The Economics of Media

by lsusr2 min read13th Feb 20213 comments

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World Optimization
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When I was a kid I thought the news came from "investigative reporters" like Clark Kent were who were paid to research stories. Since then, I have gotten my startup on national television, placed a press release into the world news, discussed biological warfare as a podcast guest, written a blog which has been reposted to Hacker News, written fanfiction which has been linked to on Reddit and read a lot of books. My understanding of the media ecosystem has become more nuanced.

Media Economics

Small fry like Lyle McDonald, the McKays and Bruce Schneier can scrape by by selling books, branded paraphernalia and other niche merchandise. Niche merchandise doesn't scale. Large megacorp news outlets generally rely on subscriptions and advertising for their core revenue.

Subscriptions and advertising scale linearly with the number of viewers. But the cost of distributing Internet[1] media is negligible. An article costs the same to write whether one person reads it or one million. The market equilibrium is one where the great masses of people get our information from a tiny number of sources.

What people do with the information doesn't much affect a media outlet's bottom line. Whether the information makes people angry or happy doesn't matter except to the extent anger and happiness affect readership. Whether the information promotes good policy doesn't matter at all—unless that policy directly affects the news industry.

Content is fungible. Financially, what matters is how many people consume it.

Minimizing Costs

I learned a lot about Twitter when I hosted the 2020 Less Wrong Darwin Game. I wrote a sequence 11,475 words. It dwarfed anything else I had ever written until then because…I barely had to write anything. The story was created Vanilla_cabs and other competitors. Reporters report on Twitter tweets for the same reason: because content is fungible and because rehashing tweets is a cheap way to mass produce news.

But there's an even easier way to generate content: Let someone else do it for you.

Media businesses convert content into money. Media businesses don't care about the content's secondary effects. The cheaper media businesses can acquire content the more money they can earn. Non-media business with products to sell want media attention. Non-media businesses profit only off of contents' secondary effects. These are the perfect conditions for symbiosis. If a non-media business can write a news story for a news outlet then the news outlet gets free content and the business gets free advertising. This kind of news story is called a "press release". The first time I got a press release posted in a major news outlet I was stunned by how little the press release had been edited. The press release was basically copied word-for-word as original content.

Political organizations, including governments, create press releases the same way companies do, except their objective is political rather than commercial.

Press releases have the same economics as news stories because press releases are news stories. Only large organizations (or startups with large aspirations) have the economics to support press releases. Small organizations don't have comparable economies of scale. The press release system therefore constitutes a emergent pressure toward centralization. I suspect this pressure is related to how national politics increasingly dominate the political dialogue in the USA.

Cleaning out your head

Most of the mainstream news is implicitly subsidized by large organizations who are trying to get you to buy their products and ideologies. How do you fight back against mind control?

  • The first step is to disconnect from the news. News makes you stupid.
  • The second step is to explore in orthogonal directions. Learn calculus and physics. Learn foreign languages. Learn the histories of China and Islam (unless you are Chinese and/or Muslim in which case you should check out The History of Rome). Learn to read palms and Tarot cards[2]. Learn to draw. Use this knowledge to start hard ambitious original projects like companies. The more your actions deviate from the default script the more holes you'll discover in the Matrix.
  • The third step is to create your own media. If you are consuming media created by another person—even if that person is George Orwell—then you are not yet thinking for yourself.

  1. Paper media had a worse calculus based around monopolizing distribution. Risk-adverse paper monopolies distributed only the most inoffensive content. ↩︎

  2. But don't take them too seriously. ↩︎

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3 comments, sorted by Highlighting new comments since Today at 5:04 AM
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I read my first anti-news manifesto about 10 years ago and the meme immediately clicked with me. Haven't gone back ever since, my close family, friends and colleagues inform me of relevant news.

I haven't been able to convince many others though. So I guess I'll just salute you, fellow meme spreader.

Two initial thoughts. First is about the saying the when you drive, you're not stuck in traffic, you are traffic. Nowadays, for the big outlets especially, you're not reporting the news, you are the news. At least in some ways and contexts. Things become news because you report them. This is hardly a new thought, it's been on this site for over 13 years, but it helps me to connect it to something I already have a short adage for.

Second, one part of my job involves analysis of news in a specific range of technical fields. Basically, to condense the news into a less-stupid version so others can get something useful out of it, even if that's just "You can safely ignore this and anything that looks like this.". With so many places re-posting identical press releases, it can be remarkably hard to find anything I could call an original source for any announcement. It's in each outlet's interest to make you want to go back to them instead of somewhere else, I get that, but it makes it more difficult to follow a story, or connect it to any other piece of information on the same topic.

I used to read a newspaper daily for half an hour during breakfast. At some point I read https://www.lesswrong.com/posts/DSzpr8Y9299jdDLc9/cardiologists-and-chinese-robbers and haven't touched a newspaper for more than reading specific recommended articles since.