Media Giants…..When will they stop???

       “Convergence is a utopian business dream of a perfect marketplace where one company delivers all content to all audiences” (Strangelove, 59). It would be most ideal is this could be done through one “box that combines the interactive capabilities of a computer with television’s mass-advertising audience” (Strangelove, 59).

       According to Mike Gasher this convergence of media is an economic strategy used by communications companies seeking financial benefit by making the various media properties and outlets they own work together.

The strategy of media convergence developed as the result of three elements:

(1) corporate concentration, where a small number of large companies own the majority of media properties and outlets

(2) digitization, which is when media content is produced using a universal computer language that can easily be converted and applied for any medium

(3) government deregulation, a process where the government’s control over businesses is reduced or removed, which has allowed media corporations to own several different kinds of media in the same markets (Gasher).

       The strategy has many advantages for organizations, such as saving them money by reducing labor, administrative and material costs. It makes it possible for companies to used the same media content across several media outlets as well as attract increased advertising by providing advertisers with package deals because they can offer them a variety of media platforms.

       It also attracts advertisers because having more advertisement spaces and outlets allows them to increase brand recognition and brand loyalty among audiences through cross-promotion and cross-selling. Last, but not least and probably one of the most beneficial aspects of the strategy is that it makes it very difficult for competition to enter into the media markets (Gasher).

       A really good example of this convergence is when AOL and Time Warner merged when AOL purchased Time Warner in January of 2001 for approximately $182 billion dollars. This acquisition created AOL Time Warner, a digital media powerhouse, worth $350 billion.

       Together these two companies hold dominating positions in the music, publishing, news, entertainment, cable and Internet industries. This domination gives them a lot of power over the information that is distributed to the public as they have control over what content they are going to release to the public.

       This type of media control in my opinion should not be allowed as it give certain organizations a great amount of power over the audience as they control the information made available to them. This gives them the majority of control over public opinion as they can put whatever spin they want on the story.

       While the corporate benefits of this strategy are being realized, the social costs are slowly becoming apparent. Media content is progressively being treated as a product like everything else, and “notions of public service take a back seat to private enterprise” (Gasher).

       Convergences such as these also take away consumer choice by limiting the entrance of competition into the market. Also as mergers such as these are quite costly organizations have started creating new budgets and focusing on cost-cutting ventures instead of increasing their investments in communication services meaning that people lose their jobs and the human aspect of the organization takes a back seat to technology development.

I do not like the idea of convergence and if it came to a vote I would not support it. However, I know that it will not come to a vote and that one day it is just going to happen as media giants continue along the same path as AOL and Time Warner.

Source : Gasher

http://www.thecanadianencyclopedia.com/index.cfm?PgNm=TCE&Params=A1ARTA0009695

March 20, 2009. Convergence.