Notes

Faculty of Applied Social Sciences
ABCG4103
Global Communication
Copyright © Open University Malaysia (OUM)

ABCG4103
GLOBAL
COMMUNICATION
Prof Dr Azizah Hamzah

Project Directors: Prof Dato’ Dr Mansor Fadzil
Assoc Prof Dr Mohd Yusof Ahmad
Open University Malaysia
Module Writer: Prof Dr Azizah Hamzah

Universiti Malaya
Moderator: Prof Dr Rahmah Hashim
Developed by: Centre for Instructional Design and Technology

Open University Malaysia
First Edition, April 2013

Copyright © Open University Malaysia (OUM), April 2013, ABCG4103
All rights reserved. No part of this work may be reproduced in any form or by any means
without the written permission of the President, Open University Malaysia (OUM).

Table of Contents

Course Guide xi–xv
Topic 1 Global Communication 1

1.1 The Growing Impact of Media 3
1.1.1 Cultural Impact 4
1.1.2 Economic Impact 6
1.2 New World Information and Communication
Order (NWICO) 7
1.3 Media Philosophies 10
1.4 Developmental Communication 12
1.5 The Economic Growth Model 13
1.6 The Research Tradition 16
1.7 Electronic Colonialism Theory (ECT) 19
1.8 World System Theory 20
1.9 The Connection: Electronic Colonialism and World
System Theory 21
Summary 21
Key Terms 22
References 22
Topic 2 American Multimedia Giants 24

2.1 Overview 25
2.2 Time Warner 26
2.2.1 History 26
2.2.2 Businesses 27
2.3 Disney 29
2.3.1 History 30
2.3.2 Businesses 30
2.4 Viacom 32
2.4.1 History 32
2.4.2 Businesses 32
2.5 News Corporation 34
2.5.1 History 34
2.5.2 Businesses 35

iv  TABLE OF CONTENTS
2.6 General Electric 38

2.6.1 History 38
2.6.2 Businesses 39
2.7 Dow Jones & Company 42
2.7.1 History 42
2.7.2 Businesses 43
2.8 Gannett Company 44
2.8.1 History 44
2.8.2 Businesses 45
2.9 Walmart 47
2.9.1 History 48
2.9.2 Businesses 48
Summary 49
Key Terms 49
References 50
Topic 3 Non-US Stakeholders of Global Communication System 51

3.1 Cultural Imperialism 52
3.2 The United States of Europe (USE) 55
3.2.1 Media Companies in the United States of Europe 56
3.2.2 European Media Companies Broadcasting in Other
European Countries 62
3.3 Other Foreign-based Multimedia Corporations 63
3.3.1 Latin America 64
3.3.2 China 65
3.4 Bollywood: IndiaÊs Film Industry 65
Summary 67
Key Terms 67
References 67
Topic 4 Global Issues, Music and MTV 69

4.1 Global Television 69
4.1.1 Early Television 70
4.1.2 British Television Broadcasting 71
4.1.3 Electronic Invasion and Media Imperialism 72
4.1.4 Americanisation and Global Television 73
4.1.5 Geocultural Television Markets 76

TABLE OF CONTENTS  v
4.2 The International Music Industry 80

4.3 MTV: The Dominant Global Music Connection 82
Summary 84
Key Terms 85
References 85
Topic 5 CNN and Other International News Channels 87

5.1 Overview 90
5.1.1 Roles and Aims of International News Channels 90
5.1.2 Global Competition 92
5.2 CNN 94
5.2.1 CNN: Pioneer in Rolling News Format and
International TV News 95
5.2.2 Impact of International News Channels and the
„CNN Effect‰ 96
5.3 BBC World News 97
5.4 Fox News and Sky News 99
5.5 Al Jazeera English 99
5.6 Regional News Channels 100
5.6.1 Europe 101
5.6.2 Asia 102
Summary 103
Key Terms 103
References 104
Topic 6 Role of Global News Agencies 106

6.1 Reuters 108
6.2 The Associated Press 110
6.3 United Press International 111
6.4 Agence France-Presse 112
6.5 Bloomberg 112
6.6 Dow Jones and Company 114
6.7 Xinhua 115
6.8 Inter Press Service 116
Summary 118
Key Terms 118
References 119

vi  TABLE OF CONTENTS
Topic 7 Media in the Middle East and North Africa 120

7.1 Liberal-Democratic Press 121
7.2 The Nature of Arab News 122
7.3 Transnational Newspaper Publishing 123
7.4 Transnational Braodcasting 127
7.4.1 Middle East Broadcasting Centre (MBC) 128
7.4.2 Egyptian Radio and Television Union (ERTU) 128
7.4.3 Al-Jazeera 129
7.4.4 Dubai Media City (DMC) 130
7.5 Advertising and Public Relations 131
Summary 133
Key Terms 133
References 133
Topic 8 Role of Global Advertising Agencies 134

8.1 Omnicom Group Inc 135
8.2 WPP Group 137
8.3 Interpublic Group of Companies 139
8.4 Dentsu Inc 141
8.5 Publicis Group 143
8.6 Havas Advertising 145
Summary 147
Key Terms 147
References 148
Topic 9 Global Telecommunication Systems 149

9.1 International Telecommunications Union (ITU) 150
9.1.1 The History of ITU 151
9.1.2 The Maitland Commission 152
9.1.3 ITUÊs Changing Roles and Expectations 154
9.2 International Telecommunications Satellite Organisations
(INTELSAT) 156
9.2.1 The History of Intelsat 156
9.2.2 Intelsat Competition 157
9.3 World Trade Organisation (WTO) 159
9.3.1 Trade versus Culture 160
9.3.2 WTO and Intellectual Property Rights 161
9.4 Organisation for Economic Co-operation and
Development (OECD) 162
Summary 164
Key Terms 164
References 165

TABLE OF CONTENTS  vii
Topic 10 Internet: The New Frontier 166

10.1 World Wide Web 167
10.2 Internet Timeline 169
10.3 Impact of the Internet 171
10.4 The Internet and Global Television Issues 172
10.5 The Internet and Hollywood Films 173
10.6 Internet Users 173
10.6.1 Internet Usage in Asia Pacific 175
10.6.2 Social Media Usage 176
10.7 Computer Viruses 178
10.8 Blogging 180
10.8.1 What is a Blog? 180
10.8.2 Blog Usage 182
Summary 182
Key Terms 183
References 183

viii  TABLE OF CONTENTS

COURSE GUIDE

COURSE GUIDE DESCRIPTION
You must read this Course Guide carefully from the beginning to the end. It tells
you briefly what the course is about and how you can work your way through
the course material. It also suggests the amount of time you are likely to spend in
order to complete the course successfully. Please keep on referring to Course
Guide as you go through the course material as it will help you to clarify
important study components or points that you might miss or overlook.
INTRODUCTION
ABCG4103 Global Communication is one of the courses offered by the Faculty of
Applied and Social Sciences at Open University Malaysia (OUM). This is a three
credits course and should be covered over 8 to 15 weeks.
COURSE AUDIENCE
This course is offered to all students taking the Bachelor of Communication
programme. This module aims to impart the fundamentals of global
communication and the main players in communication media landscape. This
module should be able to provide a strong knowledge base and critical thinking
in the dynamics of the global communication scene.
As an open and distance learner, you should be able to learn independently and
optimise the learning modes and environment available to you. Before you begin
this course, please ensure that you have the right course materials, understand
the course requirements, as well as know how the course is conducted.
STUDY SCHEDULE
It is a standard OUM practice that learners accumulate 40 study hours for every
credit hour. As such, for a three-credit hour course, you are expected to spend
120 study hours. Table 1 gives an estimation of how the 120 study hours could be
accumulated.

xii  COURSE GUIDE
Table 1: Estimation of Time Accumulation of Study Hours

STUDY
STUDY ACTIVITIES
HOURS
Briefly go through the course content and participate in initial
3
discussions
Study the module 60
Attend 3 to 5 tutorial sessions 10
Online Participation 12
Revision 15
Assignment(s), Test(s) and Examination(s) 20
TOTAL STUDY HOURS 120
COURSE OUTCOMES
By the end of this course, you should be able to:
1. Provide knowledge and understanding of complex global communication;
2. Explain the implications of changes to the worldwide media landscape;
3. Explain the impact of global media expansion on the communication
industry and less-developed nations;
4. Discuss the issues that arise from emergence of global broadcasting, global
advertising and global journalism; and
5. Identify media conglomerates that control the global media system.
COURSE SYNOPSIS
This course is divided into 10 topics. The synopsis for each topic can be listed as
follows:
Topic 1 introduces the main aspects in global communication. The topic focuses
more on the developments of globalisation and its implications on global
communication. Therefore, some related model and theory will be discussed in
this topic in order to increase the understanding of the global communication
landscape.

COURSE GUIDE  xiii
Topic 2 discusses the major US media conglomerates that dominate global media
and global media-related markets. Some of the selected global media are Time
Warner, Disney, Viacom, News Corporation, General Electric, Dow Jones &
Company, Gannet Company and Walmart.
Topic 3 discusses the role of non-US stakeholders in world culture and creative
economy. European countries, Bollywood domination in the Indian film
industry, and other non-Western groups of multimedia corporation will be
examined in terms of their operations and their influence on the cultural industry
of the world.
Topic 4 examines some key issues in the globalisation of communication media.

The focus is more on the development of global television and music industries
as well as their impact on the local culture.
Topic 5 features an introductory discussion on international news channels. The

discussion emphasises the role of CNN as a major player and its competitors
such as BBC, CNA and VOA in the international news broadcasting sphere.
Topic 6 discusses the role of main news agencies at the international level.
Among them are Reuters, AP, UPI, AFP, Bloomberg and Xinhua that are
recognised as worldwide news sources or providers.
Topic 7 focuses on the development of Arab media in the Middle East and North
Africa and track the changes from traditional and heavily controlled entities to
one that is currently undergoing rapid modernisation. It also covers the history
of this new openness, heralding a new beginning for the media in the region.
Topic 8 examines the major global advertising agencies and their development at
the international level. This topic discusses the history and activities of Omnicom
Group, WPP Group, Interpublic Group of Companies, Dentsu Inc and the
Publicis Group.
Topic 9 focuses on major stakeholders in the evaluation of telecommunication

infrastructure such as ITU, Intelsat and WTO. It covers their role and their
importance in the global communication scene as well as the issues that have
been raised about their roles in the international level.
Topic 10 focuses on the Internet and its usage as one of the communication media
in information and communication technology era. This topic discusses the
history of this new media and its communication method as well as its impact on
the media and communication industry.

xiv  COURSE GUIDE
TEXT ARRANGEMENT GUIDE

Before you go through this module, it is important that you note the text
arrangement. Understanding the text arrangement will help you to organise your
study of this course in a more objective and effective way. Generally, the text
arrangement for each topic is as follows:
Learning Outcomes: This section refers to what you should achieve after you
have completely covered a topic. As you go through each topic, you should
frequently refer to these learning outcomes. By doing this, you can continuously
gauge your understanding of the topic.
Self-Check: This component of the module is inserted at strategic locations

throughout the module. It may be inserted after one sub-section or a few sub-
sections. It usually comes in the form of a question. When you come across this
component, try to reflect on what you have already learnt thus far. By attempting
to answer the question, you should be able to gauge how well you have
understood the sub-section(s). Most of the time, the answers to the questions can
be found directly from the module itself.
Activity: Like Self-Check, the Activity component is also placed at various

locations or junctures throughout the module. This component may require you to
solve questions, explore short case studies, or conduct an observation or research.
It may even require you to evaluate a given scenario. When you come across an
Activity, you should try to reflect on what you have gathered from the module and
apply it to real situations. You should, at the same time, engage yourself in higher
order thinking where you might be required to analyse, synthesise and evaluate
instead of only having to recall and define.
Summary: You will find this component at the end of each topic. This component
helps you to recap the whole topic. By going through the summary, you should
be able to gauge your knowledge retention level. Should you find points in the
summary that you do not fully understand, it would be a good idea for you to
revisit the details in the module.
Key Terms: This component can be found at the end of each topic. You should go
through this component to remind yourself of important terms or jargon used
throughout the module. Should you find terms here that you are not able to
explain, you should look for the terms in the module.
References: The References section is where a list of relevant and useful

textbooks, journals, articles, electronic contents or sources can be found. The list
can appear in a few locations such as in the Course Guide (at the References

COURSE GUIDE  xv
section), at the end of every topic or at the back of the module. You are
encouraged to read or refer to the suggested sources to obtain the additional
information needed and to enhance your overall understanding of the course.
PRIOR KNOWLEDGE
No prerequisite is required for this course.
ASSESSMENT METHOD
Please refer to myINSPIRE.
REFERENCES
Albarran, A. B. (2002). Media economics: Understanding markets, industries and
concepts (2nd ed.). Ames: Iowa State University Press.
McPhail, T. L. (2011). Global communication: Theories, stakeholders and trends.

New York: Blackwell Publishing.
Paterson, C., & Sreberny, A. (2004). International news in the 21st century. John
Libbey Pub.
Tehranian, M. (1999). Global communication and world politics: Domination,

development and discourse. London: Lynne Reiner.
Thussu, D. K. (Ed.). (2010). International communication: A reader. Milton Park;

New York: Routledge.
TAN SRI DR ABDULLAH SANUSI (TSDAS)

DIGITAL LIBRARY
The TSDAS Digital Library has a wide range of print and online resources for
the use of its learners. This comprehensive digital library, which is accessible
through the OUM portal, provides access to more than 30 online databases
comprising e-journals, e-theses, e-books and more. Examples of databases
available are EBSCOhost, ProQuest, SpringerLink, Books247, InfoSci Books,
Emerald Management Plus and Ebrary Electronic Books. As an OUM learner,
you are encouraged to make full use of the resources available through this
library.

xxvi X COURSE ASSIGNMENT GUIDE

Topic  Global
1 Communication
LEARNING OUTCOMES
By the end of this topic, you should be able to:
1. Identify the technological, economic, political and cultural effects of
global communication at the turn of the 21st century;
2. Explain the different trajectories of development of global
communication; and
3. Describe the world systems theory and its connection with electronic
colonialism.
 INTRODUCTION
Any discussion on the state of international mass communication would
eventually settle upon the key developments of globalisation and its implications
on global communication. As students of global communication, you need to
understand the way in which media is affected by globalisation and
internationalisation, its impact on society as witnessed in excessive consumption
and materialism, extremism, intolerance and ultra-nationalism.
Other issues in global media and communication include media concentration or

conglomeration, e-colonialism, consumerism and materialism. There are many
different ways to define globalisation. Scholars, civic groups and journalists may
have their own conceptualisations which could confuse students who have
difficulty understanding and accepting one layer of interpretation.

2  TOPIC 1 GLOBAL COMMUNICATION
However, one definition that is easily accepted by all is by a well-known writer,

editor and New York Times journalist, Thomas L. Friedman, (February 1997)
who defined globalisation as:
⁄ the integration of financial, information and trade networks to create a

single high-speed global marketplace.
McKenzie (2006) defined it as:
⁄ a kind of worldwide climate in which people, industries, governments, and

countries across the world are being propelled into closer political, economic
and cultural unions.
Herman and McChesney in McKenzie (2006) described it as:
⁄ a corporate profit-making initiative that is reaching beyond domestic

markets to fertile foreign markets in order to secure cheaper labour pools and
raw materials, and new consumers for existing and yet-to-be-developed
products and services.
British sociologist, Giddens (1999), linked it to the cultural and political

dimension in his emphasis that it is:
⁄ a fundamental mistake to conceptualise globalisation in purely economic

terms because globalisation, I think is fundamentally social, cultural and
political ⁄
Giddens stressed the sociological interpretation of globalisation as the spread of

cultural modernity.

TOPIC 1 GLOBAL COMMUNICATION  3
In the field of international media studies, the ideas really point to a powerful
economic tie which promote the flow of cultural products and information and
communication technology that can indoctrinate and impose values in foreign
cultural image. Thus, it is possible that a one-way flow would ultimately create a
homogeneity which takes on the form and image of the dominant producer of
ideology and technology.
1.1 THE GROWING IMPACT OF MEDIA

Media continues to play a significant role in all societies. It is present around us,
from television and radio to books and magazines that we read every day. The
Internet and new media have also begun to be soulmates to humankind, so much
so that life without the new media is unimaginable and impossible.
Polemics on the debate about the flood of information and media content from
diverse sources into national communities remains a contested issue. There has
always been concern about the one-way flow from the rich media of the North to
the poor media of the South, especially to communities that are geographically
isolated. There is a fear that some communities in Myanmar, Afghanistan and
other remote areas of the globe would be on the receiving end of endless flow of
foreign content that would diminish the importance of their own indigenous
cultural forms and content. Instead of being enriched by their own cultural
values, these remote societies are on the receiving end of foreign cultural content.
Canadian media theorist, Marshall McLuhan (1911–1980), had already spoken as

far back as 1969 about the revolutionary impact of the media on society. The
principle of technological innovations generated such a tremendous impact upon
man and society beginning directly from the explosion of the print technology of
the 16th century. The printing technology initiated the dissemination of mass
produced books and every form of print media to the reading literate. It was in
such contexts that McLuhan spoke of the beginning of the retribalisation of
society and the decentralisation of information.

1.1.1 Cultural Impact

In the late 1960s and 1970s there also emerged a new thinking about how the
transnational corporations (TNCs), mainly from the North, were exerting their
influence and widening their market into the South. Schiller (1976), who was
affiliated to the University of California, had also proposed the idea that large
US-based transnational corporations together with the accompanying US
military and political groups were encroaching into the cultural autonomy of the
developing countries of the South and dumping hardware and software products
in those markets. SchillerÊs theory of cultural imperialism stated that:
The sum of the processes by which a society is brought into the modern world
system and how its dominating stratum is attracted, pressured, forced and
sometimes bribed into shaping social institutions to correspond to, or even to
promote, the values and structures of the dominant centre of the system.
(Schiller, 1976)
Thus, world media industries can affect social, political and cultural institutions
and members of society should determine the cumulative effects of the media
and observe and study such effects in order to limit the ramifications and not to
be complacent of its impact. The assumption in some quarters is that the impact
of the media on the cultural domain is perhaps more worrisome than for
example, the economic sector, the education, science and even military sector.
Another impact of international mass communication is seen in its tendency

towards concentration of corporate holdings especially in media properties
including print, broadcast and now digital, under giant moguls or international
captains of media industries. Finally, we see the movement of patterns of
ownership from media owned by many to media owned by a few, pushing for
endless profits.

Tehranian (1999) also presented the view that the impact of global
communication on the international cultural life is the most pervasive and
visible. He presented several examples of the international media impacting his
journey along the Silk Road in 1992. Madonna and Michael Jackson were
portrayed in broadcasts throughout the journey, passing through cities like
Almaty in Kazakhstan, Dushanbe in Tajikistan, Tashkent in Uzbekistan and
Teheran in Iran. Other international entertainers and media personalities
included O. J. Simpson trying to escape arrest, and preacher Jimmy Swaggart
talking in the Kazakh language.
A typical day in the life of a Malaysian viewer would be a diet of some local
programmes plus a huge selection of American programmes, Korean k-pop and
melodrama, Indonesian sinetron and other products from satellite television
programmes from Bollywood, Mollywood, Hong Kong, Taiwan and China.
Media in the developing world is critical of such domination due to the
justifiable fear of citizens being too exposed to foreign values and images,
especially ethnocentric occidental values such as an over presentation of political,
economic and other foreign values that project the superiority of the West rather
than projecting universal values.
The flow of news is still dominated by the super agencies of the West, namely,
Associated Press, Reuters, Agence France-Presse and Agencia Ife. Other
providers of video services and satellite television news are also dominated by
Visnews, Cable News Network, World International Network and Sky TV. These
agencies perpetuate an ethnocentric agenda and promote a sense of superiority
through large volumes of events in the First World which are not equally
balanced by coverage of news from the Third World.
ACTIVITY 1.1
The flow of information from North to South, which is dominated by

international news agencies, has raised a lot of concern from some
people.
Why? Discuss at least four reasons.

1.1.2 Economic Impact

Raymond Williams (1981) identified several eras in the development of cultural
production. The first era began with social relations between the original creators
of art and the patron, usually involving royal patrons and other aristocrats.
Scholars, poets and painters flourished under royal houses. Ibnu Sina is one such
example of a scholar and Sejarah Melayu is a good reference of such a patronage
system during the era of the Malay Sultanate.
The second era beginning in the 19th century, saw cultural and artistic pieces
being sold and kept in the personal collections of buyers. It marked the beginning
of creative symbols being managed as market products. Works of art began to be
sold by publishers and booksellers and middlepersons, indicating business
activity and accumulation of business dealings and profits. There was a sharing
of profits through the payment of royalties to the originators of artistic products.
By the 20th century, corporate professionals began to form a powerful base,

dealing in sales and purchase of works of creators and offering them to the
marketplace. With the development of mass production through modern
technology, the corporate world profited from the intensification of cultural
production and began to expand its business into what is now known as the
globalisation and internationalisation of cultural industries.
According to Schiller (1976), the impact of world communication on the economy

is one of the most studied subjects in academia. The emphasis is on the processes
of world production, distribution, international trade, banking and financing.
The activities of the transnational corporations have clearly shown a move
towards decentralisation of their production and distribution networks with the
objective of maximising profits. Relocation of their plants to countries with lower
wage expectations and cheaper resources is now the norm.
Some examples of developed nations looking for better markets and lower
operating costs elsewhere are as follows:
(a) Expansion of Rupert MurdochÊs Hong Kong based satellite TV network,

BSky Network, into India; and
(b) Purchase of 40% interest in ChinaÊs biggest online commercial firm,

alibaba.com, by US-based Yahoo Inc for USD1 billion.

The transnational corporations positioned themselves to be ready for emerging

marketplaces such as Latin America, China, Indonesia and India. Biagi (2010)
stated that the number of television sets had reached more than one billion, an
increase of more than 50%, in the last five years. The International Herald
Tribune also expanded to 35 locations around the globe. With a circulation of
241,000 copies, the newspaper is poised to be a major shaper of world opinion.
1.2 NEW WORLD INFORMATION AND

COMMUNICATION ORDER (NWICO)
Basically the critique against the domination of the flow of information by the
First World began to take form when developing countries started to detect a
Western bias to the flow of information circulating throughout the world. There
was fear that such domination would result in a form of cultural imperialism by
the West on the developing world and would negatively impact the economy,
polity and society of developing countries.
A majority of the international news agencies are located in the West. The Big Five
in Europe include Reuters and The Associated Press in United Kingdom, Agence
France-Presse (AFP) in France, Deutsche-Presse-Agentur in Germany and
AgenciaEfe in Spain. A monopoly by these agencies has created a situation of
dependency which has led to inequality between countries in the North and
countries in the South. News flow from the West is not balanced with the flow
from the developing world resulting in large volumes of information about the
West, eclipsing the number of reports from the developing world.
During the Cold War, it became obvious that the flow of information was a
highly contested area in global affairs. Both sides, namely, the American and the
Soviets, fought to ideologically capture the hearts and minds of the world. The
West was fearful of the Soviet agenda and became concerned about controlling
economic, cultural and political influence.

To counter the exploitative nature of the Western media, critics and leaders from
the Third World began a movement known as the New World Information and
Communication Order (NWICO). The group was led by Tunisian Information
Minister, Mustapha Masmoudi. The United Nations Educational, Scientific and
Communication Organisation (UNESCO) actively organised conferences and
debates on the flow of news and information and global communication.
Therefore, UNESCO was the front runner of the movement and became directly
involved with NWICO. MasmoudiÊs group tabled a list of issues to be discussed
and passed, which included the following (Masmoudi, 1979):
(a) Owing to the socio-technological imbalance, there was a one-way flow of

information from the centre to the periphery, which created a wide gap
between the haves and the have nots;
(b) The information rich dictated terms to the information poor, thus creating a
structure of dependency with widespread economic, political and social
ramifications for poor societies;
(c) This vertical flow (as opposed to a desirable horizontal flow of global
information) was dominated by Western-based transnational corporations;
(d) Information was created by transnational media as a commodity and

subjected to the rules of the market; and
(e) The entire information and communication order was a part of, and in turn
propped up, international inequality that created and sustained mechanisms
of neo-colonialism.
There were other scholars who supported MasmoudiÊs view that the imbalances
were grossly unfair to developing countries, creating a de facto hegemony and a
will to dominate. Operating through the Non-Aligned Movement, the NWICO
held a number of meetings, mainly in Algiers in 1973 and Tunis in 1976. Finally
in 1978, UNESCO adopted the 1978 Mass Media Declaration during the General
Conference of UNESCO expressing support for the principles of self-reliant
communications and self-determination for countries in establishing the role of
the mass media in development.

UNESCO formed The International Commission for the Study of

Communication Problems and appointed a statesman from Ireland, Sean
MacBride, as chairperson. The Commission had a membership of 16 from
UNESCO members including from the USA, France, Zaire, Canada and
Indonesia. The Commission published the MacBride Report in 1980 which
included amongst others, 82 ways to help achieve the NWICO. Some of the
resolutions proposed (UNESCO, 1980) are as follows:
(a) Elimination of the imbalance and inequalities which characterise the

present situation;
(b) Elimination of the negative effects of certain monopolists, public or private,

and excessive concentrations;
(c) Removal of the internal and external obstacles to a free flow and wider and
better balanced dissemination of information and ideas;
(d) Plurality of sources and channels of information;
(e) The freedom of journalists and all professionals in the communication

media, a freedom inseparable from responsibility;
(f) The capacity of developing countries to achieve improvement of their own

situations, notably by providing their own equipment, training their
personnel, improving their infrastructures and making their information
and communication media suitable to their needs and aspirations, and the
sincere will of developed countries to help them attain their objectives;
(g) Respect for each cultural identity and for the rights of each nation to inform
the world about its interests, its aspirations and its social and cultural
values;
(h) Respect for the right of all people to participate in international exchange of
information on the basis of equality, justice and mutual benefit; and
(i) Respect for the right of the public, of ethnic and social groups and of
individuals to have access to information sources and to participate actively
in the communication process.

The United States led strong opposition to the proposal and hinted at the
presence of the Soviet Union amongst the group of Third World countries
pushing the issue as part of the Cold War between the US and Soviet Union.
Claiming that the MacBride Report was against the spirit of free and liberal
media of the Western world, the opponents of NWICO also charged that it was a
ruse by Third Word leaders and dictators to impose stringent controls on the
media and to inhibit the presence of foreign journalists in their countries.
The report was finally submitted to the 31st General Conference Session of
UNESCO held in Belgrade, Yugoslavia, in 1980. The Belgrade conference passed
the resolution of NWICO. However, in 1983, the Reagan government in
Washington withdrew its USD50 million financial support for UNESCO. Since
USA was the biggest financial contributor, its withdrawal was a major setback for
UNESCO. President Reagan had initiated a new phase in the Cold War and
Washington remained steadfast in its opposition to any move taken to give
control of the mass media to Southern governments. Therefore, citing opposition
to the MacBride Commission, the US withdrew from UNESCO in 1985. The
Thatcher government of Britain, a Reagan ally, followed in 1986, confirming the
ideological shift of the Reagan-Thatcher era of right-wing governments in the
1980s.
The NWICO, therefore, remained a theoretical idea, to be studied and discussed

by scholars and students of media and communication and international and
strategic studies.
1.3 MEDIA PHILOSOPHIES

Media scholars have long observed that certain media policies of certain
countries are governed according to the philosophical framework that guides
and influences the operations of their media systems. The elements of the
framework depend upon the structure that operates the system. Therefore,
elements of the media system may be similar to the root system of a tree which
supplies all the needed nutrients that would reflect the particular cultural
environment. In other words, different countries are governed by different
philosophies of their media system (McKenzie, 2006). Ideas about the media and
society could be traced back to the 18th century philosopher, Dr Samuel Johnson,
who spoke about the need of society to ensure security and public order:

Every society has a right to preserve public peace and order, and therefore has
a good right to prohibit the propagations which have a dangerous tendency.
There is a vast body of research in international media studies on the subject of

media systems of the world which began since 1956 with the publication of the
significant seminal work of Siebert, Peterson and Schramm entitled Four
Theories of the Press. This book looked into the various systems of the press at
the time and the overall purpose of the media.
These legacies may be traced back over decades and centuries and were
developed according to Western philosophies based on their historical, political
and cultural environments. The legacy philosophies were followed by two
contemporary philosophies in order to meet new demands of evolving societies
from outside the Western moulds. The contemporary philosophies added to
describe todayÊs mass media are the Developmental and Democratic Participant
theories. McQuail (1983) referred to these as the normative theories of media
purposes which are also related to the way the state manages the transmission of
information, comment and expression.
Discussions about the development of non-Western traditions would often slip

into how different cultural traditions tend to contradict the Western concept of
media freedom and democracy. One such example would be the discussion on
the contemporary philosophy which spells out the principles of what constitutes
the developmental philosophy of the press.
ACTIVITY 1.2
The four theories mentioned earlier are also referred to as the Legacy
Philosophies of the press such as the following:
(a) Authoritarian
(b) Libertarian
(c) Communist
(d) Social Responsibility

With a coursemate, look up these theories and explain each of them.

1.4 DEVELOPMENTAL COMMUNICATION

The philosophy of developmental communication, or also referred to as Third
World theory, focuses on the issue that the media in the developing world need
to focus on improving the social conditions of the developing world. The debates
on this philosophy may be traced back to communication debates in UNESCO in
the 1970s. The voices of the developing, less developed or poor nations began to
be heard in crescendos, culminating in the report by Sean MacBride, Many
Voices, One World (1980), published by UNESCO. Some scholars have also
written on the subject such as Mass Media and National Development by Wilbur
Schramm (1984) and Agents of Power (1984) by J. H. Altschull.
According to Hachten (1992), its main principles are as follows:
(a) All mass communication tools should be harnessed to assist the role;
(b) Media is expected to support the government and not to challenge;
(c) Media plays social and political roles;
(d) Media reports positive news;
(e) Information should flow from top to bottom;
(f) Individual and civic freedom should remain at lower priority than issues of
illiteracy; and
(g) Media should cover poverty, ethnicity and health issues.
The governments that subscribe to this system are reminded that this philosophy
should be guided by two other emphases. The first is that the media serve as a
watchdog which monitors the activities of governments in building major
infrastructures such as roads, bridges, health care and supplies of basic
amenities. The main goal should be the well-being of the citizens. This also
means that government policies and the media should promote schooling in
remote areas, population planning and birth control. The second emphasis is that
the media should promote cultural autonomy which is really important for
countries that are open to flows of foreign media products. The media should
ensure that local content can be easily accessed by the indigenous population.

Malaysia as a developing nation is also cognisant of its colonial legacy. After

gaining independence in 1957, much of the governmentÊs attention was on
managing a society with different ethnic groups, religions and cultures. Thus,
development plans in Malaysia were often drawn up with the objectives of
maintaining political stability and managing the divisive nature of the
heterogeneous society. Throughout the 1990s and well into the millennium,
Malaysia charted impressive progress in transforming the structure of the
economy and maintaining the peaceful co-existence of the multiracial population
(Azizah, 2009). On top of that, the Malaysian government is constantly
challenged by the need to balance both religious and secular perspectives and
nurture a society which respected constitutional monarchy and parliamentary
democracy.
1.5 THE ECONOMIC GROWTH MODEL

Students of media and communication studies are often reminded about how the
study of media and communication often borrows principles, concepts and
methods of research from other disciplines such as economics, language and
literature, law, psychology and sociology. In this particular instance, the study of
media development and industry, which is also referred to as media economics,
is closely linked with applications of economic principles.
Albarran (2002), a well-known scholar of media economics, noted that the

development of the mass media began to attract research in the areas of
production and economic contribution in the 1950s. He cited the example of
research in the content providers as suppliers whereas consumers and
advertisers are considered as the demand side of the industry.
Central to the study of media economics is the notion that media industries
promote and contribute towards the economic growth and development of
countries. There is a vast body of research that shows that a free media promotes
growth. The same idea also proposes that a media system that is free of
government control also contributes in the long-term towards political stability
which then propels further economic growth. In this growth model there is an
equation model which proposes that media freedom promotes socio-political
stability which contributes towards a better climate of investment.

World-renowned scholar, Stiglitz (2002), reiterated that economic growth will

only occur when governments enforce the existence of free media which allows
for free flow of information, which also shows government transparency and
accountability.
The Media Industry as a Catalyst for Economic Growth

We have seen the revolution in the information and communication technology
sector which provides us all with state-of-the-art equipment and media content
such as digital television programmes, digital printing and cross media. We have
seen countries like Japan and Korea develop their creative content industries,
driving them into becoming major soft power exporters to the global
marketplace. The Asian tigers of Japan, Korea, Hong Kong and Taiwan have
growth models that are based on their capabilities to produce vast exports of
media content such as films, dramas and documentaries. The Korean Hallyu
(Wave) is a good example of economic growth of the content industry. Beginning
from the 1990s, Korea became an exporter of media products to Asia reaching as
far as Europe and America.
Cunningham, Banks and Potts (2008), in their paper for the WIPO Conference of
2007, reminded participants about how the culture and creativity industry may
be looked upon as supporters of economic growth and development. They also
stated that the cultural industries may be analysed in the context of four models
of culture and the economy. They are the welfare model, competitive model,
innovation model and growth model. The economic growth model is directly
applicable to the discussion on the growth of the creative industries, the major
contributor to the overall growth of the economy now.
In Asia, Europe and America, the creative industries are positively looked upon
as the growth driver due to the ability of the industry to contribute to new
creation of wealth and value. The creative industry is associated with the rise of
the global market economy. For example, beginning from the 1990s, Korea
became an exporter of media products to Asia and reaching as far as Europe and
America (see Tables 1.1 and 1.2).

Table 1.1: Creative Goods: Exports, by Economic Group, 2002 and 2008 (in millions of $)
Developed Developing Transition

World
Economies Economies Economies
2002 2008 2002 2008 2002 2008 2002 2008
All Creative 204,948 406,992 127,903 227,103 76,836 176,211 1,210 3,678
Industries
Art Crafts 17,503 32,323 8,256 11,443 9,202 20,715 45 164
Audiovisuals 462 811 425 726 35 75 3 10
Design 114,692 241,972 60,967 117,816 53,362 122,439 362 1,716
New Media 17,365 27,754 11,422 13,248 5,908 14,423 36 82
Performing Arts 9,689 26,136 8,947 22,539 698 3,323 43 274
Publishing 29,817 48,266 25,970 38,753 3,157 8,138 690 1,376
Visual Arts 15,421 29,730 11,916 22,578 3,474 7,097 31 56
Source: UNCTAD, based on official data in UN COMTRADE database
Table 1.2: Creative Goods: Imports, by Economic Group, 2002 and 2008 (in millions of $)
Developed Developing Transition

World
Economies Economies Economies
2002 2008 2002 2008 2002 2008 2002 2008
All Creative 225,590 420,783 187,170 317,058 36,692 93,721 1,728 10,003
Industries
Art Crafts 20,341 29,272 15,336 20,836 4,858 7,641 147 795
Audiovisuals 411 699 326 483 83 181 2 34
Design 129,232 248,358 106,388 185,810 21,905 56,376 939 6,172
New Media 17,681 36,361 14,519 26,878 3,031 9,064 132 420
Performing Arts 11,134 28,022 9,651 22,241 1,421 5,322 61 458
Publishing 29,633 49,107 25,166 36,351 4,068 10,915 399 1,841
Visual Arts 17,158 28,964 15,784 24,460 1,327 4,222 48 282
Source: UNCTAD, based on official data in UN COMTRADE database

ACTIVITY 1.3
What does the term „creative industries‰ mean? The Malaysian

Ministry of Information, Communication and Culture introduced the
National Creative Industries Policy in 2011. How is this policy
important to the nationÊs creative industries?
1.6 THE RESEARCH TRADITION

Students of media and communication studies need to be active researchers in
the study of the media to better understand the subject matter. Watson (1998)
spoke about research as exploration and as agents of change. Biagi (2010) states
that media research is like other social science research which is a continuum of
thought, each exploration and finding bringing new advances and insights.
Media students need to know of one important research area that was conducted
by the renowned media scholar Marshall McLuhan in the 1960s. He looked into
the question of television viewing and introduced the famous line „the medium
is the message‰ which he later linked to the title of his book, The Medium is the
Message. He discussed the increasing importance of television studies and noted
the effects of retribalisation which led to the creation of another of his famous
terms, the „global village‰, in the context of global communication.
ACTIVITY 1.4
McLuhanÊs technologically deterministic view of communication

presented the notion of the social effect of media on different global
societies and cultures (McLuhan, 1965). His opinion about global
television brought forth the idea of the „global village‰ pushed by the
development and expansion of direct satellite broadcasting in the 1980s,
and by the Internet in the 1990s.
What is „global village‰? With your coursemates, discuss and give
real-life examples.
The current tradition of scholarship in the media looks at the patterns of media
effects and media content, especially impact studies on various audiences. One
example is the application of the Lasswell model to study the media impact of
radio, television and newspapers. Figure 1.1 provides a visual presentation of the
various evaluation methods in dealing with audiences.


Figure 1.1: Measuring audience
Source: Vivian (2011)

Figure 1.2 depicts the Lasswell model in analysing the communication process.
These types of research rely heavily on the quantitative approaches which need
to be empirically tested and validated.

Figure 1.2: Lasswell model
Source: Biagi (2010)
There is also an active body of research in media scholarship which is more

attentive towards the economics of the media industry. For example, Miller and
Gandy (1991) reported that since the last few decades, media economics has
become a field of research that contributed to an increasing number of articles on
media economics for media and communication journals such as the Journal of
Broadcasting and Electronic Media, Journalism and Mass Communication
Quarterly and the Journal of Communication.
Media economics research is reflective of growing media industries all over the
world and looks into the application of economic theories and uses such
conceptual frameworks to analyse key production, marketing and market
performance. If we track this particular development we can see that early
studies looked into microeconomic concepts such as structure of ownership,
concentration and competition of the newspaper industries, radio and the
television industries. Albarran (2002) too noted that media research has again
focused on the macroeconomics of the industry, thus research topics such as
economic growth, employment, aggregate production, consumerism, inflation
and political economy remained popular research areas.

Of course, the topic of globalisation is also a challenge for media researchers. The
competition for the global marketplace means that researchers would be looking
into international television programming, sales and rentals of film and music
downloads. The presence of transglobal businesses means that researchers need
to look into global financial data and audience share in the domestic and global
marketplace. Therefore, global media economics is set to remain an important
section in the study of global communication. It is crucial to keep abreast of
economic issues in the media industries so that its contribution to society is
monitored and assessed.
1.7 ELECTRONIC COLONIALISM THEORY (ECT)

We have seen that technological advancements have deepened the gap between
the haves and the have-nots and the central zone entities had obvious influence
on most aspects of the semi-periphery and peripheral zones of the world. Thus, it
is a foregone conclusion that there is manipulation of the flow of information and
supply of knowledge of goods and services. This theoretical framework formed
the basis of Electronic Colonialism Theory (ECT). This framework is attributed to
Thomas L. McPhail, especially his writings in Global Communication: Theories,
Stakeholders and Trends (2002). This theory deals with the issues pertaining to
the uneven flow of information and news from the rich centre to the peripheries,
depriving the Third World of vital knowledge and data.
McPhail was associated with the Canadian media scholar McLuhan. It was while
he was attached with UNESCO that McPhail was commissioned by Sage to write
about electronic colonialism, specifically on the impact of the deluge of Western
images on the non-Western world. The title was cognisant of the earlier
colonialist tendencies of the Western world to colonise foreign lands and exploit
the raw resources for the sake of the empire. Except that now, the West is after
new marketplaces and new consumers for their electronic products, which are
now packaged nicely into high quality digital form.
The ECT is also reminiscent of the transformation of hard power status of

Western countries who export hard power products such as technology and
military hardware to the former colonies, into soft power Western nations
exporting mind products in order to capture the imagination of the South;
„getting others to want the outcomes that you want‰ (Nye & Owens, 1996). This
is the main argument of the electronic colonialism theory, that the mass media
and Internet are the new empire builders, acquiring new markets and minds by
selling soft power. In return, the new electronic empires subjugate the minds,
attitudes, values and languages of the people.

1.8 WORLD SYSTEM THEORY

According to Tehranian (1999), the concept of a world system refers to the
pattern of global economic development which began in the 16th century. This
opinion is in line with that of another theorist of the world system, Immanuel
Wallerstein, who also stressed that modern world history should be seen as the
history of capitalism as a world system (Viotti & Kauppi, 1993). Wallerstein
started his writings on the world system by analysing the emergence of
capitalism in Europe which eventually developed into a capitalist world system
that is classified into three types:
(a) Core;
(b) Periphery; and
(c) Semi-periphery.
Students of world mass communication should understand the world system as

the world being divided into three types of country groupings, the core, the
peripheries and semi-peripheries. Wallerstein reiterated that the expansion of the
global economy began with a small grouping of core countries which spread to
the two other peripheral and semi-peripheral zones. The peripheral and semi-
peripheral zones are represented by the so-called less developed countries
(LDCs). The core countries are typified as countries that have a long history of
engagement with advanced economic activities such as banking, manufacturing,
and now the technologically savvy countries. Countries in the core zones are now
part of the informatics imperialism as knowledge generating industries operating
as transnational corporations (TNCs) and media conglomerates or transnational
media corporations (TMCs), international government organisations (IGOs) or
non-governmental organisations (NGOs).
The peripheral countries are forced to sell products at very cheap rates but in
return they have to buy back manufactured products from the core countries at
relatively higher prices. Thus, there is an element of exploitation because rich
resources flow from the peripheries to the core without the subsequent balance in
economic growth.
In the current classification, the core zone nations would include United States of
America, the European Union, Canada, Australia and Japan. The peripheral
zones are countries such as a large part of the African continent, Latin America
and a large part of Asia. The semi-peripherals would be represented by countries
such as Austria, Brazil, China, Finland, Sweden, South Korea, Singapore, India,
Argentina, Mexico and Egypt.

Therefore as a summation, the world system talks about the concept of core
countries versus peripheral nations, the age old notion of weak and powerful
nations. The technological advancement and manufacturing of sophisticated and
complex products of the core West and the peripherals of the poor and
developing South with the raw resources, agricultural produce and cheap labour.
1.9 THE CONNECTION: ELECTRONIC

COLONIALISM AND WORLD SYSTEM
THEORY
These two theories are similar in the sense that both discuss the imbalances in the
geo-politics and media systems of the world. WallersteinÊs theory of the world
system can be traced back to the early history of the European voyages in search
of new territories to position their control over the new found lands. These
voyages enrich and empower their positions in Europe and the world
culminating in a continuous stronghold over trade in hard power and soft power
of ideology and influence to this day. An important element of the world system
is the classification of the world territories into the three zones:
(a) The core zone of developed Western countries;
(b) The South undeveloped countries; and
(c) The middle zone of newly developing countries.
McPhailÊs electronic colonialism also looks into the abject state of the countries
caught in the perennial trap of the vicious cycle of trade and information
imbalances that continues unchecked. The two theories are remarkable in sharing
the paradigm of media dependency of developing countries and highlighting the
reliance of a one flow information system and global news in the Western
perspective.
 We can see that globalisation, media conglomeration, electronic colonialism,

media imperialism, super consumption and materialism are the major
manifestations of the current state of global mass communication.
 The major players are jostling for top positions to be in control of production,
dissemination and influence over the global marketplace. Economic returns,
ideological and political dominance remain the core objectives of
international corporate powers.

Electronic Colonialism Theory (ECT) Media conglomerate

Globalisation Peripheral nations
Internationalisation World system
Albarran, A. B. (2002). Media economics: Understanding markets, industries and

concepts (2nd ed.). Ames: Iowa State University Press.
Altschull, J. H. (1984). Agents of power: Media and public policy. USA:

Longman.
Azizah Hamzah. (2009). MalaysiaÊs role in national development: Media policy

and national stability. Malaysian Journal of Media Studies, 11(1), 49–57.
Biagi, S. (2010). Media impact: An introduction to mass media (9th ed.).

Sacramento: California State University.
Cunningham, S., Banks, J., & Potts, J. (2008). In Anheir, H., and Isar, R., (eds).
Cultural economy. London: Sage.
Giddens, A. (1999). The DirectorÊs Lectures: „Runaway World: The Reith

Lectures Revisited‰. Lecture No 1:10, November.
Hachten, W. A. (1992). The world news prism. Ames: Iowa State University
Press.
Herman, E. S., & McChesny, R. W. (2006). In McKenzie, R., Comparing media

from around the world. Boston: Pearson Education, Inc.
McKenzie, R. (2006). Comparing media from around the world. Boston: Pearson
Education, Inc.
McLuhan, M. (1965). Understanding media: The extensions of man. New York:

McGraw-Hill.
McPhail, T. L. (2002). Global communication: Theories, stakeholders, and trends.


McQuail, D. (1983). Mass communication theory: An introduction. UK: Sage.
Masmoudi, M. (1979). The new world information order. Journal of

Communication, 29(2), 172–179.
Miller, K. M., & Gandy, O. H. (1991). Paradigmatic drift: A bibliographic review

of the spread of economic analysis in the literature of communication.
Journalism Quarterly, 68, 663–871.
Nye, Joseph, S., Jr., & Owens, W. A. (1996). AmericaÊs information edge. Foreign
Affairs, March/April, 20–36.
Schiller, H. I. (1976). Communication and cultural domination. New York:

International Arts and Sciences Press.
Schramm, W. (1984). Mass media and national development: The role of

information in developing countries. California: Stanford University Press.
Siebert, F. S., Peterson, T., & Schramm, W. (1956). Four theories of the press.
Urbana: University of Illinois Press.
Stiglitz, J. E. (2002). Globalization and its discontents. New York: W. W. Norton &
Co.

development and discourse. London: Lynne Reiner.
UNESCO. (1980). Many voices, one world: Communication society today and
tomorrow. Paris: UNESCO.
Viotti, P. R., & Kauppi, M. K. (1993). International relations theory: Realism,

pluralism, globalism. US: Macmillan.
Vivian, J. (2011). The media of mass communication. Boston: Pearson Education,

Inc.
Wallerstein, I. (1974). The capitalist world-economy. Cambridge: Cambridge

University Press.
Watson, J. (1998). Media communication: An introduction to theory and process.

London: Macmillan Press.
Williams, R. (1981). The society of culture. Chicago: University of Chicago Press.

Topic  American
2 Multimedia
Giants
LEARNING OUTCOMES
1. Identify the main multimedia conglomerates;
2. Describe the role of American multimedia giants in the media
industry;
3. Discuss the implications of the global market of media and
communication industry.
 INTRODUCTION
The production of media products from the United States, especially audio and
visual products such as films, television shows and music, seem to dominate the
media industry around the globe. The US has one of the oldest film industries in
the world and also the largest in terms of generating revenue. Hollywood, the
first movie studio in the global film industry, was founded in 1911.
The US film and music industry led the world with 20,620 companies generating
USD95.4 billion in revenue in 2010. The US has the largest number of
multinational corporations comprising television, newspaper, cable and magazine
businesses.
In this topic, you will be introduced to the major US media companies that have
an impact on global media markets. These American media giants have
expanded through regional partnerships, international joint ventures and outright
takeovers.

TOPIC 2 AMERICAN MULTIMEDIA GIANTS  25
ACTIVITY 2.1
Multimedia ownership almost always involve giant media empires

which own everything from newspapers to TV stations to information
distribution outlets, such as bookstores and publishing houses. What
do you understand about these multimedia giants? Name a few
multimedia giants in your country.
2.1 OVERVIEW
Many American corporations are operated globally. Even though other major
global corporations seem to compete with the US such as Sony (Japan) and
Bertelsmann (Germany), US firms still control a majority of foreign sales in the
global communication market. US exports of entertainment media attained
shares in international markets in excess of 90% due to the high global interest of
their products. The sector enjoyed a trade surplus of USD11.9 billion in 2009
(selecusa.commerce.gov).
The global media leaders (McPhail, 2011) listed below are multimedia corporations
in terms of revenue and assets:
(a) Time Warner (US);
(b) Disney (US);
(c) News Corporation (US);
(d) Viacom + CBS (US);
(e) General Electric-NBC Universal (US);
(f) Sony (Japan);
(g) Berterlsmann (Germany);
(h) VNU (Netherlands);
(i) Vivendi (France); and
(j) Discovery Communications.
Many of these are US-owned with extensive market activities. These multimedia
conglomerates strategically reposition themselves as global corporations in their
expansion to movie theatres, cable systems, satellite distribution system, music and
video outlets.

26  TOPIC 2 AMERICAN MULTIMEDIA GIANTS
Some critics see the global economic activities as new colonialism or electronic
colonialism because along with their expansion, the media conglomerates bring
with them American values, history, culture and language to the world, hence
impacting upon other countriesÊ domestic media and world view.
ACTIVITY 2.2
The domination of larger conglomerates has raised a lot of criticism.

Discuss examples of this criticism with your coursemates.
2.2 TIME WARNER

Time Warner, based in New York City, is one of the global leaders in the media
and entertainment business with ownership of television networks, film and TV
entertainment and publishing. This firm was formerly two separate companies,
Time Inc and Warner Communications. Now, it owns Time Inc, New Line Cinema,
HBO, CW television Network, TheWB.com, Turner Broadcasting System, Warner
Bros. Animation, Cartoon Network Studios and Castle Rock Entertainment. In
terms of revenue, Time Warner was the worldÊs second largest media and
entertainment conglomerate in mid-2010.
2.2.1 History
Time Warner was first known as Warner Brothers in 1923. In 1972, it became
known as Warner Communications Inc. In 1975, it cooperated with American
Express, bringing along with it MTV, Nickelodeon and the Movie Channel. In
1985, the group was sold to Viacom.
In 1989, it merged with Time Inc, forming Time Warner. In October 1996, Ted
Turner acquired it through his Turner Broadcasting System, forming the second
largest cable television network.

Time Warner was purchased by AOL in January 2000 for USD164 billion and
became known as AOL Time Warner. The merger turned out to be a fiscal mess
and the stock took a big drop. The company deleted the „AOL‰ from its name in
2003 to improve the image of its core assets, and AOL became a separate
independent company on 9 December, 2009. Time Warner then established a

working relationship with CNN Chile. The Chilean nationwide terrestrial

television station has since been bought over by Time Warner's Latin American
division in August 2010.
ACTIVITY 2.3
The merger of AOL and Time Warner did not work out as hoped. With
your coursemates, discuss why the merger failed.
2.2.2 Businesses
The Time Warner Annual Report 2011 classified its business into three segments,
namely, networks, film entertainment and publishing.
(a) Networks
The network business primarily consists of a brand-aligned website and
owned by Turner Broadcasting System or Turner Networks. It is operated
by Home Box Office (HBO) and Cinemax.
Turner Networks and Home Box Office (HBO) generates revenue by

providing satellite service distributors, telephone companies, programming
to cable system operators, and other services including programming and
the sale of advertising. The advertising is mainly on a national basis in the
US and on a pan-regional or local language feed basis outside the US. HBO
generates its income in the form of DVD and Blu-ray versions of the
original programmes.
TurnerÊs network in the US consists of entertainment such as Turner Classic

Movie, TNT, Cartoon Network, TBS, truTV and Boomerang; news network,
including CNN and HLN. In 2011, Turner expanded its mobile and online
products for on request viewing from its networks and live streaming from
its CNN and HLN networks to customers.
Turner constantly develops its mobile and online products. It provides

news and entertainment programming to telephone companies, satellite
distribution services, Internet Protocol Television (IPTV) system operators,
mobile device operators, cable system operators, broadcasters and others
for delivery to households, hotels and other viewers in different countries
across the globe.

By 31 December 2011, Turner disseminated its global entertainment brands

over 70 region-specific and local-language networks and 57 networks of its
regional entertainment brands in over 200 countries across the world
(www.timewarner.com). Turner has established offices in Africa, the
United Arab Emirates, Asia (e.g. in India, Korea and Japan), the Baltic area,
Latin America, Turkey, Germany and Scandinavia.
(b) Filmed Entertainment

Warner Bros Entertainment produces and distributes television and feature
films, and other programmes and videogames, as well as home video
products. Its feature films offer a various mix of types, talent and funds,
including a number of „event‰ films each year. It created franchises with
movies like Batman, The Lord of the Rings and Harry Potter.
In 2011, Warner Bros produced 22 original films for theatre exhibition,

including The Hangover Part II, Green Lantern, Horrible Bosses, Harry
Potter and the Deathly Hollows: Part 2, and Sherlock Holmes: A Game of
Shadows. The company also circulated feature films acquired or produced
for theatrical exhibition in more than 125 international locations. Besides
producing 20 English films in the same year, Warner Bros also released
23 local language films. In the US and most major international
marketplaces, Warner Bros generally releases all films as well as DVD and
Blu-ray Disc sales, video on demand and electronic sell-through at the same
time.
Warner Bros Television Group (WBTVG) is one of the worldÊs leading

providers of television programming. It circulates programming in the US
and across the world. It provides reality-based entertainment shows,
television series and animation programmes such as Gossip Girls, The
Vampire Diaries, Nikita and The Bachelor.
(c) Publishing
The publishing business is operated by Time Inc. It also operates several
websites and book publishing. By the end of 2011, it had published
21 magazines in print in the US and over 70 magazines outside the US via
IPS media in the UK and Grupo Expansion in Mexico. This firm licenses
over 55 editions of magazines for print publication outside the US to
publishers in 25 countries and licenses digital content to digital and mobile
platform operators in over 50 countries outside the US (b2bcdn.timeinc.com).

Time Inc also publishes its magazine content in various digital devices and
platforms. As of December 31, 2011, all of Time IncÊs US magazines also
provided for tablet editions. Time Inc offers an „All Access‰ model for its
US magazines that provides a print subscription plus cross-platform digital
access to subscribers. On certain digital devices and platforms, Time Inc
offers digital-only subscriptions and single-copy issues to each of its
magazines as well. Time Inc also extended its brands by widening and
initiating free and paid apps that are accessible for download across
different digital devices and platforms, such as InStyle Hairstyle Try-On,
EWÊs Must List, People Celebrity News Tracker, SI Swimsuit and Real
Simple: To-Do List, and mobile versions of SI.com, CNNMoney.com, and
Time.com.
Time IncÊs US magazines and companion websites are organised into four
business units:
(i) Lifestyle – Health, Real Simple, Cooking Light, Southern Living, All
You and Sunset;
(ii) Style and Entertainment – InStlye, People, Essence and Entertainment
Weekly;
(iii) News – Time, Fortune and Money; and
(iv) Sports – Sport Illustrated and Golf.
This arrangement has enabled Time Inc to focus on the potency of these
products and decrease costs by concentrating on central management
products that have a demand in the marketplace.
2.3 DISNEY
The Walt Disney Company or generally known as Disney is one of AmericaÊs
multinational mass media company. It is the largest media conglomerate in the
world (McPhail, 2011) with an annual income of around USD38 billion. The
Disney headquarters is in Walt Disney Studios, California, US.
Known for products from the Walt Disney Motion Picture Group, the companyÊs
objective is „to be the leader in the American animation industry‰
(www.fundinguniverse.com). It is diversified into live-action film production,
television, radio, theatre, publishing, music and online media (www.disney.com).

2.3.1 History
The history of Disney started in 1923 with the setting up of Disney Brothers
Cartoon Studios by Walter Disney and Roy Disney. Walter Disney had the
professional vision of using animated cartoon and feature films as a major
commercial venture while his brother Roy provided the financial acumen to help
build a media giant. The venture produced global icons including widely
recognised characters like Mickey Mouse, Donald Duck, Cinderella and Snow
White. Disney Brothers Cartoon Studios was later changed to Walt Disney
Productions in 1929.
Walter Disney later built the family-oriented theme park called Disneyland in
July 1955 in South Carolina, US. The theme park attracted almost five million
people and acted as the model for all subsequent theme parks (Krasniewics,
2010). Similar theme parks were later built in California and Florida, and later
expanded internationally with Disneyland in Japan, France and China. With the
successful establishment of Disneyland, Walter Disney was listed by Time
magazine as „one of the twenty innovators who changed the world during the
twentieth century‰ (Mannheim, 2002).
2.3.2 Businesses
The Disney BrothersÊ cartoon creations such as Mickey Mouse and Donald Duck
have been regarded as popular culture icons and known worldwide by everyone.
Disney has since ventured into new territories such as becoming a hockey team,
the Mighty Ducks, the addition of Disney cable channels and Disney Music.
ACTIVITY 2.4
Disney operates five primary divisions: Media Networks, Parks and

Resorts, the Walt Disney Studios, Disney Consumer Products and
Disney Interactive Media Group. Discuss the activities of each division
and list their subsidiaries.

Beginning from 1984, Disney enjoyed enormous creative and financial

regeneration under the headship of CEO, Michael Eisner, especially in the
achievement of subsidiaries like Hollywood Pictures, Touchstone Films, Buena
Vista Distribution, The Disney Studios, Buena Vista Home Video, and The
Disney Channel.
In 1996, under EisnerÊs management, Disney took over Capital Cities/ABC, a

USD19 billion deal that improved the companyÊs stature massively. The
possession of Capital Cities/ABC gave Disney the power of broadcasting and the
capability to get better entertainment content with programming–besides the
professional sports teams, cruise ships, theme parks, and other businesses ran by
the company. In the late 1990s, the company joined cyber space and used a
concerted approach to international extension.
With assets worth USD55 billion and a market value worth around USD57
billion, the Disney Interactive Media Group was established in 2008 to create
high-quality interactive entertainment across digital media platforms, including
social and console games, blockbuster mobile, online virtual worlds, and the
Moms and Family network of websites and #1-ranked web destinations
Disney.com (www.disney.com).
Currently, the largest Disney unit is its film labels, including Disney, Buena
Vista, Touchstone, Dimension Film, Pixar, Hollywood Pictures, and Miramax
films that make films for selected ABC markets and the global market. Disney
utilises the latest technology and marketing information to raise its annual
market shares. Table 2.1 displays the profitability rates for Walt Disney Co. from
2006 to 2011.

Table 2.1: Walt Disney Co. Profitability Ratios
Oct 1, Oct 2, Oct 3, Sep 27, Sep 29, Sep 30,

2011 2010 2009 2008 2007 2006
Return on Sales
Operating profit margin 18.89% 16.96% 14.40% 19.57% 19.10% 16.03%
Net profit margin 11.76% 10.41% 9.15% 11.70% 13.20% 9.84%
Return on Investment
Return on equity (ROE) 12.86% 10.56% 9.80% 13.70% 15.24% 10.60%
Return on assets (ROA) 6.66% 5.73% 5.24% 7.08% 7.69% 5.62%
Source: Walt Disney Co. annual report

2.4 VIACOM
With a total income of about USD 14.9 billion in 2011, Viacom Inc is regarded as
the worldÊs fourth-largest media conglomerate (McPhail, 2011). Viacom, (short
for Video and Audio Communications), is owned by the National Amusement
Inc, which manages over 160 networks that reach more than 600 million people
around the world (www.viacom.com). The companyÊs interests are largely in
programming production and distribution, as well as cable television networks.
The current Viacom was formed on 31 December 2005. This firm is in the
business of motion pictures, television, online and mobile platforms in more than
160 nations and borders through its firms including BET Networks, MTV
Networks, and Paramount Pictures.
2.4.1 History
Viacom was established by the Columbia Broadcasting System (CBS) in 1970 to
meet the requirements by the US Federal Communications Commission (FCC)
excluding television networks from owning cable TV systems or from
syndicating their own programmes in the US. It officially became a separate
company when CBS sold ViacomÊs stocks to its stockholders in 1971
(www.fundinguniverse.com).
When FCC dropped the prohibition against networks owning a production

house in 1995, Viacom started to become a massive video syndication company
with a global reach through its properties such as MTV, Paramount Pictures,
King World International, United Paramount, Infinity, Simon & Schuster
publishing and hundreds of movie theatres in Canada, Europe, and South Africa.
In March 2005, Viacom publicised its intentions of splitting itself into two
business companies. A new company, the present Viacom, was built and led by
Freston which encompasses MTV Networks, BET Networks and Paramount
Pictures Corporation.
2.4.2 Businesses
Viacom eventually became an „entertainment colossus‰ and expanded its
territory through a number of mergers and acquisitions as well as strategic
coalitions and product diversification. Among them was the merger with

Blockbuster in January 1994. Viacom paid the transformation with a cost; the firm
incurred huge debts and the management faced challenges and threats as a result
of the fast-changing media industry.
However, with its capabilities of keeping costs under control, good financial
management and good resources such as syndication rights for some popular
television programmes, product line proliferation, brand name and strategic
alliance, it succeeded in facing the challenge and became an international
stakeholder in major media markets ranging from motion pictures to television,
publishing, recreation and video distribution.
Viacom Inc operation comprises six segments: television, cable networks, radio,
entertainment, outdoor and video. ViacomÊs cable networks include
Nickelodeon, MTV, Nick at Night, Showtime, and VH1, while its television
consists of UPN and CBS television networks, Paramount Television and King
World Productions. Infinity Radio holds and runs a stable of radio stations.
The entertainment segment includes publisher Simon & Schuster, Paramount

ParksÊ theme attractions, and Paramount Pictures, a producer and distributor of
motion pictures since 1912. Viacom Outdoor is involved in display advertising.
Blockbuster Inc runs and franchises video stores around the globe
(www.viacom.com). Figure 2.1 shows a list of ViacomÊs brands.
Figure 2.1: ViacomÊs brands

Source: www.viacom.com

Viacom International holds the rights to a majority of Elvis Presley films

produced for Paramount Pictures such as Blue Hawaii and King Creole. It also
has its own in-house productions made for its diverse networks including Pinky
Dinky Doo, Dora the Explorer, SpongeBob SquarePants, Invader Zim, The Fairly
OddParentsm Big Time Rush, Behind The Music and iCarly.
2.5 NEWS CORPORATION

News Corporation, or News Corp, was formed and operated by Australian-
American businessman, Rupert Murdoch, and his family members. The USD50
billion company holdings operate as one of the largest media conglomerates in
the world. News CorpÊs business includes television, film entertainment, satellite
and cable network programming, magazines, newspapers, book publishing,
digital television technology, music and online programming.
It owns 40% of the STAPLES Center, the home of the Los Angeles Lakers
basketball team and the Los Angeles Kings ice hockey team, 85% of the Fox
Entertainment Group, and major league baseball team the Los Angeles Dodgers
(McPhail, 2011). Nearly 75% of the firmÊs revenues come from its US operations,
while the remaining 25% comes from Europe, Canada, the United Kingdom,
Latin America, Australia, and the Pacific Basin region (www.fundinguniverse.com).
2.5.1 History
News Corp was created by Rupert Murdoch who acquired „The Adelaide News‰
as his first newspaper after his fatherÊs death in 1952. When he returned to
Australia in 1953 after graduating from the University of Oxford, he ran the
paper and began recovering its business.
He then acquired the Sydney Daily Mirror, a New South Wales-based newspaper
chain, Cumberland Newspapers, and Melbourne and BrisbaneÊs Truth. He also
bought a stake in New ZealandÊs largest media company, Wellington Publishing,
in 1964.
Murdoch entered the US marketplace in 1974 by taking the San Antonio Express
News, and then the Village Voice, New York Post, and New York Magazine in
1976. In 1979 Murdoch formed News Corporation as a global holding company.
With News Corp in his business stable, Murdoch also created an international
empire of media, technology and sport franchises.

The firm took over The Sunday Times and The Times in the same year from the
Thomson Group. The 1980s saw News Corp acquiring the South China Morning
Post and Harper & Row publishers (1987), the 20th Century Fox (1985) and
British Sky Broadcasting (BSkyB) (1989).
However, by 1992, it had amassed huge debts and this forced Murdoch to trade
many of the American magazinesÊ interests he had acquired in the mid-1980s.
Much of the back pay came from its stakes in Sky Television satellite network in
the UK which incurred huge losses.
Recognising the US multimedia market as being the most important in the world,
News Corp announced that it would move its corporate headquarters to the USA
in 2004. According to McPhail (2011), the move was to expand the shareholder
base, scope and demand by becoming an American company since more then
75% of its income and profits came from US multimedia operations.
2.5.2 Businesses
With revenue of USD33.4 billion in 2011, News Corp is regarded as a diversified
global media company (see Figure 2.2). Based on the News Corp website
(www.newscorp.com), the firm operates six segments as follows:
(a) Cable Network Programming

This segment produces and licenses programming for distribution on cable
television systems and direct broadcast satellite platforms in the US and
Asia. The segmentÊs business includes the FOX Business Network, FOX
News Channel FX, Big Ten Network, STAR and many other popular pay-
TV channels.
(b) Filmed Entertainment

This segment is run by a global leader in movie production and
distribution, Fox Filmed Entertainment. 20th Century Fox Film is in charge
of a number of the top grossing movies of all time, including historyÊs box
office films like Avatar and Titanic.
20th Fox Television with the CompanyÊs other TV studios, made and
circulated a lot of the worldÊs most popular television programming. The
CompanyÊs TV studios are leaders in animated series and provided many
of the most top series to each of the main US networks.


Figure 2.2: News Corporation properties
Source: Metue.com

ACTIVITY 2.5
News Corp is a diversified global communication corporation with

operations and holdings in every peripheral and semi-peripheral
country as well as other regions. Among those are British Sky
Broadcasting (BSkyB) Group and STAR TV (Asia). With your
coursemates, discuss the profile and activities of BSkyB Group and
STAR TV as News Corp properties.
(c) Television
News CorpÊs television business captured viewers from more preferable
demographics. Its businesses include the 27 stations in the Fox Television
Stations group and various television operations throughout the world
including the Fox Broadcasting Company (the number one network in the
USA); Fox Sports, Fox Sports Australia and MyNetworkTV.
(d) Direct Broadcast Satellite Television

News Corp owns ItalyÊs most popular pay-TV company, SKY Italia, which
has more than four million subscribers. The Company also has major
holdings in the UKÊs largest digital pay-TV platform, British Sky
Broadcasting, which is reaching a third of all homes and a leading
broadcaster of movies, sports, news and entertainment. News Corp also
owns AsiaÊs TATA SKY and FOXTEL in Australia and New Zealand, as
well as GermanyÊs leading Sky Deutschland.
(e) Publishing
It is also engaged in the publishing business, primarily through its
subsidiaries such as HarperCollins Publishers, News International, Dow
Jones and News Limited which owns 146 newspapers in Australia. News
Corp publishing segment encompasses world-leading English newspapers
and their digital brands including New York Post and Wall Street Journal.

(f) Others
Its assets also comprise a large number of the next generation media
properties such as Disney (the leading online video site) and Hulu (a joint
venture with NBC Universal to help people find and enjoy the worldÊs
premium video content when, where and how they want it). Others include
News Outdoor; Making Fun, News America Marketing Group; Fox Library;
IGN Entertainment, Inc; and AmercanIdol.com Wireless Generation.
2.6 GENERAL ELECTRIC

General Electric (GE) is incorporated in New York with their headquarters in
Fairfield, Connecticut. GE is one of the multinational conglomerates with a broad
range of products. With a US annual growth rate of 3% and a global growth rate
of 6%, Fortune ranked GE as the 6th largest firm in the US in 2011.
The GE business list varies over time as a consequence of acquisition,

divestitures, and reorganisation. GE operates in more than 100 countries and
employs about 300,000 workers. It consists of four main segments, namely
technology infrastructure, energy, consumer, capital finance, and industrial. GEÊs
broadcasting interests can be seen after it acquired the National Broadcasting
Company (NBC) television network in 1986. From then NBC became part of GEÊs
global expansion strategy.
2.6.1 History
GEÊs history began in 1878 with the establishment of Edison Electric Light
Company by Thomas A. Edison. In 1892, a General Electric Company was born
as a result of the merger between Edison General Electric Company and
Thomson-Houston Electric Company. GE is the only company listed in the Dow
Jones Industrial Index today that was also included in the original index in 1896
Since 2001, Jeffrey R. Immelt became GEÊs Chairman and CEO. He was
instrumental in laying the vision for GEÊs many initiatives including digital
connections. Immelt has been nominated three times as one of the „WorldÊs Best
CEOs‰ by Barron's. Table 2.2 highlights GEÊs milestones.

Table 2.2: GEÊs Milestones
1986 GE became NBCÊs parent company.

1993 NBC launched Canal De Noticias, a 24-hours news service beamed to Latin
America from the NBC news channel headquarters in Charlotte, North
Carolina, USA.
1996 Prime timeÊs #1 network in the USA.
2000 Today Show, Friends and The West Wing dominated ratings .
2002 NBC acquired Telemundo (an American TV network that broadcasts in
Spanish) and Bravo (an American cable TV channel).
2004 GE acquired 80% of VivendiÊs universal properties (Vivendi is the media and
telecommunications company based in Paris).
NBC Universal was created.
2007 Launches Hulu in partnership with FOX Entertainment and Disney. Hulu is
a website and over-the-top subscription service offering ad-supported on-
demand streaming video of TV shows, movies, webisodes and other new
media, trailers, clips, and behind-the-scenes footage from NBC, Fox, ABC,
Nickelodeon and many other networks and studios.
2007– NBC Universal pursues overseas ventures with mergers resulting in the
2009 ownership of NBC Universal Global Networks, Carnival Films and Gencon
Universal Entertainment Japan.
2010 Broadcast Vancouver Winter Olympics games.
2011 NBC Universal and its affiliates acquired Universal Orlando, a theme park
resort in Orlando, Florida.
2012 NBC Sports Network made its debut. Broadcast London Summer Olympic
games.
2.6.2 Businesses
GE owns NBC which serves 15 company-owned and operated stations. This
broadly diverse holding consists of NBC television network, NBC-owned and
operated stations, NBC Entertainment, NBC News, NBC Sports, CBNC, MSNBC,
NBC Cable, NBC International, NBC Interactive and MSNBC Desktop Video.
NBC is a part of NBC Universal which was formed in May 2004 by the merger of
GEÊs NBC and VivendiÊs Vivendi Universal Entertainment. GE and US cable TV
operator, Comcast, also announced a buyout agreement for the company on
December 3, 2009. Following regulatory approvals, the transaction was

completed on 28 January 2011. Comcast now owns 51% of NBC Universal while
GE owns 49%. NBC Universal is now known as NBC Universal Media, LLC. It
owns and operates American television networks, numerous cable channels, and
a group of local stations in the United States, as well as motion picture
companies, several television production companies, and branded theme parks.
NBCÊs first major change came when GE acquired RCA (Radio Corporation of
America) and became NBCÊs parent company. In 1993, it launched Canal de
Noticias NBC, a 24-hour Spanish language news services across Latin America
which debuted on cable stations in the US in 1994. CNBC (Consumer News and
Business Channel) was created when two leading media companies, Dow Jones
(which produces crucial world business and financial news and information) and
NBC (the leading television network in the US) came together in December 1997.
Then, NBC agreed to acquire a 32% stake in West Palm Beach, Florida-based
Paxson Communication Corp for $415 million in 1999 that led to the combination
of NBCÊs brand name with the owner of the most number of television stations in
the US. NBC also acquired Bravo, an arts and culture network with over 80
million households across North America.
GE made a significant media move in 2004 in acquiring 80% stake in Universal

television and movies and became a much larger global stakeholder in global
multimedia sector. This firm operates in four divisions, namely network,
production, film and theme parks. These include 10 TV stations, Spanish-
language US broadcaster Telemundo, the fourth-rated US TV network, television
production and broadcasting operations, a stake in the Weather Channel, and
cable channels Bravo and Oxygen. It also has Universal Studios film and DVD
production and distribution operations, and Focus Features as well as parks and
resorts in Spain and Japan. Figure 2.3 showcases the properties owned by NBC.

Figure 2.3: NBC Properties (2011)

Source: NBC Universal website – http://www.nbcuni.com
GE has shares in many other ventures as well as media outlets in Europe

including Super Channel, which offers programmes to hotel rooms and
70 million homes in 44 nations. Its Spanish language news service reaches
21 countries in Latin America. It also has an Asian Service. In addition, NBC also
joined XOOM.com and CNET to create NBC Internet which enabled it to offer
„the seventh-largest Internet site based on user reach‰ (www.fundinguniverse.com).

2.7 DOW JONES & COMPANY

Dow Jones & Company is a highly regarded business press worldwide. It
consists of newspaper, newswire, websites, apps, newsletter, magazines and
property databases. With more than 5,000 employees across the globe, including
more than 2,000 journalists in 58 countries (www.dowjones.com), it became a
subsidiary of Rupert MurdochÊs News Corporation company.
2.7.1 History
Dow Jones & Company was founded by three reporters, Charles Hendry Dow,
Edward Jones and Charles Bergstesser in 1882. The company was in recent years
publicly traded but privately controlled. Dow Jones was bought in 1902 by
Clarence Barron, the leading financial journalist of the day.
Over the next 30 years, Barron recruited and developed a generation of

journalists who further assisted Dow JonesÊs name for superiority. Barney
Kilgore took over as managing editor of the Journal in 1941 and became CEO of
Dow Jones in 1945.
After KilgoreÊs death in 1967, it entered a new era where the news entered into
space and online. Dow Jones initiated the use of satellites to send out newspaper
pages and made possible a daily newspaper on a truly national scale. Before the
invention of the Internet, Dow Jones stored and coded its news digitally so that it
could be accessed online. Its website, Factiva.com, helps the business news and
information seeker to find, monitor, and interpret essential information for
individual or organisational needs. The Journal, Newswires and Dow Jones
Indexes have franchises in Europe and Asia (www.dowjones.com).
The company was acquired by News Corporation and became its subsidiary in
2007 worth USD5 billion. That gave News Corp. control of The Wall Street
Journal and ended the Bancroft familyÊs 105 years of possession. In 2010 the CME
Group announced its purchase of 90% of Dow Jones Indexes for USD60.7 million,
including the Dow Jones Industrial Average.

2.7.2 Businesses
The company is known for its Wall Street Journal which existed since 1889. It is
also known for the Dow Jones Industrial Average (DJIA) that was established in
1896 and today consists of 30 blue-chip US corporations including IBM, Microsoft
and GE.
It started Far Economic Review (1946), The Asian Wall Street Journal (1976), The
Wall Street Journal Europe (1983), and also partnered with Financial Times of
London and the Independent Media. Dow Jones also has a major global alliance
with CNBC by providing it with business and news programmes.

Figure 2.4: Dow Jones & CompanyÊs Print and Digital Media
Source: Dow Jones & Company website
Its leading brands include The Wall Street Journal, Factiva, BarronÊs,
MarketWatch, SmartMoney, Dow Jones Newswires and All Things D (refer to
Figure 2.4). The Dow Jones Local Media Group publishes neighbourhood
newspapers, websites and other products in six US states.

2.8 GANNETT COMPANY

Gannett Company is a media and marketing solutions company with a varied
selection of broadcast, digital, mobile and publishing companies. It is an
international company that provides consumers easy access to diversified news
and information.
Headquartered in Arlington, Virginia, US, Gannet Company owns 101 daily

newspapers, including USA Today, the best-selling newspaper, which makes the
company the largest US newspaper publishers. Its significant newspapers
include The Cincinnati Enquirer, The Indianapolis Star, The Democrat and
Chronicle, The News-Press and The Courier Journal.
With 53,000 employees and sales revenue of USD6.71 billion in 2003, Gannett also
possess more than 20 television stations covering 17% of the US and 130 websites
in US and 80 in UK. The firm has offices in 43 states, and in countries like Guam,
Belgium, Germany, Italy and Hong Kong.
2.8.1 History
Gannett Co. was created in Rochester, New York in 1923 by Frank Gannett, a
graduate from Cornell University when he bought his partnersÊ interest in The
Empire State Group. Gannett selected Frank Tripp as general manager who
helped operate the daily production while Gannett focussed on the Northeast. In
1947, the company managed 21 newspapers and radio stations.
In 1929, Gannett co-invented the teletypesetter which could be used to send and
receive typed messages from point-to-point and point to multipoint over various
types of communication channels. It also provided a corporate plane that helped
their reporters get to the site of news quickly. Gannett presses were also leaders
in colour use.
The company was relocated to Arlington, Virginia in 1986. In 2001, the company
shifted its operations into the present headquarters in Tysons Corner,
Washington DC.

Gannet has a fleet of 82 US dailies, including USA TODAY, which is available

in 60 countries worldwide. It has a readership of 11.6 million every week day
and 12 million every Sunday while USA TODAY.com garnered a combined
5.9 million readers daily. USA TODAY, which began its publication in 1982 was
regarded as the US No. 1 newspaper (www.gannett.com).
Gannet has 23 television stations that broadcast to 21 million household members

which is 18.2% of population of the USA. Its subsidiary, the Broadcasting
Division provides news, information and advertising on 9,500 video screens
which are distributed to office towers and hotel lobbies in 25 big cities spread
across North America (www.gannett.com).
In 1999, Gannett bought over Newsquest and became one of the U.K.Ês leading
regional community news providers. The digital newspaper was accessed by
7.5 million users each month (www.fundinguniverse.com; www.gannet.com).
Looking at its website, there are other portfolios of 17 daily newspapers and
more than 200 weekly newspapers, magazines and trade publications. Besides
that, Newsquest manages SI, an online publisher which is also a leading
recruitment site in Scotland (www.gannett.com).
2.8.2 Businesses
The company owns 99 newspapers which are among the top 100 by circulation
and 22 television stations reaching 17.4% of US television market.
Gannet also has in its fold 200 non-daily publications in the USA, including USA
WEEKEND, a newspaper magazine. It also publishes Newsquest in the United
Kingdom, coming out with about 300 titles, including 15 daily newspapers (refer
to Figure 2.5). It is obvious that Gannett is an Internet leader and sponsors its
sites in most of its TV stations and newspapers including USATODAY.com,
which has evolved into one of the most popular news sites on the web
(www.gannett.com).


Figure 2.5: Gannett Major Properties
Source: www.gannett.com

Gannet also followed the development of digital technology. The company

applied the concept of mobile journalists (known as mojo) who travel around the
communities through Wi-Fi to seek news for its News-Press website.
USA TODAY, maintains its leading position in the mobile space, with more than
7 million applications for downloads, including its iPad, iPhone and Android
apps. Gannett Broadcasting is also trying to help in the development of Digital
Mobile TV. USA TODAY – through its newspaper, web site and mobile
platforms – reaches 5.4 million readers daily, which is the top provider in mobile
applications with nearly 11 million downloads on mobile devices.
One of its marketing sectors, PointRoll, is the leader in rich media advertising
solutions and technology, and empowers more than 50% of all rich media
campaigns online and provides about 150 billion ad impressions each year.
Another marketing sector, ShopLocal, links retailers with buyers thus helping
more than 100 of the nationÊs top retailers to link localised promotions directly to
buyers.
2.9 WALMART
Walmart Store, Inc is known as an American multinational retailer corporation
that operates chains of large discount stores and warehouses. According to
Forbes, a leading source for reliable business news and financial information,
Mart is regarded as the worldÊs 18th largest public corporation in terms of
income. With 8,500 stores in 15 countries, it has over two million workers, hence
it is regarded as the largest corporation in the world. However, in terms of
international communication, is a new global stakeholder.
The family-owned business which is controlled by the Walton family, operates in

different names across the globe: Mexico as „Walmex‰, U.K as „Asda‰, Japan as
„Seiyu‰, and India as „Best Price‰. It also operates in Argentina, Brazil, and
Canada. Even though its business is successful outside North America, the
operation in Germany and South Korea does not show the same results.

2.9.1 History
The birth of Walmart in 1962 started with Samuel WaltonÊs dream to own his
own store based on serving others, not on financial goals. The dream started in
Newport, Arkansas but his first store failed. He pursued his dream by forming
another store in Bentonville, Arkansas, and become the largest franchisee of Ben
Franklin with the establishment of fifteen discount stores.
The business was successful. The company expanded to 24 stores across

Arkansas and had sales of USD12.6 million within just five years. Its first store
outside Arkansas was opened in Missouri and Oklahoma in 1969. Walmart was
incorporated in October 1969 and opened its home office and first distribution
centre in Bentonville, Arkansas in 1970. In the 1980s, the company continued to
grow and in 1987 it completed the companyÊs satellite network to ease data
transmission and video communication between all its operating units with
Bentonville office. In 2005, the company had USD312.4 billion in sales with more
than 6,200 facilities across the globe.
2.9.2 Businesses
Walmart has developed from a single store to become the largest international
company. It can be found throughout most of the U.S, Puerto Rico, Mexico,
Indonesia, Canada, Argentina, China and Brazil. With annual sales around
USD165 billion, the company divisions include Walmart Stores US, Walmart
Supercenter, Supermecado de Walmart, Marketside, Walmart Express, and
Walmart International.
In terms of multimedia, Walmart has two sectors, namely retail store sales and
Internet sales, which is the fastest growing media seller. The stores sell DVDs,
CDs, gaming systems and cassettes. In fact, the company sold more DVDs than
any other retailer. It is also the largest retailer of new blockbuster films.
Therefore, the company is HollywoodÊs largest customer with 40% of all DVD
sales (McPhail, 2011).

The companyÊs presence in cyber space happened in 1996 when its website,
Walmart.com, was formed to better serve the customers. On its online business,
Walmart offers three media products:
(a) DVD rentals via mail;
(b) Music downloads at less than a dollar per song from any genre; and
(c) DVD, VHS movies, and other products with an audiovisual connection.
Some musicians are signing exclusive contracts with Walmart such as Garth
Brooks who released an exclusive boxed set, which on the first day sold more
than a half million copies. Other artistes are said to be lining up to be the next
commercial success as a Walmart exclusive.
 US media conglomerates dominate media and communication sectors around

the world with their capability to penetrate peripheral nationsÊ domestic
market.
 American media giants have expanded through regional partnerships,

international joint ventures and outright takeovers.
 Time Warner, Disney, GE, Viacom, News Corporation, Gannett Company,

and Dow Jones & Company are among the largest multimedia corporations
in terms of revenue.
Acquisition Media conglomerate

Cultural product Peripheral nations
Hollywood

Krasniewicz, L. (2010). Walt Disney: A biography. US: ABC-CLIO.
Mannheim, S. (2002). Walt Disney and the quest for community. Burlington:
Ashgate Publishing.
McPhail, T. L. (2005, 2011). Global communication: Theories, stakeholders, and

trends. New York: Blackwell Publishing.
Newspaper Division announces four appointments. (2001). Gannett. Retrieved

from http://www.gannett.com.
Plunkett, J. W. (2009). PlunkettÊs entertainment and media industry almanac

2009. Houston: Plunkett Research Ltd.
Time Warner, Gannet Company, Disney, Viacom, News Corporation, Generic

Electric, Dow Jones & CompanyÊs official websites.
Verma, K. K. (n.d.). The AOL/Time Warner merger: Where traditional

media met new media. Archipelle. Retrieved from http://archipelle.com.

Topic  Non-US
3 Stakeholders of
Global
Communication
System
LEARNING OUTCOMES
1. Discuss the impact of cultural domination;
2. Define the theory of cultural imperialism;
3. Identify the non-Western producers of cultural products; and
4. Describe the contributions of non-European and non-American
cultural products to the international marketplace.
 INTRODUCTION
Almost everyone is familiar with Disney cartoons and Hollywood films. HBO,
Nickelodeon, CNN, MTV and Time magazine have spread all over the world.
These are all American media products and all these have some form of influence
in our daily lives. US exports of entertainment media attain shares in
international markets in excess of 90% because of the high global interest in their
products.

52  TOPIC 3 NON-US STAKEHOLDERS OF GLOBAL COMMUNICATION SYSTEM
In this topic we will look at the role of non-US stakeholders in world cultural and
creative economy which compete with the American markets. For instance, Sony
from Japan and Bertelsmann from Germany are internationally known for their
entertainment media products and have a worldwide market.
SELF-CHECK 3.1
Discuss the impact that the increase in global media has on:
(a) Media audiences;
(b) Media production; and
(c) Local identity.
3.1 CULTURAL IMPERIALISM

What is the meaning of cultural imperialism? This is a hotly debated issue in the
study of the impact of global mass communication. The main catalyst of this
debate was the end of the Cold War and the unsuccessful bid by the group of
countries pushing for the New World Information and Communication Order
(NWICO). The failure of the NWICO agenda left the world marketplace open to
the commercialisation and internationalisation activities of the media industries of
the Western developed countries. Increasing activities in international trade in
media products began in the 1970s and America was most successful in
expanding its trade across the whole world.
Noticing this imbalance in the flow of international trade in the cultural industry,
scholars began to critically study and monitor activities, economic turnover and
impact of such imbalances, especially in the receiving Third World countries. Many
nations are also concerned about the massive flow of American products, typically
films, TV programmes, music, magazines, books, news and information. Naturally
they are alarmed that this over-consumption and exposure would bring about
negative implications for the importing countries and their indigenous culture.
There is a real concern that Western cultural values would overtake the culture of
other countries, a new force of colonialisation, a cultural imperialism, and an
invasion of indigenous local culture by powerful and dominant foreign countries
through mass communication. On an overall basis, critics of the globalisation of

TOPIC 3 NON-US STAKEHOLDERS OF GLOBAL COMMUNICATION SYSTEM  53
media and communication products in the marketplace point to the three

concerns: that it will create homogenisation of the global way of life, uneven flow
of products from the First to the Third world and a new form of cultural and
media imperialism.
A leading scholar in this research is Herbert Schiller, who was attached to the
University of California (1969-1992) and published his work on the subject in an
important publication entitled Mass Communications and the American Empire
in 1969. Using the neo-Marxist approach, Schiller started to look into the global
power structures in the international media industries and tracked the patterns of
transnational business interests, especially the mega-players. Schiller presented
that some of these media organisations had business links with the major arms
and military producers based in the United States. In another book,
Communication and Cultural Domination, Schiller provided readers and
researchers with his definition of cultural imperialism:
The sum of the processes by which a society is brought into the modern world
system and how its dominating stratum is attracted, pressured, forced, and
sometimes bribed into shaping social institutions to correspond to, or even to
promote, the values and structures of the dominant centre of the system.
(Schiller, 1976)

He added that the increasing dominance of US commercialisation of the media
industries occupied a vacuum that was created by the declining influence of the
former colonial powers of Europe, such as Spain, Britain, Holland and France.
Clearly the receding influence of the former colonial powers is being taken over
by the emerging power of the American empire.
ACTIVITY 3.1
A historian from Burkina Faso, West Africa, Joseph Ki-Zerbo said, „Our
cultures are being reduced little by little to nothing. These technologies
have no passport and no visa, but they are affecting us and shaping us.‰
Discuss the above statement based in the Malaysian context.

Imperialism or Globalisation?
Some scholars have chosen to see the spread of international trade in mass media
products as a result of globalisation, not so much a development in imperialistic
intentions. Thus, a counter argument to the culture imperialism theory is that we
can no longer regard the traditional core of Western countries supplying
materials in a one-way-flow. This premise is no longer applicable since the
membership of major producers and exporters has now extended to include
some major exporters from the East such as Japan, China and South Korea.
The previous school of thought believing that the one-way flow of Western mass
media products would impact negatively on local cultures are now claiming that
there is no such thing as uncontaminated tradition (Hesmondhalgh, 2002). They
do not accept that exposure to a dominant culture would inhibit indigenous
traditions; instead the interplay of local and global would strengthen local forms
into becoming „hybrid cultures‰.
Another argument about the problem in the direct one-way impact of

imperialism is the notion of the active audience as reported by a study
undertaken by scholars, Liebes and Katz (1993). The results of this study
indicated that there are different levels and nature of reception by the countries
on the receiving end of foreign flows of products. A study on the TV drama
series Dallas illustrated different patterns of reception from different audiences,
confirming the theory of active audience in liberal-pluralist communication
studies.
Straubhaar and LaRose (2000) too discussed the losing force of the imperialism
theory due to the increasing number of countries becoming media producers and
exporters themselves. In order to succeed as producers, some countries turned to
trade protectionism. For example, France began to introduce national subsidies
for the local film industries while countries such as Brazil and Taiwan chose to
pressure their governments to increase local content and programming.
A final point to consider is the question of the blurring of physical borders in an

increasingly globalised world and the advent of the satellite and the Internet. As
a result we are in a situation where BBCWorld is broadcasting to a global
audience in 40 languages. CNN uses more than 15 satellites to transmit to a

billion viewers in 200 countries and K-pop programmes dominate the whole of
Southeast Asia. Consider also the fact that Columbia Pictures is owned by Sony,
a Japanese corporate group and 21st Century Fox by Murdoch, an Australian.
ACTIVITY 3.2
There is a possibility that cultural imperialism and globalisation might

be perceived as the same thing. Discuss the similarities and differences
between them.
To help you with this exercise, read John TomlinsonÊs Cultural

Globalisation and Cultural Imperialism (in Ali Mohammadi, 1997).
3.2 THE UNITED STATES OF EUROPE (USE)

The idea of a united Europe is not entirely new. During the 19th century,
European leaders such as Napoleon Bonaparte had already envisaged a union of
European states, Etats-Unis dÊEurope. Victor Hugo spoke of such union in his
United States of Europe speech in Paris in 1849. His speech was delivered at the
International Peace Conference where he urged for the creation of a common
senate.
In 1949 the first series of the Council of Europe meeting met at the Strasbourg
city hall to discuss the idea of a federated continent. This meeting was attended
by the foreign ministers of Britain, France, Italy, Belgium, Holland, Sweden,
Luxembourg, Norway, Denmark and Ireland. One of the most eminent figures
present was Winston Churchill, the British wartime leader. He was more
interested to get victors and losers of the war together into a strong unit in order
to check the advancement and expansion of the Soviet Union. At this point in
time Churchill made it very clear that Britain would not be part of Europe
because of the countryÊs ties with the Commonwealth, thus providing another
front to check the Soviet expansion.

The European Union was formally established under its current status with the
signing of the Maastricht Treaty in November 1993. The current geo-political
development of the 27 United States of Europe (USE) member states has
strengthened the idea of a formation of a United Europe. Op-ed pieces in
influential newspapers in Britain claimed that now, more than ever, the United
States of Europe is taking shape (The Independent, June 2012). The USE is now
facing one of its gravest challenges in the form of the on-going Euro crisis in
Greece and now Spain.
Economists and media pundits are claiming that the Eurozone crisis has to be
solved within months only. The irony of the current situation is clear for all to see
because Germany, the country that caused two major European and world wars
in the last 100 years, is now trying to save Europe. Angela Merkel, the German
Chancellor and the leaders of the European Council have managed to handle the
Greek financial crisis and they are now looking into the Spanish request for the
bailout of its banks. Germany is apparently at the forefront in the European
struggle with the economic crisis. Europe is hoping that Germany would solve
the debts of Greece, Spain, Italy, Portugal and Ireland which is estimated at a
trillion dollars.
The German Chancellor has since reiterated the European integration stand as
reported by The Independent, June 2012:
We need more Europe. We need not just a currency union, we also need a so-
called fiscal union, more common budget policies. And we need above all a
political union. That means we must step by step, as things go forwards, give
up powers to Europe as well.
3.2.1 Media Companies in the United States of

Europe
The European media system before 1980 was either owned or under the control
of the governments. Following the period of deregulation and liberalisation of
the media industry in the 1980s, Europe quickly embarked upon privatisation of
government mass communication sectors such as radio and television. Small
media houses were taken over by the big corporations, who were able to offer
better services and attracted advertisers by their expanding audience. McPhail
(2010) sees this as the steps to the formation of USE.

After the fall of the Soviet era, the USA pushed across a policy to retain their
domination as a super power in exporting both „hard and soft power‰ (Nye,
1996) across the world. US dominance in mass media proved to be of concern all
over the globe. The American dominance was assisted by the development of
media technologies making media equipment and products cheaper and more
mobile, allowing for a proliferation of such products both inside and outside
national borders.
The period of liberalisation of media markets was apprehensively noted by

governments on the receiving end of the trade flow imbalance. Not to mention
the fact that dominance of such products began to impact on countries trying to
maintain sovereignty by producing their own cultural products. Leaders of
countries from Europe to the Islamic world to China and India registered their
concerns. On September 1996, during his speech to the United Nations General
Assembly, former Prime Minister of Malaysia, Dr. Mahathir Mohammad spoke
of some of the negative impact from the Western media „destroying ⁄ cherished
values and diverse cultures⁄‰ (Thussu, 2000, 180).
Similarly, the European Commission (EC) began to take on a more protectionist

stand and attempted to reduce the market access of US products to Europe by
introducing quotas. France, for instance, suggested quotas for the importation of
television programmes and the EC approved plans to create a single unified
market to promote an open marketplace for TV programmes. The EC regarded
the audio-visual industry as a „cultural industry par excellence‰ (EC, 1999).
It is therefore apparent that although American media play a dominant role in

the global scene, media industries from other nations are also keen to play
pivotal roles in the marketplace. Straubhaar and LaRose (2004) identified the top
mass media films as shown in Figure 3.1.


Figure 3.1: Top mass media firms
Source: Straubhaar & LaRose (2004)

In the listing, major players are represented by companies in the United States,
three European companies from Germany, France and Britain and one each from
Japan and Canada. The largest corporate bodies in Europe are Bertelsmann and
the Kirch Group from Germany, Hachette and Havas from France, and Reed
Elsevier, EMI and Reuters from Britain.
Of the three countries, France has had a long tradition of government

intervention in the cultural industries. Beginning from the 1960s into the 1970s,
France invested heavily in media and telecommunication hardware. In the 1980s
and early1990s, France pushed hard its marketisation of broadcasting, especially
under the presidency of Francois Mitterrand (1981–1995). During the Chirac
government commercial channels were launched and TFI was privatised,
including Havas, the TV and advertising company.
The government of Britain too pursued the privatisation plan although it did not
privatise BBC and Channel 4. Media moguls like Rupert Murdoch, an ally of the
then British Prime Minister Margaret Thatcher, tried to change the broadcasting
scene. Murdoch, through the British Sky Broadcasting (BSkyB) was able to gain
control over TV technologies and by mid-1990s News Corporation had
monopoly over UK pay-TV.
In the music industry, three European companies are in the top six of the
recording industry of the world, as seen in Table 3.1. The big three in Europe are
Netherlands, Germany and United Kingdom while two are from Japan and one
from United States.
Table 3.1: The International Music Industry Giants
Company Home Country Worldwide Sales (1992)

Sony Japan $3.5 billion
Philips/Polygram Netherlands $3.3 billion
Time Warner United States $3.2 billion
Bertelsmann/RCA Germany $2.5 billion
Thorn/EMI United Kingdom $2.2 billion
Matsushita/MCA Japan $300 million

European companies are also driven by the need to remain in control of the
European marketplace and to keep managing media houses with profit margins.
There is always the concern for maintaining the diversity of content and to
reduce dependence on transnational corporations. The Europeans are aware also
of the importance of maintaining European traditional links in the public.
The Council of Europe are mindful of the effect of the powerful transnational
media content and have recommended several actions to protect media
pluralism. Some of the actions are as follows:
(a) The Council of Europe should initiate ongoing monitoring of transnational

media concentrations, paying attention to the evolution of the media
landscape and the way the public uses media.
(b) Member States of the Council of Europe should support public service
broadcasters, as specific providers of diverse content.
(c) Member States should include the contribution to freedom of expression

and information and pluralism of opinions.
(d) Member States should strengthen their action to secure media pluralism
and the editorial independence of the media through legislation or other
means.
(e) Member States should enforce a clear separation between political

authorities and the media and ensure that all decisions taken by public
authorities regarding the media are transparent.
Table 3.2 shows the largest media companies in Europe by turnover in 2008.

Table 3.2: Largest Media Companies in Europe by Turnover in 2008
Vivendi SA Vivendi Universal is the third largest company in the world by 2002
turnover. The companies operating in Vivendi are Canal, Universal
Music Group, Vivendi Universal Games, NBC Universal and telecom
operators in France and Morocco. It acquired Seagram Co of Canada in
a USD55 billion merger. This means that Vivendi is in control of
Universal Studios, Universal Pictures and Universal Music Group
which also means that Vivendi is the European version of Hollywood.
Bertelsmann It is the seventh largest media company in the world. Groups under this
company include EuropesÊs largest private broadcasting group, RTL
Group, the publishing company Random House, the music company
BMG, printing firms Arvato, magazine and newspaper publishing
under Gruner + Jahr and Prisma Presse.
Lagardere It is a French company with varied business activities such as
Media publishing and media interests plus military-industry affiliates. It is
currently the largest magazine publisher in the world and the 10th
largest magazine publisher in US. Elle magazine is published in 39
editions. Globally, it has 40 million readers. It markets and promotes
Elle Channel with the Parisian cosmetic company Estee Lauder Clinique
brands.
Reed Elsevier The eighth largest media company in the world and world leading
publisher of information for professional uses.
Pearson The Pearson publishing house is the tenth largest media company in the
world. The three main divisions in the company publish under Pearson
Education, Financial Times Group, and Penguin Books.
ARD It is the largest public service broadcaster in Germany.
BBC BBC is the largest public service broadcaster in Britain and major
exporter of television programmes in Europe and the world.
RTL Group This company is a subsidiary of Bertelsmann, the largest private
broadcasting group which offers services to more than ten European
states. More than 120 million people Europeans watch these broadcasts
every day.
EMI The global music publisher.
BSkyB It is a satellite digital television company operating as a subsidiary
company of News Corporation, the fourth biggest media group in the
world under the control of Rupert Murdoch.
Daily Mail and It has newspaper publishing interest as well as local radio and
General Trust information publishing in Britain.
TFI TFI is the largest free-to-air television in France and controls Eurosport.
Mediaset It is the biggest private broadcaster in Italy and is controlled by the
former Italian Prime Minister, Silvio Berlusconi.
Source: NordicommÊs Nordic Media Market 2008 in McPhail (2010)

ACTIVITY 3.3
Table 3.2 shows the various global media corporations and their
influence in the international market.
In your opinion, what are the factors that led to the emergence of these
global media corporations?
3.2.2 European Media Companies Broadcasting in

other European Countries
With the installation of satellites across Europe, broadcasters are now able to
reach audiences across national borders. An increasing number of TV and radio
broadcasters from one country are now able to broadcast to other countries in the
continent. Stations are competing for the largest audiences across national
borders. Transborder flow of information, data and cultural products across
political borders are now increasing due to the rapid technological advances such
as communication satellites. RTL Group for example is the biggest private
broadcaster. It was formed in year 2000 after the merger between TV and radio
stations owned by Bertelsmann, GBL, the Belgian-Canadian Group and Pearson
TV of UK. This merger resulted in TV channels that broadcasted to Germany,
France, UK, Holland, Belgium, Hungary, Spain Croatia and Luxembourg.
Another major broadcaster is the Swedish company, Modern Times Group,

which offers TV services to Sweden, Norway, Denmark, Finland, Estonia,
Lithuania, Latvia, Hungary and Russia. SBS Broadcasting operates in Holland,
Hungary, Sweden, Norway, Denmark, Belgium and Romania.
With regard to the Internet services, the World Wide Web has been so-well
received in the Scandinavian countries, even surpassing the US population.
These countries have the highest Internet penetration rates in the world.

3.3 OTHER FOREIGN-BASED MULTIMEDIA

CORPORATIONS
We are now able to see that the major media players in the world are mainly
American, European, Canadian and Japanese. The second major grouping
consists of about three or four dozen media firms that make about USD1 to USD6
billion a year. These kinds of numbers are big and certainly profitable to the
producers. As Western countries change public service policies toward
marketisation, other countries in the world have begun to seize opportunities to
deregulate and push for privatisation of state controlled media sectors. In
addition, as mentioned previously, countries on the receiving end of the
imbalance in the flow of cultural products are beginning to address this matter
and began to find ways to counter the Americanisation of media products.
Listed below are non-US and EU major companies (McPhail, 2010).

(a) CanWest Global Communications Corp (Canada)
(b) WETV (Canada)
(c) Aboriginal PeopleÊs Television (Canada)
(d) Grupo Televisa (Mexico)
(e) Globo Communications (Brazil)
(f) Cisneros Group (Venezuela)
(g) Sony (Japan)
(h) Bollywood (India)
(i) Zodiac Entertainment (Italy)
The other non-Western groups in the world include cultural and linguistic
groups such as the Latin American companies of TV Globo, Televisa,
Cisneros/Venevision. In the Middle East, the regional geo-linguistic television
led to the formation of pan-Arabic channels such as the Middle East Broadcasting
Centre, (MBO) owned by Saudi interests (Thussu, 2000). Although the Saudis are
new to the media related activities, they have quickly established a presence
within a few decades. Media interests include pan-Arab satellites, newspapers
like Al Hayat and Al Sharq Ai Awsat and TV networks like MBC, Orbit, ART and
Rotana. MBO began broadcasting across Europe and North Africa and the
Middle East through Arabsat. It has a potential audience of more than 100
million Arab in population competing with the influential Al-Jazeera channel in
Doha.

Other Arab channels include the Arab Radio and Television (ART), owned by the
Saudi Prince al Waleed bin Talal. Sinclair (1996) recognised Egypt as the major
producer for the Arab geocultural market. Egypt operated its own satellite
channel Spacenet in 1991 and provided alternative news on the Gulf War for
Arab nationals in foreign soil.
In Asia big multimedia companies are represented by mainly Japanese firms

such as Sony, NHK, Asahi, TVB and companies like Chinese Central TV (CCTV)
from China and the other Hollywood of the East, the Indian film industry. The
Bollywood studios produce films for the Indian diaspora in Africa, Asia and the
Gulf states. In terms of the computer economy, the state of Bangalore in India has
been recognised as a successful software technology hub along with Taiwan.
ACTIVITY 3.4
Look at the list of television programmes in all channels in your

country. Identify the following things:
(a) Which are the imported programmes?
(b) What are the most common types of imported programmes?
(c) Where are these programmes imported from?
(d) In your opinion, what are the reasons that these kind of
programmes are shown on local television channels?
3.3.1 Latin America

As a protectionist response towards the one-way flow of Western Americanised
media, Latin American governments tried to limit foreign cultural imports and
promote home grown products and to lessen the impact of cultural imperialism.
Companies such as TV Globo and Televisa turned out to be very influential
producers of telenovelas, the Latin American soap opera. TV Globo of Brazil
belongs to the Marinho family who has vast businesses in the newspaper
industry and owned record and video distribution, art galleries and advertising
concerns. It is also part of the Rede Globo, one of the largest multimedia
conglomerates with business interests in telecommunication and satellite
industries. In Brazil, TV Globo has a market share of about 76% out of 160 million
people (Sinclair, 1996).

3.3.2 China
The Chinese population of more than one billion automatically makes it one of
the biggest audiences in the world. The media industry has been rapidly
expanding and the viewership has increased from 18 million in 1975 to 1,020
million in 1995. In the 1980s and 1990s the total number of TV sets in China rose
to more than 80 million (Dominick, 1999). The Chinese Central Television
(CCTV) is a satellite channel serving 900 million viewers in the 29 provinces in
China and other countries in Asia, Australia and Africa. Needless to say, the
Chinese government maintained close control over the media in China and there
are periods of lax control to be followed by clampdowns. For example, in the
middle of the 1990s, the government banned satellite dishes and Chinese citizens
needed to register with the police if they wished to be on the Internet.
Hong Kong, a former British colony of about 12 million people, was returned to
Chinese control in 1997. Most assumed that the new Chinese territory would also
be severely controlled but it appears that the Chinese central government has
decided to allow a policy of less control of Hong KongÊs media industry. One of
the media moguls that understand the vast and profitable Chinese market is
Rupert Murdoch who set up the Chinese language Phoenix channel through the
News Corporation. Phoenix offers 24-hour Mandarin programmes to viewers in
China as well as the 30 million Chinese diaspora in Southeast Asia and North
America. In 1999, the channel was seen by more than 47.5 million households in
mainland China. Operating on the belief that local programming would be the
best model, Phoenix, like Zee TV of India concentrated on local fare such as the
popular matchmaking programme, Perfect Match.
3.4 BOLLYWOOD: INDIA’S FILM INDUSTRY

India is the worldÊs largest producer of films. Table 3.3 shows that in 1999 India
recorded an annual average of 787 films for the 1989–1998 period. US recorded
591 films, 296 by China and 255 by Japan in the same period (Thussu, 2000;
Hesmondhalgh, 2002). Doyle (2002) stated that it is also one of the indigenous
industries that could resist the Hollywood juggernaut.

Table 3.3: Top Producers of Feature Film Producing Nations
Average Number of Feature Films Average Investment per

Country Produced per Year, Production in US$ Million in
1989–98 1998
India 787 0.08
USA 591 14.00
Japan 255 3.57
Hong Kong 169 0.58
Philippines 160 figure not provided
France 148 5.26
China (PRC) 127 0.42
Russian Fed 124 figure not provided
Italy 105 3.93
Thailand 73 0.15
South Korea 73 0.72
UK 67 8.25
Source: Hesmondhalgh (2002)
The first Indian made movie was produced in 1913 and current studies show that
India produces about 1200 films annually, double that of USA. The world began
to take notice of this big production coming from Bombay (now Mumbai),
leading to the name Bollywood, a combination of the studios in the East and the
West, Bombay and Hollywood.
Post-independent Indian films began to develop the Bollywood formula which

appealed to an all-Indian audience all across the social and religious divide. It
consists of a film genre that became known as the masala mix which started to
become popular in the 1970s. Masala is the Indian word for spice mix, a
successful blend of romance, drama, comedy as well as song and dance
sequences.
Main exports are to cultural neighbours such as Pakistan, Bangladesh,

Afghanistan and countries with large numbers of Indians such as Nepal,
Myanmar, South Africa and Sri Lanka. In 1988, Indian film products were
exported to the Arabian Gulf, Indonesia, Sri Lanka and Malaysia. Now, with the
post-Independence Indian diaspora as well as the younger nationals pursuing
education and work opportunities in USA, the expatriate Indian population has
spread wider to the USA, UK, United Arab Emirates, Canada, Singapore,
Australia, Kuwait and Oman. Expatriate Indians later provided funding back to
India.

In the 1990s, Bollywood exported to the Indian diasporas in UK, USA and the
Arab countries, followed by demand from East Asian markets and Australia. A
report from Ernst and Young (2008) showed that USA and UK account for 50%-
60% of Indian export revenues. In US, popular films earned USD 1 million in an
opening weekend (Times of India, 2006).
The most successful production house is the Yash Raj Films which recorded the
highest turnover of USD 100 million in 2005. Hollywood was not able to
penetrate the Indian massive middle-class market, but instead, companies such
as Reliance from Bollywood is able to invest in Dreamworks, the flagship arm of
Hollywood (Lorenzen, 2009). McPhail (2010) reported that Bollywood has six
million workers in the cinema sector churning out successful films such as
Slumdog Millionaire which brought in a revenue of USD300 million plus eight
Oscars, including for Best Picture and Best Director.
 It may be suggested that globalisation and internationalisation have been the

main impetus in launching the rapid development of the cultural industries
of the world.
 It is the main drive in management and production of innovative cultural

products from cultural clusters all over the world.
Americanisation Globalisation
Cultural imperialism Internationalisation
Cultural products
Dominick, J. R. (1999). The dynamics of mass communication. Boston: McGraw-

Hill College.
Doyle, G. (2002). Understanding media economics. London: Sage.

European Commission. (1999). Principles and Guidelines for the CommunityÊs

audio-visual policy in the Digital Age. Document (99) 657, 14 December,
Brussels: European Commission.
Hesmondhalgh, D. (2002). The cultural industries. London: Sage.
Liebes, T., & Katz, E. (1993). The export of meaning: Cross-cultural readings of
Dallas. UK: Polity.
Lorenzen, M. (2009). Creativity and Context: Content, cost, chance, and collection
in the organization of the film industry. In Jeffcut, P., & A. Pratt: Creativity
and innovation in the cultural economy. London: Routledge: 93–117.
McPhail, T. M. (2010). Global communication: Theories, stakeholders, and trends.

Sussex: John Wiley & Sons.
NordicommÊs Nordic Media Market (2003).
Nye, J. (1990). Soft Power, Foreign Policy, 80, 153–71.
Schiller, H. (1976). Communication and cultural domination. New York:

M. E. Sharpe.
Sinclair, J. (1996). Mexico, Brazil, and the Latin World. In Jacka, E. et al. (Eds),
New Patterns in Global Television. Oxford: Oxford University Press.
Straubhaar, J., & LaRose, R. (2004). Media now: Understanding media, culture
and technology. Wadsworth: Thomson.
Thussu, D. K. (2000). International communication: Continuity and change.

London: Arnold.
Times of India. (2006). Bollywood makes a killing overseas with more prints.
Retrieved from www.timesof india.indiatimes.com.
Tomlinson, J. (1997). Cultural globalization and cultural imperialisme. in

Ali Mohammadi ed. International communication and glibalization: A critical
introduction. New York: Sage.

Topic  Global Issues,
4 Music and MTV
LEARNING OUTCOMES
1. Differentiate between global, regional and local cultural industries;
2. Describe the development of global television;
3. Describe the development of world music conglomerates; and
4. Analyse the impacts of global television and music industries on the
local culture.
 INTRODUCTION
The business of communication, media and information are becoming a trend
that cannot be ignored. In this topic, we will focus on the international market of
cultural goods – mainly films, television, music and news – from industrialised
countries that have been circulated or disseminated to worldwide markets. These
cultural goods are not only consumed by almost all nations, but they also have
the tendencies to affect local cultural values.
4.1 GLOBAL TELEVISION

Third world countries are concerned that the free flow of information across
borders would lessen their national sovereignty (Straubhaar & LaRose, 2000).
There is a nagging fear that the economic, political and cultural policies would be
in jeopardy if they are not able to control the in-flow of information and foreign
cultural goods into the countries.

70  TOPIC 4 GLOBAL ISSUES, MUSIC AND MTV
Most governments in the world have the tendency to regulate the broadcasting
industry more than the print media. Malaysia, for instance, has ample
regulations for the print media. However, most governments retain some form of
control in the broadcast media.
Another concern is the international trade policies involving cultural goods by

certain countries to strengthen their positions in trade between countries.
America has steadily maintained that the balance of trade must be observed
between countries. For instance, the flow of Japanese VCRs, radio and other
electrical products must be balanced by exports from American media industries.
Countries such as France and Canada voiced their concerns about preserving
their local productions and national cultures in television, film and music. In
retaliation, America has strongly proposed measures through the World Trade
Organisation (WTO) to impose new international trade rules in audio-visual
materials that would not allow countries to pursue protectionist policies.
However, regardless of the attempts at protectionist stances, it is a well-known
fact that television programming and feature films are almost always generated
by Western countries. McPhail (2010) reported that over two-thirds of global
video programming originated from the United States.
4.1.1 Early Television

Pioneering work in television was initiated by two Americans, Philo Farnsworth
and Vladimir Zworykin. Zworykin was working for NBC which was owned by
RCA when NBC gave an early demonstration of television in 1939 at the New
York World Fair. By the 1950s, TV sets became widespread household items in
the American homes. Early American television programming was controlled by
the advertisers who produced content. The four networks that were operating
then were CBS, NBC, ABC and DuMont. Programmes would include game
shows, interviews and a variety of soap operas, westerns, comedies and sports.
By 1959 the studio westerns became popular American series, churning out
26 westerns in prime time. Comedy series such as The Beverly Hillbillies
(1962–1971) attracted 60 million viewers weekly. The Kennedy/Nixon debate
was watched by 65 million viewers in 1960. See Figure 4.1 for the various
milestones in American television history. In 1969, the whole world watched the
live coverage of the moon landing and astronaut Neil Armstrong walking on the
moon.

TOPIC 4 GLOBAL ISSUES, MUSIC AND MTV  71

Figure 4.1: Television milestones

The 1970s was marked by a realisation that violence in television
programmes impacted strongly on the audience, especially children. The Federal
Communications Commission (FCC) and citizen groups began to exert pressure on
networks to air family viewing hour which was contested in court. During the 1980s
and 1990s, competition between the studios heightened and in 1987 MurdochÊs Fox
Broadcasting Company entered the market. Murdoch increased his activity by
getting CBS to switch to the Fox network and acquired National Football LeagueÊs
games. In 1995, Disney Company acquired ABC for USD19 billion.
4.1.2 British Television Broadcasting

Television began to spread to other parts of the globe. The British aired their first
broadcast in 1935. The British Broadcasting Corporation (BBC) was established in
1922. BBC started its operation as a radio house and it was also the first station to
start the worldÊs public television service on November 2, 1936. It was received
by 400 television sets. With the onset of the Second World War, BBC stopped
television operations and focused on radio broadcasting of war news, especially
the nightly War Report. Since then, BBCÊs role as newscaster acquired fame
throughout the world.

BBC television restarted its service in 1946 with the specific duty of broadcasting
the Victory Parade. It was known as BBC TV which was later changed to BBC
One. In 1951, there were 600,000 TV viewers in UK and by 1956 it grew to six
million viewers. Other stations began to appear, beginning with Independent
Television or ITV in 1955, ending the BBC monopoly of British electronic
broadcasting. BBC Two was launched in 1964 as the first colour station (McPhail,
2010). Following the Thatcher interest in providing commercial stations, BBC
began looking for avenues to grow and developed services for foreign stations in
the US, culminating in the 1991 launching of BBC World digital services, one of
the worldÊs top providers of global news.
In 1995, the top television programmes were Coronation Street (16 million
viewers), Eastenders (14 million viewers) Peak Practice (14 million), The National
Lottery (12 million viewers) and The Bill (12 million viewers).
Rupert Murdoch managed to secure the cable and satellite channel, British Sky
Broadcasting (BSkyB), in 1993 and used the sports channel to attract subscribers.
Through this venture, Murdoch was also able to practically gain a monopoly
over new television technologies in the UK and gain dominance in UK pay-TV
(Hesmondhalgh, 2002). By 1999, BSkyB reported a total subscription of nearly
eight million. BBC would concentrate on being a high-quality public service
provider and is now EuropeÊs largest exporter of television programmes,
broadcasting to 554 media organisations in 67 countries. In 1998, TV programme
exports brought in 135 million pounds to BBC. In 1998 BBC Worldwide channels
were viewed by 230 million households worldwide. Thus, the BBC is significant
for its position as competitor to CNN and other regional and international
television network.
4.1.3 Electronic Invasion and Media Imperialism

The dependency theory is a good explanation about how the transnational
corporations (TNCs) of the North began to influence and control the international
marketplace. Right behind these TNCs are their own national governments
giving total support in their strategies to dominate markets, resources,
production and labour (Thussu, 2000). This theory originated from Latin America
in the late 1960s when North America started to support the right wing dictators
in the Latin American governments. This brings to mind the world system theory
where the core nations of producers seek to dominate the peripheral and semi-
peripheral countries and ensure that these countries continue to be dependent
upon the West.

Herbert SchillerÊs work, Mass Communication and the American Empire (1992)
showed how the US developed the communication services in their effort to
counter what was alleged by the US government as a threat from the Soviet
expansion. US domination in satellite communications for surveillance purposes
later expanded into commercial broadcasting, financed by income from
advertising. As Schiller remarked:

Nothing less than the viability of the American industrial economy itself is
involved in the movement toward international commercialisation of
broadcasting. The private yet managed economy depends on advertising.
Remove the excitation and the manipulation of consumer demand and
industrial slowdown threatens.
Another outlook in the global communication and dependency theory was

also raised by scholar Oliver Boyd-Barrett in the 1970s. Boyd-Barrett (1977)
introduced the term media imperialism which is defined as:

The process whereby the ownership, structure, distribution or content of the
media in any one country are singly or together subject to substantial external
pressures from the media interests of any other country or countries, without
proportionate reciprocation of influence by the country so affected.
4.1.4 Americanisation and Global Television

According to UNESCOÊs report, between 1980–1991, global trade in cultural goods,
especially films, television, printed matter, music and computers increased from
USD67 billion from 1980 to USD200 billion in 1991 (UNESCO,1998). United States
was the leading exporter and the American entertainment industry revenue was
mainly derived from television programmes.
As mentioned earlier, global television news, newsreels and photos supplied

by CNN, BBC, AP, Getty and Reuters are the main world exporters. Similarly,
television programming and feature films are also mainly from the West. US
supplies to over two-thirds of global video programmes.

Tunstall (1994) drew attention to the twentieth century internationalisation of

television programming from USA. The US television industry had developed far
ahead of most other countries and beginning from the golden era of American
television of the 1960s, television exports rose to around USD100 million a year in
the 70s. A major factor in the success of US television may be seen in the role of
the government in promoting such cultural industries abroad. For instance, US
representatives in international meetings would call for a free flow of information
and entertainment around the world. US government representatives would
push for aid to foreign countries provided those receiving countries would not
limit US cultural exports. Such measures later resulted in the boom in US exports
and ultimately profits for the US television and entertainment industries leading
to the expansion and improvement of television repertoires. Table 4.1 shows the
major US media companies dealing with television programming.
Table 4.1: Top US Companies Producing Television Entertainment Programmes
Revenues Profits
Company Country
($m) ($m)
Walt Disney USA 22,976 1,850
Time Warner USA 14,582 168
News Corporation Australia 12,995 1 153
Viacom USA 12,096 (122)
Seagram Canada 10,734 946
Source: Thussu (2000)
Table 4.2: Leading Media Companies and Revenue from Television
1998 Total Revenue 1998 TV Revenue

Company % of Total Revenue
($ billion) ($ billion)
Time Warner 26.83 18.46 69
TCI 7.35 7.35 100
Walt Disney 22.97 7.14 31
CBS 6.80 4.91 72
The volume of US international trade in cultural products as well as its ability to

produce and market it successfully ensured the continuing success of the
industry. Most countries would import US programming, thus maintaining the
US leads as the world provider to television markets. Table 4.3 shows the worldÊs
biggest television markets and Table 4.4 is an indication of the main players in
global television.

Table 4.3: Global Television TV Markets
TV Households Cable Homes Satellite Homes

Country
(millions) (millions) (millions)
China 340 57 0.80
USA 98 66 8
India 79 19 2.5
Russia 45 14.5 0.35
Japan 41 14 12
Germany 37 19 11
Brazil 36 1.3 2.4
Britain 24 2.3 4.3
Indonesia 20 0.02 3
Italy 19 0.01 0.76
Table 4.4: Global TV, 1998
Type Ownership No. of Households

Network
(millions)
MTV Networks Youth Music Viacom, US 310
ESPN Sport Walt Disney, Hearst 250
Corp
CNN International News Time Warner, US 221
NBC News NBC, US 200
Discovery Channel Documentaries Discovery Comm. 144
CNBC Financial news NBC 142
TNT Films Time Warner 140
Cartoon Network Cartoons Time Warner 125
BBC World News BBC 60
The American television industry and the exports worldwide have been
profitable trade ventures and the major producers and studios ensured that their
products retained their lead by constantly upgrading their technological know-
how and maintaining massive marketing communication strategies in order to
maximise profits from overseas markets. Examples of the American zest to
conquer external markets are productions of The Hunchback of Notre Dame for
the European market and Mulan for the Chinese market.

4.1.5 Geocultural Television Markets

Hesmondhalgh (2002) acknowledges the US domination in the international
television programming in the same way that US dominated the supply of films
earlier on. Throughout the 1960s to the 1970s, American cultural products such as
films, sitcoms, action adventures and cartoons were exported all over the globe
which raised concerns over effects of such flows especially when scholars began
to link such patterns to the cultural and media imperialism theories. However,
there are counter arguments that say that the effects on the audiences are not
direct as in the bullet theory effects.
The other contention that the West is the centre which dominates all Third World
countries is also questioned by some scholars because there are groups of countries
that are more influenced by their geocultural groupings (Hesmondhalgh, 2002).
For instance, countries of Eastern Europe have closer ties with Russia because
these countries share the same language. Other geocultural groupings are Mexico
and Brazil in South America, Taiwan and Hong Kong with China as well as the
Chinese speaking populations in Malaysia and Singapore. Egypt is the central
producer of Arabic TV programmes and export to many countries in North
Africa and the Middle East. The cultural capitals of Cairo, Mumbai, Hong Kong
and Mexico are major producers and exporters of cultural products to their
geocultural markets.
Latin American television industry, especially in Brazil and Mexico has been
developing rapidly since the 1960s. These countries are now major exporters to
the Hispanic geocultural markets and markets in USA, Europe and the UK.
Televisa in Mexico and TV Globo of Brazil are the largest producers of Spanish-
language television programmes. Another major production from Latin American
television is the popular soap opera, the telenovela, the highly successful Spanish
language melodrama series that run to about 100 episodes during prime time
and remained very popular worldwide especially in the Latina geocultural
markets from Mexico to the whole Latin American continent and exported to
Spain, Cuba, Russia, Puerto Rico and other non-English speaking countries. It
originated from radio soaps and runs successfully on the melodramatic formula
of simple storylines dealing with love and family relationships and telegenic
actors.

TV Globo produced the telenovela Escrava Isaura (Slave Girl Isaura), the
historical epic which was highly popular in Italy, France, Czechoslovakia, the
former Soviet Union and China. In China, 450 million viewers were hooked and
the book version of the melodrama was translated into Chinese. In Russia, The
Rich also Cry became a hit and the telenovela Gabriela became popular in
Angola. Some telenovelas are dubbed into other languages and in 1990, TV
GloboÊs entertainment programmes were exported to 130 countries garnering a
TV revenue of USD4.4 billion.
Research organisations in Europe, such as the International Television Expert

Group (ITVE.org), in 2009 reported that the daily viewing hours of audiences
have increased worldwide to three hours 12 minutes of „watching more and
watching differently!‰ The annual overview of the report suggests that apart
from technological development, contents are the decisive factor. Fiction remained
popular, especially drama series, soap operas, telenovelas, TV movies and cartoons.
Another research organisation in Europe, IDATE (2011) reported that worldwide

television market in 2010 was worth 289.3 billion EUR, an increase of 7.1%
compared to 2009. The report observed that the US is still the largest television
market with a turnover of 103 billion EUR in 2010, a rise of 4.5%. The European
top producers are UK, Germany and France. Asian television markets are
dominated by Japan, India and China, all recording an increase from 2009 rates.
IDATE also reported that Latin America showed a good level of growth in the TV
market with Brazil as the biggest market, capturing 44% of the total Latin
American market. However, the region in comparison is still a small producer,
capturing only 7.8% of the global market. The African/Middle Eastern market is
the smallest regional market and has a share of 3.6 % of the global market.
In Asia, the Japanese television programmes began to make inroads into former
colonies such as South Korea. South Korea only allowed the entry of Japanese TV
programmes in the 1990s after a long period of embargo. Taiwan only began
importing Japanese programmes in 1993. McPhail (2010) reported that Japanese
TV dramas began to be aired by STAR TV in the 1990s. Oshin, the story of the
servant girl, became a big hit in 28 Asian countries. Figure 4.2 shows the export
of Japanese TV programmes by region while Figure 4.3 shows the exports by
genre.


Figure 4.2: Export of Japanese TV programmes by region
Source: McPhail (2010)
Figure 4.3: Exports of Japanese TV programmes by genre


South Korea is a newcomer in the Asian scene. Its TV products, especially

dramas started making inroads into other Asian countries. The Korean Ministry
of Culture and Tourism is an example of a very successful government
promotion of the cultural industry leading to exports worth USD1.6 billion
including animation, cartoons, television programmes and recorded musical
tapes. In 2006, PricewaterhouseCoopers (PWC) reported that Korea had the third
largest entertainment market in the Asia–Pacific region. The craze for Korean
entertainment products was coined as the Hallyu, the Wave of Korean
entertainment which began in China and later spread all over Asia, including a
big Hallyu across Southeast Asia. Now Korean TV programmes are shown all
over Southeast Asia, Hong Kong and Taiwan. Korean entertainment is also
beginning to receive attention in Europe and North America (see Table 4.5).
Table 4.5: Importers of Korean Cultural Products by Categories
South North
China Japan East America Europe Others Total
Asia
Audiovisual 5.8% 39.4% 15.5% 27.6% 7.6% 4.1% 100.0%
Book 10.6% 11.6% 11.5% 42.7% 9.3% 14.4% 100.0%
Cartoon 10.3% 15.4% 12.8% 23.1% 38.5% 0.0% 100.0%
Game 30.9% 31.1% 13.2% 17.7% 5.3% 1.8% 100.0%
Character 15.5% 2.3% 6.7% 33.9% 21.3% 20.4% 100.0%
Entertainment 3.9% 52.9% 3.9% 15.7% 5.9% 17.6% 100.0%
Total share 21.8% 25.3% 12.3% 25.3% 8.6% 6.8% 100.0%
The US dominates the global supply of television programmes but there are
other players selling packages to their national and geocultural markets too.
Researchers have provided possible explanations to the rise of non-western
television content, one of which is that TV melodrama is the newer
representative of the new „universality‰, and it provides avenues for tackling
every day life matters in the form of comedy, tragedy, entertainment, action and
romance.
Such diversity also lends support to the debunking of the homogenisation of

world culture, instead it promotes the idea of heterogeneity, plurality and
diversity. Appadurai (1990) maintained that instead of turning into a
homogenised world, the cultural outlook is more reflective of a hybridised
culture, one which has blurred boundaries between the modern and the
traditional, the high and low culture and the national and the global culture, a
phenomenon referred to as „glocalisation‰ (Robertson, 1992).

ACTIVITY 4.1
American television programmes dominate the international marketplace

but other countries are also becoming major producers. Discuss.
4.2 THE INTERNATIONAL MUSIC INDUSTRY

McPhail (2010) reported that in the first decade of 2000, sales of the global music
industry reached USD40 billion and the biggest sales were from United States,
Europe and Japan. Most songs are in the English language although the Spanish
language market is growing rather fast.
Table 4.6 shows the Big Six in the global music industry, four of which are also
countries in the core Western nations such as EMI Group (UK), Time Warner
Music (US), Bertelsmann (RCA/BMG) and Philips/Polygram (Holland). Sony
and Matsushita of Japan are the two Asian giants in the group. As can be readily
understood, the world music industry is managed by these entities.
Table 4.6: The Big Six in the International Music Industry
Company Home Country Worldwide Sales (1992)

Sony Japan $3.5 billion
Philips/Polygram Netherlands $3.3 billion
Time Warner United States $3.2 billion
Bertelsmann/RCA Germany $2.5 billion
Thorn/EMI United Kingdom $2.2 billion
Matsushita/MCA Japan $300 million
McPhail (2010) identifies a slightly different structure in the leading global music
industries. He recognises five major players and all five are from the core nations,
namely, Universal Music Group (UMG) from France, Sony Music from Japan,
EMI Group from UK, Warner Music from US, and Bertelsmann from Germany.
However, in 2003, Sony Music merged with Bertelsmann. Table 4.7 lists the
leading names in the global music industry.

Table 4.7: Leading Global Music Industry
Universal Music UMG, which is owned by Vivendi, France, is the worldÊs largest
Group group. It has two main units, the recorded music and music
publishing. It has branches in 77 countries and employs about 10,000
members of staff. UMG has 18 labels and very famous artistes such
as ABBA, Bryan Adams, Rolling Stones, Sting, Julio Iglesias, Black
Eyed Peas and many other world class performers.
Sony Music It became the second largest music company after the merger of
Sony Music Entertainment Group of Japan and Bertelsmann of
Germany. The artists under this group include Celine Dion, Mariah
Carey, Barbra Streisand, Bob Dylan, and Will Smith. SonyÊs partner,
Bertelsmann Music Group (BMG) had artists like Elvis Presley,
Frank Sinatra and Carlos Santana. Sony music group wrote the
music for Playstation 3 and signed a deal with YouTube.
Warner Music This group is the third largest conglomerate formed after Time Inc,
Group bought over Warner Bros. at the end of the 1980s. There are about
1000 artists under the various labels including Eric Clapton, Faith
Hill and Red Hot Chili Peppers. Their artistes are available on the
online site and over 150 stores worldwide.
EMI Group EMI is the fourth largest music corporation. Its labels include EMI,
Capitol, and Virgin Records. The artistes under their portfolio
include Diana Ross, the Beatles, the Beach Boys, Spice Girls, Keith
Urban, and Ice Cube. EMI is facing some internal adjustments after
failing to merge with Time Warner in 1999 in its effort to create the
largest music group in the world. This USD20 billion deal was
checked by the European UnionÊs Merger Task Force.
Music, especially popular music for the younger audience is one genre of
international content that appears more global than others because popular
music does not depend too much on language. Popular music of the West had
origins in various traditions and cultures and has further fused the music into
new sounds, such as „world music‰ that comprises various sounds from all over
the world. These new sounds are more receptive to the world audience,
especially the younger generation.
The advances in technology assured a dissemination across the world through

FM radio, satellite, cable television and the Internet. These technologies help the
spread of musical forms, from rap to world music. That is the reason why the
world is seeing the emergence of global, regional, national and local music
industries which produce for a wide variety of genres and markets. American
and British groups are currently very popular and their songs are played
throughout the young world. In the 1960s, British talent were in the American
music charts, from groups like the Beatles, and later the Rolling Stones. In 1983,
the world caught on the Thriller album by Michael Jackson which was sold in
much higher profit margins in the form of compact discs (CDs). Current popular
recording artists are mostly Americans and British, comprising mega names like
AmericaÊs Madonna, Beyonce, Britney Spears, Jennifer Lopez and the British
group Spice Girls to name a few.
4.3 MTV: THE DOMINANT GLOBAL MUSIC

CONNECTION
During the 1980s, an important development began to take shape in the music
industry, namely, the emergence of the popular music videos and ViacomÊs
Music Television (MTV). Top recording artists of the 1980s, such as Paula Abdul,
Bon Jovi and Madonna owed their success to MTV (Dominick, 1999). According
to McPhail (2010), MTV is projected to over 340 million viewers in 140 countries.
The audience is mainly comprised of preteens, teens and young adults. Figure 4.4
shows a list of the MTV worldwide.
Figure 4.4: MTV worldwide

MTV was the first music service to be aired on a 24-hour basis, 7 days-a-week. Its
income is mainly generated from advertising which is targeted at the 12–34-year
old age group. Its website, MTV.com is still the most popular site amongst an
estimated 80,000 music websites.
One of the strategies that made MTV a success is its recognition of the strong ties
to local sounds, thus making MTV a place for Americans as well as local music.
However, American pop music still topped most of the worldÊs charts. For
example, pop queen Madonna and the Rolling Stones topped the charts in Latina
MTV. The European MTV is also dominated by American artistes despite a
ruling enforcing a 30% airing of local European artistes.
One of the policies enforced by the European authorities to protect indigenous

programme-making industry is the Television Without Frontiers (TWF) which
stipulates the compulsory quota of transmitting local output. Article 4 of the
TWF states the following:

Member States shall ensure where practicable and by appropriate means that
a broadcasters reserve the European works⁄ a majority proportion of their
transmission time, excluding the time appointed to news, sports events,
games, advertising and teletext services. This proportion ⁄ should be
achieved progressively, on the basis of suitable criteria.
Doyle (2002) sees it as an economic problem in terms of a negative trade balance

and a loss in job opportunities and wealth creation (CEC, 1977). There are also
worries that the invasion of the foreign television content might pose a threat to
the indigenous languages and values.

Tehranian (1999) observes that MTV is successful in exporting youthful US
cultural values across Europe, Asia, Africa and Latin America. It promotes the
sale of music that it shows and the local music industries are quick to respond
with their local repertoires. In this sense, MTV is an influential global player of
not just American pop culture but also the indigenous culture.

McPhail however, observed that MTV, through electronic colonialism had indeed
marginalised local artistes and indigenous genres of music, giving examples of
the African and Australian aboriginal music. McPhail reiterated that the objective
of MTV is to appeal to the youth market of the world and to colonise and
capitalise on the youth culture. In its latest Internet venture, MTVÊs own Internet
service, MTVi Group targeted youths with credit cards who can purchase music
by downloading music and merchandise materials. In a sense, MTV is fully
aware of the potential of the music industry and is powerful enough to influence
the shape of the global popular culture amongst youths.
ACTIVITY 4.2
1. What is world music?

2. Why does it appeal to the global marketplace?
 Television sets became widespread household items in American homes by

1950s.
 Early American television programming was controlled by the advertisers

who produced content.
 United States is the leading exporter of music and the American entertainment
industry revenue is mainly derived from television programmes.
 Global television news, newsreels, photos supplied by CNN, BBC, AP, Getty
and Reuters are the main world exporters. Similarly, television programming
and feature films are also mainly from the West. US supplies to over two-
thirds of global video programmes.
 US dominates the international television programming in the same way that

it dominates the supply of films.
 The US dominates the global supply of television programmes but there are
other players selling packages to their national and geocultural markets too
like Latin America and Korea.

 In the global music industry, there are the Big Six, four of which are countries
in the core Western nations such as, EMI Group (UK), Time Warner Music
(US), Bertelsmann (RCA/BMG) and Philips/Polygram (Holland).
 In the 1980s, an important development began to take shape in the music

industry, namely, the emergence of popular music videos and ViacomÊs
Music Television (MTV).
 The largest global television and music entities clearly have a stronghold on
many nations of the world. They are able to even decide on the selection of
labels and artistes, not to mention being influential enough to dictate tastes
and trends amongst youths of the world. These conglomerates are powerful
and they are able to enjoy huge economic returns from a rapidly growing
market for cultural products.
Americanisation Homogenisation
Conglomerate Indigenous culture
Global television Internationalisation
Geocultural Popular cultural products
Appadurai, A. (1990). Disjuncture and difference in the global cultural economy.

Public Culture, 2, 2, 1–24.
Boyd-Barret, O. (1977). Media imperialism: Towards an international framework

for the analysis of media systems. In Curran, J., Gurevitch, M., & Woollacott,
J. (Eds.). Mass Communication and Society. London: Edward Arnold.
CEC. (1977). Television without frontiers (The Broadcasting Directive).

97/36/EC.
Dominick, J. R. (1999). The dynamics of mass communication. Boston: McGraw-

Hill College.
Doyle, G. (2002). Understanding media economics. London: Sage.

Hesmondhalgh, D. (2002). The cultural industries. London: Sage.
ITVE.org. (2009). TV Market Data. Retrieved from http://www.international‐

television.org.
McPhail, T. M. (2010). Global communication: Theories, stakeholders, and trends.

Sussex: John Wiley & Sons.
Robertson, R. (1992). Globalisation: Social history and global culture. London:

Sage.
Schiller, H. I. (1992). Mass communication and the American empire. New York:
International Arts and Sciences Press.
Straubhaar, J., & LaRose, R. (2004). Media now: Understanding media, culture
and technology. Wadsworth: Thomson.

development, and discourse. London: Lynne Reiner.

London: Arnold.
Tunstall, J. (1994). The media are American: Anglo-American media in the world
(2nd ed.). London, England: Constable.
UNESCO. (1998). World culture report 1998: Culture, Creativity and Markets.
Paris: UNESCO.

Topic  CNN and Other
5 International
News Channels
LEARNING OUTCOMES
1. Explain three types of international news channels;
2. Discuss CNNÊs role in developing international news channels; and
3. Identify the major players competing in the international news
broadcasting sphere.
 INTRODUCTION
This topic features an introductory discussion of international news channels. In
general, these are 24-hour television news channels that can be viewed by
audiences in different countries and world regions via satellite, cable and the
Internet. With a viewership that crosses national boundaries, international news
broadcasting is creating a global public sphere (Hannerz, 1996; Volkmer, 2003)
insofar as media is considered an important element of public discourse, public
spheres and political communication.
There are an estimated 37 international news channels broadcasting via satellite

into at least two world regions, if not more (Rai & Cottle, 2010). This number
only considers cross-border satellite transmission of international news channels
and does not include online means of cross-border news transmission of
broadcast journalism, for example, via video-on-demand (e.g. YouTube) or live
streaming (e.g. Live Station).

88  TOPIC 5 CNN AND OTHER INTERNATIONAL NEWS CHANNELS
This topic discusses the role of CNN as a pioneer of both the rolling news
genre and international news channels. It also introduces you to major
international news channels currently making up the global sphere of
international television news broadcasting.
SELF-CHECK 5.1
Look at the list of international news channels in Table 5.1 and answer
these questions.
1. Are you familiar with any of these news channels?
2. What do you think about the number of international news channels
available? Do you think it is too many or too few?
3. Does your country have its own international news channel? Hint:
Look up World Broadcasting Channel on the Internet.
Table 5.1: International News Channels
News Channel Ownership and Language International Reach

CNN and CNNI Commercial: Timer Warner, Global
various languages
BBC World UK Public Broadcaster/ Global
Commercial, English
CNBC Commercial: NBC & Dow Global
Jones, English
Bloomberg TV Commercial: Michael Global
Bloomberg, English
Fox News, Sky Commercial: News Global
News and Star Corporation, various languages
News
Al Jazeera Qatar government-financed, Global
Arabic & English
Todo Noticias ArgentinaÊs Grupa Clarin, South America and some parts
Spanish of North America
Euronews European Public Broadcaster, Europe, Central Asia
various languages
France 24 French Public Broadcaster, Europe, Middle, Africa and
French, English, Arabic Central Asia

TOPIC 5 CNN AND OTHER INTERNATIONAL NEWS CHANNELS  89
Russia Today Russian state-owned, English Europe, Middle, Central Asia

TVE 24 Horas Spanish Public Broadcaster, Spain and some parts of North
Spanish America
NTV Commercial TurkeyÊs NTV Turkey, some parts of the
Media Group Middle/North Africa and
Central Asia
Al Arabiya Saudi MBC Group, Dubai- Middle/North Africa, and some
based, Arabic parts of Central Asia
El Ekhbariya Saudi Arabian State-Run, Middle/North Africa and some
Arabic parts of Central Asia
Al Hurra US-government funded, US- Middle/North Africa and some
based, Arabic parts of Central Asia
Press TV Iran state-run, English Middle/North Africa, some
parts of Europe and Africa
Zee News IndiaÊs Essel Group, Hindi South Indian continent, some
parts of Mid/North Africa,
Europe and Africa
NDTV IndiaÊs NDTV Group, Hindi South Indian continent, some
and English parts of Mid/North Africa,
Europe and Africa
Sun News IndiaÊs Sun Network, Tamil South Indian continent, some
parts of Mid/North Africa,
some parts of North America
and Asia
Asianet IndiaÊs Asianet Ltd, multiple South Indian content and
languages Mid/North Africa
Indiavision and Private Indian Network, South Indian continent and
TV9 Malayalam and Telugu Mid/North Africa
Gemini News India Sun Network, Telugu South Indian content and
Mid/North Africa
ETV Network IndiaÊs Eenadu Network, South Indian continent and
Multiple regional channels, Mid/North Africa
various languages
PTV News Pakistani State Broadcaster, South Indian continent, some
Urdu and English parts of Central Asia and
Mid/North Africa
ARY News PakistanÊs ARY Network, Urdu South Indian continent, some
& English parts of Central Asia and
Mid/North Africa

CCTV-9 ChinaÊs State Broadcaster, Asia, North America, Central

(International) and English and Mandarin Asia, Africa, South Indian
CCTV continent
Phoenix News Hong KongÊs Phoenix Holdings Asia
and News Corp (minority),
Mandarin
Channel News Asia SingaporeÊs Media Corp Asia, some parts of Central
(government owned), English Asia
NHK World TV JapanÊs Public Broadcaster, Asia (Japan), some parts of
English North America and Europe
YTN Korea State Electric Corp, CNN Asia (Korea), and some parts of
Partner, Korean North America
ABS-CBN News PhilippinesÊ Lopez Family, Asia (Philippines), some parts
Channel Tagalog and English of North America and Mid
East/North Africa
Source: Adapted from Rai & Cottle (2010, pp. 55–64)
5.1 OVERVIEW
International news broadcasting began in the 20th century and is intensifying in
the 21st century with the proliferation of rolling news channels beamed via
satellite or streamed via the Internet (Paterson & Sreberny, 2004; Thussu, 2010).
The Cable News Network (CNN) is a pioneer in satellite and 24-hour global
television news broadcasting (Volkmer, 1999). Following CNNÊs success and
popularity, a host of other similar television news channels, for example, satellite
news channels of the British Broadcasting Corporation (BBC), Euro News and
many others have emerged (Cushion, 2010; Rai & Cottle, 2010). Along with these
satellite news channels, other earlier ventures in international news broadcasting
such as the famed Voice of America (VOA) gave rise to an international sphere of
television news broadcasting (Cushion, 2010; Rai & Cottle, 2010; Volkmer, 1999).
5.1.1 Roles and Aims of International News Channels

Most international news broadcasters are perceived by audiences as being closely
related to the host countries, partly because these news outlets focus heavily on
news events occurring in geopolitical regions of interest to their home countries,
and they also tend to report on global news events from a domestic perspective
(Clausen, 2003, 2004).

In general, international news outlets broadcast to a global audience. Most of

these international news organisations feature a main English-language channel
that broadcasts news to a global audience, for example, CNN International, BBC
World and Al Jazeera English. Some of these international news broadcasters
also offer several regional channels featuring news in different languages, for
example, BBC Persia, CNN Chile and France 24 Arabic.
While commercial news broadcasters such as CNN (owned by Time Warner Inc)
and Fox News (owned by Rupert MurdochÊs News Corp) are usually driven by
financial imperatives, many other international news broadcasters were
established with the twin aims of reporting world news from the perspective of a
particular region whilst simultaneously presenting a regional or local news to
audiences to an international audience; for example, Channel News Asia, China
Central Television (CCTV) and France 24. Still others, such as BBC World, Euro
News etc, were established as public service broadcasters, funded by government
grants, but editorially independent from state control.
There are also a number of international broadcasters established by the

governments of core nations and rising peripheral nations with the overarching
aim of exerting „soft power‰ on the international stage, particularly within
geopolitical regions of interest to the broadcasting state (Boyd-Barrett & Boyd-
Barrett, 2010a, 2010b; Jirik, 2010). Some scholars liken the use of media to exert
„soft power‰ to propaganda. These broadcasters aim to influence public opinion
to become favourable to the broadcasting state (Hafez, 2005, 2007). Some
examples are Voice of America and Al Hurra, both funded by the United States
(US) State Department. Other examples include Press TV (Iran) and CCTV
(China).
Despite the existence of different types of international news broadcasters

(commercial, national, „soft power‰), these traits do not represent mutually
exclusive categories. In other words, a commercial satellite news channel may be
aligned with state policies and appear to exert „soft power‰ on behalf of the state
(e.g. CNNÊs coverage of US wars Iraq and Afghanistan is often perceived as
being highly US-centric). Similarly, public service news organisations may also
be market-driven, relying on advertising and subscription to fund its operations.
For example, while BBCÊs UK-based operations are funded by licence fees, its
commercial arm, BBC Enterprise, is a market-driven entity.

ACTIVITY 5.1
1. Select one news channel that is owned by, or closely affiliated, to a

state. Find definitions of „soft power‰.
2. Select one international news channel that is closely affiliated

to a country (e.g. Australia Network, CCTV, Channel News Asia,
France 24, Press TV). View some of the channelÊs international news
broadcasts/videos and search for news coverage of the channelÊs
home country. You may do this on the channelÊs website, on
YouTube, or other online streaming sites (e.g. Live Station). Write a
short paper discussing how the channelÊs coverage of local news
events helps its home country to exert „soft power‰.
5.1.2 Global Competition

Regardless of a channelÊs overarching role, whether it is to make money, to
provide a public service by bringing high quality, objective news to its audiences,
to bring a region or countryÊs perspective to world news, or to spread
propaganda, these news channels all aim to garner audience attention. The more
people watch a news channel, the more successful a channel is in obtaining
advertising and subscriptions, the more successful a channel is in educating the
public, and in presenting its perspective on news events, and the more people
that its diplomacy efforts reach. What this means is that international news
channels compete with each other as well as with local news media for
audiences. As more and more news channels are established, each trying its best
to compete for audience attention, their time and in the case of subscription-
based channels, their money.
Although it appears that there are many international news channels that reach
across most world regions, it is important to note that there is a difference
between a news channelÊs „reach‰, and an audienceÊs „access‰ to the various
news channels that are available in the region (Rai & Cottle, 2010). In general,
international news broadcasters negotiate with operators of distribution
networks (i.e. satellite, cable and IPTV systems) to carry their news channels and
allow these international broadcasters to expand their „reach‰ across vast and
diverse geographic regions. While terrestrial television channels generally reach
viewers for free (e.g. MalaysiaÊs RTM and Media Prima television channels), it is
a different matter for satellite, cable and even IPTV channels.

In many countries, in order to watch the international channels carried by these

cross-border television providers, viewers must pay substantial subscription fees.
For example, Malaysian viewers must subscribe to the satellite operator Astro, or
one of the broadband IPTV providers (e.g. Unifi, Maxis Home) in order to watch
Al Jazeera English, BBC World, CCTV-9 and CNNI Malaysia on television. Due
to this, the global „reach‰ of an international news channel would always be
limited by the channelÊs actual access to television audiences. Similarly, the
numbers of audience who have access to these channels are also limited to more
affluent members of society with sufficient disposable income to spend on pay-
TV subscription fees (See Cottle & Rai, 2008, pp. 67–70).
Therefore, international television channels compete with one another for the
relatively limited attention and finite financial resources of these relatively small
numbers of audiences (when compared to the number of audiences with access
to terrestrial channels). In the competitive sphere of international news channels,
it is largely the Western news channels, notably CNNI, BBC World, and Fox
News that are leading the competition. A newer entrant into this group of elite
international news channels is Al Jazeera English, established in 2006, but
already a serious player in the global news sphere. These leading international
news channels are able to access greater numbers of audiences across virtually all
world regions, whereas other international channels find it more difficult to
penetrate markets outside of their own region. Mughda Rai and Simon Cottle
(2010) explain:
While an increasing number of non-Western channels are beamed over the air
space of Western nations, the extent to which they are distributed and
available within Western households is often fairly limited. To provide a
simple analogy, CNNI is available in virtually every Indian household with
satellite television, while in the USA it is considerably more difficult and
expensive to gain access to ZEE News broadcasts. These distribution
structures are creating an interesting paradox in which the news markets of
the non-Western world, in many cases, are more pluralised, offering a mix of
regional and national channels alongside the major Western players, while
Western news markets remain dominated by their own channels with few
non-Western choices.
(Rai & Cottle, 2010, pp. 69–70)

ACTIVITY 5.2
Identify at least one major pay-TV distribution systems in our country,

including satellite television operators, cable television systems,
broadband IPTV providers, etc. For your selected pay-TV operator,
identify the 24-hour international news channels that are offered to
customers. How many of these international channels are English-
language Western channels? How many news channels originate from
non-Western countries? Among those international channels that
broadcast in other non-English languages, how many are actually
owned by, or affiliated with, Western news channels (e.g. France
24 Arabic)?
The following pages will profile several international news channels currently in
operation in various world regions. We will begin with the pioneer and „market
leader‰ of international television news, CNN International, followed by several
of its major global competitors. Next, we will profile some major regional news
channels in Europe, South America and the Asia Pacific. However, we will
discuss news media in the Middle East and North Africa in Topic 7.
5.2 CNN
CNN International is the global news channel of the Cable News Network
(CNN), owned by US-based transnational media conglomerate, Time Warner Inc.
In order to understand the genesis of CNN International, it is useful to briefly

look at its parent channel, CNN. In the early 1980s, media mogul Ted Turner and
his Turner Broadcasting System (TBS) saw the need for a television channel
dedicated to news and information. Turner established the Cable News Network,
CNN, as a 24-hour all news channel, available to US audiences through satellite
signals and cable television systems.
The following year, Turner launched a second channel, CNN2 or CNN Headline
News with continuous 30-minute news segments, allowing viewers to catch the
news at any time of the day. In this way, Turner and CNN pioneered the rolling
news format, and the 24-hour television news genre. CNN Headline News
eventually became known as the Head Line News (HLN), an entertainment and
celebrity news channel.

In 1985, CNN International (CNNI) was launched, and became the first
international all-news channel. In many regions outside the US, CNNI was
simply referred to as CNN.
In 1996, CNNÊs parent company, Turner Broadcasting System (TBS), merged

with Time Warner Inc. Under the merger, TBS and CNN founder, Ted Turner,
maintained control of the TBSÊs cable networks division, and was also given the
post of Vice Chairman of Time Warner, and a seat on the merged companyÊs
board of directors. However, disagreement between Turner and Time WarnerÊs
CEO, Gerald Levin, over the purchase of dotcom company America Online
(AOL), eventually led to TurnerÊs 2003 resignation from the post of Vice
Chairman, and 2006 resignation from Time WarnerÊs board of directors. Turner
Broadcasting System, and CNN, is now wholly owned and operated by Time
Warner Inc.
5.2.1 CNN: Pioneer in Rolling News Format and

International TV News
CNN is credited as pioneering the rolling news genre (Cushion, 2010; Flournoy,
2001; Volkmer, 1999). In its early days, CNN was initially considered a risky
venture, as it was competing with CBS, NBC and ABC, the three giant networks
of American television. These networks „had an established grip on nightly news
audiences and a significantly greater budget‰ (Cushion, 2010, p. 16). However,
CNNÊs news format emphasised „breaking news‰, „live‰ coverage and visuals
over scripted news casts. In the 1980s, these new news conventions were viewed
with some measure of scepticism by other news outlets and academics. However,
as more and more news channels began emulating CNN, these formerly novel
journalistic conventions became routine.
According to media scholar Stephen Cushion (2010), the news innovations

introduced by CNN marked the first phase in the rise of 24-hour news television.
This was followed by the second phase which was marked by a proliferation of
transnational news channels broadcasting across national borders. This phase of
the rise of 24-hour news channels was also inspired by CNN, as countries and
news organisations around the world began establishing transnational news
channels, with the aim of expanding their reach and influence beyond their own
national borders.

In 1980, CNN was available to about 1.7 million US households. In the second
decade of the twenty-first century, it is estimated that CNN reaches potentially
two billion viewers in over 200 countries via CNN (also known as CNN/U.S),
CNNI and numerous other sister networks. CNNÊs vast international reach via
live satellite transmission, created the first possibilities of a global public sphere,
setting the international news agenda for viewers around the world. By doing so,
CNN „reshaped the conventional agenda of international or „foreign‰ news and
created a platform for worldwide communication‰ (Volkmer, 1999, p. 2). Being
the first international news channel, CNN was also ahead of others in garnering
transnational influence and setting the global news agenda.
A pivotal point where CNN became a global news leader was during the first
Gulf War when Iraq invaded Kuwait, prompting a US-led international military
coalition to intervene. Most international journalists were asked to leave Iraq at
the start of the war, but CNN journalists were allowed to remain. Thus, CNN
succeeded in covering the war live from inside Baghdad. This meant that other
news organisations around the world depended solely on CNNÊs visuals and
CNN reporting. In other words, news organisations were forced to depend on
CNNÊs perspective of the war. This became an important impetus for other
countries and news organisations to establish their own transnational news
channels.
From the late 1990s onwards, the world witnessed a steady proliferation of
24-hour satellite news channels, with numerous transnational channels, and also
local national news channels being established in developed and developing
countries around the world. As mentioned earlier, some of the primary aims of
establishing international news channels included commercial profit; the desire
to cover international news events through a particular regional or national
perspective; for nations to exert „soft power‰ by providing international viewers
information and (positive) news about local news events.
5.2.2 Impact of International News Channels and the

“CNN Effect”
In addition to its role as a pioneer of rolling news and international news
channels, CNN is also credited as having major influences on US and other core
statesÊ foreign policy and intervention in foreign crises. The phenomenon termed
as the „CNN effect‰, is where CNNÊs coverage of major crises (e.g. armed
conflict, natural disasters, human rights violations) influences foreign policy and
military intervention or humanitarian aid.

The origins of the „CNN effect‰ lies in the US government and other core
nationsÊ reaction and responses to CNNÊs comprehensive and intense coverage of
major crises events , namely Chinese pro-democracy protests at Tiananmen
Square in 1989, the fall of communism and the Berlin Wall in modern Europe, the
first Gulf War, and the Battle of Mogadishu. In each of these events, CNN
coverage and its influence on domestic and foreign public agendas caused the US
government and other core governments to feel pressured to issue statements
and to make a stand, and even to intervene.
The „CNN effect‰ initially referred to CNNÊs influence on the world political
arena, particularly during the 20th century. However, the global proliferation of
international news channels in the twenty-first century has expanded the
meaning of „CNN effect‰ to include other international news channels. In
particular, the „CNN effect‰ refers to the powerful influence of the worldÊs major
news channels, namely CNN, BBC, Rupert MurdochÊs Fox and Sky News
channels and the Qatar-based Al Jazeera network (Cushion, 2010; Flournoy, 2001;
Gilboa, 2005; McPhail, 2010; Robinson, 2002; Seib, 2008; Volkmer, 1999).
5.3 BBC WORLD NEWS

The British Broadcasting Corporation (BBC) is the United KingdomÊs public
broadcaster, founded in 1922 as a radio broadcaster and established as a public
broadcaster in 1927. With the invention and advent of television in 1936, the BBC
thus established the worldÊs first public television service (McPhail, 2010, p. 260).
The BBCÊs television broadcast was interrupted during World War II from 1939
to 1946, but resumed with coverage of the AlliesÊ Victory parade in London in
June 1946.
BBC World News was launched in 1991 as the BBC World Service Television
outside of Europe, eventually being known as BBC World in 1995 and 1996 when
it was re-launched as a 24-hour news channel. The name was later changed to
BBC World News in 2008.
BBC World News is owned and operated by BBC World Ltd., one of BBCÊs
commercial companies drawing revenue from subscription fees and advertising.
BBC World News broadcasts in English to over 200 countries and territories
across the world with an estimated audience reach of over 75 million viewers.

The BBC World News channel owes its genesis to the BBC World Service which
had provided radio service to the British Empire since 1932, and on-going
television broadcasts since the end of World War II. The BBC World Service is
funded in part by the British Foreign Office as well as television licence fees that
fund BBC operations inside the UK, supplemented by the commercial activities
of a wholly owned subsidiary. BBC Worldwide Ltd. BBC World News is
essentially an English-language news channel. However, like CNN, the BBC also
operates a number of regional news channels under its BBC World Service
division, separate from BBC World News, including BBC Arabic, BBC Hindi and
BBC Persian.
BBC World News is available as a free-to-air channel in some countries, and as

part of a subscription pay-TV in other countries. Like other international news
channels, BBC World News is distributed via satellite, cable, IPTV and also
internet streaming. BBC World News is CNN InternationalÊs top international
competitor.
ACTIVITY 5.3
1. Although BBCÊs international news activities are commercially-

funded, channels like BBC World News are often discussed in terms
of public service ethos. Quality programming is a hallmark of BBCÊs
journalistic activities. Find out the meaning of public service and
quality programming.
2. With a partner, watch the main news bulletins of a BBC television

news channel (preferably BBC World News). If you do not have
real-time access to the BBC, you may substitute by watching the
selected channelsÊ online news videos, either on its website or on
YouTube. You and your partner may watch the news separately,
but be sure to watch the same channels. Discuss how the BBC news
bulletins reflect the organisationÊs ethos of „public service‰ and
„quality programming‰.

5.4 FOX NEWS AND SKY NEWS

Fox News is a US-based international news channel owned by media mogul
Rupert MurdochÊs transnational News Corporation (News Corp). Sky News
International is one of Fox News ChannelÊs sister channels.
Fox News Channel was launched in the USA in 1996, and provided intense
competition to CNN in the US. Where CNN pioneered the rolling news genre,
and BBC emphasised its public service function as a provider of quality
programming, Fox News focused strongly on visual presentation of news. Fox
News made common the use of attention-grabbing graphics and text that
illustrated and summarised key points of a news story. Even though Fox News
Channel carries the slogan „fair and balanced‰, the network is frequently
criticised in the US and internationally as being biased in favour of the US
Republican Party, and the neo-conservative movement in US domestic and
foreign policies and action. Fox News is available in the US and internationally
on a range of satellite, cable, IPTV and Web-TV systems.
In addition to Fox News, News Corp also owns shares in Sky News. Sky News
belongs to the UK satellite television operator, British Sky Broadcasting (BSkyB).
News Corp. holds a minority stake in BskyB, and partially owns Sky News
which is internationally available as the Sky News International channel. In
addition to Sky News International, there are also several regional variations to
the channel, including Sky News Arabia, Sky News Australia. Like CNNI and
BBC Word News and CNN, Sky News International is available internationally
via satellite, cable, IPTV and Web-TV.
5.5 AL JAZEERA ENGLISH

In this topic, we will only discuss Al Jazeera very briefly by providing a brief
profile of Al Jazeera English as it pertains to global news broadcasting.
Transnational broadcasting in the Middle East will be covered more thoroughly
in Topic 7.

Al Jazeera English is the English-language sister channel of the most successful

pan-Arabic news channel, Al Jazeera. It is the first global English-language
channel to be headquartered in the Middle East. Al Jazeera English was launched
in 2006 as a global news channel, broadcasting from dedicated news centres in
Doha (Qatar), London (UK), Washington DC (USA) and Kuala Lumpur
(Malaysia), with around 70 bureaus all around the world (Kugelman, 2008).
In late 2010 and early 2011, organisational restructuring of the Al Jazeera network
downsized the Kuala Lumpur and Washington DC broadcast centres, leaving the
channel to broadcast from just Doha and London, alternatively.
Since its launch, Al Jazeera English managed to steadily extend its reach to most
of the world, but faced stiff opposition by satellite and cable carriers in the US. It
is widely believed that American carriers were influenced by neo-conservative
movements opposed to Al Jazeera English. However, in 2011, in part due to Al
Jazeera EnglishÊs „Demand Al Jazeera in the USA‰ campaign, the station finally
managed to secure broadcasting rights via satellite and cable in a handful of US
cities. The stationÊs campaign continues with the goal of greater reach across the
US (source: http://www.aljazeera.com/demandaljazeera/).
Although Al Jazeera English is a relatively new player in the global news sphere,
it is now seen as a serious competitor to leading international news channels like
CNNI and BBC World News. While CNN, BBC, and other major global players
like Fox News Channel and Sky News are Western-owned organisations, Al
Jazeera English the first, and to date the only, major global channel from a non-
Western region (Pedrosa, 2008).
5.6 REGIONAL NEWS CHANNELS

CNNÊs international role and competition is sometimes discussed in terms of
imperialist debates, which cite the arguments for and against the hegemonic
tendencies of Western and American media. However, in the second decade of
the 21st century, where the proliferation of news channels in both core and
periphery countries provide important competition to the flow of news from
CNN, the issue of imperialism and hegemony is less relevant. Apart from the
major global channels, that is, BBC World News, Fox News, Al Jazeera English,
there are other regional news organisations currently rivalling CNNI particularly
in Europe and Asia. The remainder of this topic will focus on several major
international news broadcasters originating from Europe and Asia.

5.6.1 Europe
Similar to the BBC World News and its public broadcasting genesis, Europe also
boasts a number of public service international news broadcasters. Among these
are Euronews, GermanÊs Deutsche Welle and France 24. Similar to the BBC
World News and its public broadcasting genesis, these news broadcasters also
subscribe to a public service ethic.
(a) Euronews
Euronews was launched in 1992 by the European Broadcasting Union in
response to CNN and its exclusive coverage of the first Gulf War. The
channel covers European and world news events from a pan-European
perspective. Euronews comprises public broadcasters and state television
stations across Europe.
Euronews operates on news exchange between member broadcasters. This

means that the channel uses the footage and news information from its
partners, as well as news agencies like Associated Press Television News
(APTN) and Reuters TV, repackaging the visuals and information into its
own news stories, using voice-overs recorded by Euronews staff. Unlike
other news broadcasters, the station did not initially have studios, anchors,
or even on-the-ground news gathering team (Baisnée & Marchetti, 2006).
However, in 2011, Euronews began supplementing its news exchange
content by deploying journalists to cover events the same way that most
other news outlets do. The channelsÊ reach via satellite, cable, and IPTV
covers all world regions, including Malaysia via Hypp.TV. Euronews
provides news in over ten languages, namely English, French, Spanish,
German, Italian, Portuguese, Russian, Arabic, Turkish, Persian, Ukrainian
and Polish.
(b) Deutsche Welle

Deutsche Welle (DW) is GermanyÊs international news and information
broadcaster. According to its official website, the public broadcaster
„represents Germany in the international media landscape‰, by focusing on
„intercultural dialogue‰. DW Television was launched in 1992 as an
international news channel, and became a 24-hour channel shortly after, in
1996. DW Television broadcasts in German and English. The channel is
available via satellite in most world regions, but not including Asia.
However, through Internet television, namely Livestation, the channel can
be watched from anywhere in the world. (Source: http://www.dw.de)

5.6.2 Asia
There are a number of international news broadcasters throughout Asia. Among
the major broadcasters are JapanÊs Nippon Hōsō Kyōkai World (NHK World),
SingaporeÊs Channel News Asia (International) and China Central Television
News (CCTV News).
(a) NHK
NHK is JapanÊs public broadcaster. NHK WorldÊs television station was
launched in 1995 aimed at Japanese expatriates in Asia, and named NHK
Asia TV. As the organisation began expanding beyond the Asian region, it
was renamed NHK World Television in 1996. NHK World TelevisionÊs
news and informational channel was established in 2009 as an English-
language news channel broadcaster. It became a 24-hour news channel in
early 2012, reaching viewers around the world via satellite, cable and IPTV.
Apart from providing news and information, NHK World also aims to
„foster mutual understanding between Japan and other countries and
promote friendly and cultural exchange‰ (Source: http://www3.nhk.or.jp)
(b) Channel News Asia

Channel News Asia (International), established in 2000, is a regional Asian
news channel owned by Media Corp, SingaporeÊs state-owned media
conglomerate. According to the channelÊs official website, it „reports on
global developments with Asian perspectives‰. The channel maintains
correspondents in major Asian and Western cities. Channel News AsiaÊs
reach covers much of the Asia-Pacific via satellite, cable and IPTV.
(c) China Central Television

China Central Television News (CCTV News) is ChinaÊs international news
television broadcaster, launched in 2004 as an English language channel. It
was formerly known as CCTV-9 until a name change in 2010. The stationÊs
reach covers over 100 countries around the world via satellite, cable and
IPTV. In addition, CCTV NewsÊ global channel also provides news services
in French, Spanish, Arabic and Russian. In early 2012, the station launched
two more regional channels, namely CCTV Africa and CCTV America
(Jirik, 2010).

ACTIVITY 5.4
Do you follow any particular international news channel? If no, try to

spend one week following the news channel, either on television or via
the Internet. Think about the countries and types of news stories that
are most often covered by the channel. Think about how the channelÊs
coverage of international news stories shape your understanding and
perception of different world regions and current global issues. If you
do follow, how does the international news channel shape your
understanding and perception of different world regions and current
global issues? Discuss this with your coursemates.

 CNN is a pioneer in the 24-hour rolling news format, and in the international
television news broadcasting genre.
 Major international news broadcasters are from the core countries of US and
UK. These are: CNN International, BBC World News and News CorpÊs Fox
News Channel/Sky News. The only non-Western global news broadcaster is
Al Jazeera English.
 International news organisations can play a commercial, public service role,

or „soft power‰ role.
 A major impact of international news broadcasting is the „CNN effect‰.
Rolling news International news channel

Public service broadcasting Soft power
CNN effect Reach and access

Baisnée, O., & Marchetti, D. (2006). The economy of just-in-time television

newscasting. Ethnography, 7(1), 99–123.
Boyd-Barrett, C., & Boyd-Barrett, O. (2010a). 24/7 news as counter-hegemonic

soft power in Latin America. In S. Cushion & J. Lewis (Eds.), The rise of
24-hour news television: Global perspectives (pp. 199–220). New York: Peter
Lang.
Boyd-Barrett, C., & Boyd-Barrett, O. (2010b). Latin American 24/7 News Battle
for Honduras. Globam Media Journal, 9(16), Article No. 6.
Clausen, L. (2003). Global news production. Copenhagen: Copenhagen Business

School.
Clausen, L. (2004). Localizing the global: „Domestication‰ processes in

international news production. Media, Culture & Society 26(1), 25–44.
Cottle, S., & Rai, M. (2008). Television news in South Africa: Mediating an
emerging democracy. Journal of Southern African Studies 34(2), 344–358.
Cushion, S. (2010). Three phases of 24-hour news television. In S. Cushion &

J. Lewis (Eds.), The rise of 24-hour news television: Global perspectives
(pp. 15–29). New York: Peter Lang.
Flournoy, D. (2001). Coverage, competition and credibility: The CNN

international standard. In T. Silvia (Ed.), Global news: Perspecitves on the
information age (pp. 15–43). Ames: Iowa State University Press.
Gilboa, E. (2005). The CNN effect: The search for a communication theory of
international relations. Political communication 22(1), 27–44. Retrieved from
http://www.informaworld.com.
Hafez, K. (2005). Globalization, regionalization, and democratization: The

interaction of three paradigms in the field. In R. A. Hackett & Y. Zhao
(Eds.), Democratizing global media: One world, many struggles (pp. 145–163).
Lanham: Rowman & Littlefield.
Hafez, K. (2007). The myth of media globalization (A. Skinner, Trans.).

Cambridge: Polity.

Hannerz, U. (1996). Transnational connections: Culture, people, places. London:

Routledge.
Jirik, J. (2010). 24-hour television news in the PeopleÊs Republic of China. In

S. A. Cushio & J. Lewis (Eds.), The rise of 24-hour news television: Global
perspectives (pp. 282–298). New York: Peter Lang.
Kugelman, M. (Ed.). (2008). Kuala Lumpur calling: Al Jazeera English in Asia.

Washington DC: Woodrow Wilson International Center for Scholars.
McPhail, T. L. (2010). Global communication: Theories, stakeholders, and trends

(3rd ed.). New York: Blackwell Publishing.
Paterson, C., & Sreberny, A. (2004). International news in the 21st century:
Published by John Libbey Pub. for University of Luton Press.
Pedrosa, V. (2008). Working for Al Jazeera: The realities. In M. Kugelman (Ed.),

Kuala Lumpur calling: Al Jazeera English in Asia (pp. 57–64). Washington
DC: Woodrow Wilson International Center for Scholars.
Rai, M., & Cottle, S. (2010). Global news revisited: Mapping the contemporary
landscape of satellite television news. In S. Cushion & J. Lewis (Eds.), The rise
of 24-hour news television: Global perspectives (pp. 51–79). New York: Peter
Lang.
Robinson, P. (2002). The CNN effect: The myth of news, foreign policy and
intervention. London: Routledge.
Seib, P. (2008). The Al Jazeera effect: How the new global media are re-shaping
world politics. Washington D.C.: Potomac Books.
Thussu, D. K. (Ed.). (2010). International communication: A reader. New York:

Routledge.
Volkmer, I. (1999). News in the global sphere: A study of CNN and its impact on
global communication. Luton: University of Luton Press.
Volkmer, I. (2003). The global network society and the global public sphere.
[Thematic section]. development 46(1), 9–16.

Topic  Role of Global
6 News Agencies
LEARNING OUTCOMES
1. Describe the early development of international newspaper
companies;
2. Identify the major news agencies at the international level; and
3. Explain the services offered by the global news agencies.
 INTRODUCTION
News has been flowing across borders since ancient times – by horses, carrier
pigeons, foot messengers, by ships across the oceans and continents, ferrying
important pieces of information for trade, war and geopolitical forays into the
new world. Newspaper companies are the earliest media companies to have
networks across the world. Strategically, many newspaper companies set up
agencies abroad so that they could supply news back to the home bases and fulfil
the various needs of their governments and readers. During the expansion of the
colonial empires, such services were vital for the empiresÊ administrative
purposes and economic enterprises.
The expansion of news companies and increase in news flows were significantly
aided by the development of newswire services based on the telegraphic
technology invented by Samuel Morse in 1837. This invention enabled rapid

TOPIC 6 THE ROLE OF GLOBAL NEWS AGENCIES  107
transmission of vital information which assisted the process of the unification

of the then British Empire. The telegraph played an important role in the
consolidation of British trade with the provinces, especially in the export and
import of cotton from Egypt or India to England.
The telegraph was also instrumental in the military operations against the
Russians during the Crimean War. The international telegraph system also led
to the birth of news agencies, an important development in the history of
newspapers.
The French established the French Havas Agency, the precursor to Agence
France Presse (AFP) in 1835. AFP primarily served France while Havas
controlled the market in South America and Indo-China. This was followed by
the formation of the Associated Press (AP) which began operations as a
cooperative newspaper in the US in 1846. The British then set up Reuters in 1851
to supply international news for the British Empire.
United Press International (UPI) began as a rival service operator (Straubhaar &
LaRose, 2002; Vivian, 2002).
During the early days of wire services these news agencies sold news and still
photographs but in the current multimedia and converging environment, they
provide video news feeds for broadcast media and information and financial
databases (Thussu, 2000). Today, media companies set up their agencies across
the world and appoint correspondents to ensure that their news is bought first by
the world media. The news agencies offer wire services to a global marketplace
and are driven by profit. The list below is an example of the major global news
agencies.
(a) Thomson Reuters
(b) The Associated Press (AP)
(c) Agence France Presse (AFP)
(d) Bloomberg
(e) Dow Jones & Company
(f) Xinhua News Agency
(g) Inter Press Services (IPS)

108  TOPIC 6 THE ROLE OF GLOBAL NEWS AGENCIES
Table 6.1 provides the output of the top three agencies.
Table 6.1: The WorldÊs Top Three News Agencies
Associated Press Reuters Agence France-Presse

(USA) (UK) (France)
Worldwide bureaux 237 183 140
Countries covered 112 157 165
Languages used 6 23 6
Journalists employed 3421 2072 1200
News output 20 million 3 million 2 million
(words per day)
Source: www.ap.org, www.reuters.com and www. afp.com
SELF-CHECK 6.1
1. What are the roles of news agencies?

2. Discuss the importance of global news agencies.
3. Apart from the agencies stated earlier, list other global news
agencies.
6.1 REUTERS
The expansion of the British Empire between 1880 and 1914 was also
instrumental to the development of Reuters. The spread of the Empire was
complimented by the expansion of trade and foreign investments during the 19th
century. With the advent of telegraph, the communication technology of the
time, Reuters was set to expand alongside the Empire. Telegrams sent through
the Reuters offices reached as far as the colonial offices in New Zealand and
South Africa.
Reuters began the earliest wire services in October 1851. Paul Julius Reuter, an
immigrant German, set up office in London to supply business information,
mainly stock market quotations, to London and Paris. According to McPhail
(2010), Reuters soon developed its operations as a source for news and began
reporting on the wars and elections. Later it served the British press, the colonies

and the European countries. In 1855, it became the first wire-service company in
Europe and reported on the assassination of President Lincoln of the US. By
the 1870s, Reuters had branches in the colonial capitals in Calcutta, Bombay, and
Sri Lanka as well as services to Southeast Asia, China, Japan and Australia. In
East Asia, Shanghai became the headquarters of Reuters. India became an
important operations base and news market because of the importance of the
Jewel in the Crown (Read, 1992).
Reuters continued to lead as the provider of international information well into

the period from 1870–1914. After the War, United Kingdom declined in power
and the world began to see the rise of the United States, bringing with it the
increasing presence of the American news services, especially Associated Press.
Reuters continued in its main business of providing commercial information for
the business sector and retained leadership in commodity, currency, equity, and
financial markets (Tunstall & Palmer, 1991).
The early involvement has resulted in Reuters continuing to be one of the leading
business information agencies to this day. In 1999, Reuters clinched the number
one spot as the worldÊs largest multimedia corporation, supplying the global
financial markets and the news media with a range of information and news
products. Reuters has become the world's largest international news agency, and
is well-known across the globe as a leading provider of real-time, high-impact,
multimedia news and information services to newspapers, television and cable
networks, radio stations and websites around the globe.
In 2008, the Thomson Corporation, a leading Canadian communication

conglomerate bought Reuters. The Thomson Corporation and Reuters Group
PLC combined to form Thomson Reuters and the companyÊs common shares
were listed in the New York Stock Exchange and Toronto Stock Exchange. Under
Thomson Reuters, the company has launched several initiatives including the
following:
(a) Trustlaw, global service for free legal assistance;
(b) Reuters Insider, a multimedia platform that delivers programming with

content from 150 global partners; and
(c) WestlawNext, research system representing attorney created editorial

analysis and technological innovation.
Reuters serves 60,000 media companies worldwide. It has 120 bureaus in

80 countries and the company offers its services in 11 languages and has 27,000
subscribers worldwide (Vivian, 2002).

6.2 THE ASSOCIATED PRESS

The Associated Press (AP) began since the middle of the 1800s. It was the first
private sector entity in US and had delivered news by pigeon, pony express,
railroad, steamship, telegraph and teletype since the early years. Recognising the
increasing costs of news collecting and reporting, officials representing six
New York City newspapers met in May 1846 to discuss cost saving devices. The
meeting initiated the formation of a cooperative plan by the six competing
newspapers and also initiated the formation of AP. Thus, AP started operations
as a news cooperative and maintained this structure up to now. AP also claims to
having reported on all the major events and supplied high quality news service
for the past 166 years. It is not a profit oriented organisation and it now has
over 1700 members from the thousands of news and television stations. These
members then elect 18 board members to oversee policy matters and charges.
In 1849, AP set up a bureau in Halifax, Nova Scotia, which was an important port
of call for the Cunard shipping services. Thussu (2000) noted that in terms of
overall news output, AP was the largest news-gathering company, serving 15,000
news organisations all over the world, supplying news, photos, graphics, audio
and video to the global marketplace. APÊs services are also available in German,
Swedish, Dutch, French and Spanish. The agency has won 50 Pulitzers including
30 photo Pulitzers.
AP is headquartered in New York on the West Side of Manhattan and is

currently employing over 3,700 workers, of which two thirds are journalists and
editors in more than 300 locations worldwide. AP is credited to continue its
existence until today because of „its pragmatism and ability to adapt to the new
demands of information and communication technologies‰. Its database now
contains all the AP content, meeting the current needs of the changing
technology. It now moves in digital bits to every platform, from newspaper to
tablets. AP also operates the global video news, APTN. Its video newsgathering
is located in 70 bureaus with more than 300 clients including the major news
broadcasters such as ABC, NBC, CNN, CBS, FOX News channels and Univision.
AP launched AP All News Radio (ANR), a 24-hour radio newscast. More than
50 radio stations are now part of the profitable all-news format. Other activities
include a sampling of the following:
(a) Sale of packaged news to non-members such as governments and
corporations;
(b) Sale of AP Online, a group of subject-specific news wires tailored to
customersÊ needs;

(c) Sale of photos through APÊs Wide World subsidiary;

(d) APÊs Adsend group sells advertisements from agencies and retailers to
newspapers;
(e) AP operates the Multimedia Services Department for members;
(f) AP introduced the AP Leaf Picture Desk to facilitate receiving of photos
into the computer for editing and production of US newspapers;
(g) Operates the Graphics Bank, the first online graphics archive for television;
and
(h) AP provided the first digital camera for photojournalists, the AP News
Camera 200.
AP has introduced many firsts in the news world. However, like all newspaper
businesses around the globe, AP too faces many challenges such as calls to
withdraw membership and pressure to reduce fees as well as requests for
discounts for their services. Its diversified activities also brought in the issues of
copyright.
6.3 UNITED PRESS INTERNATIONAL

United Press International (UPI), another influential US-based news agency was
founded by E. W. Scripps in 1907. Since that inception, UPI has been a leading
provider of news to American radio stations, media outlets, governments,
businesses and researchers worldwide. UPI merged with the William Randolph
HearstÊs outfit, the International News Service in 1958 to become United Press
International, or UPI. UPI is now a global corporation with headquarters in
Washington DC and agencies in Beirut, Hong Kong, London, Santiago, Seoul and
Tokyo. In the 1960s, UPI had over 6,000 employees and more than 5,000 news
subscribers. In the 1980s, UPI introduced the first global wire-service radio
network, giving voice reports from worldwide correspondents. This service
allowed subscribers to select their content rather than selling in broad topics. In
1995, UPI installed its global satellite transmission that ended the landline
services.
UPI shares during most of the 1990s were owned by Saudi media interests but
beginning from 2000 it was purchased by News World Communications (NWC)
a global multimedia company. The new owners are part of the Unification Church
headed by Reverend Sun Myung Moon. Now NWC operates 20 newspapers at
the global level including The Washington Times.

As a result of several organisational and corporate problems. UPI began to cut

down its domestic news services. It also had to sell its US-based broadcast news
business to its traditional rival, AP, in 1999 (McPhail, 2010).
6.4 AGENCE FRANCE-PRESSE

Thussu (2000) and McPhail (2010) placed Agence France-Presse (AFP) as the
third largest wire service after Reuters and AP. It is the oldest news service
since it began operations in 1835. AFPÊs English language service is distributed
globally and the French government assists the agencies through support in the
form of subscriptions by the government and the French embassies.
AFP is now a global news agency operating from its bureaus located in
110 countries, employing 1200 journalists and photographers as well as
2000 stringers. AFP also has 102 correspondents in peripheral nations – 22 in
Latin America and Mexico, and another 80 in Africa and Asia. Thus, it has
representations from five geographical zones, namely: North, Central and South
America, Africa, Europe, Asia and Middle East.
AFP was the first news agency to report on the demise of Stalin, Pope John Paul I
and Indira Gandhi. It was also complimented for its coverage of the 1999 war in
the Balkans and the Chechnya conflict. Interestingly, AFP was also the agency
that did not fall for the weapons of mass destruction theory spun by other world
agencies.
In 1997, the news feed from AFP was received by BloombergÊs multipanel
information screen produced in London using the European Canal Satellite. AFP
continues to provide services reaching to over thousands of subscribers including
radio, television, newspapers, corporations from its Paris headquarters as well as
offices in Washington DC, Hong Kong, Nicosia and Montevideo.
6.5 BLOOMBERG
Bloomberg was formed in 1982 in New York by Michael Bloomberg with the aid
of Duncan MacMillan, Thomas Secunda and Charles Zegar. It was established as
the Innovative Market Systems before it became known as Bloomberg LP in 1986.
Bloomberg is a global information services, news and media company. The firmÊs
core business, the Bloomberg Professional, delivers online material to Bloomberg

Terminals which serve government offices and agencies, corporations, financial

services industry, and news organisations in 192 locations (Plunkett, 2009;
www.bloomberg.com). Now, with about 15,000 employees and a revenue of
USD6.9 billion in 2010, Bloomberg has grown into a global news service.
ACTIVITY 6.1
Bloomberg Professional comprises four primary services as follows:
(a) Bloomberg Tradebook
(b) Bloomberg Electronic Trading
(c) Bloomberg Data Licences
(d) Bloomberg Roadshows
Discuss each of their main functions with your coursemates.
Bloomberg opened its office in London, UK and Sydney, Australia in the

late 1980s, first offering financial services, then expanding it to include
business news. Bloomberg News began its operation in 1990. Now, with a staff of
2,300 professionals in 146 bureaus worldwide, it files over 5,000 news stories
daily and syndicates to over 450 newspapers worldwide. The focus of its
coverage is in economics, business, financial markets, technology and global
stock markets and trends. It is available in five languages, namely English,
French, Spanish, German and Japanese.
Launched in 1994, the first Bloomberg television product was called Bloomberg
Business News, followed by Bloomberg Information TV and finally the European
Bloomberg Information TV. Bloomberg Television offers a 24-hour financial news
channel that gives information on the economic and political news that affect
markets. It has a unique TV Data Screen that offers breaking news headlines and
financial data at all times. It also offers the top 50 major news stories for each
half-hour, 24 hours a day (McPhail, 2010).
Generally, Bloomberg News comprises the following (Plunkett, 2009):

(a) Bloomberg Radio – providing business news to 750 affiliates worldwide;
(b) Bloomberg Television – broadcasting in seven languages across 10 networks
into 200 million homes through national cable distribution, the USA Network,
DIRECTV and the Bloomberg services;

(c) Bloomberg.com – offering financial news and information; and

(d) Bloomberg Magazines – specially edited for Bloomberg Professional
subscribers; consist of Bloomberg Businessweek and Bloomberg Markets.
By the mid 1990s, this company not only began to catch up with Reuters and
Dow Jones but equalling and perhaps even exceeding them as global multimedia
giants. BloombergÊs terminals and news service began to grow in the overseas
market, including Malaysia.
6.6 DOW JONES AND COMPANY

As discussed in Topic 2, Dow Jones & Company is a business news publisher
which provides subscribers with daily business news. Dow Jones competes
directly with Bloomberg and Thomson Reuters for governments and the
corporate clientele.
The company is best known for its flagship newspaper, The Wall Street Journal,
the major global daily newspaper covering financial, business, national and
international news since 1886. It also started other well-known publications such
as Asian Wall Street Journal (1976), Wall Street Journal Europe (1983), The Wall
Street Journal Special Editions, BarronÊs (1921) and Far Eastern Economic Review
(1946).
Other consumer-oriented publication of Dow Jones include Hedomosti, a joint

venture in Russia in the 1990s; SmartMoney, the consumer magazine jointly
owned with Hearst Corporation; MarketWatch.com, the online financial news
site; and The Daily, worldÊs first iPad news application in the US and Australia.
The owner of Dow Jones Local Media Group also controls the Ottaway
newspaper chain with 19 dailies and 15 weekly newspapers (McPhail, 2010).
In broadcasting, Dow Jones owns half of CNBC Europe and CNBC Asia and
provides news content to them. The company joined Reuters to establish a new
interactive electronic global service to provide business information for corporate
and professional clients. Its news wires have over a million subscribers globally.
In late 2004, it acquired MarketWatch Inc, a highly profitable online financial
news and information, for USD519 million.

Since 2007, it became a full subsidiary of News Corporation. However, it still

plays an important role in the global economy and global communication arena
with its global appearance in newspapers, magazines, radio and television
business programmes.
ACTIVITY 6.2
As a company that specialises in business and financial news, Dow

Jones needs to compete with its competitors. What does Dow Jones
offer to its clients that is different from the other news agencies? Discuss
with your coursemates.
6.7 XINHUA
Xinhua started in November 1931 as the Red China News Agency, Xinhua.
Headquartered in Beijing, it is a publisher as well as a government news agency.
It owns over 20 newspapers and a dozen magazines (Shrivastava, 2007). The
agency has set up worldwide networks which combine satellite communication
technologies with optical fibre cable. It delivers its news in various languages
including Chinese, Russian, French, English, Portuguese, Arabic, Japanese and
Spanish.
Xinhua developed overseas broadcasting capabilities during the Pacific War.

However, the news and information transmission network is centred in Beijing
with Hong Kong, New York, Paris, and London as regional relaying centres. It
has also made agreements to substitute news and news pictures with more than
80 foreign news agency or governmentsÊ political departments.
The network enables Xinhua to release simultaneously news and information

round the clock in the form of text, photos, diagrams, audio, and video and
provides other forms of information services across the globe. Xinhua also has 31
domestic bureaus and sub-bureaus throughout China. With employees of more
than 10,000 people and 107 bureaus worldwide (Shrivastava, 2007), it is the
biggest centre for collecting information and press conferences in the largest
country in Asia.

On its website, Xinhua began to establish a new section for AsiaNet and provides
images, original releases in English, Chinese translations and edited translations
(www.asianetnews.net).
In 2001, Sing Tao News Corporation Limited, a Hongkong listed media

company, invested in joint ventures with Xinhua to set up a market information
website and offered audio and visual services for planning and consulting. With
its multimedia database, editors at Xinhua have been able to process and release
multimedia news and information products since July 2003 and it can supply
media and non-media subscribers with the desired multimedia news and
information products. It serves as a digital working platform, integrating news
and information editing, storage, processing, management, marketing and
service (Shrivastava, 2007).
ACTIVITY 6.3
Xinhua is known for its long, dull articles that avoid criticism of
Chinese government officials or action, and is heavily censored. Is this
good or bad for its clients? Discuss this with your coursemates.
6.8 INTER PRESS SERVICE

Inter Press Service (IPS) focuses on issues like human rights, environment,
development and civil society. Founded in 1964 by Roberto Savio and Pablo
Piacentini in Rome, Italy, IPS is a non-profit international cooperative of
journalists that aims to promote global communication by bringing together civil
societies, policymakers, and national and international media. It is promoting a
horizontal flow of news on a cooperation basis among developing countries. It is
the only global news organisation with over 70% of contributors permanently
based in countries of the Southern hemisphere. Most of them work from their
own countries or region of origin.
Initially the primary objective of IPS was „to fill the information gap between
Europe and Latin America through a snail mail-borne feature news service‰
(www.ips-tv.net). It broadened its objective „to fulfil the hopes of Third World
countries and peoples for a new international economic order‰ (www.ips-tv.net).
It distributes information about developing countries to the industrialised

countries. This led to the formation of a regional structure · IPS Africa (Harare,
Zimbabwe), IPS Asian (Manila, Philippines), IPS Latin America (San Jose, Costa
Rica), IPS Europe and Mediterranean, IPS Middle East, and IPS North America
and the Caribbean (New York).
IPS operations consist of the following:

(a) IPS News – an independent global news wire;
(b) IPS Telecommunications – offers technical expertise for upgrading of
developing countriesÊ communication and information infrastructures; and
(c) IPS Projects – was established to design, manage, and report on project in
the field of training, information and exchange and increasing public and
media awareness of the importance of global issues.
IPS has more than 250 journalists in more than 100 nations and provides news
and information services for more than 1,000 clients, among the conventional and
new media. IPS utilises financial sources from subscribers and media clients. As
the benefactor from various foundations, IPS was able to become the sixth largest
international news-gathering organisation (Rauch, 2003, p. 89).
IPS news is available in English and Spanish and in the form of translations in
10 additional languages including Arabic, Dutch, Finnish, French, German,
Italian, Japanese, Portuguese, Swahili and Swedish. It operates five newspapers
under its printed publications division namely Terra Viva Conference Daily,
Terra Viva Europe Daily Journal, G-77 Journal, IPS Features, and Rural
Development as well as bulletin such as Rural Development and Africa Bulletin.
Its IPS Columnist Services provide a series of exclusive columns written by
statesmen, opinion makers, opposition leader, officials and experts offering
insight on major issues (McPhail, 2010).
IPS is rapidly assimilating the changes in the communication field, transforming

itself from a print news agency to a multimedia player, offering services in a
variety of languages and formats. With the advent of the Internet, IPS has
worked very hard to increase its presence on the Web through a number of news
and project-related websites, which generates some 45 million page views per
month. The IPS websites generate 34 periodic newsletters in seven languages
(Arabic, Dutch, English, French, Italian, Portuguese and Spanish), sent to some
350,000 email subscribers. All stories in English and Spanish can be shared by
readers over social media (Digg, Del.icio.us, newsvine, Reddit, Stumbleupon,
yahoomyweb), allowing IPS to increase readership and circulation.

In 2010, IPS produced 332 podcasts in English and 339 in Spanish as well as
18 original videos globally and a total of 38 of these videos were distributed and
are available at IPS-TV. It also hosted blogs such as Gender Masa, Lobelog and
heavy Metal Colombia (www.ips.org). This shows that although IPS represents
developing countries, it has made many efforts to represent a model of
developmental journalism.
 The major global news agencies operate in a highly competitive environment.
 The major services are all based in industrial core nations with an extensive
bureau network in other core nations and nearly all semi-peripheral nations.
 AP and Reuters, the leader of global news agencies are owned by the US.
 Bloomberg and Dow Jones and Company both specialise in a niche market,
namely business and financial news and information with clients around the
world.
 As official news agency of PRC, Xinhua is regarded as the „eye and tongue‰
of the party to observe what is important for the masses and passing on the
information to the government.
 IPS is a non-profit international cooperative of journalists that wish to fill the

information gap between Europe and Latin America through a feature news
service which fulfil the hopes of Third World countries.
Civil Society Newsgathering

Development journalism Telegraph
Newswire

Markham, J. (1967). Voices of the red giants. Ames: Iowa State University Press.

Plunkett, J. W. (2009). PlunkettÊs advertising and branding industry almanac 2007

(e-book). Houston: Plunkett Research Ltd.
Rauch, J. (2003). Rooted in nations, blossoming in globalization? a cultural

perspective on the content of a „Northern‰ Mainstream and a „Southern‰
Alternative News Agency. Journal of communication inquiry, vol. 27, no. 1,
pp. 87–103. London: Sage Publications.
Read, D. (1992). The power of news: the history of Reuters, 1849–1989. Oxford:
Oxford University Press.
Shrivastava, K. M. (2007). News agencies: From pigeon to Internet. New Delhi:

Sterling Publishers.
Straubhaar, J., & LaRose, R. (2000). Media now: Communication media in the
information age. US: Wadsworth.

London: Arnold Press.
Tunstall, J., & Palme, M. (1991). Media moguls. London: Routledge.
Vivian, J. (2011). The media of mass communication. Boston: Allyn & Bacon.
www.asianetnews.net
www.bloomberg.com
www.ips.org
www.ips-tv.net

Topic  Media in the
7 Middle East and
North Africa
LEARNING OUTCOMES
1. Describe the changes in the Middle East and North African media
landscape;
2. Explain the development of democratic media systems in the region;
3. Identify the emerging players in the region; and
4. Discuss the leading Arab transnational organisations.
 INTRODUCTION
This topic shall focus on the development of Arab media in the Middle East and
North Africa. We will track the changes from traditional and heavily controlled
entities to one that is currently undergoing rapid modernisation and thus
shedding the image of closed and ultra conservative enclaves. You will be
exposed to the history of this new openness, heralding a new beginning for
media in the region.
The genesis of the Arab media may be traced to the events that occurred during
World War I and the ultimate end of the era of the Ottoman Empire which ruled
the Middle East and parts of North Africa for 400 years (De Beer & Merrill, 2009;
McPhail, 2010). The defeat to the Western powers led to British control of Egypt
and the Arabian Gulf. Through the League of Nations, Britain also took control of
Palestine, Jordan and Iraq while France took over the North African states of
Morocco, Tunisia and Algeria.

TOPIC 7 MEDIA IN THE MIDDLE EAST AND NORTH AFRICA  121
During this period in history, modern Turkey was ruled under Kemal Ataturk in
1923 who turned Turkey into a Westernised and secular country. Later, in 1948,
events after World War II led to the creation of the state of Israel in the middle of
the Arab world and the beginning of the plight of the Palestinians in their own
homeland. In unison, the Arab voices began to unite in their fight against
occupation, and with the Egyptian Voice of the Arabs radio in the 1960s, Arab
nationalism was stirred.
The discussion in Topic 7 centres on the new developments and the emergence of
the new Arab news and broadcasting centres in the 1990s that have changed the
face of mass communication in the region as the people seek to disseminate a
wide range of information as well as create a more informed and open society in
a previously heavily controlled socio-political environment. That is why recent
developments are exciting to watch because a freer media environment has
resulted in the opening up of closed societies, thus offering a new sense of
freedom of information to a majority of its people.
ACTIVITY 7.1
1. Name the countries in the Middle East.

2. Which countries are referred to as North Africa?
7.1 LIBERAL-DEMOCRATIC PRESS

Dramatic growth in the media industry in the Arab and North African countries
became the main attraction of media observers and scholars across the world in
the 1990s. Previously, the pan-Arabic world came under the influence and
control of their governments and was literally mouthpieces of the authorities.
Vivian (2011) regarded some of the Islamic countries (comprising countries in
northern Africa to Southeast Asia) as still caught in a time trap with the ulama
(clerics) in charge of policies. De Beer & Merrill (2010) listed some recent
developments in the dynamics of Arab societies in the Middle East and North
Africa as follows:
(a) The disintegration of the Soviet Union and the retreat of the Arab Left;
(b) The rise of religious fundamentalism;
(c) The change in media economics and content as a result of globalisation and
privatisation;

122  TOPIC 7 MEDIA IN THE MIDDLE EAST AND NORTH AFRICA
(d) The onset of Palestinian-Israeli peace negotiations, which despite their

failure, changed the Arab worldÊs media relations with Israel.
(e) The growth of non-governmental organisations that monitor government-
press relations;
(f) The accession to power of new young leaders relatively more open to
freedom than their predecessors;
(g) The fall-out of September 11, 2001, which resulted in new „antiterrorism‰
legislation that was often used against the opponents of the rulers rather
than to fight terrorism; and
(h) The 2001 invasion of Iraq and the divisions and religious forces it
unleashed, forces that use the new media skilfully and may be seen on
YouTube and the Internet.
Scholars of the Arab world often reminded readers that the term „the Arab
media‰ is misleading because there is no such element of unity in the Arab
world, especially not in the media environment. Vivian (2011) sees the media
systems in some of the Middle Eastern countries as diverse political systems
which are driven by theologies although some nations are pragmatically oriented
towards creating a pan-Arabic mass audience. There are vast differences in terms
of infrastructure, technical capacity and content in some Arab countries as in the
liberal democratic press that ensued.
7.2 THE NATURE OF ARAB NEWS

Students of journalism may recall the standard question of what constitutes news
in their journalism classes. Almost always it will lead to the well-used statements
of, „Dog bites man is not news. Man bites dog is news!‰
In the UK, the big news for this year was the phone-hacking of famous British
citizens by the News of the World journalists. Consequently the NoW was
discontinued after 168 years in service to the British public. In the meantime, the
headline news in Europe is the biggest of financial woes leading to the collapse of
banks in Greece and now Spain while the spotlight on China is about how the
nation is currently experiencing an economic boom.
The BBC first established the Arabic Service in 1938. Western powers targeted the
Middle East because of the geo-strategic importance of the region as the source
of the worldÊs largest supply of oil. Therefore, some media systems in the
Arab states began to be influenced by Western ideology while others tried to
determine their own media philosophies and were able to retain their indigenous

content. In Egypt, President Gamal Nasser had to resort to the radio in order to
counter Western broadcasting of the Arab region (Thussu, 2000). This led to the
establishment of the „Voice of the Arabs‰ and the promotion of pan-Arabism in
the 1950s and 1960s. Pan-Arabism also took on the responsibility of operating the
Palestinian liberation radio which was broadcasted from Cairo, Beirut, Algiers,
Baghdad and Tripoli.
The BBC tried again to establish the Arab language service. This mission was not
successful and was finally abandoned in 1996. However, the initiative was later
taken-up by the Gulf state of Qatar which then started the 24/7 television news
service like the Atlanta-based CNN.
The Arab world is now gripped by news reporting of the Arab Spring (Thaurah
Syabab) which led to the demise of the authoritarian regimes in Tunisia, Libya
and Egypt. To date, the Arab world is reporting about the chaotic socio-political
situation in Syria. Previously, Arab newspapers would not leave out stories on
the Gulf War which finally toppled Saddam Hussein, followed by the September
11, 2001 attack in New York and the Al-Qaeda. The Arabic satellite station
Al Jazeera began to air Bin LadenÊs tapes after the September 11, 2001 and from
then on a new media phenomenon began to develop in the peninsula state of
Qatar, challenging the American domination in international news
Thus, Arab news agencies which used to assist the governments in disseminating
state information and controlling incoming flows of news from foreign sources
are now experiencing a new sense of purpose and effort to break free from
government control.
7.3 TRANSNATIONAL NEWSPAPER

PUBLISHING
There are 22 Arab countries and certainly there are major differences in the way
the presses are operated. There are differences in the media systems and policies,
in the infrastructure and technical know-how. Because of the liberalisation of the
print media in certain parts of the Arab world, certain governments are observed
to be more tolerant of the local operations of their presses. The inescapable
conclusion that everyone can draw is that state power is slowly but surely being
challenged by the public who are exposed to the Internet and new media.
Freedom House (2012), the international body that reports on media freedom of
the world, consistently ranked the media systems of some countries in the
Middle East as „Not Free‰, such as Saudi Arabia, Syria, Bahrain, Yemen, United
Arab Emirates, West Bank and Gaza Strip. „Partly Free‰ in 2012 are countries like
Lebanon, Tunisia, Egypt, Kuwait, and Libya (see Table 7.1) For example, Saudi

Arabia and Syria control the press system but paradoxically, Saudi Arabia, for
example, is lenient when it comes to the Internet, recognising it as vital to
international trade, economic development and cultural advances.
Table 7.1: Press Freedom of Middle East and North Africa
Rank 2012 Country Rating Status

1 Israel 30 Free
2 Lebanon 51 Partly Free
Tunisia 51 Partly Free
4 Egypt 57 Partly Free
Kuwait 57 Partly Free
6 Libya 60 Partly Free
7 Algeria 62 Not Free
8 Jordan 63 Not Free
9 Qatar 67 Not Free
10 Morocco 68 Not Free
11 Iraq 69 Not Free
12 Oman 71 Not Free
13 United Arab Emirates 72 Not Free
14 West bank and Gaza Strip 83 Not Free
Yemen 83 Not Free
16 Bahrain 84 Not Free
Saudi Arabia 84 Not Free
18 Syria 89 Not Free
19 Iran 92 Not Free
Source: Freedom House (2012)
One unifying factor that moulded the Arab press into a unison of voices was the
anti-imperialist rhetoric present in the writings against the creation of the state of
Israel in 1948 and the subsequent occupation of Palestine by Israel (De Beer &
Merrill, 2009), which in turn created about 520,000 to 850,000 Palestinian
refugees. The Palestinian Occupation fired Pan-Arab nationalism and its form
was exhibited in most of the Arab press despite major differences in the 22 Arab
states.

Below are examples of the activities of the Arab news media.
(a) The Gulf States: Saudi Arabia and Kuwait
(i) Saudi Arabia

In historic terms the Gulf states were mostly British protectorates until
as late as 1971. Because of their strategic and geo-political importance,
these countries came into focus during the Palestinian issue, the Iran-
Iraq War and the Gulf War.
The Kingdom of Saudi Arabia power centre is in the hands of the Al-
Saud royal family. The Kingdom became independent in 1932 and it is
a country ruled by Islamic conservatism. Media organisations are
under government control and a strict censorship central committee
oversees local and foreign media content.
The Saudi Press Agency (SBPA) is under government management

and maintains close supervision on content and editors are often
reminded of their responsibility towards the nation.
However, being a rich country, Saudi media organisations are able to

acquire information and communication equipment easily and Saudi
governments often finance the publication of Arab newspapers
abroad especially in Europe. London is a centre of Saudi backed
newspapers and generally these publications are freer than those in
the home country.
(ii) Kuwait
The Freedom House Index (2012) listed Kuwait as a partly free media
system. It is a modern monarchy with an elected parliament and the
Kuwaiti press has the support of high technology capabilities and a
brand of journalism that is acceptable in the eyes of Western media
standards.
In 2006, the government introduced new media laws that ended state
monopoly of the press. Only the courts had the right to cancelation or
suspension of the media. The laws of the land too abolished
imprisonment for journalists. However, the authorities put in place a
law that prohibited blasphemy especially to „God, the Prophet, his
Companions and the Quran‰.

(b) North Africa: Algeria and Lebanon
(i) Algeria
Unlike the Gulf countries, the North African states, consisting of
Algeria, Morocco, and Tunisia came under French colonial rule.
Algeria was colonised by the French for a century until their
Independence in 1962. Algeria has a history of struggle between the
fundamentalist Islamic Salvation Front (FIS) Party and the Algerian
authorities. When the FIS won in the first round of elections in
December 1991, the army initiated a crackdown and tried to install
pro-government political parties in the later elections.
The Freedom house classified the Algerian press as „Not Free‰ and
the media system began to change after the Algerian constitution
introduced a form of political pluralism and a diversity of information
sources in 1989. During this period of relaxation of central control,
about 65 political parties were formed and there was a period of
rejuvenation and active political consciousness.
Newspapers mushroomed to about 630 dailies and weekly publications

but the number was later reduced to 45 Arabic and French dailies in
2007. The circulation was reported at 1.5 million copies.
An air of openness was evident in 2006 when President Boutteflika

released 67 journalists allegedly guilty of various offences including
defaming state institutions. Currently the Algerian media are
debating over their past human rights abuses and the role of the
Islamists in Algerian politics.
(ii) Lebanon
McPhail (2010) considers Lebanon to be the Tower of Babel of the
Arab media world. It was the Lebanese journalists who founded the
Egyptian paper al-Ahram and then opened up publications in Sudan,
Morocco and Qatar. Lebanon turned into the capital of Arab
journalism and centre of active political press (De Beer & Merrill,
2009). A freer atmosphere in the country attracted Arab leaders and
their political struggles which were published in the Lebanese press.

However, the thriving and open society in Lebanon ended after the
Israeli invasion in 1982 to expel the Palestinian refugees in the
Lebanese capital. Besides destroying the infrastructure, the Israeli
invasion also resulted in the death kneel of LebanonÊs thriving press
industry. Nevertheless, many of the trained journalists in Lebanon
began to practice in the other parts of the Arab press and some of
them started to publish news in London, including the leading Saudi-
backed Al-Hayat which began their London operation in 1988. Al-
Hayat was also printed in other Arabic capitals such as Riyadh,
Frankfurt and New York. London eventually became the centre of
intra-Arab media, a „pan-Arab media‰ headquarters. To this day, the
Palestinian paper Al Quds al Arabi and another Saudi-backed paper,
Ashary Alawat, continue their publications.
7.4 TRANSNATIONAL BROADCASTING

Pan-Arabic nationalism also became a dominant theme in Arab broadcasting,
especially in pan-Arabic satellite broadcasting. Growth of pan-Arabic television
is one of the important developments in Arab media in the 1990s. As previously
mentioned, this region is among the last remaining enclaves of strict government
surveillance but a study of television content from some of the television
broadcasting centres may raise eyebrows over the appropriateness of such
content in very traditional and religious societies of the Arab world.
The beginnings of modern Arab television programmes may be traced to the

1990-1991 Gulf War when Iraqi forces started the invasion of Kuwait. The
population in the Arab nations were searching for the latest developments and
had to resort to external sources like the BBC and CNN using the still illegal
satellites. Such turn of events triggered the Arab governments to quickly
establish their own channel of information so that they are not totally set aside by
their own people.
Thus, the Arab governments initiated moves to launch their own television
broadcasting, with the Saudi government taking the lead in establishing the
Middle East Broadcasting Centre (MBC), a pan Arabic satellite channel which
provides news and general entertainment programmes. This media centre is
owned by the Saudi royal family and it was headquartered in London. In terms
of content, the MBC was able to operate free from government control and
followed the successful format of Western broadcast channels.

This new liberalisation of content is due to the establishment of new broadcasting

stations that broadcast Arabic programmes to the Arab populations living
abroad. An estimated five million Arab nationals live in Europe and about two
million in North America (Thussu, 2000), forming a wealthy foreign Arabic
media marketplace.
7.4.1 Middle East Broadcasting Centre (MBC)

As previously mentioned, one such television broadcaster is the Middle East
Broadcasting Centre (MBC) which was launched with an initial capital of
USD300 million. Based in London, it reaches across Europe, and North Africa via
the Eutelsat II and through the Middle East via the Arabsat satellite. The MBC
has exhibited high production abilities and professional standards to about 100-
120 million viewers in the Arab world by 1999. It is backed by the services of
correspondents in most Arab countries and US, France, Germany, Russia, India,
Italy, Sweden and Bosnia. It has now evolved into the Middle East Broadcasting
(MBC) Group and is now located in Dubai Media City.
MBC offers quality news broadcasting and other programmes such as current
affairs, talk shows, musicals, features and serials. It started a programme with the
collaboration of the Voice of America called Dialogue with the West. Voice of
America (VOA) is a broadcast service operated by the US government into the
nations which are identified as being under state control.
MBC is owned by Shaikh Walid al-Ibrahim, the Saudi entrepreneur from the
wealthy royal house of the Saud. Such financial strength made it possible for
MBC to purchase the latest satellite technology and state-of-the-art
communication technology equipment. Shaikh Walid also had an interest in the
UPI news agency and favoured Western style journalism and content
development.
7.4.2 Egyptian Radio and Television Union (ERTU)

President Nasser of Egypt was the first political leader who understood the
power of the media. He distributed the radio to rural areas and used the radio as
a tool for development. Egyptian radio services began to be received by many
countries under its „Voice of the Arabs‰ broadcast.

In 1960, television services started its operation consisting of two national

terrestrial channels and six regional channels. Egypt too was the first to launch its
communication satellite, the Nilesat 101. The Egyptian Radio and Television
Union (ERTU) controls the services and its Nile TV International began to
broadcast some programmes in the English language as well as Hebrew.
Egypt is the forerunner in supplying television programmes to the Arab world

and it maintains a huge library of Egyptian films which remained perennial
favourites. Egyptian soap operas are very successful in the region and brought in
huge revenues for ERTU. In 1995, television dramas brought in USD18 million.
7.4.3 Al Jazeera
As mentioned in Topic 5, the BBC had planned to start an Arabic language
station but it failed to materialise. This idea was taken-up by Sheikh Hammad
bin Khalifa, a prince from Qatar who provided a funding of USD140 million, thus
launching the Arabic equivalent of US-based CNN in 1996. This new media
entity, Al Jazeera, became a first in the Arab world. Suddenly Arabs from all over
the region, whether militants or political critics, began calling in, voicing out their
grievances and offering ideas and suggestions to improve their lives and their
governments. It was therefore not surprising that some Arab countries sought to
ban Al Jazeera broadcasts into their countries. It was obvious that this new
network began to offer the other point of view, challenging both the local
governments and providing contra-flows to the US domination of news.
However, after the 9/11 incident, Al Jazeera began to turn its attention to the US
invasion of Afghanistan and Iraq. The Bush Presidency criticised the network as
biased against the US and at one time the US government had to request other
nations of the world not to broadcast excerpts of Osama bin Laden which was
shown on Al Jazeera. Its bureau chief in Washington DC, Abderrahim Foukara,
provided a glimpse into the hearts of the Arab population in his explanation:

The genius of Arab Satellite TV is that it has captured a deep-seated common
existential pain called Arab sensibility and turned it into a picture narrative
that speaks to something very deep in the Arab psyche.
(McPhail, 2010)


Al Jazeera has now established itself as the Pan-Arab Voice in Qatar. In becoming
the new Global Arab Village, it began to take over the role of the Voice of the
Arabs radio in Cairo. Al Jazeera began to add other programmes such as the talk-
shows More Than One Opinion, The Opinion of the Other Opinion and The
Opposite Direction, bringing together people of different persuasions to argue
their points to audiences across the Arab world and beyond. There is a new spirit
of discussion and debates as well as heated arguments on the topics of the status
and roles of Arab women, religion and leaders of their countries.
The nature of Al JazeeraÊs content and guest lists have brought them in direct
confrontation with the advertisers, and had to be bailed out by the owners in
2003 after accumulating losses of 19 million pounds. The station refused to censor
its programmes and continued to provide an alternative service to the Arab
world. During the war in Afghanistan, Al Jazeera sold footage of the war to other
news channels. As a result, its office in Kabul was targeted by American smart
bombs. At other times, Al Jazeera broadcasted the true picture of the war and its
horrifying images to the whole world, negating the US claims of a „bloodless,
costless and clean war in Iraq‰. For that too, its bureau in Baghdad was bombed
in 2001.
However, in an effort to provide competition to Al Jazeera, the Al-Arabiya

network was launched in 2003. Funded by Saudi interests, Al-Arabiya began to
be the leading service in Saudi Arabia and the Gulf countries.
Al Jazeera was able to build an audience of 50 million in 2000 and in 2003 the
station signed a service sharing agreement with BBC and CNN, thus explaining
the familiar faces from CNN and BBC appearing on the Arab network.
7.4.4 Dubai Media City (DMC)

There is an increasing competition in the thriving media industry of the region.
The latest development may be traced to the development of the Dubai Media
City (DMC) project which was launched in January 2001 with the objective of
establishing Dubai as one of the centres for communications and a media hub for
the region. The DMI is part of the Dubai Holding, a government investment
group. DMC accepts 100% foreign ownership and offers a 50-year corporate and
personal tax exemption to media people as well as corporations.

Dubai is a rapidly developing Arab country that embraces the spirit of

globalisation and capitalism while retaining its Middle Eastern image. Its
strategic position at the crossroads of the Middle East, Africa and South Asia
provides a great advantage to serve as a media hub and commercial centre of the
thriving region. By concentrating on building a commercial media centre, Dubai
managed to evade being embroiled in the political broadcasting competition of
the other Arab players of the region. The state has invested USD800 million and
pushed to offer cutting-edge technology and transmission facilities.
The Dubai Internet City (DIC) has attracted world-class computer companies as
well as the return of home companies that had migrated overseas. Companies
that have set-up their presence there include Microsoft, Oracle, Compaq, Sun
Microsystems and Hewlett-Packard.
Its vision of a media hub is materialising because the MBC, the largest Middle
East media conglomerate has relocated to DMC from London. Other media
organisations include Arabian Radio Network (ARN), BBC World, CNN,
Reuters, Sony and Showtime Arabia.
ACTIVITY 7.2
There are several challenges facing Al-Jazeera in reaching the Arab

audiences. Describe some of the challenges and with a partner, discuss
some of the measures that you think would solve the problems.
7.5 ADVERTISING AND PUBLIC RELATIONS

By now you may be aware that countries in the Middle East and North Africa
have faced long periods of colonialism, internal strife and war. However, despite
it all, these countries continue to plan for their societal development and look
ahead to the future like the rest of the globalised world.
As can be seen in the advertising and public relations (PR) sectors of the Arab
world, countries such as Egypt, Jordan, and to some extent Kuwait and Saudi
Arabia have exhibited some level of growth in the industry. De Beer & Merrill
(2009) also reported about advertising and public relations efforts in nations like
Qatar and Bahrain.

Dr Mahmoud El Ghaury of Egypt is regarded as the founder of the centre of

Arab Public Relations Society which began its activities since 1996. He was also
responsible for the establishment of the Public Relations Institute. As we had
deduced in the previous sections, most governments in the Arab states would
also have an interest in the two communication sectors because of the need for
state public affairs activities. The state of Qatar, for example, uses the public
relations offices to ensure that flow of information on government activities reach
the public.
The Saudi government too uses the national and international PR institute as the
public affairs and corporate communications arm of the government. Increasing
commercial activities in the country means that there is a need for PR as a booster
for international trade, management communication and marketing communication.
The state of Kuwait has also established a national public relations association
institute. As in other Arab nations, advertising and PR are needed to meet the
increasing international trade and national commercial activities.
Current PR activities are also managed by agencies that collectively formed the
Middle East Public Relations Association (MEPRA). It was established in 2001 by
a group of PR agencies that seek to raise awareness of the discipline to broader
audiences especially in international standards and ethics. Another agency, the
Active PR and Marketing Communications Consultancy has established its
presence in the Dubai Media City (DMC) apart from its location in Riyadh.
Non-indigenous PR agencies such as Bell Pottinger, which is regarded as one of

the worldÊs leading communication businesses, have operations in Abu Dhabi,
Dubai, Doha and Bahrain. Hill and Knowlton has invested heavily in the Middle
East offices in Abu Dhabi, Jeddah, Riyadh, Doha, Kuwait City and Cairo.
A web page on Middle East advertising agencies listed all the advertising
agencies in the region, beginning from Bahrain, Kuwait, Oman, Qatar, Saudi
Arabia, United Arab Emirates and Yemen. That is the indication of how the
region has developed along the lines of global communication activities.

 Dramatic growth in the Pan-Arabic media has led to rapid internalisation of

Arabic news and television programmes.
 To a certain extent, rapid growth of transnational Arabic broadcasting has

provided an alternative to the American news flows.
 There are pro-Western broadcasters who are seen as the voice of moderate
Arabs.
 There are emerging globalised communication models from the Middle East.
Traditional Arab societies

Democratisation of the Arab world
Moderate Arab voices
De Beer, A. S., & Merrill, J. C. (2009). Global journalism: Topical issues and media
Systems. Boston: Pearson Education, Inc.

Press Freedom in 2011: Breakthroughs and Pushback in the Middle East, 2012.
Freedom House.

London: Arnold Press.
Vivian, J. (2011). The media of mass communication. Boston: Allyn & Bacon.

Topic  Role of Global
8 Advertising
Agencies
LEARNING OUTCOMES
1. Explain the major global advertising agencies;
2. Describe the importance of the advertising agencies in the global
economy; and
3. Discuss the activities of these companies in the global economy and
its growth with the advent of technology.
 INTRODUCTION
In the era of globalisation, advertising can be seen as being a contributing factor
to the success of companies in an increasingly competitive market. For McPhail
(2010), advertising is a necessary component in the global economy to create
consumer awareness and increase sales locally and internationally. With the
advent of the Internet, users can learn about products in other countries and
purchase them.
Therefore, global or international advertising entails the dissemination of

advertising messages to target audiences in more than one country. However,
companies which advertise internationally are confronted with more challenges
despite financial and brand image advantages.

TOPIC 8 THE ROLE OF GLOBAL ADVERTISING AGENCIES  135
Advertising is not just regarded as a communication process, but it can also be

seen as a business practice and as an industry. Based on ZDnet.com, advertising
will grow from USD33.3 billion in 2007 to USD41.4 billion globally in 2012. And
now, the advertising industry is not limited to traditional media-based channels
such as radio, television, newspapers and magazines, but it is shifting to new
concepts like product placement, digital video recorders, video gaming and
music marketing.
In this topic, you will be exposed to the major global advertising companies that
rank among the biggest firms in the world such as WPP Group, Omnicom
Group, Dentsu Inc, Interpublic Group of Company and Publicis Group. These
companies are based in developed nations and bring along values, attitudes and
business practices into all other countries, including economically developing
and less developing countries.
SELF-CHECK 8.1
International advertising can be a business activity, an industry and a

social force. Explain this statement.
8.1 OMNICOM GROUP INC

As one of the foremost advertising and marketing communication services
company, Omnicom Group has been viewed by The New York Times as one of
the „Big Four‰ advertising agencies, alongside WPP, Interpublic and Publicis.
With its headquarters in New York City, OmnicomÊs branded networks and
specialty firms provide advertising, digital and interactive marketing, strategic
media planning and buying, public relations, direct and promotional marketing,
and other specialty communications services to more than 5,000 clients in more
than 100 countries (Plunkett, 2009).
The company was created in 1986 through the unification of three US advertising
giants, namely Doyle Dane Bernbach, BBDO, and Needham Harper Worldwide.
To date, it has 1500 subsidiary agencies which are active in the acquisition area,
including Wolf Aolins (an international brand consultancy) in May 2001, Allyn &
Company (an independent public relations firm in Texas) in January 2002, and
Aaron Walton Entertainment (Los Angeles-based entertainment marketing
agency) in April 2002.

136  TOPIC 8 THE ROLE OF GLOBAL ADVERTISING AGENCIES
With the merger and acquisitions, Omnicom Group functions as the parent
company for three separate and prestigious agency networks – BBDO Worldwide,
DDB Worldwide and TBWA Worldwide – as well as many independent leading
US-based national advertising agencies such as Goodby, Arnell, Zimmerman
Partners and GSD&M, and also the marketing services network, Diversified
Agency Services (DAS). Through DAS, Omnicom Group provides services in
direct marketing, promotional marketing, public relations and specialty
communications. DAS includes RAPP, the leading direct marketing agency, and
Fleishman-Hillard, among the worldÊs largest public relations firm
(www.omnicom.com).
ACTIVITY 8.1
Omnicom Group Inc consists of three top global advertising agencies,
BBDO, DDB and TBWA. Each has its own valuable clients around the
world. Find information on each of them and discuss the following:
(a) History;
(b) Clients; and
(c) Recognition/Awards received.
Omnicom Group Inc also manages Omnicom Media Group (OMG) that was
formed out of the media department of its three global advertising agencies. OMG
comprises three full service media companies, namely PHD Network, OMD
Worldwide and Prometheus. Under this group there are media specialist
companies in branded entertainment, print, outdoor, etc.
About 60% of its advertising revenues come from TBWA International and
Goodby, DDB Needham Worldwide, BBDO Worldwide; while 40% of its revenue
comes from its specialty advertising and marketing service companies
Its three global agency networks all rank in the top 10 global advertising agencies
and receive many high-status awards. In 1996, BBDO was recognised as "The
Most Creative Agency Network" by Advertising Age International. In the 1996
Cannes International Advertising Festival, DDB Needham garnered the most
awards.
In 1996, TBWA opened new offices in Asia (Singapore, Hong Kong and China),
Latin America (Brazil, Chile and Argentina), South Africa and Europe (Warsaw,
Munich, Berlin and Cyprus) (www.fundinguniverse.com).

8.2 WPP GROUP

Originally a UK manufacturer of wire basket, Wire and Plastic Products (WPP)
Group was created in 1971 and renamed WPP Group in 1987. It is one of
the main advertising and communication services group in the world with
₤10 billion revenue as of 31 December 2011. WPPÊs clients include over 300
of the Fortune Global 500 and over half of the NASDAQ 100. The group has
3,000 offices in over 110 countries and its companies provide services in
advertising, information and consultancy, media investment management,
branding and identity, public relations and public affairs, and specialist
communications (www.wpp.com). Figure 8.1 shows WPPÊs company list.
Figure 8.1: WPPÊs company list

Source: www.wpp.com
With about 162,000 employees, the groupÊs mission is to develop, manage,

motivate, support, and apply talent for its operating units, releasing them of the
majority of their administrative and financial responsibilities by achieving
efficiencies in information technology, procurement, professional development
and client coordination that no single individual company would be able to
achieve on its own.

This company started to build its worldwide marketing services company

through massive and high acquisitions by an English businessman, Martin
Sorrell, a famous financial director of the advertising giant Saatchi & Saatchi pls.
With its core administration in London, UK, and its registered and executive
office in Dublin, Ireland, WPP has four global advertising networks: Ogilvy
Group, Young & Rubicam Brands, Grey Group, and JWT (J. Walter Thompson).
They were acquired when WPP turned its attention to the US.
WPP bought out JWT Group Inc., a media advertising agency in financial trouble
in June 1987. That buyout included Hill & Knowlton Inc, the public relations
giant, and several satellite firms. In 1989, it acquired the Ogilvy Group for
USD864 million and built an alliance with Asatsu-DK In of Japan in 1998. WPP
entered the new millennium focused on expansion and getting another attention
with bids of USD630 million for the Tempus Group. It purchased Young &
Rubicam (Y&R) in 2000 in a USD4.7 billion acquisition to form the worldÊs largest
advertising and services group. With Y&R and Tempus, its marketing services
increased to 65% of total incomes.
In 2008, Y&R became the fourth largest US advertising agency with 16,000
employees in 186 offices all over the world. It offers a wide range of advertising,
media, and communication services as well as the controlled public relations
giant Burson-Marsteller. This agency utilised a number of globally-based video-
conferencing site for its management and clients. It also has a major global
marketing subsidiary called Wunderman, which takes a technology focus in
order to assist clients with e-commerce and internet-based marketing needs and
solutions. The group is thus moving into new areas such as Internet, data mining,
behaviour modelling and customer retention work.
The group has managed its portfolio of investments and acquisitions through
WPP. DigitalWPP has won global HSBC and Samsung accounts, the prestigious
account Dell, IBM, Kraft Foods, Johnson & Johnson, Nestle and Unilever.
ACTIVITY 8.2
As one of the largest and prominent advertising companies, WPP has

received various recognitions and awards. With a partner, list down
these awards.

8.3 INTERPUBLIC GROUP OF COMPANIES

Headquartered in New York City, the Interpublic Group of Companies (IPG) has
been considered as „the grandfather of the global marketing communications
companies‰ (www.interpublic.com). As one of the „Big Four‰ global advertising
agency companies, this New York City group has 42,400 employees with
revenues of USD7 billion in 2011. Over half of IPGÊs revenue is derived from
print and traditional media advertising while the remaining 42% comes from
marketing services (www.wikiinvest.com). Its subsidiaries specialise in
consumer advertising media planning and buying, public relations, interactive
marketing and other specialised disciplines such as event marketing and sports.
ACTIVITY 8.3
As one of the leading global advertising agency, IPG has a large number
of customers comprising major companies and famous brands. List the
major clients of IPG.
IPG is the parent company of advertising agency McCann Erickson and media
company, Universal McCann. It has offices in more than 100 countries. The
group operates in two main business segments as follows (www.wikinvest.com):
(a) Integrated Agency Networks (IAN)

It accounts for most of IPGÊs business and consist of its flagship agencies
of Lowe, Draftfcb and McCann, and also media agencies, stand-alone
agencies. The McCann group of agencies, is IPGÊs best recognised brand,
operating in over 100 nations.
(b) Constituency Management Group (CMG)

This is a smaller segment accounting for only 16% of income in 2007.
It includes the specialist marketing service offerings. The segmentÊs
brands include MWW Group, Jack Morton, Weber Shandwick, De Vries,
FutureBrand, Golin Harris and Octacon.
Even though IPG was created in the early 1960s with an association of two
agencies, McCann Erikson Worldwide and McCann-Markshalk, the history
goes back over 100 years. It was first incorporated in 1930 under the name of
McCann-Erickson Incorporated, succeeding the advertising agency started by A.
W. Erikson and in 1911 by Harrison K. McCann (Gralpois, 2010). IPG then added
on 38 agencies, communications companies and PR firms by 1966.

IPG has been a client-centric organisation since its beginning. The companyÊs
mission has been to develop client trade and brands, with a particular
emphasis on constructing global brands through local and synchronised
marketing programmes. This holding company is among the top five advertising
conglomerates by revenue in the world. It has three global advertising agencies,
namely Draftfcb, McCann Worldgroup and Lowe and Partners as well as full-
services US agencies (such as Deutsch, Campbell Mithun and The Martin Agency
and Mullen). Figure 8.2 shows IPGÊs revenue and net income while Figure 8.3
shows IPGÊs revenue by geographic area.
Figure 8.2: IPG revenue and net income

Source: www.wikiinvest.com
Figure 8.3: IPG revenue by geographic area in 2007

Source: www.wikiinvest.com

To respond to the growth of Internet advertising and competition from specialty

firms, IPG has developed partnerships and joint ventures such as with SocialVibe
to focus on the marketing power of social networks. IPG has also developed its
own digital offerings such as R/GA, a special agency that designs interactive
campaigns for clients (www.interpublic.com).
8.4 DENTSU INC

Dentsu Inc is JapanÊs leading advertising company with the highest percentage of
net sales (Figure 8.4). The company has overseas branches and subsidiaries
in four continents. It ranks among the top companies of the world in terms
of income with net sales that totalled USD18,041,897,000 in the year ended on
March 31, 2010. For Sugiyama and Andree (2010), Dentsu is the worldÊs second
largest advertising agency after the USA by a share of the mass media
advertising market of around 22%.
Figure 8.4: Advertising expenditure in Japan by

percentage of net sales up to 2010
Source: www.dentsu.com
*HDY refers to the total non-consolidated net sales of hakuhodo, daiko advertising and
yomiuri advertising.

DentsuÊs roots dated back to 1901 when Hoshiri Mitsunaga founded the
Telegraphic Service Company. In 1936, Dentsu reinvented itself as a specialised
advertising agency. By 1959, Dentsu began its international spreading out by
establishing offices and subsidiaries in New York, London, Paris, Moscow, Taipei
and Beijing. Dentsu joined with Young & Rubicam to become a joint venture firm
for several major accounts. It continued to expand globally. Dentsu then shifted
toward Asia by expanding and buying out Asian advertising agencies.
Headquartered in Minato, Tokyo, Dentsu operates in 27 countries worldwide

and has more than 6,000 clients including multinationals in established markets
like Canon and Bell Atlantic in US and Europe as well as companies from
emerging economies in South Africa and Asia. Its dominance is due to a variety
of client portfolio and enjoys buying power in all key mass media formats while
maintaining the top share in all mass media formats in Japan. In its effort to offer
the clients the most distinctive, innovative, and diversified communication
solutions, Dentsu divided its services as follows (Plunkett, 2009):
(a) Total advertising services – creative development, strategic planning, and
media services;
(b) Marketing services – advertising and sales services;
(c) E-solution services – e-business consulting and system integration services;
(d) Content business – the sales of broadcasting and sponsorship; and
(e) Overseas operations – provides communication services to overseas clients.
Operating within a framework of „Integrated Communication Design‰, it has

expanded beyond the traditional parameters of the advertising business. It
does corporate image design, branding, market research, publicity, new product
planning, and main events planning and design for sports and exhibitions.
Dentsu operates in four well defined markets, which are (www.dentsu.com):
(a) The domestic market – largely traditional mass media advertising;
(b) Advertising related market – sales promotion and specialised marketing
services;
(c) New markets – including sports marketing and entertainment; and
(d) Overseas market.

Dentsu is always ahead of the domestic market with planned preparations in

high-growth media like the Internet. The company launched a Dentsu Tec Inc
and started another Internet advertising business cooperation with TokyoÊs
Softbank Corporation called Cyber Communication, Inc (CCI). With the advent
of technology, Dentsu did not waste time and made an official deal and
involvement in the Bcom3 Group, which had a total of 520 offices in 90 countries
in March 2000 (www.dentsu.com).
ACTIVITY 8.4
With „Good Innovation‰ as its corporate philosophy, Dentsu provides a
diverse range of services including the following:
(a) Strategic solutions;
(b) Communication design;
(c) Creative sphere;
(d) Promotions;
(e) Digital;
(f) Media content; and
(g) Social solutions.
Explain each of DentsuÊs services.
Now the Internet is fully integrated into DentsuÊs offering and bundled together
with other media. According to Sugiyama and Adree (2010), the approach not
only improved services for clients, but also created accountability.
8.5 PUBLICIS GROUP

With activities covering 104 nations in five continents and employing almost
49,000 professionals, Publicis Group is regarded among the largest advertising
and media conglomerates and the worldÊs third largest advertising holding
company (McPhail, 2010). With its headquarters in Paris, France, this group
provides three main categories of services: traditional advertising, specialised
agencies and marketing and media operations. According to Gralpois (2010), the
Publicis Group is a large family of companies which has autonomy to foster its
own culture but still participates in the group community.

Publicis was founded in 1926 by a 20-year old French advertising pioneer, Marcel
Bleustein-Blanchet. After opening a New York office in 1957, through a merger
and strategic alliance with Foote, Cone and Belding in 1988, Publicis entered the
US market and grew beyond Europe in the mid-1990s with purchases of shares in
main agencies in Asia, Latin America, and Canada. About 59% of the companyÊs
revenue were generated in Europe, excluding France. In 1999, Publicis bought
49% of Burell Communications, a large advertising agency specialising in the
African American market which has several major clients including Coca-cola,
McDonaldÊs and Sears.
Publicis Group was formed in 2000 when Publicis, the Paris-based agency,
acquired Saatchi & Saatchi, the international holding company that has
operations in advertising, marketing and communications and employs 6000
workers for USD1.7 billion. Its namesake has about 150 offices and serves global
clients such as Procter & Gamble, Toyota, and General Mills. The group then
merged with Bcom3 Group under the leadership of Maurice Levy as CEO. It also
formed a strategic partnership with Dentsu, JapanÊs largest group, in order to
strengthen its global reach in Asia. Figure 8.5 shows PublicisÊ key figures in 2011.
Figure 8.5: PublicisÊ key figures for the year 2011

Source: www.publicisgroupe.com

Overall, with „Viva La Difference‰ as its slogan, Publicis Group now includes the
following (Plunkett, 2007):
(a) Three global advertising networks – Publicis, Leo Burnett and Saatchi &
Saatchi;
(b) Two multi-hub networks – Barthe Bogie Hegarty and Fallon Worldwide;
(c) Regional agencies – Beacon Communications (Tokyo), Kaplan Thaler
Group (New York) and Marcel (Paris); and
(d) Two global media consultancy and buying networks – ZenithOptimedia
and Starcom MediaVest Group.
The merged firms provide a broad range of communication services such as

advertising, public relations, marketing research and media buying and
planning. One of the partners, Leo Burnett has an illustrious history and has
worked with prestigious clients over the years such as LÊOreal, Nestle, HP,
Whirpool, Toyota, Nintendo, Walt Disney and General Motors.
With the prime objective to becoming a leader in the digital sector, the group has
acquired Digitas (the fourth largest marketing services agency in US and the
third largest interactive agency at the time) in December 2006, and Rzarfish from
MicrosoftÊs prior acquisition of aQuantive, to improve its digital capabilities since
Internet-based advertising is increasing. Under the Publicis GroupÊs Vivaki pole,
it built up a technological platform supported by Google, Microsoft, Yahoo! and
AOL that recommends advertisers the possibility to aim particularly defined
audiences in a single campaign with various networks.
8.6 HAVAS ADVERTISING

Formerly identified as Havas Advertising before changing its name in 2002 to
Havas, this company is a leading pan-European agency which operates in over
88 countries in addition to Europe. It employs approximately 15,000 people
worldwide. Headquartered in Puteaux, France, this company offers various
communication consulting services, including traditional advertising; brand
strategy and consulting services; digital and online marketing; advertising;
corporate, financial and human resources communication; experiential and
design marketing; sports marketing; health communication; and media expertise
services, as well as relational, promotional and interactive marketing services.

Based on its website (www.havas.com), Havas operates through its two business
units, namely:
(a) Havas Worldwide

Havas Worldwide integrates the Euro RSCG Worldwide network with 233
offices in 75 nations, the Arnold micronetwork with 16 agencies in 15
countries, as well as other agencies with strong local identities. It focuses on
three key areas, namely:
(i) Its model and the integration of digital at the core;
(ii) Its ability to influence consumer behaviour as a global network; and
(iii) A focus on attracting and retaining the best talent in the industry.
(b) Havas Media

Covers over 100 nations and incorporates the Arena Media, MPG, Havas
Digital networks and Havas Sports & Entertainment. It presented a set of
robust results in 2011, with double digit growth on the top line and an
improvement in profitability. All regions contributed to this performance,
especially in LATAM (led by Mexico), Asia Pacific (notably in China), NEC
regions and Germany, as well as North America, France and Spain.
In 2011 Havas Media continued to invest in three key areas, namely:

(i) Developing market insight with a focus in helping its clients and their
brands to build more meaningful relationships;
(ii) Investing in its product through new initiatives, especially in the
digital area; and
(iii) Strengthening its international network.
As a global advertising and communications services group, it also provides

advertising, promotions, design and branded content; and creates applications
and products for mobile, social media, distribution and community engagement.
With a revenue of €1,645 million in 2011, it is proud of the ties it has built not
only with large international firms, but also with significant regional and local
clients such as Unilever, Sony, Volvo, Dell, Coca-Cola, Clarins and KIA. Europe
represents 59% of its revenue, with France being the major player. North
America provided 30% of its revenue. With the advent of technology, Havas has
brought the digital environment into the core of all of its agencies becoming one
of the industry leaders in the social media space.

 Global or international advertising entails dissemination of a commercial

message to target audiences in more than one country.
 Major advertising agencies are based on the core nations, such as Omnicom,
WPP, IPG and Dentsu Inc.
 As one of the leading advertising and marketing communication services

company, Omnicom Group has been viewed by The New York Times as one
of the „Big Four‰ agency companies, alongside WPP, IPG and Publicis.
 As JapanÊs largest adverting agency, Dentsu is ahead of the domestic market

in high-growth media categories such as the Internet. The company launched
a Dentsu Tec Inc and founded another Internet advertising joint venture with
TokyoÊs Softbank Corporation called Cyber Communication, Inc.
 The merged firms in Publicis Group provide a broad range of communication

services such as advertising, public relations, marketing research, and media
buying and planning. With the prime objective of becoming a leader in
digital, the group has acquired Digitas and Razorfish to improve its digital
capabilities since Internet-based advertising is increasing.
 Havas is a leading pan-European agency which has brought the digital

environment into the core of all of its agencies to justify being one of the
industry leaders in the social media space.
Acquisition International advertising

Brand Media buying and planning
Integrated communication design Social media

Douglos, S. P., & Craig, S. (2002). International advertising. In International

encyclopedia of social and behavioural sciences. London: Elsevier.
Firth, K. T., & Mueller, B. (2010). Advertising and societies: Global issues. US: Peter
Lang.
Funding Universe Website. (n.d.). Retrieved from www.fundinguniverse.com.
Gotemba, G., & Iwamoto, Y. (2006). Japan on the upswing: Why the bubble burst
and JapanÊs economic renewal. US: Algora Publishing.
Gralpois, B. (2010). Agency mania: Harnessing the madness of client/agency

relationships for high-impact results. US: Publish Green.

trends. New York: Blackwell Publishing.
Milenkovic, M. (2009). Global advertising in a cultural context. Diplomica Verlag.
Omnicom Group Inc., WPP Group, Interpublic Group of Companies, Dentsu Inc,
Havas, Publicis Group Websites. (n.d.). Retrieved from www.havas.com.
Plunkett, J. W. (2007, 2009). PlunkettÊs advertising and branding industry

almanac 2007 (e-book). Houston: Plunkett Research Ltd.
Sugiyama, K., & Andree T. (2010). The Dentsu way. London: McGraw-Hill
Professional.
www.dentsu.com
www.interpublic.com
www.wpp.com

Topic  Global
9 Telecommunication
Systems
LEARNING OUTCOMES
1. Describe the major stakeholders in the evolution of telecommunication
systems;
2. Discuss the role of selected major stakeholders in the global
communication system;
3. Explain the importance of their existence to global communication;
and
4. Identify the issues of concern in global telecommunication
infrastructure.
 INTRODUCTION
The advent of information and communication technology helps the easier flow
of information. The world has indeed become a global village as predicted by
Marshall McLuhan.
With the existence of satellite parabolas or dishes, the emergence of the Internet,
broadband, wireless, fibre optic cables, and mobile telephony, the transmission of
contents rely heavily on the efficiency of telecommunications infrastructure.
Therefore, every nation, especially the metropolis nations, needs good
telecommunication systems to ensure effective communication and efficient
access and distribution of information.

150  TOPIC 9 GLOBAL TELECOMMUNICATION SYSTEMS
Global telecommunication systems are the central nervous system of the global
economy. Hence, an internationally functioning technical transmission system or
infrastructure is required.
In this topic, you will be exposed to selected major players in the global
telecommunication infrastructure. The discussion focuses on the International
Telecommunications Union (ITU), a global telecommunication agency under the
United Nation (UN). We will also focus on International Telecommunications
Satellite Organisation (INTELSAT) and other players that are also responsible to
the global telecommunications system.
ACTIVITY 9.1
One popular phrase in McLuhanÊs book Understanding Media: The

Extensions of Man is „the medium is the message‰. What does the
phrase mean? Discuss with your partner.
9.1 INTERNATIONAL TELECOMMUNICATIONS

UNION (ITU)
The International Telecommunications Union (ITU) is committed „toward its
mission to connect all the worldÊs inhabitants‰. ITU aims „to provide protection
and to uphold the right to communicate for all‰ (www.itu.int). ITU is located in
Geneva, Switzerland, and has 193 states as members as well as about 700 private
corporations.
As an international agency under UN, ITU plays the role of a platform for
international meets and exhibitions and serves as a forum for bringing together
officials from both the government and private telecommunications and the
Information Communication Technology (ICT) industry to share ideas, know-
how, and technology. It convenes major global conferences to monitor global
technical standards as well as issues impacting on the telecommunications
businesses. However, it sometimes becomes a battlefield between core and
peripheral nations, especially regarding the New World Information and
Communication Order (NWICO).
Nowadays, all core nations have the latest in communication technologies whereas
the peripheral nations have less. Therefore, the main objective of the ITU is to close
the „digital divide‰ between the metropolis and peripheral nations.

TOPIC 9 GLOBAL TELECOMMUNICATION SYSTEMS  151
9.1.1 The History of ITU

ITU has its early beginning in Paris and started operations as the International
Telegraph Union in 1865 under the International Telegraph Convention signed by
20 European nations. It was renamed ITU in 1934 and gradually evolved into a
specialised unit of the UN in 1947. It can be considered the most important
international organisation for the regulation of communications.
It was formed to standardise international regulations of telegraph network usage.

It was followed by the granting of the patent for the telephone in legislation to
regulate the telephony business.
The advent of wireless telegraphy in 1896 and the utilisation of such technology
for maritime purposes, led to the International Radiotelegraph Conference which
was convened in 1906 in Berlin. It led to the introduction of radio regulations.
By 1927, during a conference in Washington DC, the International Radio

Consultative Committee (CCIR) was established. It was later followed by The
International Telephone Consultative Committee (CCIF, set up in 1924), the
International Telegraph Consultative Committee (CCIT, in 1925). The CCIR was
put in charge of coordinating the technical studies, tests and measurements that
were conducted in the various fields of telecommunications. Later they were also
responsible for the drafting of international standards.
At the 1932 Madrid Conference, the Union decided to combine the International
Telegraph Convention of 1865 and the International Radiotelegraph Convention
of 1906 to form the International Telecommunication Convention. In 1956, the
CCIT and the CCIF were merged to form the International Telephone and
Telegraph Consultative Committee (CCITT), in order to respond more effectively
to the requirements generated by the development of these two types of
communication.
In 1959, CCIR set up a study group responsible for studying space radio
communication as a way to meet the challenges of new space communications
systems. The introduction of space telecommunication systems necessitated the
improvement of procedures.
ITU became the major agency in organising the World Summit on the
Information Society (WSIS) that aim to close the digital gaps. WSIS became the
body to ensure a people-centred development-oriented Information Society
(www.itu.nt).

9.1.2 The Maitland Commission

Though ITU is the platform in discussing issues related to ICT, peripheral nations
seem discouraged to push the New World Information and Communication Order
(NWICO) to ITU because of the following factors (McPhail, 2011):
(a) There would be other global meetings sponsored by the ITU at which they
could state their case and make gains in their movement towards a fairer
share of the radio spectrum and orbital parking spaces;
(b) Pressure applied by many nations, particularly the US, to ensure that an
orderly spectrum remained intact, especially satellites;
(c) Almost all nations want to see their domestic system continue operating
without major adjustments; and
(d) Divergent and conflicting interests among peripheral nations prevent the
formation of a powerful and united voting block that could present
resolutions and amendment demanding radical changes in ITU.
Figure 9.1: Population and telephones by country economic grouping –

Maitland Commission Report 1985
Source: www.itu.int

To reduce criticism from peripheral nations, the ITU responded with the
establishment of the Independent Commission for Worldwide Telecommunications
Development: The Missing Link, better known as the Maitland Commission
chaired by Sir Donald Maitland during the 1980s. The report published by ITU in
1985 addressed the inequities in the distribution of telecommunication systems
and services between developed countries and other nations.
For instance, the report indicated that 96% of the distribution of global telephones
is in high-income or upper-middle income countries as shown in Figure 9.1. It
showed that two-thirds of the global population do not have telephone services. In
the majority of the developing countries, services are below the global standard
and the latest models of telecommunications are not available, with the exception
of the larger towns and commercial meeting points.
Based on the commission, the causes of this inequality are due to various reasons,
including disparities in economic ability, past abilities, and different priorities
given to investment in telecommunication between both groups. In the developed
or industrialised countries, individuals enjoy the use of more than one telephone
per two people. All businesses and the majority of households are already „on the
telephone‰. Customers expect a high quality of service and when faults occur, the
management of the network is heavily criticised. Furthermore, telecommunication
is truly the central nervous system of the emerging information society.
That imbalance should be removed to gain the benefits from the importance of the
telecommunication system:
Given the vital role telecommunications play not only in such obvious fields
as emergency, health and other social services, administration and commerce,
but also in stimulating economic growth and enhancing the quality of life,
creating effective networks worldwide which will bring immense benefits. An
increase in international traffic will generate funds which could be devoted to
the further improvement and development of telecommunications services.
The increased flow of trade and information will contribute to better
international relationships. The process of creating effective networks
worldwide will provide new markets for high technology and other
industries⁄

ACTIVITY 9.2
Based on the Maitland Commission there are big gaps in the digital
divide between industrialised countries and developing countries. How
about now, more than 20 years after the report was published? Do you
think the situation has changed?
Read the report „Twenty Years of Measuring The Missing Link‰ from
the ITU website (http://www.itu.int/osg/spu/sfo/missinglink/kelly-
20-years.pdf) and discuss it.
Telecommunication systems are now viewed as essential components of

development. It is a prerequisite for any type of social or economic development in
developing or peripheral countries. Therefore, modern telecommunication
development activities are crucial, such as the following (www.itu.int):
(a) Governments, development agencies and financing institutions are to give a
higher priority to investment in the telecommunication sector;
(b) Developing countries should review their development plans to ensure that
sufficient priority is given to investments in telecommunication;
(c) Existing networks should be made more effective and commercially viable
and should gradually become self-reliant; and
(d) All projects or development activities with economic and social components
should have a telecommunication element built in.
Nowadays, ICTs are becoming crucial tools for economic and social
development. As a matter of fact, the Internet is now seen as the main technology
for all needs. Therefore, access to broadband should now be a basic requirement
just like what electricity or roads used to be then. Having access to the Internet
should now be the right of every citizen.
9.1.3 ITU’s Changing Roles and Expectations

ITU tries to enhance its role in confronting the new environment, especially in
the globalisation and expansion of the global economy, along with rapid
innovations in the ICT sector. One of it is through the privatisation of
telecommunication systems and services.

Privatisation now dominates the telecommunications landscape, which witnesses

the emergence of new stakeholders who have little or no connection with their
own governments whether in ownership or control. These private sector
stakeholders such as Hewlett-Packard, Microsoft, Intel and IBM provide the
technical expertise for both wireless telecommunications and satellite technologies.
The private sector entities were estimated to provide over 90% of the intellectual
and technical services that underpin ITUÊs recommendations and technical
standards (McPhail, 2005). ITU needs to deal with this situation to retain its
global technical decision-making role.
In 2010, ITU World Telecommunication Development Conference described the

regional presence of the ITU as crucial „in supporting and encouraging the
enhanced development of ICT facilities in member countries, particularly the
developing and more specifically the poor nations‰.
Developing countries now enjoy their voting status at ITU and do not want to see
it weakened by adding private sector voting rights. These countries are
concerned that private sector voting rights would go to multinational corporations
based on the developed countries like USA, Europe or Japan. The marginal
voices of developing countries could decrease if ITU fulfils the private sector
demand. However, if ITU fails to respond, many major ICT players could shift
their interests, role and advice to other regional groups.
At the same time, ITU realises that reform is needed. In its Strategic Plan for
2008–2011, ITUÊs major planning document recognises the crucial role that they
should play within the broader context of the global economy. It realised the
challenges on the ICT and telecommunication current trends and tried to
reposition itself in the international telecommunications debate. ITU attempts
to solve the digital gap problems by organising the World Summit on the
Information Society (WSIS) as a global forum with a pledge for building a
people-centred development-oriented Information Society. This is followed by
the initiation of the WSIS Stocktaking process in 2004. The purpose is to provide
a register of activities carried out by governments, international organisations,
the business sector, civil society and other entities, in order to highlight the
progress made since that landmark event.
As telecommunications and ICT become a central nervous system of the global

economy, ITU can be regarded as an important platform to the future of global
communication. It is seeking to retain global leadership at the preeminent
intergovernmental organisation where public and private business work in an
orderly and fair manner.

9.2 INTERNATIONAL TELECOMMUNICATIONS

SATELLITE ORGANISATION (INTELSAT)
The creation of Intelsat can be regarded as a landmark in the commercialisation of
space activity. It was formed as a result of the 1961 UN General Assembly
resolution that „communication by means of satellite should be available to the
nations of the world as soon as practicable, on a global and non-discriminatory
basis‰ (Murphy, 2002).
On the basis of agreements signed by 11 participating countries on August 20,

1964, it led to the formation of the International Telecommunications Satellite
Consortium, an intergovernmental body. Its purpose was the design, development,
construction, establishment, operation and maintenance of a global commercial
telecommunications satellite system. It operates as a wholesaler providing satellite
services to users through Intelsat members in each country.
Starting from a single satellite after the launch of Intelsat I in 1965, the Intelsat
system has grown to a global network using many satellites. As of March 2011,
Intelsat operates a fleet of 52 communication satellites with their corporate
headquarters in Luxemburg, and it is the leading provider of satellite services
worldwide. With the aim of aiding the global community, Intelsat is the crucial
tool in many international organisations, such as the Red Cross and World Vision
which continue in their service for the good of humanity across the world.
Controlled and owned by 144 member nations, this organisation has been
disseminating information and entertainment programmes for most of the
international media houses and their sister companies, the Internet Service
Providers, and governmental bodies. IntelsatÊs central unit feed into the worldÊs
network of fixed satellites, teleport, and fibre infrastructure network. Therefore,
IntelsatÊs nerve centre supplies the support and strength needed for national,
regional and global communications.
9.2.1 The History of Intelsat

In the mid 1960s, Intelsat launched a satellite – due to the proven feasibility of
communication satellites – to gain information in four areas:
(a) Rain margins required at ground stations;
(b) Reaction of telephone users to the transmission delay;
(c) Long-term operation of the station keeping control valves; and
(d) Applicability of communication satellites for commercial telephone use.

Early Bird (also known as Intelsat I) was put into regular commercial service in
1965, and thereafter contracted for manufacture and launch of dozens of
satellites.
By 1969 it provided global television coverage on the moon landing to an

audience estimated to exceed 500 million people. In 1978, Intelsat linked the
World Cup football matches to over 1 billion TV viewers in 42 countries. By 1997,
it had established three regional support centres – Pacific Rim, Southeast
Asia, and Europe – to increase market awareness and develop further
telecommunications business. In 2000, billions of people around the world
watched the broadcast of the Sydney Olympic Game via 10 of its satellites
(McPhail, 2011).
Intelsat operates as a financial cooperative. Its ownership is shared by all

signatories designed by the members, which contribute to the capital requirements
of the organisation in proportion to the investment shares. Members could be
either governments or a „communications entity, public or private‰ such as
COMSAT, owned by the US. From the beginning, the US was a major participant
and the leading core nation in the ITU.
Notwithstanding IntelsatÊs success, competition in the area of satellite

communications increased, and it became apparent that for Intelsat to survive in
the global market it would need to operate with greater flexibility. At the same
time, its competitors criticised its status as an international organisation which
rendered it immune from antitrust and tax measures. Therefore, as a direct
impact of massive support and promotion by PanAmSat, a US satellite operator,
the US Congress approved the Open Market Reorganisation for Betterment of
International Telecommunications Act to corporatise it.
Almost after 37 years of operation as an intergovernmental entity, on July 18,

2001, Intelsat became a private business body known as Intelsat Ltd. It began to
invest in ground infrastructure and media-oriented satellites as well as providing
end-to-end solutions through networks of teleports, leased fibre and points of
presence around the globe. In 2005, Intelsat was acquired by a group of private
investors, before the completion of its merger with PanAmSat Holding
Corporation in July 2006.
9.2.2 Intelsat Competition

Even though Intelsat can be regarded as a leader in global telecommunication, it
has had to overcome competition to survive to this day. One of it is the
revolutionised fibre optic technology that surpassed satellite technology in two
aspects: clarity and security of the signal transmitted. Fibre optic telephone calls
do not have the built-in one half second delay of GSO satellite calls and have
virtually no distortion. In addition, signals sent over fibre optic lines are almost
impossible to intercept. The competition has been described by IntelsatÊs Director
General as follows:

Global fibre-optic capacity has doubled each year for the past five years. Over
the next five years, it is expected to double again⁄ [A]s a result of the growth
in fibre-optic capability, the migration from satellite to fibre on high-density
routes has significantly reduced IntelsatÊs growth in telephony services. Some
of the customers migrating to fibre-optic cables are members of IntelsatÊs own
close group of customers (namely signatories) who are often investors and
developers of cable networks.
(Bender, 1998)
There are several companies now providing satellite centric telecommunications

services and compete directly with Intelsat for high-volume users and transoceanic
telecommunication business. Competition from independent satellite launchers
also threatens the economics of Intelsat as the satellite organisation that handles
two-thirds of all international telephone traffic (Bender, 1998).
According to McPhail (2011), these two competing groups service those routes
that provide considerable profitability. They do not serve the undeveloped
nations, less populated areas, or low-profit tracks where there is little interest for
high-capacity and high-speed digital communication. However, Intelsat is the
lifeline provider for universal access to satellite service and this satellite operator
has a strong chance to dominate the North American market and becoming a
stronger contender on the global scene after its merger with PanAmSat.
IntelsatÊs satellite capacity provides vital communications for critical applications

that expand the presence of education and health for such organisations as
ChildrenÊs National Medical Center and Mindset Network. As the satellite
industry leader, this organisation supports humanitarian efforts, education,
quality of life initiatives and organisations that help improve lives through
employee volunteerism, in-kind assistance and gifting.

ACTIVITY 9.3
Besides Intelsat, there are other satellite providers as listed below. With
a partner, find information about these satellite providers:
(a) Eutelsat;
(b) Immarsat;
(c) Intersputnik; and
(d) SES S.A.
9.3 WORLD TRADE ORGANISATION (WTO)

The World Trade Organisation (WTO) can be traced from the beginning of the
organisation that formed the General Agreement on Tariffs and Trade (GATT)
which was established by the industrialised nations in 1947. The aim of WTO is
to establish international procedures for encouraging free trade by limiting the
number of tariffs and government aids. It is a multilateral agreement where
several nations have agreed to reduce tariffs in order to facilitate growth in trade
and the global economy.
WTO officially commenced and succeeded GATT in January 1995 under the
Marrakech Agreement. As the only global international organisation dealing
with the rules of trade between nations, it is formed to promote international
trade by introducing a procedure for formalising trade agreements and providing
a framework to solve disagreements between nations. With 155 member countries,
of which 117 are developing countries, WTO activities are administered by a
Secretariat of some 700 employees based in Geneva, Switzerland under the
management of the WTO Director-General.
The WTO roles and influence become more important as global trade increases,
including a substantial number of mergers and acquisitions internationally in the
communications sector. However, there are controversies in the roles played by
the WTO.

9.3.1 Trade versus Culture

The expansion of WTO control over audiovisual services and intellectual
property in the Uruguay Round is an area of concern to member nations. An area
of dispute is the question of the linkages between the notion of the industry and
culture.
The movement towards commercial liberalisation has been advantageous to the

bigger and long established industries in cultural industries since this industry,
particularly the film industry, is still nascent in most nations. The liberalisation
efforts within WTO have brought up non-commercial interests. This raised a
debate which can be seen as having these dichotomous elements:
.... liberalisation promoted by WTO negotiations follows a non-discrimination

principle, expressed mainly by the rule of national treatment (non-
discrimination between national products and like foreign products) and the
most favoured nation treatment (non-discrimination between foreign member
states).
On the other hand, considering that some countries have more powerful
cultural industries than others, arguments may be put forward that in the
cultural sector open market may lead to cultural standardisation if member
states cannot adopt and maintain cultural policies to preserve their cultural
expressions.
(Hanania, n.d)
However, the US insists that media products such as films, books and magazines
may be considered as any other manufactured product. This goes against the
national interests in a number of countries because they view these cultural
products as central to their history, national identity, language and culture.
Therefore, some parties have threatened to walk out from GATT negotiations
and want to defend their right to exclude cultural industries and products from
the negotiation.

ACTIVITY 9.4
With the evolution and advent of technology in the audiovisual market,

it is difficult to draw a clear distinction between cultural goods and
cultural services.
1. How about transmission of television programmes or the sale of
audiovisual services via the Internet? What do you think?
2. In your opinion, how can we differentiate between goods and
cultural products?
3. Should all trade products be considered the same and can enter
other markets in the name of free trade?
9.3.2 WTO and Intellectual Property Rights

There are also criticisms on the inclusion of Agreement on Trade-Related Aspects
of Intellectual Property Rights (TRIPS) into the WTO charter. The WTOÊs TRIPS,
which was included in the Uruguay talks of 1986–1994, introduced intellectual
property rights into the multilateral trade between nations for the first time. This
introduction was initiated in order to narrow the gaps in the matters pertaining
to intellectual rights from all over the globe, thus putting them under one
governing body. It ensures a basic level of protection that each government needs
to observe in granting the intellectual property of fellow WTO members.
Some parties see it as being needed now, especially with the expansion of the
global communication corporation; the ability to reward and determine
ownership of creative works is becoming more problematic. However, a
professor of economics and law in Colombia University, Jagdish Bhagwati
asserts that intellectual property does not belong to the WTO, since protecting it
is simply a matter of royalty collection.

9.4 ORGANISATION FOR ECONOMIC CO-

OPERATION AND DEVELOPMENT (OECD)
The Organisation for Economic Cooperation and Development (OECD) aimed to
promote the principles that will improve the economic status of people all over
the world. Together with the national governments, OECD aims to showcase the
plight of cultural producers and bring awareness in order to bring about changes
in their economic, social and environmental situations. Therefore, OECD initiated
policies to change towards the better.
The roots of OECD came from the Organisation for European Economic
Cooperation (OEEC) after World War II with the determination to avoid the
mistakes in World War I. The European leaders realised that the best way to
ensure peace is to encourage co-operation and reconstruction, not punish the
defeated. The OECD was formed by 20 nations in Europe and North America on
30 September 1961 after OEEC members signed the new OECD Convention.
As an international trade organisation headquartered in Paris, OECD today has

34 member countries worldwide and has the aim of stimulating economic
progress and world trade. Most OECD members are regarded as developed
countries and have a very high human development index. It has relations with
70 other nations and several NGOs.
The OECD has been accused of favouring the richer nations. It also has been
criticised on the draft Multilateral Agreement on Investment because it has been
seen as threatening the quality of protection of human rights, labour and the
environment.
OECD publications are a prime vehicle for disseminating its research

publications. OECD provides printed and digital reports, annual overviews, and
analysis of comparative statistics. Some examples are OECD Economic Outlook,
OECD Factbook, OECD Economic Surveys and Going for Growth. Other work
focuses on the impact of global trade, including media technologies from video to
the Internet. It also provides data on a variety of topics relating to the mass
media such as those shown below (McPhail, 2011).
(a) Media mergers;
(b) New social and economic approaches to a multimedia world;
(c) The implications of convergence;

(d) Global information infrastructure;

(e) Competition and regulation in broadcasting;
(f) Competition law and policy; and
(g) Telecommunications regulations: Institutional structures and responsibilities.
Apart from publishing between 300 to 500 books each year mostly in English and
French, OECD also releases the biennial OECD Communication Outlook and
OECD Information Technology Outlook. The content of such publications are
status reports, forecasts and analysis of comparisons between countries.
For this organisation, communication technologies are perceived as one of the

critical factors in social and economic development. It provides the underlying
connectivity for a range of innovative applications in areas like smart energy,
electronic heath services, and electronic government. A key factor in making
services available to customers and business at inexpensive prices is fostering
competition and innovation. Based on OECD Communications Outlook 2011,
OECD countries have a strong record in the liberalised telecommunication
market, as regulatory frameworks have achieved a certain degree of maturity.
However, initiatives should be complemented to deploy communication
infrastructure and achieve efficient competition which can increase customers
and businesses to use communication services, create new business models and
integrate into their lives.
ACTIVITY 9.5
Try to get the OECD Communications Outlook 2011 from the official
OECD website and read about the telecommunication market size,
network development and the Internet infrastructure. Then answer the
questions below.
(a) Compare the data and the findings to the Malaysian context.
(b) What do you think about Malaysian ICT development based on
the comparison that you have done?
(c) In your opinion, what should we do to foster competition and
innovation in this sector?

 ITU is a UN agency with 144 member nations that plays the role of a platform
for worldwide and regional exhibitions and forum in bringing together
representatives of government and the telecommunications and ICT industry
to exchange ideas, knowledge and technology.
 ITU sometimes become a battlefield between core and peripheral nations,

especially regarding the New World Information and Communication Order
(NWICO).
 Intelsat can be regarded as a landmark in the commercialisation of space

activity. This organisation disseminates data, information and reports on the
entertainment industry of leading media and network entities, multinational
corporations, Internet Service Providers and governmental agencies.
 The WTO roles are more important as global trade increases, including the
communications sector.
 OECD uses its wealth of information on a broad range of topics to help ensure
the environmental implications of economic and social development are taken
into consideration. OECD publications are the prime vehicle for disseminating
its research output.
Cultural expression Industrialised countries

Cultural products Developing countries
Liberalisation NWICO
Privatisation WSIS

Bender, R. (1998). Launching and operating satellites: legal issues. US: Wolters
Kluwer. [Part IV: Competition on satellite Operation]
Hanania, L, R. (n.d). The international commercial rules on the exchange of

cultural goods and services. Retrieved from
http://b2bcdn.timeinc.com/tw/ ourcompany/TWX_AR_2011.pdf.
ITU: Committed to connecting the world. (n.d.). Retrieved from

www.itu.int/osg/spu/sfo/missinglink/kelly-20-years.pdf.

trends. New York: Blackwell Publishing. [Chapter 6: Global Technologies and
Organizations].
Murphy, S. D. (2002). United States practice in international law: 1999–2001.

Cambridge: Cambridge University Press. [Chapter VII: International Oceans,
Environment, health and Aviation Law]
OECD official website. (n.d.). Retrieved from http://www.oecd.org.
WTO official website. (n.d.). Retrieved from http://www.wto.org.

Topic  Internet: The
10 New Frontier
LEARNING OUTCOMES
1. Describe the changes of communication in the era of the Internet;
2. Explain the development of the Internet as a new mass medium;
3. Identify the Internet phenomena among Netizens; and
4. Analyse the impact of the Internet on the media and communication
industry.
 INTRODUCTION
This final topic will focus on the Internet and its usage in the new information
and communication technology era. You will be exposed to the history of this
new media and its impact on the media and communication industry.
The emergence of the Internet has changed the face of mass communication. This
new media technology disseminates a wide range of information and has created
a virtual reality environment.
The Internet presents various types of content, from news to entertainment and
from general information to the very personal. The Internet is regarded as the
backbone of mediated communication now (Chafee & Metzger, 2001).

TOPIC 10 INTERNET: THE NEW FRONTIER  167
ACTIVITY 10.1
Go to www.netaddiction.com and take the Internet Addiction Test

(IAT) provided in the Self Test under Recovery Resources. What is your
score? Are you addicted to the Internet?
10.1 WORLD WIDE WEB

Development of the World Wide Web (WWW), better known as the Web, led to
the explosion of the Internet. From a difficult tool used by academics and
technicians, the Internet evolved into a simple tool for finding and sharing
various types of information.
Prior to the Web, the Internet was only a massive interconnected network of
computers. It was text-oriented, black and white, and image free. It was used
primarily by large corporations and research institutes to share information. With
the introduction of the Web, millions of Internet users have turned it into a
repository of information.
Kettel (2002) says that:
The web is like an encyclopaedia, a record collection, a video shop and

speakerÊs corner all rolled into one and accessible through any computer.
According to Christian (2000):
It is also seen as an immense library, made up not of books but of individual

web pages.
The Web was initially a means of communication between scientists. It was

designed as a scientific project by Tim Berners-Lee at the European Organisation
for Nuclear Research (CERN) in Switzerland. The history of the Web started
when Berners-Lee built a system to organise, connect and explore the virtual
world in the computer in 1989.

168  TOPIC 10 INTERNET: THE NEW FRONTIER
From 1991 to 1993, Berners-Lee continued to turn the Web into a highly
functional entity. He began to make plans for a web page and coordinated
recommendations of users on the Internet. In 1992, research organisations in the
Netherlands, Germany and the US became committed to the Web.
The words „Internet‰ and „World Wide Web‰ have been used every day without
much distinction even though they are not the same. The Internet is a global
system of interconnected computer networks while the Web is one of the services
that run on the Internet. Table 10.1 gives a variety of definitions of the Web.
Table 10.1: Various Definitions of the Web
Pawan Lingras and ⁄ a „software infrastructure‰ consisting of many different

Porter Scobey (2012) communication standards for gaining access to, and exchanging
information over, the Internet.
Gavin Hoole and ... is a part of the Internet where one can access millions of files
Cheryl Smith (2007) located on nearly as many computers linked worldwide through
the Internet – text, photographs and other images, as well as
sound and video files.
Gary B. Shelly and ⁄ is a part of the Internet that supports multimedia and consists
Denise M. Woods of a collection of linked documents.
(2008)
It is called the Web because every single page can be linked to allow readers to
read from one page to another. The Web can be regarded as a medium for
publishing any information on the Internet. Christian (2000) distinguished the
Web from other publishing media by highlighting that it is a:
(a) Multimedia system;
(b) Hypertext system;
(c) Public access system;
(d) Searchable system;
(e) Distributed system; and
(f) Dynamic system.

The rapid growth of the Web is the result of many innovative advances in Web
technology. The Web is now widely used to disseminate information in various
fields including business and for marketing purposes. Many companies have
developed their own websites to compete in an increasingly competitive market.
10.2 INTERNET TIMELINE

The history of the Internet goes way back to the 1950s and 1960s. Figure 10.1
shows a brief timeline highlighting some of the main developments that have
shaped todayÊs Internet.
Based on the timeline, it is obvious that Internet technology is constantly

experiencing growth and is changing all the time. In 2000, the growth of the
Internet could no longer be stopped because of the high usage by users. For
instance, yahoo.com reached 55 million visitors, while google.com and msn.com
reached 35 million and 25 million visitors respectively. Blogs became a trend in
2002. It also saw the birth of Friendster, once a popular social networking site.
Then we saw the emergence of other popular social media like Facebook,
MySpace, Wikipedia, Second Life, Flickr, YouTube and Twitter. Furthermore, the
Internet can now be used on smartphones.
The birth of the Internet has facilitated the communication process in various
fields such as education, entertainment and business, to either convey or obtain
information. Regardless of distance, time and place, information can be
disseminated to a wider audience immediately.
ACTIVITY 10.2
In some ways, the Internet resembles a traditional mass medium that

sends messages from a central transmission point. But it is much more
than that. Discuss with your coursemates.

Source: www.courses.psu.edu
Figure 10.1: Internet timeline

10.3 IMPACT OF THE INTERNET

Since its creation, the Internet has been used extensively in our lives whether for
personal use or for job purposes in various fields. It is indispensable in many
aspects of life from education to politics, from individual to global society as it
has become a global communication platform and a phenomenon since the 1990s.
The Internet has made the world a lot smaller because it has enabled people in
any part of the world to communicate with people in other parts at the same
time. It also helps interpersonal relationships as it allows people to connect by e-
mail, instant messaging, chat and message board, regardless of distance.
Social media such as Facebook, Twitter, MySpace and LinkedIn are regarded as
effective networking tools since these help people to re-establish contact with
friends they have not spoken to in years or build a network of contacts for
business purposes easily. Apart from that, individuals can keep friends and
families updated on what is going on in their lives without having to contact
them individually.
The Internet can be regarded as a globalised media. It gives access to cyberspace

and enables people to express themselves without restraint. Kerbs (2001) listed
two key distinctions between other media and the Internet:
(a) With the Internet, everyone with a modem, a computer and a telephone line
can be connected and not only receive but also produce information; and
(b) The Internet has not only changed the distribution of images but also of
printed documents.
According to McPhail (2010), news editors, pundits and politicians can no longer
act as gatekeepers who control, revise, twist or limit information in the news.
With the emergence of social media, there is an explosion of user-generated
content. The Internet is constantly provided with new personalised content
through websites, blogs and online forums that allow everyone to get
information faster and freer. The global public is therefore better informed. They
are like the public jury, armed with information concerning major political and
other issues.

This new media is used as a political tool by political groups to gain support
from the public or to carry out their mission. This has led to the rise of Internet
activism such as demonstrated in the Arab Spring. The impact can be seen in
Egypt, Libya, Tunisia and other parts of the Arab world where Facebook and
Twitter were used as tools of modern democracy to speak up on issues and unify
the community. For example, the Myanmar government received pressure not
only from the international community but also from their citizens.
Even though the exposure of private, secret and classified documents, such as
by Wikileaks, was rather shocking, it was an example of cyberfreedom and
democratisation. However, it also shows that the Internet does not have privacy.
Everything is open.
ACTIVITY 10.3
The terms „cyberdemocracy‰ and „cybersociety‰ embedded in Western

industrialised media culture may be regarded as the myth of the
Internet.
1. Explain the meaning of both terms.
2. In your opinion, how far can these two benefit the global public?
10.4 THE INTERNET AND GLOBAL TELEVISION

ISSUES
With the Internet, most things have become possible to do. We no longer depend
on the television set to entertain ourselves. We can also access entertainment
programmes via the Internet. YouTube, for instance, offers millions of choices to
Internet users, from amateur video clips to any kind of TV programmes aired
previously in local television channels around the world.
We have the option of watching live video via the Internet. However, this can
cause problems particularly in terms of copyright because the copyright holders
might not realise that their products have been circulated without their
permission. Copyright law gives moral and economic rights to the producer or
publisher for their works. The law prohibits any irresponsible party from
copying, producing or distributing the works for commercial purposes.

The convergence of television and the Internet have led to the birth of global
television. There are arguments that the Internet site has infringed copyright laws
and incurred trademark infringement. As an example, the US-based National
Football League decided that legal action became necessary because US Internet
users were watching the NFL games through station repeats on the iCraveTV
Internet site (McPhail, 2010).
10.5 THE INTERNET AND HOLLYWOOD FILMS

The Internet has been seen as a threat to the entertainment market, including
Hollywood products. Although Hollywood would usually market and distribute
its products around the world, it is now more difficult to have the capability of
pre-empting or hiding Hollywood products from the public before the launch or
opening in cinema theatres.
Generally, HollywoodÊs main studios will release their films within the US first
and later around the world, to Western nations and then audiences in the South-
South countries. The distribution takes months and maybe a year to be viewed
by audiences in smaller nations like Eastern Europe.
With the advent of new media technologies, the global entertainment market can
obtain information about newly released Hollywood films quickly via some
websites. With various methods such as FTP, e-mail and P2P, many videos can
be searched and downloaded within the US. Some consumers can just purchase
the films through online shops or e-commerce businesses that focus in film
distribution, primarily DVD disk technology. Therefore, there is a need for the
film industry to re-examine its global distribution policy because of the Internet.
10.6 INTERNET USERS

The number of Internet users has increased each year. Data from Internet World
Stat shows there are only 16 million users in 1996 but this number rose sharply to
360 million at the end of 2000. By 2011, the number of Internet users in the world
reached 1,349 million. China recorded the highest number of Internet users in the
first quarter of 2012 with 513,100,000 users (see Table 10.2). By region, 44.8% of
the worldÊs Internet users are based in Asia, followed by Europe (22.1%) and
North America (12%).

Table 10.2: Top 10 Countries of Internet Users in 2011
# Country or Population, Internet Users Internet Users Penetration World

Region 2011 Est Year 2000 Latest Data (% Population) % Users
1. China 1,336,718,015 22,500,000 513,100,000 38.4% 22.5%
2. United 313,232,044 95,354,000 245,203,319 78.3% 10.8%
States
3. India 1,189,172,906 5,000,000 121,000,000 10.2% 5.3%
4. Japan 126,475,664 47,080,000 101,228,736 80.0% 4.4%
5. Brazil 194,037,075 5,000,000 81,798,000 42.2% 3.6%
6. Germany 81,471,834 24,000,000 67,364,898 82.7% 3.0%
7. Russia 138,739,892 3,100,000 61,472,011 44.3% 2.7%
8. Indonesia 245,613,043 2,000,000 55,000,000 22.4% 2.4%
9. United 62,698,362 15,400,000 52,731,209 84.1% 2.3%
Kingdom
10. France 65,102,719 8,500,000 50,290,226 77.2% 2.2%
Source: Internet World Stat
The Internet usage shows a significant upward trend and that the new media is
increasingly being used. In fact, it has become a necessity for some people.
Besides being a source of reference or „library‰ for all forms of information and
knowledge, this medium is a tool for effective communication. The Internet is a
new dimension of communication that has changed the way people
communicate (St Amant & Zemliansky, 2004; Anja, 2004).
From electronic mail (e-mail) to the bulletin boards, Internet Relay Chat,
multiuser domains and the Web, the Internet has become a popular
communication tool among us. With this technology, communication with
family, friends, business partners, government organisations, non-governmental
organisations or individuals can be done easily without limitations of distance,
area or time.

ACTIVITY 10.4
The Internet in Malaysia is seen as a medium for information and

communication. In fact, since the introduction of the Multimedia Super
Corridor (MSC), its usage has become more important. Try to find the
information below:
1. How many Internet users are there in Malaysia?
2. What is the Internet penetration rate in this country?
3. What are the demographics of Internet users in Malaysia?
4. What are the main activities of online Internet users in Malaysia?
Nowadays, the Internet can be accessed almost everywhere by various means,

including mobile Internet devices such as mobile telephones, iPad and
notebooks. Some users use public places to access the Internet including libraries
and Internet cafés. Even though English is the main language for communication
for the Internet and global communication, other languages such as Chinese can
be used with the advent of new information and communication technology.
10.6.1 Internet Usage in Asia Pacific

Based on the Asia Pacific Digital marketing Yearbook 2011, Asia Pacific has more
than 825 million Internet users and the usage is expected to grow further
especially with the broadband revolution (see Table 10.3). Mobility will be
regarded as a factor of growth. In early 2011, there were 2.6 billion subscribers
and 400 million users with access to mobile Internet. Despite a slowdown in
growth rates in telecommunication markets, Asia Pacific is expected to sell 100
million smartphones in 2011, representing almost 20% of all mobile devices sold
across the region.

Table 10.3: Asia PacificÊs Internet users 2010
Gender:
Male 59.6%
Female 40.4%
Education:
School until age 16 2.0%
School until age 18 12.5%
Trade/technical school/college 23.2%
University 50.3%
Postgraduate 11.9%
Employment Status:
Full-time workers 58.8%
Part-time workers 6.3%
Freelancer 5.1%
Self-employed 4.8%
Full-time parent 3.2%
In education 13.5%
Unemployed 3.1%
Other 5.2%
Source: Asia Pacific Digital Marketing Yearbook (2011)
The report released by Nielsen indicated that Internet access through mobile
phones and desktop computers by Malaysian households are the same, namely,
77%, down only 2% compared to laptop computers while 18% involved the use
of tablets. This is quite different in Indonesia, which recorded the highest
percentage of mobile phone use, which is 78% compared to desktop computers
(31%) and laptops (29%). This is because Indonesia is the third largest mobile
market in Asia Pacific after China and India.
10.6.2 Social Media Usage

The use of social media as one of the applications of the Internet has become a
global phenomenon and Asia is the largest market in terms of consumer
participation. A study conducted by Universal McCann in 2009, involving 17,000
users in 29 countries, found that all social media platforms have grown
significantly and showed an increase in penetration rate from 33% in 2005 to 83%
in 2008. In the Asian region, social media is the latest craze.

If viewed from the perspective of online activities in the Asia-Pacific market,

Table 10.4 shows that watching video clips, managing network profiles,
uploading photos, and instant messaging are among the most frequent online
activities.
Table 10.4: Online activities in Asia Pacific
Activities % of Internet users

Watched a video clip 66.0
Uploaded a video online 28.5
Managed social network profile 45.3
Written your own blogs 37.7
Used a micro-blogging service 30.4
Subscribed to an RSS feed 15.4
Used an aggregator 13.3
Used instant messenger 52.4
Make a phone call online 21.8
Used webmail 70.3
Used online office applications 42.1
Managed own website 20.5
Used Internet banking 65.1
Left a comment on a story on a website 40.5
Written a story/article 22.0
Purchased a product online 32.4
Reviewed a product or brand online 58.3
Used a social bookmark service 23.0
Installed an application on your browser 44.5
Posted a comment on a forum/message board 43.7
Uploaded photo online 51.9
Source: Asia Pacific Digital marketing Yearbook (2011)

According to Guan (2008), a total of 456 million users in Asia, which is one-third
of the worldÊs population online, engage in social media activities. In Singapore,
for example, the favourite activities are blogging, social networking and online
forums, while in Malaysia, an estimated 11 million users of social media are said
to use this medium to voice their opinions in blogs and interact in social sites like
Facebook and Malaysiakini. Consumers in Thailand are more attracted to citizen-
journalism, or any form of sharing news, while in Indonesia, most are using
instant messaging and electronic mail to communicate and interact in cyberspace.
10.7 COMPUTER VIRUSES

Computer viruses are man-made and emerge with the advent of the Internet. It
can be referred to as the results of destructive programmes or codes that are
loaded onto computers without the knowledge of the user. The viruses can
replicate themselves and spread from one computer to another. Stang (1992)
observed that some viruses could get rid of all information while other viruses
show unrelated messages on the screen or proceed to execute changes in
computer programmes.
Many of us sometimes use the terms „virus‰, „worm‰ and „Trojan horse‰
interchangeably. Though all are malicious programmes that can cause damage to
computers, there are differences between the three – whether one requires host
programmes and/or makes copies of itself. A worm is software designed to
propagate and perhaps destroy or modify files and multiply itself automatically
to other computers through networks while a Trojan horse is a programme that
appears harmless but hides malicious functions (Stang, 1992). All three can harm
a computers systemÊs data or performance (see Table 10.5).

Table 10.5: Virus, Worm and Trojan Horse
Requires Host? Replicates?

Virus Yes, by inserting themselves in Yes, all viruses make copies of
existing executable programs, they are themselves, infecting other boot
harder to detect and ensure that they sectors, master boot sectors or
will run from time to time. programmes as the opportunity arises.
Worm No, a host is not required because Yes, a worm makes copies of itself as
worms are typically a mainframe it finds the opportunity.
problem and do not need to hide from
most users.
Trojan No, while the term sometimes refers No, most Trojan horses activate
Horse to the programme containing when they are run, and tend to
destructive codes, the term is more destroy the structure of the current
often used to refer to the entire com. drive, obliterating themselves in the
or exe. process.
Source: Stang (1992)
The number of viruses which account for the majority of infections is growing
each year: some gained in commonness while some lost ground. From 1989 to
1991, the US experienced a growth in the diversity of infections. The Stoned virus
became more common, moving from 8% of all infections to 42%; Jerusalem-B
became relatively less prevalent, shifting from 62% of infections to 32% (Stang,
1992). According to Gery Menegaz in ZDNet, the top five worst computer viruses
are Mellisa, the Anna Kournikova Virus, MyDoom, Sasser & Netsky, and 2007
Strom Worm.
The virus infections can cause great problems particularly to major corporations
because of their potential to free protected data, wipe out data, modify data or
freeze or take over computer systems. There are said to be over 100 new viruses
per week (McPhail, 2010). With the widespread Internet usage and e-commerce
as daily routines for many people, the impact of viruses is worrisome. It can
cause the loss of millions of dollars in time and business.

10.8 BLOGGING
Blogging involves not only individuals but also companies, organisations, media
and others. Blogging is the easiest way to present ourselves to the Web and make
our voices heard, acknowledged as well as responded to by those interested. It
can be regarded as a new and future platform for instant publishing and personal
publishing. It has changed the concept of publishing in traditional media.
Usually the media are the ones which identify the news; companies are the ones
that sell products; publishers produce books; recording firms produce cassettes
or CDs; and we as consumers can make a choice to purchase them. To get our
printed materials accepted and published by traditional media is quite
challenging. In print publishing such as newspaper reports, articles, novels or
textbooks, the author is not in charge of how the text will look.
Before blogging became popular, cyber communities used various forms,

including Usenet, bulletin board and online forum. Blogging quickly gained in
attractiveness when blog usage increased in 1999.
10.8.1 What is a Blog?

What is a blog actually? Blog is coined from the word „weblog‰ which refers to
the website owned by a certain group or person where all the entries can be read
and commented on. According to Harris (2008), the word „blog‰ can also be
applied as a verb which means „to add and maintain entries of contents to a blog
site‰.
The idea of blogging came in the late 1980s when some people learned how to
post contents using a certain network. However, it was only in the late 1990s
when the word „weblog‰ was used and the word „blog‰ became popular among
the public. The usage of blogs exploded in 1999 and became popularised by the
arrival of early blog hosting sites such as Open Diary, Live Journal and Blogger.

According to Werbach (2001), the definition of a blog is:

A personal website that is always updated with news, headlines, opinions and
commentary, and which also provide links and/or diary entries, generally
organised chronologically. A weblog is recognised as a weblog in the sense
that it is organised chronologically and designed for short, frequent updates.
The modern blog evolved from the online diaries of individuals that are used
daily to keep a running activity of their personal lives. The content in a blog is
displayed in date order, with the most recent information at the top of the page.
Therefore, an actively maintained blog will develop and grow from day to day
with the support of its avid followers or readers. Among the popular blog hosts
are Blogger, WordPress and Moveable Type.
Generally, a person who posts these entries is called a blogger. However, they
can also be called diarists, journalists or journallers. Many blogs provide
commentaries, which make it different from the ordinary or static website. This
makes the blog a part of interactive media that allows guests to leave comments
and messages.
SELF-CHECK 10.1
Blogs can be identified by the way the content is provided or written.

Therefore, many terms are now used. Explain each of the following type
of blogs:
(a) vblog
(b) linklog
(c) photoblog
(d) tumblelogs
(e) mblog

10.8.2 Blog Usage

Blogging became extremely popular at the start of the 21st century and has been
one of the foundations of the social web. Blogging became mainstream web
activity by 2004, to the point that the Merriam-Webster Online Dictionary
recognised „blog‰ as the word of the year. Today, there are millions of weblogs –
self-contained blogs and blogs in online communication like MySpace, Vox and
LiveJournal – updated daily on the Web by individuals, groups and international
businesses.
The blogging phenomenon has changed the Internet whereby anybody can use it
to post thoughts and opinions. Personal webpages can be linked to other online
pages – especially the blogroll, permalink and trackback. This, along with blog
search engines, allows users to keep track of blog threads that connect them to
other people with similar interests.
Blogs can influence people on certain events or issues that might not be covered
fully in the mainstream media like the Rathergate scandal where Dan Rather, the
television journalist, presented a view that conflicted with the accepted version of
President BushÊs military service record. This gave greater reliability to blogs as a
tool of news spreading. Even though it is often seen as follower gossips, bloggers
sometimes direct the way information is disseminated to the public, unlike the
traditional media that is directly influenced by the media ownerÊs decision.
Therefore, some said, blogging has reshaped the look of journalism and has also
been called „online journalism‰.
 Dramatic growth in Internet usage in the 1990s was due to the development
of the World Wide Web.
 The web is now widely used to disseminate information in various fields

including business for marketing purposes.
 The Internet has made the world a lot smaller because it enables someone in
any part of the world to communicate with people from other countries.
 Regardless of its benefits, the growth in the Internet usage is a cause for
concern with increasing activities of copyright infringement and the
emergence of computer viruses that may affect the industry.

Democratisation Computer virus

Global public Worms
Political revolution Trojan horse
Cybersociety Blogging
Chaffee, S. H., & Metzger, M. J. (2001). The end of mass communication? Mass
Communication & Society, 4(4), 365–379.
Christian, P. (2000). Web publishing for genealogy. US: Genealogical Publishing

Company.
Deuze, M. (2001). Online journalism: modelling the first generation of news

media on the World Wide Web. First Monday. Issue 6, No 10.
Guan, N. (2008). Asia Social Media Report 2008 (Can Brands Have A Social
Life?). (2008). Retrieved from http://www.slideshare.net.
Harris, D. (2008). Blogging 100 success secrets. US: Lulu.com.
Hoole, G., & Smith, C (2007). The really really really easy step-by-step computer
book 1 (XP). New Holland Publisher.
Kerbs, V. (2001). The impact of the Internet on Myanmar. First Monday.

Retrieved from www.firstmonday.org.
Kettell, B. (2002). Valuation of Internet and technology stocks. Butterworth-

Heinemann.
Levine, J. R., & Young, M. L. (2011). The Internet for dummies. London: John
Wiley & Sons.
Lingras, P. (2012). Web programming and Internet technologies: An e-commerce

approach. US: Jones & Barlett Publishers.

Liu, B. (2011). Web data mining: Exploring hyperlinks, contents and usage data.
London: Springer.

Scobey, P., & Lingras, P. (2012). Web programming and Internet technologies: An
e-commerce approach. Burlington, Mass: Jones & Bartlett Learning.
Shelly, G. B., & Woods, D. M. (2008). HTML: Complete concepts and techniques.
London: Cengage Learning.
Stang, D. J. (1992). Computer virus survival guide. Washington, DC: Virus

Research Center, International Computer Security Association.
Volker, I. (1999). News in global sphere: a study of CNN and its impact on global
communication. UK: University of Luton Press.
Walsh, B. (2007). Clear blogging: how people blogging are changing the world
and how you can join them. New York: Appress.
Werbach, K. (2001). Triumph of the weblogs. Eadventure, June 18, 2001.

Retrieved from www.eadventure.com.

MODULE FEEDBACK
MAKLUM BALAS MODUL
If you have any comment or feedback, you are welcome to:
1. E-mail your comment or feedback to modulefeedback@oum.edu.my
OR
2. Fill in the Print Module online evaluation form available on myINSPIRE.
Thank you.
Centre for Instructional Design and Technology

(Pusat Reka Bentuk Pengajaran dan Teknologi )
Tel No.: 03-27732578
Fax No.: 03-26978702


Notes

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Notes

Uploaded by

Copyright:

Available Formats

Faculty of Applied Social Sciences

Copyright © Open University Malaysia (OUM)

Copyright © Open University Malaysia (OUM)

Module Writer: Prof Dr Azizah Hamzah

Moderator: Prof Dr Rahmah Hashim

Developed by: Centre for Instructional Design and Technology

First Edition, April 2013

Copyright © Open University Malaysia (OUM)

Topic 1 Global Communication 1

Topic 2 American Multimedia Giants 24

Copyright © Open University Malaysia (OUM)

2.6 General Electric 38

Topic 3 Non-US Stakeholders of Global Communication System 51

Topic 4 Global Issues, Music and MTV 69

Copyright © Open University Malaysia (OUM)

4.2 The International Music Industry 80

Topic 5 CNN and Other International News Channels 87

Topic 6 Role of Global News Agencies 106

Copyright © Open University Malaysia (OUM)

Topic 7 Media in the Middle East and North Africa 120

Topic 8 Role of Global Advertising Agencies 134

Topic 9 Global Telecommunication Systems 149

Copyright © Open University Malaysia (OUM)

Topic 10 Internet: The New Frontier 166

Copyright © Open University Malaysia (OUM)

Copyright © Open University Malaysia (OUM)

Copyright © Open University Malaysia (OUM)

Copyright © Open University Malaysia (OUM)

Table 1: Estimation of Time Accumulation of Study Hours

Attend 3 to 5 tutorial sessions 10

Assignment(s), Test(s) and Examination(s) 20

TOTAL STUDY HOURS 120

Copyright © Open University Malaysia (OUM)

Topic 4 examines some key issues in the globalisation of communication media.

Topic 5 features an introductory discussion on international news channels. The

Topic 9 focuses on major stakeholders in the evaluation of telecommunication

Copyright © Open University Malaysia (OUM)

TEXT ARRANGEMENT GUIDE

Self-Check: This component of the module is inserted at strategic locations

Activity: Like Self-Check, the Activity component is also placed at various

References: The References section is where a list of relevant and useful

Copyright © Open University Malaysia (OUM)

McPhail, T. L. (2011). Global communication: Theories, stakeholders and trends.

Tehranian, M. (1999). Global communication and world politics: Domination,

Thussu, D. K. (Ed.). (2010). International communication: A reader. Milton Park;

TAN SRI DR ABDULLAH SANUSI (TSDAS)

Copyright © Open University Malaysia (OUM)

Copyright © Open University Malaysia (OUM)

Other issues in global media and communication include media concentration or

Copyright © Open University Malaysia (OUM)

However, one definition that is easily accepted by all is by a well-known writer,

⁄ the integration of financial, information and trade networks to create a

McKenzie (2006) defined it as:

⁄ a kind of worldwide climate in which people, industries, governments, and

Herman and McChesney in McKenzie (2006) described it as:

⁄ a corporate profit-making initiative that is reaching beyond domestic

British sociologist, Giddens (1999), linked it to the cultural and political

⁄ a fundamental mistake to conceptualise globalisation in purely economic

Giddens stressed the sociological interpretation of globalisation as the spread of

Copyright © Open University Malaysia (OUM)

1.1 THE GROWING IMPACT OF MEDIA

Canadian media theorist, Marshall McLuhan (1911–1980), had already spoken as

Copyright © Open University Malaysia (OUM)

1.1.1 Cultural Impact