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Media Crisis 2.0. The newspaper will soon disappear. For the democratic public, a networked information economy is a chance.

By Robin Meyer-Lucht

[This article published in: Freitag 49, 12/4/2008 is translated from the German on the World Wide Web, http://www.freitag.de/2008/49/08490601.php. Robin Meyer-Lucht directs the Berlin Institute and is editor of the political blog (carta.info).]

In a deja-vu way, the media fall of 2008 is similar to the year 2001. Publishers axe editorial staffs. Advertising markets collapse. Bankruptcies cannot be excluded any more. In one central point, however, this time is different from the last crisis. Printed pages are affected this time. The media crisis 2.0 is a crisis of the print media.

The anxious question is: Are we faced with a cyclical or a structural collapse? Will printed media emerge permanently weakened from the new economic mess? If so, does a loss in the democratic public threaten?

The American scholar Eli Noam described the basic model of the transitional crisis three years ago: the media industry is a typical scale industry. Massive publication units are necessary to finance the high standing expenses. However if a new technology develops that makes possible new access, the stability of the mammoth entities will be quickly over. In such phases, a ruinous competition breaks out, prices fall incredibly and businesses collapse until a new consolidated structure of the mammoth units finally forms.

At present we find ourselves in this trough. The mammoth entities of the analogous media industry totter in light of the stronger online competition and compete over who will be in the new structure. This process will last longer than a business cycle crisis. This process began before the online competition and will not be over with its end. But the current plight could give the decisive tip of the balance.

The stars of the Internet have turned out to be genuine rivals for the classical media. In Germany, Google already realizes high sales. In the 14 - 64 age group, Spiegel Online reaches more readers than Sueddeutsche Zeitung…

The print media have a twofold problem, a cost- and a cultural problem in competition with the Internet. On one hand, it is ridiculously expensive to print daily papers. In contrast, Internet pages can circulate at a fraction of the cost. Public news journalism becomes a free product. The print media also suffers another disadvantage in the advertising market. Gaining their higher advertising prices is increasingly hard for the print media.

The change of information cultures by the Internet is threatening for the old media industry. Driven by occasions and events, people inform themselves online. The habitual use of publications decreases. Users react to the diversity of information by narrowing their spectrum of interests. At the same time the personal milieu gains importance as a source of information. Reading news about people one knows and seldom prominent mass media persons is possible thanks to social networks.

Because of cost-pressure and cultural change, the trend from the classical media to the Internet is irreversible. This development is driven above all by geography. The civil society increasingly recognizes that the net covers its information need better, more efficiently and more interestingly than the classical media. The media change also follows an abstract logic, the pressures of users.

The current crisis is a catalysor of the media change. It shows that the technological configuration produced by classical media and its journalism is coming to its end. With the daily papers, a central part of German republican culture threatens to be lost. In the young German history of democracy, there were always daily papers. The print mass media and the discursive public can hardly be thought separately. On the contrary, many regarded the daily press as an almost ideal incarnation of a deliberative public. The status quo of daily papers was the normative point of reference.

Still one should not succumb to this normative moment of madness. First of all, it is ahistorical. In the time of their mass acceptance, daily papers were regarded as indicators of a superficial populist impulse of dubious significance. Such a conclusion threatens to develop into a hardly useful self-blockade. A neutral perspective appears. The Internet is a far superior technology to circulate journalist themes and form a deliberative public. As a universal, networked and cheap media with open access, it can present discourse and positions better and in greater complexity than the classical media system. That the latter is bequeathed, often disheartened, unoriginal and absurdly inefficient is gladly repressed in the debates.

As a communication space, the Internet may always be alarmingly chaotic and fragmented. Representative for many, Jurgen Habermas sees here only splintered “accidental” public opinion without any synthesis mechanisms. While partly true, such a position fails to appreciate the character of provisional situations and the signs of a growing structuring.

A new networked information economy and social communication is slowly forming with increasing speed in the net. In this new constellation, specialized offers on one side and great aggregations on the other side play decisive roles. Public opinion arises on a new interplay of publications and comments.

The new digital exchange relations are hardly clear. Classical journalism was organized around the principle of distribution oligopoly and was governed with professional norms. The Internet enters the cultural walls established around journalism. A new system of independence and economizing replaces the old.

As a journalist, one is responsible for the truth of the texts. The system of the click-economy breaks into the journalistic world. The new freedoms must be domesticated through new cultural agreements. Social discussion is necessary.

What must be done now is not hard to see. Even Habermas notes the assumptions of the pessimistic diagnosis in the matter of the Internet must be quietly re-examined. A deliberative public opinion need not be a classical mass media opinion. From an economic perspective, Eli Noam predicted three years ago: nothing remains for the publishers than to prepare for a paperless future.