Central regional conference of the SEE Media Observatory:
“Media and journalism in South East Europe –
Captured by particular interests or turning to serve the public?”

Tirana, 12-13 June 2014
Session 3:
Media finances – is there a media market at all? To blame the industry or the state?

Presentation by speaker:
Milan F. Živković, Head advisor for media policy, Ministry of Culture, Croatia

The current media crisis has its economic and labour dimension which together result in a deficit of democratic account of the media. The crisis of the Croatian media economy is most directly reflected in the erosion of revenues of television and radio stations, news agencies, newspapers and magazines. 

From 2008 to 2012, the annual turnover of Croatian media fell from Euro 773 million to 520 million. The audiences of traditional media are shrinking; sales have been declining for seven years in a row. Advertisers, whose ad-spend at the Croatian media went down from Euro 293 to 186 million, seem to be aware of that as well.

The second structural problem of Croatian media is employment which fell from 12.5 to 9.3 thousand workers or by 25 per cent between 2008 and 2012. Publishing of newspapers and other periodicals, which have simultaneously recorded a loss of 47 per cent of jobs, are the activities most exposed to restructuring. We thereby need to take into account that media are an industry with an above average number of workers hired for a limited period, based on a service or temporary contracts, meaning that the decline in journalistic employment could be even higher. 

Three thousand persons, whose previous employment was of journalistic nature, have been registered with the Croatian Employment Service during the past five years.

Part of the downfall in advertising revenues may be considered as a temporary result of a long-lasting recession – but to which extent temporary? However, what is far more troubling on a long term is shifting of advertising revenues to the Internet, in particular to internet browsers which do not produce journalism. 

With the advertising revenues falling (even faster than the newspaper circulation decline), journalists become more and more “expensive” to media owners. Consequently, media owners launch a new round of layoffs, although they know this will lead to further decline in quality of journalism, sales, and advertising revenues.

Even though, part of the jobs of laid-off journalists have been assumed by the remaining employees, for the same or lower salaries, such a huge loss of jobs had to reflect on the overall quantity of published journalistic works. If certain national media system loses half of the journalism workforce, that may result in half of the news never being published. As the author of The Wire TV series, a former journalist, David Simon told to the U.S. Senate: “The next 10 to 15 years will be halcyon days for local corruption. It's going to be a great time to be a corrupt politician.”
Setting aside the issues of a not so easily measurable quality, deteriorated trust, ownership concentration, commercialization and inclusiveness of public debate which, according to some opinions, media are supposed to serve to, the loss of journalist employment and deterioration of the journalists' working condition produce the deficit in the capacity to meet the requirements of the majority of current concepts of democracy.

Unless a substitute for the lost inflow of media revenues is developed through public subsidies, we may also lose the remaining half of journalism as well, together with its democratic role, to which we so often call upon.