why is money very important to open a media house
Answers
Answer:
this is your answer
Explanation:
The Guardian is a 195 year old British newspaper which expects to burn through £90m in 2017 after incurring damage of £200m the year before.
The Economist once described The Guardian as:
“[T]he most stylish paper in the hyper-competitive British quality pack, the wittiest and best-designed, the strongest for features, the one most likely to reflect modern life.”
At it’s peak it sold half a million papers per day. In June 2016, at peak Brexit-vote tension, The Guardian online claimed to have over 165m unique monthly browsers.
Yet, despite this history, reputation, and traffic, there are serious warnings that the money will run dry in as little as six or seven years.
If they can’t make it work, how can anyone? What future is there for journalism and traditional media?
In this article, we’ll explore a number of business models in use today on both a large and small scale, and begin to analyze their strengths and weaknesses.
We’ll break that down into 10 key recommendations for anyone looking to hop onboard the media startup bandwagon.
Then, for a bit of fun, we’ll delve into what could lie ahead for the future of print media.
Extra, extra! Read all about it!
Life’s easier with a sugar daddy – or momma
start a media company rupert murdochLots of media outlets are owned by rich folk.
It has become the normal state of affairs for wealthy individuals to expand their share of the media sphere as the market has become increasingly reliant on small margins. Local newspapers struggle to survive as print circulation drops and they lack the available capital to invest in expansion.
When we think of media tycoons, we think of Bloomberg, Murdoch, and now Bezos stateside. In the UK we see Murdoch again, Lord Rothermere, and the Barclay brothers. Other notable names like Warren Buffet and John Henry crop up when looking into media ownership in the US too.
According to the Who Owns The UK Media report from the Media Reform Coalition, the media market is becoming increasingly centralized within fewer and fewer hands:
This short report shows that just three companies dominate 71% of the national newspaper market – a market that may be shrinking but is still crucial when it comes to setting the agenda for the rest of the news media. When online readers are included, just five companies dominate some 80% of market share.
Clearly, having a bit of money behind the company is an effective way of gaining advantage over the pack. That capital investment can go into revamping online presence, creating content across different media pathways, and increased spend on business operations like marketing, analytics, and sales.
Even The Guardian’s corporate structure uses a wealth fund to invest in stocks to cover the newspaper’s operating losses. However, it’s not necessarily successful enough to guarantee The Guardian’s future if the media outlet doesn’t improve its revenues. As Colin Morrison notes for the World Association of Newspapers and News Publishers:
The non-profit parent company has traditionally been organised almost as a private-equity firm, with external shareholdings which have helped to fund newspaper losses and capital investment. These have produced an endowment of some £700m. But, after years of bold expansion – in the UK as well as the US and Australia – The Guardian is now coming to terms with the fact that, unless it stops the losses, even these reserves may run out in 6-7 years.
Billionaire or no billionaire, a newspaper needs to be generating revenue. If it doesn’t become financially sustainable it may find that the deep pockets of its proprietors eventually turn their attentions elsewhere.
We saw this recently in the UK when Russian oligarch Alexander Lebedev sold off parts of The Independent which he originally bought in 2010. First, it’s smaller tabloid sibling, the i. Then, last year, it ceased its print copy and closed The Independent on Sunday.
If you don’t make money, you won’t last long.
So, how do newspapers and online media outlets make money?
Answer:
because it is a tool of rich people