note: This is a first attempt to gather evidence, views, as well as scholarly sources to outline the impact of the financial crisis on mass media in Cyprus. Additionally, this article has also used information from interviews and discussions with editors, media owners and journalists.
Combined with my past and present experience working with the media, the resulting article is surely not exhaustive on the matter and more aspects regarding the impact of the financial crisis on mass media in Cyprus are yet to be explored.
Useful information and opinions were also gathered during a round table discussion organized by Politeia: “Crisis, Media and Democracy”, 19 June 2013, with the participation of relevant stakeholders (journalists/editors, media owners, representatives from the Union of Cyprus Journalists, Advertisers associations, academicians, bloggers etc).
The OSI Reports (Footprint of Financial Crisis in the Media, analysing the sutuation in several Eastern European countries) have been especially helpful. Paragraphs and chunks taken from those reports seem to be eerily prophetic and needed very little editing from my behalf to match with an estimating opinion on how the future could unfold for the media in Cyprus!
Impact of Advertising
Drop: not just profits
In the words of Antonis Makrides, president of the Union of Cyprus
Journalists, “Advertising is the blood donor of media”. As
spending on advertising and marketing has dropped in the last years,
the financial woes of media organizations have deepened.
At a round table discussion (organized by
Politeia (2013) regarding the Impact of the financial crisis
on Press and its implications on Democracy), editors and journalists,
media owners and managers, academicians, representatives of
advertising companies unions and other stakeholders, have come
together to examine the depth of the problem, establish a common
understanding about it and its implications and ways to tackle them.
The round table discussion was based on the assumption that the
financial crisis, causing a drop in advertising revenue that the bulk
of media organizations' survival depends upon, will cause media to
shrink with a lot of outlets shutting down and subsequently the media
will not be able to perform their duty to society: to investigate,
analyse and reveal and present the facts to the public, thus to help
the public articulate informed opinions and make informed decisions.
A blow in the media's ability to perform this role will lead to
uninformed citizens, prone to manipulation, false information and
superficiality in the news, thus based on information of poor
quality, to make wrong decisions and this becoming a blow to
democracy itself.
Of course, the impact of crisis on media and subsequently on
democracy is neither unique to Cyprus, nor new to the world. Reports
and papers presented here, that have studied the cases of other
countries, outline and describe similar findings. Though there are
disparities of the urgency of the situation among countries: For
example, the serious, prolonged financial crises in several of the
eastern European countries (crises that have pre-existed that of
Cyprus) have far more serious implications on media and in the
societies (see report of OSI, 2010)
rather than e.g. western more well-off European countries. However,
what is worrying, is by deducting the differences of those countries
with Cyprus and by combining them with the patterns of the downward
spiral effects of severe financial crises, a conclusion to be drawn
is that the Cyprus media will soon face the same difficult situations
and ailments of media in Easter European countries.
From a point of view, advertising revenue is of utmost importance for
the independence and impartiality of media organizations (Reuter,
Jonathan, and Eric Zitzewitz, (2006)). Advertising revenue
allows media organizations to be as such, because then they do not
need to endorse practices of political affiliations and rely on
corporate and other external vested interests that would want to
control media's opinion and direction by having them relying on their
sponsorship and financial support. Thus, media organizations that are
more independent (and, therefore, more reliant on advertising
revenue), are in even more disadvantaged position than media of
government (or politically-affiliated) ownership.
With advertising markets still largely at a standstill and people’s
purchasing power considerably below the pre-crisis levels, the future
will be hard. More cost-saving measures will follow, further
withdrawal of foreign companies investing in Cyprus (and providing
advertising revenue) is probable and bankruptcies of media
organizations seem to be imminent.
The situation has become more difficult not only in terms of
generating revenue through advertising but also maintaining
advertisement prices.
The effects on the
Media Labour Relations and Labour Market
At the early effects of the crisis, most media organizations started
by reducing staff in non-editorial departments such as marketing,
administration and advertising. But as the issue became more serious,
salary freezes, abolition of annual bonuses and wage cuts among
editorial staff followed suit and, eventually, lay-offs of
journalists. This is a pattern found not just in Cyprus, but in other
cases as well (State of the News Media, 2013).
Media organizations are constantly being forced to reduce costs, and
the journalists’ salaries remain low, also cutting on the number of
staff so as to reduce personnel costs. Despite the cuts, an attempt
is made to maintain the level of quality and quantity and the
remaining employees are given extra work at the same pay scale.
Consequently, when there are replacements of experienced journalists
that have been recently laid-off, many times they are replaced by
inexperienced journalists in order to be hired on a lower than usual
salary and this is another factor that effects the quality of news
coverage. Also, newly-hired (young) journalists are hired under
weaker, less favourable labour-regulating conditions: Instead of
being registered by their employers to the Union of Cyprus
Journalists (that would ensure some privileges like access to
trainings and protection as journalists and in their job), they are
instead hired on personal contracts that weaken their status as
journalists and make them more vulnerable to pressure, sacrificing
essential integrity and impartiality.
They are more susceptible to the media outlet’s owner “watchful
eye” ensuring the outlet’s news reporting does not deviate from
certain lines of interest (for example in Cyprus, politics are often
behind business in the media industry), so these journalists are not
always given the chance to freely function professionally.
The weakening of the Union of Cyprus Journalists' ability to protect
editorial staff from practices of manipulation and interference to
impartiality is caused by the stiff competition of journalists trying
to simply keep having a job. Not only young journalists that have
recently entered the trade are in a disadvantageous position. An
eloquent descriptive narrative of the situation by Antonis Markides,
president of the Union and senior journalist: “When I was then an
editor in newspapers, I had the freedom and security and no fear to
investigate and write whatever I wanted. I had no fear that when I was digging and exposing information, someone could tell me “don't do
it because of X and Y interests”. If the media owner would ever
come to me and say so, I could easily tell him off and tell him where
to go! I have done that in a number of newspapers I worked at.
Nowadays, I know that, even I, if the media owner comes and tell me
“do not write this”, what could I tell him? Without backing and
the easiness of being left without a job, how can I resist to him and
tell him “no”? I am afraid I do not know whether I have that power any more”.
However, from an opposing point of view, an extensive research by Andreas Panayiotou (2013) suggests that there is substantial evidence indicating that mass media outlets have generally failed to report important news regarding the scandals in the banking sector – or even participated in cover-up of many scandals. The study suggests that banks and political factors have had an influence on media, thus regulating what and how is published.
The use of freelancers by media organizations is a practice that is
gaining ground as a way to cut costs. This is, again, found beyond
the scope of Cyprus (see study of Cranberg,
Gilbert, Bezanson, Randall, and Soloski, John. 2001 for more
about labour relations and employment practices in corporate media
ownership regime). Freelancers can even be former staff members and
even currently working full time elsewhere. This, to some extent,
eases the budget conditions of the media, but puts journalists at a
greater social risk, as freelance relationship can be terminated
without notice and compensation and does not have provisions for sick
leave or holiday. Lack of professionalism can be a consequence of
that and thus lower output quality.
The Role of Mass Media
for the challenges posed by the Financial Crisis
The current financial crisis is rapidly becoming a crisis at all
levels, also threatening to become a major social crisis in Cyprus of
an unprecedented magnitude – comparable with the social
consequences of the war of 1974 – as well as a crisis for democracy
itself.
As media plays an important role in the dissemination of information,
it also plays an important role on both how analysts and investors
look at news information and how the public opinion is shaped on
matters beyond the economy. (Brad, and Terrance
Odean, 2008).
In fact, media actors at all levels (journalists, editors, owners and
others), bear the burden of the big responsibility in their
professional capacity, as in these years of crisis they have to play
a major role in strengthening the country’s democratic system by
informing the public in the most complete and accurate manner.
However, this role of media is very challenging, considering the
profound circumstances after the March 2013 Eurogroup memorandum
agreement that has sent shockwaves through the Cypriot economy's foundations. This
means, journalists and media organizations alike cannot “play”
this completely different game with the same rules and modus operandi
they used during the previous years.
Now more than ever, investigative journalism is of essence in order
for media to be able to scrutinize. But investigative journalism is
expensive (Houston, 2010), since it
involves a large commitment of reporting staff that are then would
not be available to cover everyday matters; also carrying costs in terms
of travel and gathering information.
Moreover, media organizations have to take in consideration the fact
that nowadays information and different kinds of data (text and
audiovisual) constantly stream in every place and in different kinds
of devices too: homes, offices, on the road; smartphones, handheld
devices – beyond traditional desktop and laptop computers. This
means news consumers are getting more demanding not only about the
quality and quantity of content, but also about the variety and level
of sources: different outlets, but also through social networks –
beyond traditional newspapers and magazines. In other words: choice.
The latter signifies that delivery of news must become
individualized, being custom-delivered based on its weight of
relevance on each news consumer. (See also: Westlund
O. 2008 ).
Recommendations for Journalists and Media Organizations
As a recommendation, journalists should be trained in business and
economy/financial journalism in order to tackle the problem of
insufficient coverage of crisis-related issues - to close the gap on lack of
relevant investigative skills and understanding of the matter. Media
organizations offering targeted support for investigative journalism
will help to keep dubious governance practices in public view (Casey,
Joseph E. Diego G. and Christopher P. (2010)).
In communities with limited ways to get their voice heard and with low
internet skills, a more balanced coverage of local issues and news
delivery can be achieved by means of Community Media, i.e.: training,
media literacy and skills, collectively using media with new
technologies - strategically, for the benefit of the community.
Both the established and new media organizations and outlets have to
adopt innovative and flexible media business models to ensure
sustainable and diverse news delivery. Sound business models that
encompass values of openness and public participation are compatible
with today’s “flat” news hierarchies and technological capacity
of the modern news consumer.
Journalists should be updated in modern techniques and receive
training on subjects like data journalism and data scraping,
contemporary online and ICT skills, strategic use of social media.
Especially regarding data journalism, journalists should also be
trained how to use online techniques combined with strong knowledge
on how various Freedom of Information regulations work (e.g. in state, local authorities and public administration levels, EU level and also in various countries) in order
to be able to gain quick and full access to information.
Such initiatives will help to ensure that cash-strapped media do not
compromise their public function and do not leave citizens poorly
informed and prone to political manipulation.
Internet: a ally or a
foe for Mass Media?
Although internet is a powerful tool for disseminating information,
the crisis in the media in Cyprus is also connected to the diffusion
of the Internet. The internet, as a cheap and omnipresent tool able
to convey news and information rapidly around the world, has
challenged the traditional media that have enjoyed the monopolies on
communication information to the public. Media organizations in
Cyprus were late to encompass internet and new technologies into
their strategic plans and as a result they were not able to fit in
the changing marketplace that relies more and more on technology and
instantly available information.
As a result, the media outlets have become increasingly deferred with
the public’s expectations regarding online experience and thus they
have lost market in online advertising. Moreover, the public has
started getting news from social networks and international news from
websites of foreign media organizations.
In combination with the public’s increasing interest to read the
news “between the lines” of what the established media offered,
the Internet offered the opportunity to the alienated members of the
public to bypass established media outlets and on the other hand it
offered the possibility to bloggers, various opinion holders, as well
as new outlets exclusively based on the web to “fill the gap” –
phenomena particularly among the middle classes and younger citizens
(See also World Association of Newspapers, 2012
on how young persons turn to online media).
More active members of the public have turned to alternative media on
the internet for news and analyses, gaining greater diversity of
opinions and thus enabling them to form a more balanced opinion on a matter, as
compared of getting information from a single established media news
outlet. Active citizens seek news online from sources beyond
established media, as certain news and analyses fall outside the
purview of the monitoring of established media and news state
agencies (that are more concerned with monitoring traditional mass
media outlets). Also, members of the public can access news and
information that could not be published by established media, due to
controversy or censorship (self-imposed, or state-regulated) (See
also an interesting case on how radio offered alternative news
perspectives and shaped public opinion by Stromberg,
David, 2004).
Online Opportunities
exploited
“When one door closes another door opens”, at the same time,
beyond the negative effects, the financial crisis has also had
certain positive effects on media organizations. It forced outlets to
increase efficiency and invest in online presence. It has also
increased resourcefulness among audiences with people consuming more
sources in order to form their opinion. When comparing with the
impact on “traditional media” -e.g. newspapers that rely on
expensive printers in order to print daily and TV stations that rely
on expensive terrestrial broadcasting- the crisis, has affected media that are exclusively web-based much less and has brought new audiences to the internet.
The rapid rise of Twitter and Facebook coincided with the crisis and -combined with the drop in consumers’ disposable income and the need
for traditional media to find new audiences- has led to an explosion of
online communities of consumers.
An explosion of blogging, micro-blogging and social networks
coincided with the financial crisis constitute one of the biggest
recent changes in the media landscape. Some traditional outlets have
turned this trend to their advantage, expanding their presence on
Facebook and Twitter – some using those social media not as just
another way to dispense their information, but to create an online
interactive community with the public. The financial crisis has also
greatly influenced internet users’ behaviour and preferences
especially among the young generation. Generally there is a trend of
increasingly turning to the internet as their primary (and many times
exclusive) source of news.
Another impact of the financial crisis is that although it has made it
difficult for new entrants to enter the news media industry, new
technologies, however, can enable much wider new participants in the
news media. This could be one of the few overall biggest
changes in recent developments in the media sector.
Indeed, not only independent new websites acting as online news
portals have emerged, but also blogs, forums and online communities
in social media have been established that provide the public with
alternative news sources other than the established mass media.
However, apart from some efforts of establishment of quality online
news portals that are important to provide alternative options to the
public, this increase in amount of information on the internet has
not translated into a higher quality of content (supporting this
view: PJ Boczkowski, M De Santos, 2007).
This is because most of these blogs, forums or portals are ran or
managed, for the most part, by inexperienced or non-professionals,
and this may lead to misinterpretation and misrepresentation of
facts. There is not much original news produced by online portals,
sometimes acting as mere news aggregators, or relying a lot on
translations from other outlets. That is why most news consumers would rather search for confirmation in the mainstream media,
if they have any special topics of interest in the news.
Sources and further reading:
Footprint of Financial Crisis in the Media -
Open Society institute - Media Program - January 2010 - http://www.opensocietyfoundations.org/reports/footprint-financial-crisis-media
Panayiotou Andreas
2013, Οι Τράπεζες, τα ΜΜΕ και οι προσπάθειες
Συγκάλυψης, Μετατόπισης και Λογοκρισίας
των σκανδάλων - (Η εισαγωγή, η εξέλιξη
και οι αναπαραστάσεις της οικονομικής
κρίσης στην Κύπρο), Αντρέας Παναγιώτου
Politeia, 2013: Round table discussion “Crisis,
Media and Democracy” organized by Politeia a Civic Organization (
www.politeia-cyprus.eu
), 19 June 2013.
Westlund O. 2008: From Mobile Phone to Mobile
Device: News Consumption on the Go. Canadian Journal of
Communication, Vol 33, No 3 (2008)
Brad, and Terrance Odean (2008) .The effect of
attention and news on the buying behavior of individual and
institutional investors, Review of Financial Studies 21, 785–818.
Cranberg, Gilbert, Bezanson,
Randall, & Soloski, John. (2001). Taking Stock: Journalism
& the Publicly Traded Newspaper Company. Ames, IA: Iowa State
University Press.
Casey, Joseph E. Diego G. and Christopher P.
(2010). The power of rhetoric in financial journalism, Working paper,
University of North Carolina.
Reuter, Jonathan, and Eric Zitzewitz, (2006)
Advertising and bias in the financial media, Quarterly Journal of
Economics 121, 197–227.
Stromberg, David, 2004, Radio's impact on
public spending, Quarterly Journal of Economics 119, 189–221.
PJ Boczkowski, M De Santos (2007) “When more
media equals less news: Patterns of content homogenization in
Argentina's leading print and online newspapers” - Political
Communication, 2007 - Taylor & Francis, Volume 24, Issue 2, 2007
Brant Houston, 2012. “The future of
investigative journalism” Daedalus, Spring 2010, Vol. 139, No. 2,
Pages 45-56, (doi:10.1162/daed.2010.139.2.45), American Academy of
Arts & Sciences.
