Vol. VII No. 3 (April 2010)

International Convergence

By Matt McColl, Editor

In looking at convergence and the myriad ways it affect us, it is easy to forget the rest of the world is not far behind - or in some cases ahead - of North American media. From the economics of convergence as well as initial application of the idea, the international community is moving forward in exploring convergence as a function of news.

This month, Augie Grant and Alexander Gorelik provide an in-depth review of a program designed to train early and midcareer journalists in Ukraine in of convergence. Mark Edge looks at the possible causes of Canada's of unstable state of television and Guillermo Coll describes how one can view the product of how convergence has been implemented by Spain's media.

We here at The Convergence Newsletter welcome articles and feedback from all our readers. You can e-mail us at convedit@mailbox.sc.edu and you can comment on all articles at The Convergence Newsletter blog, http://convergencenl.blogspot.com/.

Contact Matt McColl, editor of The Convergence Newsletter, convedit@mailbox.sc.edu.

View past newsletters at http://www.jour.sc.edu/news/convergence/. Visit The Convergence Newsletter blog at http://convergencenl.blogspot.com.

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Featured Articles

Emerging Media Models in Ukraine

Convergence blamed for media mess in Canada

Newsroom convergence in Spain

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Quick Glance Calendar(details)

May 6 -7: 4th International Conference on eDemocracy, Danube University, Krems,

June 21-25: 2010 Newsplex Summer Seminar I, Columbia, S.C.

June 28-July 2: 2010 Newsplex Summer Seminar II, Columbia, S.C.

August 4-7: 21st Annual Asian American Journalist Convention, Los Angeles

October 11-12: 2010 Convergence and Society: Health & New Dimensions of Communication, Columbia, S.C.

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Feature Articles

Emerging Media Models in Ukraine

Most studies of convergent journalism have focused on the efforts of existing media organizations.[1] But history shows that the biggest innovations sometimes come from outside of traditional structures, as entrepreneurs are unencumbered by organizational or economic constraints.

A group of early and mid-career journalists in Ukraine was challenged to create business plans for new media organizations. This analysis is designed to identify patterns among the proposals and to distill lessons from these plans that may provide insight into the trajectory of journalistic organizations worldwide.

Western commentators have viewed Ukraine as a relative success among the former Soviet republics, with an economy evolving toward liberalization while the country moves towards greater democratic freedom.[2]

Since Ukraine's 2004 "Orange" revolution, the country has stayed ahead of some immediate neighbors in economic and journalistic freedom. As such, Ukrainian mass media can be viewed as a likely, if imperfect, model for the near future of these countries' mass media.[3] There are still some problems:

• While lists of acceptable topics no longer come from the president's office, officials occasionally try to change the scope or angle of coverage.

• Cooperation from state-controlled media is inconsistent, especially in distributing independent media.

• Subsidies tend to go to outlets perceived as "loyal" to the state.[4]

As the dependence on the state as a business model wanes, the next generation of media managers, journalists and audience members is looking for a new business and technology platform that increasingly is found in convergent media.[5]

The "Digital Future of Journalism" Program

The Kiev-Mohyla Academy is a private university in Ukraine's capital and one of the few in Ukraine offering both graduate and undergraduate programs in journalism. The faculty were looking for ways to broaden their impact to include training for working journalists, which led to creation of the "Digital Future of Journalism" (DFJ) program, designed to provide training for early and mid-career journalists in the new generation of media tools and practices, especially those related to convergent journalism.

Over eight months, journalists participated full time for a week each month in intense training that included conceptual, practical, and hands-on experience with convergent journalism. The topics were:

1. Introduction to convergence, media audiences, and multimedia journalism.

2. Creating multimedia and interactive content for the Web.

3. Audio and video editing and graphic design.

4. Internet audio, podcasting, and Internet radio.

5. Video journalism: Shooting, editing, downloading, storage, and distribution.

6. Graphics production; photography and photo editing.

7. International field trip to visit converged media organizations.

8. Economics and business models for new media.

The eighth weeklong session had an intensive set of lectures on business models, economics, management, leadership, intellectual property, and entrepreneurship in journalistic organizations. Students then worked in groups of three to five to create a business model for a new media organization in Ukraine. Masters' students in Kiev Mohyla Academy's journalism program also attended, so 10 groups created models.

The only restriction was that revenues had to exceed expenses. Each plan had an overview of the organization and its products; a detailed financial analysis, including monthly revenues and expenses; a competitive analysis; a proposed organizational structure; and a marketing plan.

Proposed plans

The economic models range from advertising support to direct pricing (subscription) models. Importantly, the business plans evidence a certain reluctance among journalists to rely exclusively on revenues from the media side.

All the plans require only modest investments, with limited reach and revenue opportunities. Most are targeted at a specific geographic area and would support a small staff, usually less than two dozen employees.

The attendees quickly grasped the complex concepts discussed, such as management, finance, accounting, or marketing, and applied these as they created their business plans. This finding has important implications in the debate over whether it is more important to provide future journalists with training in journalism or in the fields they will be covering.

Lessons learned

Although it is difficult to generalize from such a small group of students, some interesting lessons may be drawn from analysis of these business plans. With only one week of training on the business of convergent journalism, these attendees constructed business plans that addressed the full range of financial issues (including comprehensive projections of revenues and expenses), created marketing plans, assessed the competition, and proposed an organizational structure.

As young professionals (most in their 20s and early 30s), those in the DFJ program clearly did not see "journalism" (in the narrow sense of this word) as their exclusive occupation. Instead, these young people saw themselves as information entrepreneurs and did not shy away from getting involved in marketing, community building and moderating, managing online stores, and allowing sponsored content to become significant in revenue generation – indicating their ability to quickly respond to the changing economic, legislative, political, and technological environment with flexible business models.

An interesting characteristic of these models is that most called for direct payment for media content from consumers, with almost as many calling for subsidy of media content from sponsoring organizations. These journalists clearly place a value on the content they create, but it will remain to be seen whether paid media content can effectively compete in a converged media market. Their answer to this question may presage efforts by media organizations to take similar efforts to collect income directly from users.

The final lesson is the role business training plays in preparing journalists for a converged media environment.. From the outset, this program conceived of convergence as a process that impacts the business side as well as the journalistic side of media organizations. Other convergent journalism programs may want to follow the lead of this program, including a range of business considerations alongside the journalistic considerations in convergence training.

[1] DeMars, T. (2009). News convergence arrangements in smaller media markets In Grant, A.E. & Wilkinson, J. S. (Eds.) Understanding media convergence: The state of the field. New York: Oxford University Press.

Dupagne, M. & Garrison, B. (2009). The meaning and influence of convergence: A qualitative case study of newsroom work at the Tampa News Center In Grant, A.E. & Wilkinson, J. S. (Eds.) Understanding media convergence: The state of the field. New York: Oxford University Press.

Silcock, B. W., & Keith, S. (2006). Translating the Tower of Babel? Issues of definition, language, and culture in converged newsrooms. Journalism Studies 7 (4), 610-627.

[2] Merchant, E. (2009, May 25, 2009). Russia / Ukraine: sharing solutions to beat the recession. Retrieved September 28, 2009, from http://www.mdlf.org/en/main/newsroom/13/.

Purvis, S. (2006). Clean sweep in the Ukraine. British Journalism Review, 17(2), 65-69.

Richter, A. (2008). Post-Soviet Perspective On Censorship and Freedom of the Media: An Overview. International Communication Gazette, 70(5), 307-324.

[3] Goldstein, J. (2007). The Role of Digital Networked Technologies in the Ukrainian Orange Revolution: The Berkman Center for Internet and Society.

Zarecky, A. (2004). Official Discourse in Soviet Ukraine (Why Is It so Hard to Find a Way out of Post Totalitarian Space?). Evropa (Европа), 11(2), 101-122.

Becker, L. B., Vlad, T., & Nusser, N. (2007). An Evaluation of Press Freedom Indicators. International Communication Gazette, 69(1), 5-28.

Dyczok, M. (2007, May 18). Ukraine: Media Policies Reveal Divergent Values. Retrieved September 2006, 2009, from http://www.rferl.org/content/Article/1076569.html.

Richter, A. (2008). Post-Soviet Perspective On Censorship and Freedom of the Media: An Overview. International Communication Gazette, 70(5), 307-324.

Under Assault: Ukraine's News Media and the 2004 Presidential Elections (2004). Freedom House.

Zassoursky, Y. (2004). Iskushenije svobodoj [Seduction of freedom]. Moscow: Moscow State University press.

[5] Krasnoboka, N. (2002). ‘Real Journalism Goes Underground: The Internet Underground’: The Phenomenon of Online Media in the Former Soviet Union Republics. Gazette: The International Journal For Communication Studies, 64(5), 479–499.

Mitchelstein, E., & Boczkowski, P. J. (2009). Between tradition and change: A review of recent research on online news production. Journalism, 10(5), 562-586.

Semetko, H. A., & Krasnoboka, N. (2003). The Political Role of the Internet in Societies in Transition: Russia and Ukraine Compared. Party Politics, 9(1), 77-104.

Dr. Alexander Gorelik is an adjunct professor in the School of Journalism and Mass Communications at the University of South Carolina. Contact him at dr.alex.gorelik@gmail.com

Dr. August E. Grant is an associate professor in the School of Journalism and Mass Communications at the University of South Carolina. Contact him at augie@sc.edu.

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Convergence blamed for media mess in Canada

By Marc Edge, Sam Houston State University

With some television stations closing and others selling for a token few dollars, and with the country's largest news media company in bankruptcy, Canada's media system is broken, according to the country's converged media players.

They want the Canadian Radio-Television and Telecommunications Commission, the nation's broadcasting regulator, to bail them out by ordering the more profitable cable television companies to pay them for carrying the over-the-air signals the cable companies have always transmitted for free.

The cable companies labeled the proposed carriage fee a "TV tax" and promised in an advertising campaign that has bombarded Canadian television viewers to pass the extra cost along to consumers. Full-page newspaper ads also carried their message that the networks' financial problems are both cyclical, due to reduced advertising revenues brought by the recent economic downturn, and self-inflicted. The cable companies pointed to mismanagement by the networks in taking on enormous levels of debt to finance multimedia acquisitions and in bidding up the cost of imported American television shows, which now account for the majority of television programming expenditures in Canada.

The networks responded with their own advertising campaign urging Canadians to "Save Local TV" by contacting their local member of Parliament to support the carriage fee. They also made good on their threats to close money-losing stations in smaller markets without regulatory relief. CTV, the country's largest network, shut down CKX in Brandon, Manitoba, (pop. 41,000) after deals to sell the station for $1 twice fell apart. CTV offered in March 2009 to sell CKX and two Ontario stations for that token price because they were losing money.

Cable giant Shaw Communications quickly offered to meet the asking price for all three stations, but backed out after doing due diligence research on their finances. CKX was then apparently sold to an investment group that also changed its mind after failing to secure carriage on Canadian satellite television systems. CTV converted CKNX in Wingham, Ontario, (pop. 3,000) to a rebroadcaster but agreed to keep CHWI in Windsor, Ontario, (pop. 216,000) broadcasting for at least another year after the Radio-Television and Communications Commission boosted subsidies for local programming by half.

Canwest Global Communications, the country's convergence leader, closed CHCA in Red Deer, Alberta, (pop. 90,000) and sold CHEK in Victoria, British Columbia, (pop. 78,000) to its employees for $1 in September. Canwest was overextended with debt from major acquisitions.

It had bought Canada's largest newspaper chain, Southam Inc., for $3.2 billion in 2000. But with reduced advertising revenues in the recession that hit early in the decade, it soon began having trouble making the payments on its estimated $4 billion debt and was forced to sell several newspapers in smaller markets. During the ensuing economic recovery, Canwest embarked on another buying binge, first acquiring the New Republic magazine in the U.S. for $8.3 million. It then raised concern by bending Canada's foreign ownership rules to acquire 13 cable television channels for $2.3 billion in 2007. The purchase was made in partnership with U.S. investment bank Goldman Sachs, which contributed almost two-thirds of the purchase price despite Canada's limits on foreign ownership of media totaling 46.7 percent directly and indirectly through a holding company. The CRTC held hearings into the arrangement, which saw Canwest hold two-thirds of the company's voting shares, and approved it in late 2007 with only slight modification.

CTV weathered the recession early in the decade better than Canwest because it made its foray into convergence not by taking on debt but instead by becoming a partner with the Globe and Mail national newspaper to form CTVglobemedia. It even expanded during the downturn, paying $74 million in 2001 for French-language network TQS. It also paid $100 million in 2003 for an interest in the Toronto Maple Leafs of the National Hockey League and the Toronto Raptors of the National Basketball Association, the cable television networks that broadcast their games, and the arena where they were played. CTVglobemedia then took on major debt in 2006 to buy a chain of 33 radio stations, seven television stations, and 21 cable television channels for $1.4 billion.

The latest recession dropped television network profits in Canada from $113 million in 2007 to only $8 million in 2008, with results for 2009 promising to be worse yet. As a result of reduced revenues, Canwest missed a number of interest payments to bond holders and scrambled to sell assets to raise cash. It sold two stations in major markets – CHCH in Hamilton, Ontario, and CJNT in Montreal – for a mere $12 just to avoid their losses.

In late September, Canwest seemed to have eased its credit crisis by selling its majority interest in Australia's Network TEN for $634 million. The sale also erased $582 million of Network TEN's debt from Canwest's books, lowering Canwest's debt load to an estimated $2.5 billion. Just when it appeared Canwest might have life, however, it announced in early October that it had filed for court-ordered protection from its creditors and faced having its divisions auctioned off individually.

CTVglobemedia was reportedly forced to renegotiate almost $2 billion in loan agreements to avoid defaulting and moved to lower costs by eliminating hundreds of jobs and canceling morning shows at several local stations. It reported a $13.3 million loss for 2008 and forecast that its loss in 2009 would be $90 million to $100 million. It also took a $1.7 billion accounting write-down on its television assets, or three-quarters of their book value.

The networks demanded carriage fees despite the CRTC's having already turned down the request in 2007 and 2008. As a result of political pressure brought by the advertising campaign, a parliamentary committee convened hearings in Ottawa, where the cable companies protested that the networks were taking advantage of the economic downturn to exaggerate their financial problems. The hearings ordered the CRTC to revisit the carriage fee debate yet again, which it did in hearings at year's end.

The CRTC cited data that showed the networks had spent a record $775 million on foreign (mostly U.S.) programming in 2008, compared with $619 million on Canadian programming. Because expenditures on foreign content had increased 43 percent since 2003, the CRTC threatened to impose a spending limit by requiring the networks to spend as much on Canadian content as on foreign content. A CRTC decision on carriage fees is expected early this year.

Some analysts, however, note that the threat to broadcast television in Canada may not be as severe as made out by the networks. Canwest CEO Leonard Asper himself said the company as a whole was still profitable, just not profitable enough to make its loan payments. And while CTVglobemedia did lose money on its conventional television operations in 2008, its newspaper and cable television revenues allowed it to turn an overall profit of 9.7 percent. Its reported loss for the year, according to public filings, was actually the result of the large write-down it took on paper of the book value of its television assets.

Marc Edge is an associate professor in the Department of Mass Communication at Sam Houston State University in Huntsville, Texas. Contact him at mail@marcedge.com.

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Newsroom convergence in Spain

By Guillermo Coll, The University of South Carolina

Journalism's survival worldwide depends on its ability to find, and capitalize on, convergence within various platforms. Each country, and even each newsroom, faces different challenges in integrating journalism. Among European newsrooms and media, Spain, my home country, has probably been one of the most eager to integrate media options to provide more efficient information dissemination.

The rapid and steady innovation and journalistic diversification is truly surprising considering Spain's lack of technological progress during the long period of dictatorship that left Spain as one of the last countries in Western Europe to become a democracy in 1975.

In Europe, most national televisions stations have successfully implemented the diverse modalities of digitally integrated newsrooms. In Spain, companies are continually looking for good examples of convergence to model themselves after, like Radio Television Espanola, the state's official public television and radio stations. Since the late 1990s, not only they have tried to introduce digital technologies into their daily workflow, but they have also been fostering journalists' continuous learning process to prepare the new generation for the different types of multimedia content demanded.

Internet, mobile and convergent digital platforms allowed Radio Television Espanola to create a whole new experience for audiences. The complete integration and persistent collaboration between newsrooms, along with the right coordination between separate media platforms, each with different content, have established RTVE as a pioneering example for the rest of Spain's journalistic institutions.

Online versions of Spain's national newspapers present a good picture of the convergence evolution in Spain during the past 12 years. In 1998, while most of Europe's newspapers were already providing digital versions, only El Mundo and El Pais, the two main national newspapers in Spain, ventured into the realm of digital content.

It was poor content, and both digital newsrooms existed in isolation for two years without drawing much attention. But from 2000 to 2002 those online newsrooms showed they could be as productive as the paper version. The papers' global thinking and usage of convergence provided the template for success. The two newsrooms made a joint effort and produced a converged product that provided different content while interconnecting their individual offerings.

Universities and research institutions have had also a great impact in the decision by journalism associations and media to pursue the interactive boundaries that social networks and other platforms were opening for journalism. La Facultad de Comunicación de la Universidad de Navarra, one of the most prestigious universities in Northern Spain, exemplifies the willingness to unify newsrooms and use all the tools available to promote interactivity and civic participation at all levels. This institution helped in the development of Newsplex, the multimedia newsroom at the University of South Carolina.

Also, a private gigantic journalistic entrepreneur like PRISA, which owns El Pais (the national leader in circulation) and 20 other media platforms, has been working closely with other journalistic institutions from South America and Europe to start thinking more globally. Most of these ventures are driven by the importance of reducing costs and increasing benefits, but at the same time giving people what they want. Even small media groups are incorporating Widget, Twitter, Facebook, mobile services, and customized products more and more often as their central offering.

The conclusion is that in Spain, as in the United States, more and more people consume convergent audiovisual content among more platforms. At the same time, newsrooms have come to understand that convergence allows them to reach fragmented audiences and create multiple possibilities for delivering information.

Although convergence in Spain has created a veritable eternal spring of convergence, some journalists think some of the media groups, like Antena 3, have seen convergence as an opportunity to reduce quality of journalism in favor of total information inundation. The newly instituted technologies have allowed the corporations to take personnel away from fact checking and copy editing, which has led to a distinct downturn in the journalistic quality of their product.

But for the most part, convergence has been a boon to the journalism and communications community within Spain. Since the turn of the last decade, the country has led Europe in implementing new methods of news dissemination, and that enterprising spirit should mean it will continue.

Guillermo Coll is a first-year graduate student in the School of Journalism and Mass Communication at the University of South Carolina. Contact him at coll@email.sc.edu.

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Conferences, Training and Calls for Papers

4th International Conference on eDemocracy Danube University

Krems, Austria

May 6-7

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2010 Newsplex Summer Seminars

Teaching and Research in Convergent Media

Columbia, S.C.

June 21-25

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2010 Newsplex Summer Seminars

Convergence Software Bootcamp

Columbia, S.C.

June 28-July 2

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AAJA 21st Annual National Convention

Los Angeles

August 4-7

http://www.aaja.org/features/articles/2009_10_30_01/

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Convergence and Society: Science, Health and New Dimensions of Communication

University of South Carolina, Columbia

Oct. 11-12

http://www.sc.edu/healthcomm/research/conference.html

Call for papers deadline: June 15

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Publisher and Editorial Staff

The Convergence Newsletter is free and published by The College of Mass Communications and Information Studies at the University of South Carolina.

Executive Editor Doug Fisher

dfisher@sc.edu

Editor Matt McColl

convedit@mailbox.sc.edu

Visit The Convergence Newsletter blog at http://convergencenl.blogspot.com, where you can comment on recent articles and keep up with the latest in convergence news.

There is also an RSS feed option for those who want alternative access.

View past and current issues of The Convergence Newsletter at http://www.jour.sc.edu/news/convergence/.

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