Anthony J. Pennings, PhD


Discerning Media Economics

Posted on | August 25, 2014 | No Comments

The area of media economics has made important contributions to understanding traditional broadcast technologies such as newspapers, television and radio, but has only recently addressed the capabilities and consequences of digital media. This post seeks to investigate two interrelated areas: media economics and the political economy of communications/media; then begin to apply them to the realm of new digital media and the web by reviewing some important contributions to field.

When I arrived at New York University in the wake of the crash, one of the first courses we created was the Political Economy of Digital Media. The hubris of the “New Economy” met with a bitter setback in those first few years of the new millennium as hundreds of new companies in New York City’s “Silicon Alley” and around the country ran out of cash and gullible investors. So the course became a foundation for a digital media management program that was more attuned to the economic realities of New York City’s very dynamic but competitive media environment. The course combined microeconomic concerns about the management and operations of digital media firms with the larger macroeconomic issues of the emerging “new media” industry and its relationship to employment patterns, investment activities and international trade.

Gillian Doyle’s Understanding Media Economics (2008) for example examined these different media industry sectors including film and “new media”, but lacked a comprehensive understanding of the role of digitalization and its impact on convergence of these industry sectors. A better approach was pursued in Media Economics: Applying Economics to New and Traditional Media by Colin Hoskins, Stuart McFadyen, and Adam Finn that organized its inquiry into media activities by economic areas such as supply and demand, consumer behavior, production and market structure. However, it still relied heavily on the analysis of traditional media with little more than token references to digital media and the Internet.

The political economy of communication/media genre has admirably placed emphasis on the role of media in society, problems associated with monopoly, and tensions in the workplace; but it has also relied on the traditional mass media model and has failed to connect with significant audiences despite its major goal of mobilizing for social action and political intervention. Critical texts like The Business of Media Corporate Media and the Public Interest (2006) by David Croteau and William Hoynes, while providing a very useful discussion of the role of the citizen knowledge and the public sphere, failed to anticipate key aspects of digitalization, social media and netcentric commerce that are radically changing the news industry and the organization of online knowledge.

Many of the political economy of media texts are written from a Marxist perspective, providing interesting social insights, but organizing their critiques around claims to an internal validity that have not been sufficiently substantiated. Furthermore, they over-utilize insular language that reduces external validity – their applicability to contemporary issues, and thus their relevance to the activism needed to address and confront social problems brought on by the new media. Vincent Mosco’s Political Economy of Communication (2009) for example, was claimed to be a major rewrite of his classic manuscript by the same name, but has been criticized for its adherence to an economic reductionism forged in an era of durable goods manufacturing and an insular debate with cultural studies. It neglects to apply its analysis to the web economy where the “click” is a new form of laboring.

Robert McChesney’s The Political Economy of Media: Enduring Issues, Emerging Dilemmas (2008), while reminding us of the problems of a media-saturated society such as censorship, propaganda, commercialism, and the depoliticization of society failed to address the relationship of media to economic sustainability and innovation, creative expression, as well as learning and education. As a result, his emphasis on the “critical” path of media scholarship, while dismissing what he disdainfully refers to the “administrative” path of communications, hasn’t framed its arguments in a manner that reaches students confronting the economic issues of their lives as well as practitioners in the field facing highly complex design and implementation problems.

He is such a major contributor to the area though, that it is hard to be too critical of his stance and I invite the reader to look at McChesney’s considerable body of work at Amazon. Likewise, take a look at Gilliam Doyle’s newer (2013) Understanding Media Economics, as she made an interesting transition from examining separate media areas like film, print and television, to looking at the characteristics of a more converged digital environment. With more emphasis on network effects, technological disruption, and the economics of content distribution, her analysis transcends some of the traditional barriers between these various media.

This area of economic inquiry is very promising for the future as it now encompasses a wide realm of digital media activities, going beyond traditional media to incorporate e-commerce and a number of other digital applications from drone journalism to quantifying health technologies. What is particularly exciting is the possibility of combining the development of individual skills and productive capabilities with exposure to progressive, socially conscious media and a new dimension of overall economic analysis.


AnthonybwAnthony J. Pennings, PhD is a professor of global media at Hannam University in South Korea. Previously, he taught at St. Edwards University in Austin, Texas and was on the faculty of New York University from 2002-2012. His first faculty position was at Victoria University in Wellington, New Zealand.


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    Professor at State University of New York (SUNY) Korea since 2016. Moved to Austin, Texas in August 2012 to join the Digital Media Management program at St. Edwards University. Spent the previous decade on the faculty at New York University teaching and researching information systems, digital economics, and strategic communications.

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