Academic journal article New Zealand Sociology

Financialisation of Media Ownership in New Zealand

Academic journal article New Zealand Sociology

Financialisation of Media Ownership in New Zealand

Article excerpt

Abstract

From the early 2000s, the financialisation of global capitalism reshaped the strategies of transnational media conglomerates. As financial institutions expanded their operations, non-financial corporations became seen as an assemblage of business units that ought to be continuously restructured to maximise share price performance and profit rates. Media corporations thereby moved away from conglomeration toward a strategy of rationalizing holdings around strong market positions in certain sectors. Aggressive, unlisted financial operators, such as financial equity companies, regard media holdings as a lucrative source of revenue by means of acquisition and/or a leveraged buyout. In this context, we argue that those transnational media corporates that have colonized the New Zealand mediascape are themselves becoming colonized by listed and unlisted financial institutions. This process is well-advanced in the cases of MediaWorks, Fairfax and APN and News Media. Their difficulties have been exacerbated by an historic decline in print news readership and concerns about the commercial viability of on-line news provision. More recently, financial interests have increased their ownership stake in Sky Television. Together, these developments point to an uncertain future for commercial media organizations and media professionals alike. Meanwhile, mainstream news media coverage continues to thin out as advertising culture prevails.

Introduction: financialisation and global media

From about 1980 media-communication conglomerates with lucrative holdings across key media markets took over stand-alone businesses. Major players such as Time Warner, Bertelsmann, Viacom, Disney, NBC Universal and News Corporation subsequently acquired worldwide cross-media portfolios. During the 1990s and early 2000s a global oligopoly of media entertainment corporations established a dominating presence across core areas of cultural production and leisure activity (film, television, recorded music, print media, hotels, resorts, theme parks) Each corporation sought to control the production and distribution of cultural content through vertical integration. Within the media entertainment system as such, advances in internet applications, digital `television and mobile telephony blurred traditional separations between broadcasting, computing, telecommunications and consumer electronics (Murdock & Golding, 2002; McChesney, 1999; Fitzgerald, 2012).

At the same time, however, media entertainment corporations operated within business conditions shaped by the financialisation of the global economy. The general process was enabled by the proliferation of neo-liberal policy regimes requiring the dismantling of international currency agreements and the deregulation of nationally centred financial sectors. At the same time digital convergences between information and communication technologies provided necessary infrastructure for the globalisation of financial institutions and financial flows. These developments effectively changed the structure and strategy of corporate governance. The process dates from the 1980`s when new kinds of financial activity reshaped the American corporation. Hostile takeover firms were then growing in number and activity. They broke up conglomerates so that component parts could be sold for more than the previous market valuation. Individual investors gave way to institutional investors who gained major control over corporate stock. Such investors did not simply value conglomerates as a whole; priority was given to divisional profit performance and the establishment of `focused` firms. Consequently, share analysts grew in number and developed specialisations. Corporations eager to attract favourable analyst coverage were obliged to sell off businesses unrelated to core competencies. The core competency-shareholder value priorities of institutional investors and analysts began to shape corporate governance and strategy. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.