered to the market just like any other company would offer its products or services to consumers. This was a paradigm shift in the way communication was perceived in society. Then we will discuss the methodology how the News Corporation managed to gain big shares of several big markets. This is the part we have labeled vertical integration and horizontal regulation .
At the end comes the concluding part. This is the part of the commenting of the dilemma of todays media scholars: should the media become purely a business or should we enhance more the social integration and information aspects of it?! The answer to this question we will try to give in the profit and the public interest final part of the paper.
And finally, I would say that this research paper may not encompass all the resources available for analysis in the area but it almost certainly has a strong and solid structure and reference basis.
The new media industry
In their fine research published just a few years ago, David Croteau and William Hoynes, for the first time introduced a study focused not on the media and communication effect on society but on what now has become the business of media. Media and communication that serves primarily as means for the good of the individual and society and then for other things, has passed away time ago (Croteau & Hoynes, 2006). They note in their research that from the public sphere modeling of the media now we have a dominance of the market model of the media. Even if the research is focused on American society still it can be generalized for all societies labeled as developed or industrialized. Nevertheless, the authors do mention the fact that the emerging so called third world countries, or developing countries, also are copying the market model of the developed countries instead of developing a more public sphere approach to the media (Croteau & Hoynes, 6).
But, before coming to the focused media group of our paper, News Corporation and its Fox News subsidiary, it is best to have an overview of what is this new media industry.
The booming of this sector began in the early 1980, when Margaret Thatcher, in the United Kingdom, and Ronald Reagan, in the United States, brought a new view of the role of government in society. The advent of laissez faire capitalism as governmental policy, made possible for the business world to expand to other sectors that were deemed until that time to be not places for private ownership. The same happened to the media sector. As a new form of cultural expression born just a few decades ago the television had an enormous growth rate (16% per year from 1980 to 1984 in the United States for example) that could not pass without being noticed. This fact coupled with the deregulatory policies of government made corporations direct their attention toward the media. As author Douglas Gomery states:
In a single year one network (ABC) was sold (to Capital Cities Communication), another (NBC) taken over (by General Electric), and the third (CBS) nearly toppled by cable television mogul Ted Turner. (78)
At this same time are the advent of Rupert Murdoch in the mass media business and the creation of his News Corporation. This takeover of corporations of the media sector in society made possible the conditions for the advent of the new media we have today. Since corporations, as any other business-based company, have as their priority increase of revenues and, thus, profits, so the media too was changed to adapt to the new objectives. Now the focus of the corporate owned media groups was to increase their profits for the benefit of their shareholders.
The public sphere interest came to be second if not third. By 1985, Rupert Murdoch owned 51% of News Corporation and was an important player in three major markets: Australia, United Kingdom and United States.
What should be noted is that he was one of the first investors and media owners to grasp that in order to be as much profitable as it could a media should not just serve public interest, it should form it. Thus, the media now was not just a servant of the public sphere providing it with information but it became an important actor of the public sphere. This new role was meant to influence the formation of public opinion as much as it can by turning it into a consumer of what the media would offer. This was revolutionary thinking that aimed to turn the public sphere from a citizen based one to a consumer based one. We will talk in detail at the vertical integration and horizontal regulation part how Rupert Murdoch set the example to be followed by other corporate owned media groups.
The global media system of News Corporation
Rupert Murdoch was the first to understand that in order to succeed, a business needs clients and customers. This way it can both increase its sales and attract other investors for future projects. It is now a recognized fact that the satellite television networks alone that News Corporation owns, worldwide can reach as many as three hundred million homes (Broe, 99). If we have to count also the press media part, cable television and movie studios that this corporation owns that number could be even doubled. The reach of every media sector News Corporation owns also is global making it, as many would say the only real global company that covers the world (Broe, 97).
This is what makes the News Corporation unique in its role and influence. Soon, fellow corporate owned media groups followed it in the business model it offered for the new media industry.
Vertical integration and horizontal regulation
Rupert Murdoch began its conquest with News Corporation by acquiring local newspapers one by one in local markets. After that the corporation went on to acquire television stations in his native home, Australia. After he had consolidated his position there, the News Corporation went on to become a major player in the biggest market of the world, the United States. At the end of 1985, it has managed to become a major player there by acquiring local television stations and newspapers and integrating them as parts of a wider network. This vertical integration of the local media players was done in such a way like the pieces which are separate are connected together to form a bigger puzzle. The Fox Cable News is an example of this vertical integration.
In a certain sense, the corporation had no need to start up from the beginning new media, being those printed or visual, but it managed to link together existing ones in order to form a bigger entity that would revitalize all its forming members. This is exactly the way a privately owned business firm is managed in order to make it more profitable. Corporations were born out of this model, or scheme.
This was the first time that it was being used for the media, which was considered to be more a public sector than a private domain. This came to be a disaster for the independence of the media though. Independence in the sense that, prior to the acquisition, these local media had their own editorial viewpoint and policy, but now they had to stress out the editorial viewpoint and policy that the mother corporation decides. All of them had to uniformly form a single editorial policy and express the same viewpoints about different issues.
These editorial policy and points of view were decided by the board or directors of the News Corporation. But these people were at the same time the shareholders of the company. It is natural that their tendency is to safeguard the future of their company as a business primarily than as a public serving concern. Thus, it can be fair to say that the natural tendency of these network media was to mind more their business in order to make it more profitable than to have as their major concern the serving of the public opinion.
The second characteristic of these new media is the so called horizontal regulation. What it means is that the media tries to create hegemony among the public in order to be the sole directing force of public opinion trends (Herman, para. 4). The corporate media, of course, presents itself as helper of the public or even as protector of its freedoms and as serving its interests. But in reality it is serving its own corporate interest and is using the public for consumerist reasons.
The variety of entertainment and of other sort of offerings that the corporate media offers the public is meant to keep the public busy on selecting which product or service to consume. On the other hand, the opinions and ideas presented are filtered accordingly by the editorial policy of the corporate. This editorial policy of course favor opinions and viewpoints of ruling elites and that are in accordance with business sectors benefits and profits (Herman, para. 7).
Of course the News Corporation is not going to trumpet against its own interests as a business company. To give an example of this situation, we can mention the fact that Fox Cable News is not going to trumpet against the interest of its shareholders or investors or even partner businesses in other sectors and industries. The combination of entertainment and presenting of only favorable opinions and ideas made the corporate media become an important actor of the business world. The profits of this industry increased even more that what they were before corporate takeover as mentioned above.
This is especially characteristic of the Murdochs media conglomerate since it was this group that lead the way in this area. As in Rupert Murdochs own words the media was meant to entertain and not educate (Broe, 98). But entertainment means consumerism and consumerism means more profits for those entities offering such consumer products or services. Thus the horizontal regulation means to be the first public choice when it comes to consumer related issues. This can be said to be one of the reasons why the Fox Cable News incorporated so much of the Afghanistan and Iraq war in its daily schedule of transmissions. The favoring of ruling elites has become the norm for this corporation or other giant media conglomerates. On their turn, these ruling elites favor the advancement of business over other sectors of society with the so called deregulating and free market policies. Indirectly, the media was favoring its own future as a business. But there were other reasons too. The vast media coverage of a harsh event like a war had its own consuming benefits.
The extensive use emotional language and slogans like our troops fighting for freedom against an evil enemy who wishes our destruction attracted the attention of the public more and more.
It is not casual than after September 11th, 2001, Fox Cable News trumpeted in support of the war and subsequently, in the midst of the war in Iraq, Fox Cable News passed CNN as the most viewed cable news network in the United States (Broe, 100). At this time the advertising time cost (dollar you have to pay per second of advertisement) in this media skyrocketed. Thus, it had a direct impact on the revenues and profits of Fox Cable News as a network. Many believe that it was the turning of warfare as an entertainment consumerist television show that served as an attracting tool to gain the attention of the public and subsequently orient public opinion in the directions the corporate media wants (Croteau and Hoynes, 122).
Their masters voice
You have got to admit that Rupert Murdoch is one canny press tycoon because he has an unerring ability to choose editors across the world who thinks just like him. How else can we explain the extraordinary unity of thought in his newspaper empire about the need to make war on Iraq? After an exhaustive survey of the highest-selling and most influential papers across the world owned by Murdochs News Corporation, it is clear that all are singing from the same hymn sheet. Some are bellicose baritone soloists who relish the fight. Some prefer a less strident, if more subtle, role in the chorus. But none, whether fortissimo or pianissimo, has dared to croon the anti-war tune. Their masters voice has never been questioned. (Greenslade, para. 1)
During the last decade and especially after the invasion of Iraq, the News Corporation has been accused of being one-sided and of censuring the critical voices to the war. It is not casual that News Corporation is accused as all of its subsidiaries, all of the networks and media part of this conglomerate do follow exactly the editorial policy for the mother corporation and express its point of view. The quote cited above is part of a research article published by journalist Roy Greenslade in the British newspaper The Guardian since February 2003. In this part we will refer heavily to that article since the research undertook by Mr. Greenslade does fully prove our point of view.
It is not casual that all of the newspapers, television channels or any other sort of printed or digital media owned by the News Corporation has shown public support of the war expressively or indirectly. For all of the conglomerate members to have shown essentially the same public support backed by almost the same form of argumentation in an autonomous and independent way, it is quite impossible. Even in the form of support they offered the United States government, along with its alleys, for their action toward Iraq has a clear business background. One of the most important fact to be noted for our study purposes of the new political economy of the mass media is Rupert Murdochs own reference to the rationale for going to war, blatantly using the o-word (Greenslade, para. 5). Even though publicly many politicians in the United States and Britain have strongly denied the significance of oil for this war and stressed out the important of values like freedom and democracy, Murdoch himself was more direct and less reticent.
In an interview for a local Australian newspaper he expressed his believe that deposing the Iraqi leader would lead to an opening of Iraqs oil market which, in turn, meant cheaper oil for the entire world. The greatest thing to come out of this for the world economy&would be $20 a barrel for oil. Thats bigger than any tax cut in any country (Greenslade, para. 6).
This is his personal opinion but what should be noted here is the fact that every one of the major media components of his News Corporation expresses at least three times this point of view as a supportive argumentation for the ongoing of the war in Iraq (Greenslein, para. 8). This is an important fact to mention regarding the loss of independence of this media and the pressure corporations are putting upon them. At the same report of Mr. Greenslein we will find that the corporate own media groups offered less than 20% of the total coverage of the issue to critical voices of the war. Of course the Fox Cable News led this statistics with less than 10%.
It is not the scope of this paper to come to final conclusions but we do not think that it is a premature conclusion to say that it seems quite clear that what Fox Cable News has done is in opposition with professional journalistic principles and, of course, a tentative to direct public attention toward the viewpoint that this corporate media believes is the correct viewpoint.
Conclusion: Profit and the public interest
In social studies, there exists a conventional view of the proper relationship between the government and the media. It is one of mutual control and help for the benefit of the society.
The way it developed in the United States, is well known: the focus is on the free press, generated by private citizens independent of government censorship and control but with the final purpose of benefiting public interest more than individual interest (McChensey and Schiller, 3). Public interest is the core principle behind this relationship. Private profit from this sort of activities is not deemed to be neither illegal nor immoral but it is deemed to be less important than the general public interest. Hence the communications systems developed within a community are meant more to deliver to the community than to profit from it. It is when the private profit interest becomes the primary concern of the communication system that society begins to lose because its interest, the public interest, is not the focus of the communication systems.
The media is the most advanced expression of the communication system society has ever constructed. Thus, it was meant to focus the most on public interest than on private profit gaining. The problem with the new political economy of the mass media invented by Mr. Murdochs News Corporation is that it has changed the status of the media as a communication system developed to benefit the public interest. As a consequence its role has changed also. It now is transformed into a tool of profit increase for privately owned corporation which, in turn, benefit only small groups within society.
Works Cited
Broe, Denis. Fox and its friends: Global commodification and the new Cold war . The Cinema Journal, no. 43, 2004.
Croteau, David & Hoynes, Williams. The business of media: Corporate media and the public interest, 2nd edition. U.S.A: Pine Forge Press, 2006.
Gomery, Douglas. Vertical integration, horizontal regulation: the growth of Rupert Murdochs U.S. media empire . Screen, no. 27 (3-4), pg. 78-86, 1986.
Greenslade, Roy. Their masters voice . The Guardian [online]. Web.
Herman, Edward S. The Political Economy of the Mass Media: Edward S. Herman Interviewed by Robert W. McChesney . Monthly Review [online]. January, 1989. Web.
McChesney, Robert W. & Schiller, Dan. The Political Economy of International Communications Foundations for the Emerging Global Debate about Media Ownership and Regulation . Technology, Business and Society, Program Paper Number 11, United Nations Research Institute for Social Development, 2003.
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