Capitalisation of the Media Industry
From a Political Economy Perspective
Manfred Knoche
Paris-Lodron-University
of Salzburg, Salzburg, Austria, manfred.knoche@plus.ac.at
http://www.medienoekonomie.at
https://kowi.uni-salzburg.at/ma/knoche-manfred/
@Medoek
https://de.wikipedia.org/wiki/Manfred_Knoche
Translation from German:
Christian Fuchs
Abstract
Approaches
to the critique of the political economy of communication in society belong to
the “forgotten theories” in media and communication studies. But in view of the
unmistakable structural change of a media industry “unleashed” by deregulation,
privatisation, digitalisation, concentration, globalisation, etc., it seems
from an academic perspective necessary to analyse the development of the media
industry in close connection with the equally unmistakable general development
of an “unleashed” capitalism. This article therefore shows that the analysis of
the development processes of capitalism as the undoubtedly globally dominant
economic and social system from a political economy perspective makes it
possible to analyse, explain, and partly forecast the economisation or
commercialisation process in the media industry in an academically appropriate
way with regard to its causes, forms, consequences, and further development.
Theoretical explanations are offered by the further developments of the
analysis and critique of contemporary capitalism based on Marx’s critique of the
political economy as a historical-materialist analysis of society. In doing so, the permanent fundamental characteristics, modes of
functioning and “regularities” of the capitalist mode of production and the
capitalist formation of society are analysed in connection with the
particularities of the current capitalisation process in the media industry.
Keywords: capitalisation of the
media industry, critique of the
political economy of the media and communication, transformation, media
industry
Acknowledgement:
This article was first published in German: Manfred Knoche. 2001. Kapitalisierung der Medienindustrie
aus politökonomischer Perspektive. Medien & Kommunikationswissenschaft 49 (2): 177-194. Baden-Baden: Nomos. Translated into
English and publication of the translation with permission by Nomos Verlag
“Today, in my view, capitalism is for the first time in a state, in
which the logic of capital functions just as purely and unadulterated,
as Marx described it in Capital.”
Oskar Negt 1997, 38.
Introduction
What has recently been increasingly discussed in media
and communication studies as the economisation or commercialisation of the
media industry is, from a political economy perspective, an old phenomenon that
can be seen as an essential structural feature of privately organised media
production, distribution and consumption. Belonging to the commercially
organised sector of the private economy has characterised the media in
capitalist societies since their emergence (see Kiefer 1999, 705).
Nevertheless, it should be noted that it was only at the end of the 20th
century that media and communication studies in the German-speaking world
suddenly and rather astonishedly realised that the
mass media and thus also communication in society were becoming more and more
economised (see Meier 1997, 173). This astonishment could have been less sudden
or at least earlier if there had not been such widespread abstinence in this
academic field – similar to all other fields – with regard to the reception and
application of Marx's critique of the
political economy and its current developments. The currently
recognisable, partly novel (not new)
push for the economisation or commercialisation in the media industry opens up
the chance for academia that this old phenomenon’s political economy
foundations, due to their novel, more visible and thus less contestable forms,
can be recognised by more scholars than before and that academic findings that
are based on the Marxian approach can be recognised.
1. Economisation as Capitalisation of the Media Industry
However, the concept of “economisation” falls short in
the perspective of a critical political economy. Economisation is rather about
a further historical phase of the progressive “capitalisation” of the
private-sector media industry[1], i.e.
a radical subsumption of the entire
media system under the general conditions of the valorisation of capital. This
means that the media system has even more strongly than before become integrated
into the specific capitalist mode of production, the relationship between the productive
forces and the relations of production and the economic-political formation of
society (see Altvater 1999), which correspond to the
advanced stage of development and the further requirements for the survival of
capitalism as the globally dominant economic system and system of society. This
capitalisation means above all: media production is included even more
comprehensively than before in the overall economic system of capitalist
commodity and surplus-value production. Media production is thus also more
intensively subjected to the “laws of motion” and “constraints” of production
and capital valorisation, of profit maximisation and competition, as well as of
accumulation and concentration. Of relevance to society as a whole is the
further capitalisation of information, education, politics, culture,
entertainment as well as working and living conditions, which inevitably goes
hand in hand with the described developments and is usually referred to as “commercialisation”.
These commercialisation and capitalisation processes form a contribution to the
neoliberal “all-round capitalisation” (Durchkapitalisie
rung) of all areas of life (see Röttger
1997, 18f).
We are
experiencing a new push for capitalisation (Kapitalisierungsschub)
as part of the permanently progressing capitalisation process, which is,
however, of fundamental importance for the further development of the media
industry on the basis of the privatisation of originally non-capitalised
sectors. Essential characteristics of this push for capitalisation in the media
industry are
· capitalisation
through the privatisation, deregulation, and commercialisation of additional sectors of the media industry
which, organised in Europe as (monopoly) sectors under state or public law, had
not yet been accessible to direct
(but indirect) capital valorisation (radio, television, telecommunications, Internet);
· a structural
change in the media industry, which is particularly evident in the increasing
commercialisation of media content production as commodity production, in
growing international economic and journalistic concentration as well as in
economic and institutional mergers (see Knoche 1999a,154ff,
translated in English: Knoche 2016) of traditional and new media sectors with
each other and with other industries (media as infrastructure, e-commerce);
· an intensified “capitalisation”
of the relationship between the state and the media industry as well as of the state’s
media policies as media economic policies;
· an intensified “capitalisation”
of the economic and political fulfilment of the macroeconomic and societal
functions of the media industry in the worldwide structural transformation (transformation
process) of capitalism.
In view of the incalculably extensive – structurally
in part novel – “unleashing” of the media industry through deregulation,
privatisation, commercialisation, globalisation, multi-mediatisation, media and
industry convergence, digitalisation, concentration, the anonymisation of
capital, e-commerce etc., it seems to me even more appropriate than before to
analyse the development of the media industry in close connection with the
equally incalculable general development of an “unleashed” capitalism. This development
is of particular importance because the current and most likely also future
capitalisation process in the media industry is (as a novel development) characterised above all
by the fact that there is a far-reaching mutual penetration of the media
industry and the rest of the national economy.
2. Critique of the Political Economy of the Media
The fundamental significance of the progressive
capitalisation of the media industry in close connection with the development
of the capitalist economic system and system of society points to the necessity
of a critical approach that is centred on capital and capitalism (see Knoche 2016,
Prokop 2000) in communication studies that can be considered academically adequate
to the subject matter. However, as long as in the East-West conflict after the
Second World War the occupation with the critique of capitalism on the basis of
a critique of the political economy in the West also led to[2] “marginalisation”
in the academic field, or at worst to professional bans of academics, there was
no favourable “climate” for the development and reception of critical political
economy as approach for the study of the societal problem of the economisation
or commercialisation of the media industry, which had long been recognisable.
Approaches to a
critique of the political economy of communication in society or mass
communication[3] have been presented sporadically in
the Anglo-Saxon world in works on the “Political Economy of Communication(s)
(of the Media)” (see for example: Mosco 1996, Golding and Murdock 1997, Sussman
1999, McChesney 2000). Such approaches were also developed in Germany in the
1970s (see for example: Berliner Autorenkollektiv
Presse 1972, Dröge and Modelmog
1972, Holzer 1973, Hund 1976, Negt and Kluge 1972,
Prokop 1974). But the political economy of communication in society undoubtedly
belongs to the “forgotten theories” (Robes 1990, see also Knoche
1999b, 76ff). Among the attempts to remember, revive and apply political
economy approaches in German-language media and communication studies in the
1990s and around 2000 were the works by Holzer (1994), Meier (1996/1997), Meier
(1997), Knoche (2016 [originally published
in German as Knoche 1999a], 1999b), Prokop (2000),
and Steininger (2000, 210ff).
The subject of a
critique of the political economy is the critical
theory-based empirical analysis of capitalism. This shows that political
economy is not a branch of economics but a comprehensive science of society (see
Kade 1977, Schikora 1992)[4]. The critique of the political
economy is focused on the analysis and critique of the social preconditions and
structural conditions of the capitalist mode of production and thus about its
functioning and dynamics (see Conert 1997, 140). In
other words, it is focused on the analysis and critique of the “capitalist
regulation” (Kisker 2000a, 66) of the relations of
production and life, i.e. of all
economic, social, political and cultural human life. Capitalism is seen here as
a mode of production and formation of society that has developed historically and is fundamentally changeable (see Ganßmann,
1998, 23).
3. The Media Industry Under Capitalism
For our object of study, the usefulness of a political
economy as theory and method is to be examined. Such a political economy sees
itself as a further development of the analysis
and critique of contemporary capitalism. It
is a historical-materialist analysis of
society[5] that is based on the
Marxian critique of political economy. This approach has in Germany, among
other places, been developed for some time
by economists, sociologists, and political scientists on the basis of extensive
studies of the international academic literature. The focus of interest here is
the critical examination, above all, of
· the
transformation process of contemporary capitalism (see Altvater
et al. 1999, Bischoff 1999, Hickel, Kisker, Mattfeldt, and Troost 2000, Hirsch 1990), especially with a
focus on the transformation of the role of the state in capitalism (see Hirsch
1998, Kisker 2000b);
· neoliberalism (see
Bischoff, Deppe, and Kisker 1998a, Kisker 1998, Schui 2000),
Keynesianism, market myths and economic crises (see Zinn 1998);
· current economic
policy (see Hickel 1998, Huffschmid 1994);
· competition and
concentration (see Bischoff et al. 2000, Huffschmid
1994 and 2000, Kisker 2000b) and globalisation (see Altvater and Mahnkopf 1999,
Heinrich and Messner 1998, Kisker 2000a);
· the political
economy of financial markets (see Huffschmid 1999).
From a political economy perspective[6], the contemporary capitalisation of
the private sector media industry is considered and explained in the context of
the current developmental tendencies of the entire
capitalist economic and societal system. From the point of view of the
highly concentrated and internationally active private sector, the media
industry in Europe was an underdeveloped “foreign body” before the phase of
Europe-wide privatisations and deregulations, which proved to be an obstacle to
capital valorisation and capitalist expansion interests in several respects.
Monopolies organised by the state (postal services and telecommunications) or as
public services (radio and television) and non-capitalised sectors (the Internet)
were not accessible as spheres of capital investment. They could only be used
to a limited extent within the framework of infrastructural
technical-organisational rationalisation measures. They could only be “commercialised”
to a very limited extent. They did not allow extensive integration into “global”
marketing, advertising and PR strategies. The “capitalisation backlog” of the
traditionally private media sectors of press and book production, whose “disadvantage”
is still seen today in their largely medium-sized and national ties, also
proved to be an obstacle. In the interest of the economy as a whole, this “backlog”
of the media industry has been largely overcome since the mid-1980s with the
help of globally uniform neoliberal economic and social policies of the nation
states and the EU that used slogans such as the “opening of domestic markets”
and “international competitiveness”. The political-economic “backwardness” of
the media industry in Europe was similarly an obstacle for European and
especially US media corporations to realise their expansion strategies that
were necessary for their existence. There was also a “need to catch up” for
emerging European media corporations in terms of overcoming national expansion
boundaries by participating in international mergers, strategic alliances and
corporate networks of the “global players” (see Knoche 2001).
The nature,
extent, timing and course of the capitalisation of the media industry are thus
determined by the permanent economic interests and basic problems of the media
industry in connection with similar
interests and basic problems of the entire economy. However, the economic and
related political measures and medium-term strategies for solving problems,
first and foremost the problem of structural overaccumulation of capital,
regularly lead to new cyclical “crises” and long-term problems in the economy
and society (see figure 1).
The reduction of
investments that enable the expansion of capital and are made under the
pressure of the structural overaccumulation of capital (declining investment
rates) and investments in (technology-driven) rationalisation regularly lead to
a reduction in the labour force (unemployment), the intensification of labour and
a reduction or stagnation of the level of wages and salaries. In conjunction
with the simultaneously enforced dismantling of the welfare state, these
developments lead to reduced purchasing power and a corresponding decline in
consumption. These developments lead in turn to intensified competition between
companies in largely saturated or stagnating markets and thus to cyclical
economic “crises” of the entire economic system.
In this context,
the capitalisation of the media industry is of growing elementary importance
for the economy and society as a whole because it also has an important
function in the necessary medium-term problem-solving strategies of the economy
as a whole. In this respect, it is explainable that the capital valorisation interests
(and their permanent fundamentally crisis-prone endangerment) in the entire
economy drive the capitalisation process of the media industry in symbiosis
with the specific capital valorisation interests in the media industry.
Figure 1: The capitalisation of the media industry as strategy for solving the problems of the entire economy
The interests of (hitherto) non-media capital are
directed, on the one hand, towards the media industry as a new profit-promising
investment sphere for over accumulated, “excess” capital. On the other hand,
these interests aim at the advertising, PR and capital circulation function of
the media, the intensive use of which is seen by the entire economy as a
necessary and appropriate problem-solving strategy in light of the crises of
overaccumulation, the decline in purchasing power, and the associated
intensification of competition.
These
media-related interests and strategies of the entire economy in principle,
although mainly represented by large corporations, are one of the triggers of capitalisation
processes in the media industry. Together with the interests of media companies,
the media-related interests and strategies of the whole economy led the
governments of the various European states to remove the obstacles to
capitalisation and commercialisation in the overall economic interest. In this
context, the legal enablement of the privatisation and deregulation of the
media sectors of radio, television, telecommunications and the Internet played
an important role. These developments increased the pressure on the media companies,
which are highly dependent on advertising revenues, to fulfil their
advertising, PR and circulation function even more effectively than before in
the interest of the entire economy and in their own interest, which is
necessary for their existence, on the basis of capitalisation and
commercialisation of media production. In connection with this, the need or
willingness of media companies to cover their capital requirements increasingly
from capital that was previously located outside the media sector or through an
initial public offering (IPO) also grew.
The fundamental
problem, however, is that the capitalisation of the media industry – even when
used as a medium-term problem-solving strategy for the entire economy – inevitably
leads to considerable economic and societal problems in the long term (see figure
1). Due to the fact that individual capitals’ action-guiding strategic goal and
interest of profit maximisation is politically legitimised and enforced as the
undisputed basic goal of capitalism, the competition
between individual capitals, which is
also politically legitimised, can only ever lead systematically to temporary
individual economic problem solutions, which in reality lead to an aggravation of problems for individual
capitals and for the economy as a whole. For there is also a redistribution of
capital and profit via the capitalisation of the media industry, which is
characterised by increasing unequal distributions: there are temporary “winners”
(concentration of capital) and (partly “final”) “losers” (destruction of
capital). But this is not a permanent solution to the problem, even for the
winners, but an aggravation of the problem, since the aforementioned permanent
basic problems of the capitalist economy (structural overaccumulation, falling
profit rates, intensification of competition) inevitably lead to the next
economic “crisis” at a higher level.
This development
also applies in a structurally similar way to the consequence of long-term societal problems, which are partly
intensified by the capitalisation of the media industry. There is a
far-reaching redistribution of consumer goods of all kinds among the
population, which, in combination with wage and salary losses, mass
unemployment and the dismantling of the welfare state, leads to a widening of
economic and social inequalities. On the one hand, this causes the next
economic “crisis” and ultimately the next socio-political “crisis”, especially
due to the associated lack of mass purchasing power. Consequently, the
capitalisation of the media industry is hardly a suitable means to solve
macroeconomic and societal problems, for example in the sense of distributive
justice for society as a whole. On the contrary: it promotes the further
capitalisation and commercialisation of the entire social and societal life
with negative consequences that will be discussed in more detail.
4. Causes, Forms, and Consequences of the Media Industry’s Capitalisation
The intensive study of the general and current development
processes of capitalism is, in my opinion, a suitable basis for the analysis, explanation and partly the forecasting of the capitalisation
process in the media industry in an academically appropriate manner that is
focused on causes, forms, consequences, and further development. The concrete
starting point is the observation that market-radicalism’s “unleashed” media
industry as an integral functional realm of capitalism is connected with the likewise
“unleashed” global transformation process of capitalism. The global
transformation process of capitalism has been characterised with keywords such
as “turbo”-capitalism (see Altvater et al. 1999), “shareholder”-society
(see Deppe and Detje 1998, 171ff), or “pure
capitalism” (Bischoff, Deppe, and Kisker 1998b, 225).
From a critical
political economy perspective, the current capitalisation of the media industry
stands in close connection with the general development process of capitalism and
the associated problems of capital valorisation in all sectors of the economy.
However, it is also important to analyse the economic-political particularities of media production,
distribution and consumption in comparison to other economic sectors. These
particularities result above all from the additional
macroeconomic and socio-political functions (going beyond the “normal”
economic function of capital valorisation that is achieved by the production
and sales of media products) which are usually fulfilled by private sector
media production (see Holzer 1994, 195):
· on the one hand,
there are the media industry’s indispensable economic functions for the entire
national economy (the function of general advertising and goods
circulation, media technology’s function in capital valorisation, the media’s
roles as a means of production),
· on the other
hand, there is the media industry’s equally indispensable ideological function for legitimising and securing the rule of the
capitalist economic system and system of society (the function of ideology
production) among the population.
· and finally, there
is the media industry’s function for the reproduction
of the labour force through media consumption (regeneration function).
Figure 2: Causes, forms, and consequences of the media industry’s capitalisation
The connection between causes, forms and consequences
of the capitalisation of the media industry is presented in an overview in figure
2. Three complexes of causes can be distinguished as part of an interacting
bundle of causes:
· the permanently fundamental impact factors of the
capitalist mode of production and the
capitalist formation of society as
well as the laws of movement of capital
(see Altvater, Hecker, Heinrich, and Schaper-Rinkel 1999), to which the capitalist media industry is in
principle subject in the same way as other industries.
· the specifics of the current “crisis” with
the valorisation problems of capital or media capital, causally linked to the
currently observable unleashing and transformation process of capitalism.
· the concrete capital or media capital strategies interact
with the the state’s (media) economic policy that
unleashes capitalism (privatisation, deregulation, promotion of concentration,
etc.), which causes forms and consequences of the current push for capitalisation
in the media industry (see Knoche 1999a,180ff, translation in English: Knoche 2016).
4.1. Causes of Capitalisation
In figure 3, selected causes of the capitalisation of
the media industry are presented in more detail, the first being the factors
that are fundamentally characteristic of the capitalist mode of production (see,
for example, Conert 1997, 141; Kisker
2000a, 66 ff):
· the specific
form of the capital relation: the
legally protected private ownership of
the means of production as well as the power
of disposal over the dependent workers derived from it (labour power as a commodity) as well as
the right of the sole determination of the production
goals and the valorisation of the
produced goods by capital ;
· the specific
form of the capitalist relations of
production as relations of domination of capital over labour;
· the specific
contradictory relationship between productive
forces (the relation of constant capital = means of production and raw materials
and variable capital = labour power) and relations
of production
· the specific
form of capitalist commodity production
as the production of values (use-values and exchange-values), whereby the
realisation of exchange-value for the owners of capital dominates over the use-value
interests of consumers;
· the specific
form of capitalist surplus-value
production through capital’s appropriation of the surplus-value produced by
the surplus-labour of dependent workers
· the specific
form of the connection of the compulsion to produce, valorise and profit with the
competition, accumulation, concentration
and centralisation of capital;
· the specific
form of securing capitalist rule
through the interaction of capital owners and the state (see Nutzinger 1977, 222 ff).
· the specific
form of the capitalisation of society
via the connection of the production and reproduction process of humans with
the inequality of the distribution of goods and income and the associated inequality
of material, political, cultural and social living conditions.
Figure 3: Causes of the media industry’s capitalisation
If one takes these fundamental factors of the
capitalist mode of production into account, it becomes clear why all sectors of the private sector media
industry are in principle in the same manner subject to a
constantly progressing capitalisation process. This circumstance applies to the
sectors of the press, books, film, video, music, radio, television, for which a
new push for capitalisation can be observed in the context of the globalisation
of the entire economy and also of the media industry (see Herman and McChesney
1997, 41ff). Some large companies in the media industry – which has so far been
economically rather insignificant compared to other industries – are “catching
up” with the capitalisation level of other industries in their capitalisation
strategies. Bertelsmann AG, for example, has developed into a “media group with
an affiliated investment bank” (Jakobs 2001, 110),
i.e. for years the largest part of its profits has not been generated by media
production but by stock market deals and the purchase and sale of companies and
company shares.
Furthermore, figure
3 lists the factors that can be considered relevant causes for the
capitalisation of the media industry in connection with current crisis
phenomena of capitalism and the media industry. The development of the
capitalist economic system is generally determined to a large extent by the structural
overaccumulation of capital, which
acts as a major trigger for economic crises on the basis of disproportionate development (see Zinn
1998, 23). Disproportion means that in principle more is produced than can be
sold, i.e. that can be valorised at what is considered an appropriate profit
rate, or that less is produced due to sales problems that result in
overcapacities. Structural overaccumulation, which is signalled in particular
by over-investment, over-capacity and over-production, means that too much
capital is accumulated in relation to the realisable profit rates, so that
there is a danger of capital devaluation. The strategic action of companies is
consequently directed towards taking measures to counter the danger of crisis
that accompanies overaccumulation (see Kisker 1998,
87ff). Overaccumulation and disproportions are consequences of the competition
between the companies and the sectors that want to “win” in the competition for
the sale of their goods by overproducing beyond the demand that is
fundamentally limited by a lack of purchasing power or demand that is limited
by saturated or undeveloped needs (underconsumption).
The causes of
these limits to growth, which fundamentally endanger the valorisation of
capital, are declines in purchasing power as a result of lower wages and
salaries, unemployment, a decline in social benefits, a growing pressure to make
cuts (pensions, insurance), as well as the extensive saturation of “absolute”,
vital needs. To overcome these limits to growth and the associated dangers of
profit reductions that threaten capital, the following production strategies
are regularly used in the competition between companies in the same and
different sectors:
· the (partial)
shifting of production from goods necessary for existence and for the
satisfaction of absolute, vital needs
to products for relative needs (“validity
and prestige consumption”);
· the (partial)
shifting of production from the secondary
(industrial) sector to the tertiary
(service) sector;
· the (partial)
shifting of production from material to
immaterial goods (see Zinn 1998, 28ff).
In the application of such combined business
strategies, the media industry is generally regarded as a high-growth and profitable
economic field insofar as it opens up growth opportunities due to the interplay
of the three production strategies.
In this context,
the current process of the capitalisation of the media industry can be
explained mainly in three ways. The capitalisation of the media industry is
· firstly, for
traditional media companies, a means to solve their capital valorisation problems
associated with overaccumulation and competition, among other things by
investing surplus-capital in new privatised media sectors or in new media
markets or in media product innovations;
· secondly, for
companies from other industries/sectors/branches, a means to solve their
capital valorisation problems through increased sales-promoting advertising and
PR presented in the media; and
· thirdly, for
companies from other industries/sectors/branches, a means to solve their
capital valorisation problems by investing their surplus-capital in a media
industry that has been considerably expanded through capitalisation.
Finally, figure 3 presents another set of causes that
is relevant in the context of the “unleashing” or transformation of capitalism
and the media industry. One can speak of “unleashing”, for example, insofar as
media capital, like the rest of capital, is freeing itself from the “fetters”
of nation states through internationalisation and globalisation. A similar “unleashing”,
namely the liberation from obstacles to capital valorisation, is achieved in
particular through the privatisation and deregulation of broadcasting,
telecommunications, and the Internet in conjunction with the state’s economic
policy. Within the framework of the state’s industrial, location and
competition policies that promote concentration, the media industry is
additionally freed from obstacles to concentration (see Knoche 1996). Within
the framework of neoliberal economic and social policy, media capital frees
itself from the “fetters” of the welfare state and parliamentary democracy. For
the media industry, this means that it frees itself from the “fetters” of the
remnants of the publics service-orientation
and cultural orientation of media
production and media policy.
4.2. Forms and Consequences of Capitalisation
Forms of the push for
capitalisation in the media industry include, among others, the sectors
mentioned in figure 4, which in their current form are an expression of this push
for capitalisation, as well as product diversifications and innovations in the
press sector. There are forms of this push for capitalisation that can be
observed in the same way for
different media sectors. These forms include, for example, the stronger
integration of media production into the overall economic system of the capitalist
production of goods and surplus- value as well as into the system of consumer-oriented
advertising; a more intensive influence of the compulsion to produce and valorise
capital, of the compulsion to maximise profit and competition, as well as of
the compulsion to accumulate and concentrate capital. The basic similarity
(partly uneven, depending on the stage of development of the media sector) of
the push for capitalisation in the individual media sectors results from the
basic similarity of the shown causes, which in turn result from the similarity
of the preconditions – the private-sector organisational form of the media in a
capitalist economic system and a capitalist formation of society. In addition,
the similarity is shown by the fact that through technical and
economic-institutional convergence, the push for capitalisation is effective in
a media industry that is characterised precisely by the increasing dismantling
of the individual media sectors’ special features.
Furthermore, on
the level of a more differentiated analysis, one can for the different media
sectors of an expanded media and
communication industry recognise some specific causes, forms and consequences
of this push for capitalisation. In this respect, the distinction (see Knoche 1999a,
153f, English translation: Knoche 2016)
between two types of capital is important:
· media capital
used for the production or duplication of programmes and other content (the
media sectors of news agencies, the press, books, radio, audio, television,
film, video, online production), as well as
· media-related
capital and media infrastructure capital that is used only – and usually only
partially – for the production of media-related production, compression/storage,
transmission, encryption and reception technologies (in the electronics
industry, the chemical industry, the computer industry, the telecommunications
industry, the cable and satellite industry, the printing industry, the paper
industry, the mechanical engineering industry).
The media-related industries have long been engaged in
the progressive capitalisation process that is “normal” in capitalism. For example,
the companies in these industries were already suppliers of media technology
according to private-sector business principles before the privatisation of the
telecommunications sector. More novel, more comprehensive and politically much
more significant are the capitalisation processes in the media sectors where
capital valorisation is carried out with the production or duplication of programmes
and other content. Here, all the fundamental capitalisation processes mentioned
at the beginning become effective: capitalisation via privatisation,
deregulation and commercialisation of sectors of the media industry that were in
Europe previously organised by the state or as public service media, largely as
monopolies; the increasing commercialisation of media content production as
commodity production in all media sectors; the increasing influence of the
advertising industry and the integration of the media as sales media
(teleshopping, e-commerce); the macroeconomic (advertising, sales function,
consumer climate), political (political consciousness, legitimisation of the
capitalist economic system and the capitalist formation of society) and social
(regeneration of the labour force through entertainment) functions of media
production in the worldwide transformation process of capitalism.
A further
distinguishing feature for identifying tendentially differentiating
capitalisation processes is the type of financing of media production. Media
products that are financed exclusively or predominantly by advertising, one
might think, are exposed to a different capitalisation pressure than media
products that are financed exclusively by sales and distribution. However, this
view fails to recognise that media producs such as
film/video and audio (music) are also produced to a large extent in such a way
that they can serve as an environment favourable to advertising in radio and
television broadcasts. The capitalisation of the radio and television sector stands
not only in the interest of the companies involved and the advertising
industry, but also of the film and music industry. The sale of playback rights
to private radio and television companies not only creates additional sales
opportunities, but also tends to reduce the problem of the lack of purchasing power
and thus the problems of overproduction and overcapacities, since no physical products
have to be sold directly to consumers individually as in CD or video sales. An
additional variant of the capitalisation of the television sector, pay TV
without advertising, helps to solve capital’s valorisation problems that result
from overcapacities of films or film rights for which sales through
advertising-financed channels alone are not sufficient.
Finally, the
distinction between “traditional” and “new” media sectors reveals
differentiations in the capitalisation process. While some traditional media
sectors have for a long time reached a high level of capitalisation (especially
the film and music industries), the capitalisation of the Internet and online
media was in the late 1990s and around the new Millennium only in its initial
phase. There are many “strategies for the digital economy” (European
Communication Council Report 1999). Presumably the capitalisation process of
online communication will proceed rapidly as it is driven on the basis of a
high level of the capitalisation of the entire economy, including the media
industry.
Figure 4: Forms and consequences of the media industry’s capitalisation
As the most general consequence of the capitalisation of the media industry, the media
industry is subjected even more strongly than before to the general and
media-specific structural and functional changes of the economy and society in
accordance with the interests of capital valorisation. At the same time, the
media industry also influences this change. The consequences of the
accompanying expansion of the commercialisation of media production extend in
particular to
· the design of
media products as consumer goods and as commodities in competition with other
commodities;
· the expansion of
the media’s function as a means of advertising and circulating goods for the
entire economy with corresponding consequences for the content of media
products;
· the
strengthening of international capital and market concentration as well as the
globalisation of the media industry;
· the spread of
structural unemployment and precarious employment in the media industry;
· the regeneration
of the labour force according to the interests of capital;
· the creation of a
sales-promoting “consumer climate” and a political consciousness that is
aligned with capitalist interests;
· the alignment of
the state’s media policy with capitalist interests;
· the
legitimisation and securing of the domination of the international capitalist
economic system and the capitalist formation of society, especially in the
currently dominant form of neoliberalism.
5. Conclusion
Phenomena of economisation and commercialisation of
the private sector media industry were analysed in this paper as a progressive
capitalisation of the media industry. The analysis applied approaches that are
based on Marx’s critique of the political
economy and this approach’s current developments.
The
capitalisation of the media industry characterises a worldwide process in the
course of which media production is being incorporated even more
comprehensively than before into the overall economic system of capitalist
commodity and surplus-value production. The associated capitalisation of
information, education, politics, culture and entertainment is seen above all
as a contribution to the “all-round capitalisation” (Durchkapitalisierung) of all
areas of life in the course of neoliberal economic and social policies. The
capitalisation of the media industry follows the regularities that are also
effective for other branches of industry. By advancing distinctive advertising,
marketing and PR measures, the capitalisation of the media industry fulfils a
not insignificant capital and commodity circulation function within the
framework of the entire economy’s problem-solving strategies .Special features
of the capitalisation of the media industry are to be seen in the fact that, in
addition to the economic functions of capital valorisation, capitalist media
have the indispensable political-ideological function of legitimising the
capitalist economic system and the capitalist formation of society as well as the
regenerative function of reproducing the population’s labour-power through
entertainment and leisure culture. The causes, forms and consequences of the
capitalisation of the media industry do not differ in principle from those that
can be observed in other economic sectors. They can be explained in the context
of the general problems of capital valorisation and the crisis phenomena that
are permanent features of capitalist economies. It becomes clear that the progressive capitalisation of
the media industry as an irreversible process is hardly a suitable means of
promoting the fulfillment of functions in media
production that are desirable from a democratic theory perspective.
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About the Author
Manfred Knoche is professor emeritus of
media economics at the University of Salzburg in Austria. He studied
journalism, sociology, political science and economics at the University of
Mainz and the Free University of
Berlin. He obtained his PhD (1978) and defended his habilitation (1981) at the
Free University of Berlin. He was research assistant in the years 1974-1979 and
assistant professor for communications politics in Berlin in the years
1979-1983. From 1983-1994, he was professor of media and communication studies at
the Vrije Universiteit Brussel in Belgium, where he was also the director of
the Centre for Mass Communications Research. From 1994-2009 he held the chair
professorship for journalism and communication studies with special focus on
media economics at the Institute for journalism and communication studies at
the University of Salzburg in Austria, where he was the head of the department
for media economics and empirical communication research. He chaired the German
Association for Media and Communication Studies’ (DGPuK)
media economics-section. He is author of many publications on the critique of
the political economy of the media. His work has especially focused on the
critique of the political economy of media concentration and the media
industry’s structural transformations.
http://www.medienoekonomie.at,
https://kowi.uni-salzburg.at/ma/knoche-manfred/
Twitter: @Medoek
Wikipedia: https://de.wikipedia.org/wiki/Manfred_Knoche