Watching CNN, they had a panel discussing the press coverage of the election. In particular, they were calling Trump a liar in his “tweet” about the New York Times losing subscribers. They quoted the NYT saying, basically, ~’Yeah but… our online subscriptions went up!’ and that it was likely that the electronic subscribers offset the physical subscription losses. Yeah, right…
There’s a world of difference between an ‘online subscription’ and a real physical paper subscription. But I think there is a more important point. The internet is causing “disintermediation” in news.
(This link had one of those annoying “please subscribe” pop-up ads, so I’m quoting enough that you do NOT need to ‘hit the link’, so as to save you from the nag-pop-up.)
What is ‘Disintermediation’
Disintermediation, in finance, is the withdrawal of funds from intermediary financial institutions, such as banks and savings and loan associations, to invest them directly. Generally, disintermediation is the process of removing the middleman or intermediary from future transactions. Disintermediation is usually done to invest in instruments yielding a higher return.
BREAKING DOWN ‘Disintermediation’
The goal of disintermediation is to lower the overall cost involved in the completion of transactions. Removing the intermediary may also allow a transaction to go through more quickly.
Wholesale Versus Traditional Retail
One common example of disintermediation occurs when a wholesale purchase allows an interested buyer to purchase goods, sometimes at quantity, directly from the producer. This can result in lower prices for the buyer since the intermediary, a traditional retail store, has been removed from the purchasing process. This saves the buyer from the markup cost generally associated with the transition of a product from a wholesale to a retail environment.
Not all companies choose to offer wholesale options directly to customers, as it often requires a bigger investment in resources to process and ship these orders. It does, however, have some benefits to the company if it wants to limit the number of long-term wholesale contracts in use with retailers; working directly with customers bypasses a segment of the traditional retail market.
What that says, when you strip out the jargon, is that generally “disintermediation” is an economic term talking about how the Bank gets in between the borrower and the money source and takes a cut for arranging the deal. Folks looking to lend can get a better rate of return, and folks looking to borrow can get a lower cost to borrow, if they cut out the bank.
That’s the general notion seen in Econ classes. The wiki starts to broaden it:
Bold by me.
In economics, disintermediation is the removal of intermediaries from a supply chain, or “cutting out the middlemen” in connection with a transaction or a series of transactions. Instead of going through traditional distribution channels, which had some type of intermediary (such as a distributor, wholesaler, broker, or agent), companies may now deal with customers directly, for example via the Internet.
Disintermediation may decrease the total cost of servicing customers and may allow the manufacturer to increase profit margins and/or reduce prices.
Disintermediation initiated by consumers is often the result of high market transparency, in that buyers are aware of supply prices direct from the manufacturer. Buyers may choose to bypass the middlemen (wholesalers and retailers) to buy directly from the manufacturer, and pay less. Buyers can alternatively elect to purchase from wholesalers. Often, a business-to-consumer electronic commerce (B2C) company functions as the bridge between buyer and manufacturer.
However manufacturers will still incur distribution costs, such as the physical transport of goods, packaging in small units, advertising, and customer helplines, some or all of which would previously have been borne by the intermediary.
My thesis in this article is simple:
The internet has brought disintermediation to the media.
What Trump Did
Trump took his “messaging” directly to the people. He bypassed “the media” by having huge rallies and by “tweets”. He indirectly leveraged an alternative path through the media by “guest appearances” and frankly, by “earned media”. He would say something that was able to gather ears and eyes on him, then deliver his message directly to the cameras. No editor need apply…
OTOH, the extraordinarily group think Journalism Majors who make up “news” and “media reporting” today, with 90%+ of them Democrats and all of them surrounded by a sea of reverberating group think “progressive” talking points; they see their job as to “frame” ideas and statements and to “message” (as a verb) to the unwashed masses. To “mold public opinion” by “creating a narrative”. I.e. to be an intermediary filter that shapes and changes the story to be what they think it ought to be.
The Public, having lots of direct access to the source material, saw this “framing” and “messaging” and “creating the narrative” as just what it was: Distortion to outright lying for effect.
The Public, having lots of direct access to the source material email of Hillary and Podesta and the DNC, saw their cozy relationship with “the media” as what it was: Collusion, fraud, and deception.
The result was massive disintermediation of information flow as folks flocked to ‘direct from the manufacturer’ delivery. Trump Rallies. Rightside Broadcasting Network. Trump tweets.
I know I did. While I avoid tweets and Twitter in general ( I’m not keen on being tracked and they love to track things and people) I did watch Rightside Broadcasting. I “attended” in person (via Rightside Broadcasting) about a dozen Trump Rallies in as many cities spread around the USA. I heard a consistent message and it was simple and honest. I saw my fellow attendees via the RSBN cameras showing the huge crowds inside and out.
Now compare that to the MSM coverage, and you get “cognitive dissonance”. So “Who you gonna believe? My carefully crafted creation of a narrative with fine framing and directed messaging, or your own lyin’ eyes?”… and people chose their own disintermediated POV.
Now compare Hillary. We had a dozen very minor snippets of vision “behind the curtain” at some of her events; all wrapped in huge layers of secrecy and hiding. Her “message” warping and shifting with the assessment of what that particular group wanted to hear. We got bits of “her off stage” that were in stark contrast to her on stage. We had hiding from view and we had berating those who did show her off stage. The MSM put on a great show of framing with the most beautiful and gilded frames, and messaging with glowing reports of prowess and greatness usually only reserved for World Leaders in North Korea… Hillary did not understand that “we the people” had disintermediated from the Main Stream Media (MSM) filter / editorial / framing / message manufacture process; and that she could not stop it nor control it.
We saw some of that disintermediation on this site. Individuals acting as “reporters” and finding bits of clear information here and there, posting them in comments and generally acting as field reporters. The whole set of readers acting as the editorial board deciding what comment needed to be lauded and which links were dodgy. We, collectively, disintermediated the MSM Editors and Reporters.
Disintermediation is what has grown Amazon. They have everything, just about, and it is delivered direct to your door. No ‘retail store’, no parking lot (free or valet with fee), no wholesale cut to the distributor, etc. etc.
Disintermediation is what has grown micro-loans (directly connecting small lenders to even smaller borrowers) and such things as crowdfunding sites. (Go Fund Me, Kickstarter, Indiegogo, etc.). It bypasses the Venture Capital industry for small (and some not so small) ideas.
Disintermediation lets me buy a 4 core computer direct from China for about $7 ($10.30 with shipping) even bypassing Amazon.
Now disintermediation has let me (and a few tens of millions of others) bypass the MSM and go direct to The Donald and make our own assessment of the facts. (It also let us bypass the DNC, MSM, HRC, and more to assess Hillary… Thank You Wikileaks!)
It is possible that The Donald even used his disintermediated platforms to bypass the RNC and get himself the nomination (the Debates being partly disintermediated in that the candidates go head to head on stage).
So one of the Talking Heads was trying to “poo poo” The Donald and his tweets by saying how it wasn’t very Presidential and how he’d have to stop it once President or look the fool (as a paraphrase). Well, I’ve got news for you Talking Heads: The Donald knows the power of disintermediation. He’s not going to let that go to waste. He might assign the job of making the text to someone else, but when he sees your “framing” and “messaging” and “crafting the narrative” as B.S. you can damn well expect a “tweet” saying “That is a B.S. Story they made up!”. It will go directly to tends of millions of ‘followers’ and you will be the one with the “small audience”.
“But there’s no arguing that Trump has his following on the popular social media platform —Twitter says the Republican presidential nominee has 12.1 million followers across the globe.” (From: http://www.app.com/story/news/politics/2016/10/09/trump-twitter-followers-everywhere/91811810/ and do note that is BEFORE he became President Elect…)
NYT: Circulation 1,865,318
Let’s face it: Newspapers are going the way of the dinosaur.
The sad fact is that most people just aren’t reading the news in print anymore.
Although many in this industry have managed to make the switch to online, they are suffering the loss of a massive revenue generator: print advertising.
And without these ads, media companies are seeing a dramatic downward slump.
Nobody in the print media is safe. Gannett, News Corp. and TEGNA, all once top media brands, are dealing with a combination of falling print-ad revenue and digital sales that are too sluggish to bridge the gap.
Even New York Times , a $1.8 billion media behemoth and time-honored institution, is at a tipping point.
So Trump with a Tweet reaches 12 Million directly, all of whom care about his message. NYT reaches 1.8 Million but many of them not really interested in that story and reading some other part of it.
You have been disintermediated. Please pick up your things as you exit the house…
That’s the real story behind The Donald “tweet” about NYT drop in circulation, and about the CNN et. al. claim that it was a lie as you must count ‘online subscriptions’. OK, let’s do. By that metric The Donald is way larger in ‘circulation’ than the NYT circulation.
IMHO, as more folks get a bigger ‘taste’ of disintermediated “news”, it is not only the print media that is at risk. Already I watch foreign sources for my overseas news. France24, RT Russia Today, and a whole lot more. Try to ‘spin’ what is happening in Allepo and I’m seeing camera feeds from both sides of the front line with editorial bias from both sides of the story and that just highlights all the “framing” and “spin” and “creating the narrative” and once that is factored out, the real news is what remains.
So “the nightly news” can get back to straight reporting of the “Who, what, where, when, how and some why” and get out of the “framing” and “creating the narrative” propaganda business, or they can be left on the disintermediation trash heap of history. It isn’t because it is more convenient that I’m watching news via the internet, it is because it is a better way to get “Just the facts, mam.”
Is there no place for the Editor?
Yes, there is. Frankly, my biggest complaint about many online news sites is that they have embraced the buffet model. They chop up their news into 100 little bits and say “Go Fish!” for the 5 minute ‘story’ on the thing that interests you. Part of why I watch news instead of just read it is for the Editor and Storyboarding. I want someone to pick the dozen most important things of that particular moment and shove them to the top of the heap, and then I can just “click once” and let it run for a half hour. Yes, I know, I’m getting your editorial slant in what you choose to promote. I’m OK with that (as other news flows with other editorial choices will balance it.) What I’m not OK with is changing the story to have an editorial goal. Trouncing Trump, lauding Hillary. I’ll make my own evaluations of what it all means, thank you very much. I want: What happened. Who did it and where. When. How it was done (sadly almost always left out of manicured for effect spin stories). Then, maybe, some of why and what it means, but only if you can keep your grubby paws off the truth and stop molesting it into a slut selling your intellectual wares…
So get back to basics, or be disintermediated out of my life. After all, I have a direct line to The President… and I can just ask him.