The (New) Media’s Influence

Over the past weeks, New York has lost its governor, a major investment bank, and nearly lost a second investment bank to the rumor mill. Billions have been raised to shore up balance sheets and to quiet critics. According to the press and some analysts, the economy has been moving into or towards recession and certain industries are called out as most vulnerable. Calls for bail outs and subsidies are loud even entering the presidential election debate. Consumer confidence has plunged. Amidst the turmoil in Albany, Washington and on Wall Street, another crisis is brewing. A recent survey by WeMedia/ Zogby found that 2/3 of Americans believes that traditional journalism "is out of touch with what Americans want from their news."

I have previously posted about the feeding frenzy that is the main stream media. The feeling among politicians and many on Wall Street is that the media has added to the probability of recession and will influence the speed and timing of recovery. Consumer sentiment has a direct correlation to discretionary spending and is directly influenced by the tone and content of what media is broadcasting. Lately, that tone has been dire. A quick excerpt from MarketWatch:

Consumer sentiment sunk to its lowest level in 26 years in early April, according to a report from University of Michigan/Reuters, as worries about the economy, unemployment and inflation deflated hopes for the future.

U.S. consumer sentiment index fell to 63.2 in early April from 69.5 in March. Sentiment is at its lowest level since March 1982. Economists surveyed by MarketWatch were looking for an April result of 68.8.

The bulk of information received by consumers is from the main stream media. The power of the press is vastly underestimated when it comes to creating and influencing sentiment. TV, cable, web pundits, and newspapers guide conversations everywhere from bars to golf courses. A new and not as well disseminated influence is having some people "feel" they may have a newer perspective or inside scoop. Some of the influence sphere is changing.

Americans across the country aren't just complaining about the state of journalism, they are taking action. 77% of those polled in the survey see "citizen journalism" as a critical part of correcting errs of the traditional media. One only needs to look at the rise of user generated content via blogs and RSS feeds into MyYahoo and custom Google pages, and even into the very small screens of Blackberrys and iPhones to realize the influence. Look to the user generated content on Facebook, Myspace, Digg, and YouTube to witness that the "Me" generation of savvy internet users wants to both control and create content. This generation also marks a profound shift in media usage: 55% of those polled between the ages of eighteen and twenty-nine relied on the internet as their primary news source. This figure will only increase as today's tech savvy children reach adulthood. The instantaneous web, combined with rich media and interactive content made possible by broadband and more recently mobile has made the internet an attractive source for news: written, audio and video.

The internet has also democratized opinion and created a new form of journalism and commentary. Anyone (myself included) can start a blog and join the conversation. Some bloggers are inevitably more knowledgeable and better read than others. This flood of viewpoints and commentary can and is helping to fix "broken" parts of traditional journalism by covering issues from more angles. Of course it can also add a lot of noise. The point of professional journalism is that it is written and edited by pros. The down side of blogs is that they can present perspectives from non-experts, and goal oriented public relations "spin doctors" can present pseudo content. The up side is that blogs also can be written by people with expertise far beyond what a well meaning and even Ivy League educated journalist can be expected to possess. Many bloggers have specialized knowledge and focus that a journalist could not hope to achieve. These may be the same experts sought after and interviewed by journalists, or possibly professionals with niche knowledge unknown to the media. Many people seeking knowledge welcome these new writers to the conversation. One of the big differences between blogging and traditional journalism is that it creates a conversation. There is noise, there is self serving content, but for those willing to dig, there is also a deeper conversation.

In our more polarized society, "traditional" journalism can be out of touch in terms of objectivity (Fox News) and medium (broadcast TV and many Newspapers). It can also serve to point out the obvious but now under the guise of entertainment (Colbert and The Daily Show). The spread of news has always been an essential part of the fabric of society, and will continue to be in the future. The quest for news dates back to its recitation in town squares and the sharing of news in the pubs near ports, and spreading across the countryside.

One of the main developments in the spread of news is globalization created by technology and it's near instantaneous effect on society and the business world. I analyze what the markets are doing in Asia when I first wake up to gain a feel for what might transpire in the US markets. Like many other market participants, I read the commentary not just look at the numbers. Thanks to technology, the world today is near real-time; in the midst of typing this post, I received an alert from the WSJ updating a pending merger.

My hope is that schools and Universities in the industrialized world and global projects like One Laptop Per Child (www.laptop.org), an organization started by MIT faculty that ambitiously distributes low-cost laptops to developing areas throughout the world, spur the development of a new generation of global citizen responsible blogger/journalists.

From a revenue and career path standpoint, there will always be a market for objective and balanced "traditional" journalism. The blogsphere to date has been a business for a few, supplemental income for many, a hobby for thousands, and a source of new information for tens of millions. It also acts as a valuable supplement for journalism and analysis. The existence of blogs creates meaningful dialogues encouraging deep analysis of topics and the potential to uncover material facts and perspectives of interest. Based on the results of the consumer confidence survey and my assessment of the landscape I have two words of advice for my fellow bloggers: Keep Writing.