Markets for lemons

Column Why poor quality so often prevails in journalism, leaving audiences wading in the shallows "You can't drown in the shallows." The
The snappy slogan on which RTL boss Helmut Thoma once based his
business model for private television has a lot to offer. Before
Belgian media entrepreneur Albert Frère, in particular, was inspired by Thomas
instinct - after all, he has just spent 4.5 billion euros on his
25.1% share in Bertelsmann. A deal that only became possible,
because Bertelsmann expanded into the TV business a few years ago and
RTL wanted to bring the company under its control and
Frère's majority stake in the private broadcaster against the
stake in the Gütersloh-based media multinational.

There is much to suggest that Thomas' formula for success can also be applied to the
newspaper market in Switzerland works. At least in the big
Publishing houses - at Ringier and Tamedia - seem to have realized this.
believe. First the success of the Blick years ago, then the
The meteoric rise of the free newspaper 20 Minuten to the highest circu
newspaper in the country seems to prove the publishers right. So much so,
that Ringier is now a little overconfident and wants to find out whether
in the afternoon with Heute, another free newspaper, and on
market can be established. In the upper class, Neue Zürcher
newspaper, the Tages-Anzeiger and also many regional papers
Meanwhile, circulation is crumbling.

But why do so many people indulge themselves with inferior information?
satisfied? Part of the media market undoubtedly functions as a "market
for lemons" is how the economist George A. Akerlof described markets,
on which buyers receive much less information about product quality.
than the sellers and therefore the quality competition is not
works. In such a market, goods are often sold relatively
poor quality, so-called "lemons". As soon as the
buyers realize this, they for their part are only prepared to pay a
to pay a lower price. However, this reduces the
suppliers of expensive, high quality, the incentive to develop for this market is
produce. Gradually, in a spiral movement, the
poor quality and pushes the good quality out of the market.

Can the trend be counteracted with any prospect of success? In the short term
probably hardly. In the long term, however, according to economist John
Maynard Keynes, "all dead". Publishers who nevertheless firmly believe in the
The only way quality journalism has a chance of survival is if it believes that quality
at least communicate proactively. This, in turn, is not possible with
Advertising and public relations. They come to nothing if there is no
journalistic platforms that deal with media and journalism
employ.

It's strange that so many publishers and media managers don't want to admit it.
want their offer to the advertising industry, which they benefit from
have lived so well themselves, even for their own
could be good for securing the future: A car company, a fashion company
or a computer manufacturer can always rely on particularly intensive
effect of its advertisements, if an editorial environment
attracts the attention of the interested public, which
corresponds to the advertised product in terms of content, but is not
independent journalists. Similarly
presumably generate demand for quality media if these media
would not only advertise themselves and do PR, but also
space to talk editorially about media and journalism, and
to report. Those who do not do this are not offering their customers
Orientation guide on what constitutes journalistic quality. That is why
it is hardly surprising that the public then flock to the
Wading into the shallows, accessing cheap or free media offers
and spend a lot of money on cell phone ringtones instead.

Stephan Russ-Mohl heads the European Journalism Observatory at the University of Lugano.