Profits and Losses: Business Journalism and Its Role in Society


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    Most large newspapers eliminated foreign correspondents and many of their correspondents in Washington. The number of newspaper reporters covering state capitals full-time fell from in to at the beginning of A large share of newspaper reporting of government, economic activity, and quality of life simply disappeared.

    Not all newspapers are at risk. Many of those less battered by the economic downturn are situated in smaller cities and towns where there is no newspaper competition, no locally based television station, and no Craigslist. A number of them have sought to limit the loss of paid circulation and advertising in their print papers by charging non-subscribers for access to most of their Web content.

    Although they have not attracted many paid Web-only subscribers, their publishers say they have so far protected much of their print circulation and advertising. Larger newspapers are seriously looking into ways to seek payment for at least some of the news they put online. Their publishers have been discussing various proposals from Internet entrepreneurs, including improved technologies for digital subscriptions, micropayments on the model of iTunes to read individual news stories, single-click mechanisms for readers to make voluntary payments, and business-to-business arrangements enabling newspapers to share in the ad revenue from other sites that republish their content.

    By James Harkin

    The audience for public radio has been growing substantially for several decades, driven largely by its national news programs. Only a few large newspapers are already charging for digital news of special interest. Both The Wall Street Journal and the Financial Times sell subscriptions for access to their Web sites, and the Journal also has decided to charge for its content on mobile devices like BlackBerrys and iPhones.

    The Milwaukee Journal Sentinel sells subscriptions to avid Green Bay Packers football fans for its Packer Insider site, and the Pittsburgh Post-Gazette offers paid membership to a niche Web site of exclusive staff blogs, videos, chats, and social networking. One entrepreneurial venture, Journalism Online , claims that publishers of hundreds of daily and weekly newspapers have signed letters of intent to explore its strategy for enabling online readers to buy digital news from many publications through a single password-protected Web site.

    Attributor offers to negotiate with Internet advertising networks to share that revenue with publishers who join its Fair Syndication Consortium. The Associated Press recently announced a strategy for tracking news produced by AP and its member newspapers through the Internet, and then seeking payment for it. Entrepreneurs have also proposed ways in which news consumers could allow their reading habits on the Internet to be monitored so that news organizations could sell highly targeted groups of readers to advertisers at high prices.

    Google offers publishers some ways to use its search engine to seek payment for their digital news. There have been suggestions that philanthropists or foundations could buy and run newspapers as endowed institutions, as though they were museums. But it would take an endowment of billions of dollars to produce enough investment income to run a single sizeable newspaper, much less large numbers of papers in communities across the country. Senator Ben Cardin of Maryland has introduced legislation to allow newspapers to become nonprofits for educational purposes under section c 3 of the tax code, similar to charities and educational and cultural nonprofits.

    Philanthropic contributions to them would be tax-deductible. But the bill, which has not moved anywhere in Congress, does not address how a newspaper that is losing money, especially one saddled with significant debt or other liabilities, could be converted into a viable nonprofit.

    And many newspapers are extensively restructuring themselves to integrate their print and digital operations, creating truly multimedia news organizations in ways that should produce both more cost savings—and more engaging journalism. A growing number of newspapers also are supplementing their reduced resources for news reporting by collaborating with other newspapers, new kinds of news organizations, and their own readers.

    They share state, business, sports, arts, and entertainment news reporting, various kinds of features, editorials, photographs, and graphics. The newspapers work independently and competitively on enterprise and investigative reporting, to which their editors say they can each now devote more of their smaller number of reporters. The Star-Ledger in Newark has created a separate community news service that hired three-dozen younger, lower-paid journalists to report from surrounding New Jersey towns.

    Local news coverage remains underfunded, understaffed, and a low priority at most public radio and television stations, whose leaders have been unable to make—or uninterested in making—the case for investment in local news to donors and Congress. As newspapers sharply reduce their staffs and news reporting to cut costs and survive, they also reduce their value to their readers and communities. At the same time, they are disgorging thousands of trained journalists who are now available to start and staff new kinds of local news organizations, primarily online.

    This sets the stage for a future for local news reporting in which the remaining economically viable newspapers—with much smaller staffs, revenues, and profits—will try to do many things at once: publish in print and digitally, seek new ways to attract audience and advertisers, invent new products and revenue streams, and find partners to help them produce high quality news at lower cost.

    They will do all of this in competition—and in collaboration—with the new, primarily online, news organizations that are able to thrive. Some local television stations sometimes produce exemplary local and regional reporting, as demonstrated by the winners of the DuPont Award.

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    A two-year investigation by WTVT, a Fox affiliate in Tampa, of criminal justice in nearby Hardee County led to the release of a truck driver wrongfully imprisoned for vehicular manslaughter. WFAA in Dallas, an ABC affiliate that has won more than a dozen national awards, received a special citation for three notable investigative reports in a single year. Still, even in their best years, most commercial television stations had far fewer news reporters than local newspapers, and a study of fifty-nine local news stations in nineteen cities found that 90 percent of all their stories reported on accidents, crimes, and scheduled or staged events.

    In recent years, with their ratings and ad revenues in rapid decline and their once extravagant profit margins imperiled, many local television stations have made further cuts in already small news staffs. The number of television stations producing local news of their own is steadily shrinking.

    At stations around the country, newscasts are now produced by other stations in the same cities. In the past, the Federal Communications Commission required station owners to show they were serving the public interest before their broadcasting licenses could be renewed. But the FCC no longer effectively enforces the public-service requirement. Some cable television systems offer all-news local channels produced by the cable company itself or by broadcast station owners. The cable news channels, which recycle a relatively few news programs throughout the day, are usually lower cost, smaller-audience versions of host or collaborating broadcast stations.

    The Future Of Business Journalism

    On radio, with the exception of all-news stations in some large cities, most commercial stations do little or no local news reporting. A growing number of listeners have turned to public radio stations for national and international news provided by National Public Radio. But only a relatively small number of those public radio stations also offer their listeners a significant amount of local news reporting.

    And even fewer public television stations provide local news coverage. Congress created the current system of public radio and television in The stations, which are owned by colleges and universities, nonprofit community groups, and state and local governments, supplement relatively small CPB grants with fundraising from individual donors, philanthropic foundations, and corporate contributors. The Public Broadcasting Service , collectively owned by local public television stations and primarily funded by the CPB, is a conduit for public affairs programs produced by some larger stations and independent producers that consist mostly of documentaries, talk shows, and a single national news discussion program, The NewsHour with Jim Lehrer , on weeknights.

    Because PBS has no production capacity of its own, it does not do any news reporting. An internal PBS study reportedly recommends the creation of a destination public news Web site, with content from throughout public television and radio. David Fanning, the longtime executive producer of Frontline , has proposed going further. Fanning wants to create a full-fledged national reporting organization for public television with its own staff and funding. Realizing either his proposal or the vision of the PBS study would require a major realignment of public media relationships and funding.

    Neither would increase independent local news reporting by public television stations. While the audience for public radio of about 28 million listeners each week is just over one-third of the 75 million weekly viewers of public television, it has been growing substantially for several decades, driven largely by its national news programs. Although NPR also has lost revenue during the recession and laid off staff for the first time in a quarter century, it recently launched an ambitious Web site with national news updates and stories.


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    It also hired its first editor for investigative reporting, Brian Duffy, who is working on accountability journalism projects with reporters at NPR and local public radio stations. NPR has seventeen foreign bureaus, more than all but a few American newspapers, and six U. Those that do tend to be large city, regional, or state flagship stations. Some of these operations are impressive.

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    It may be a good thing. We have to think of there being a new news ecosystem. Some public radio stations have sought advice from CPB, asking how they could expand and finance local news coverage, using journalists who had worked at local newspapers. NPR is a nonprofit that supplies national and international news and cultural programming—but not local news—to about public radio stations.

    These stations are owned and managed by local and state nonprofits, colleges, and universities that support NPR with their dues. Overall, however, local news coverage remains underfunded, understaffed, and a low priority at most public radio and television stations, whose leaders have been unable to make—or uninterested in making—the case for investment in local news to donors and Congress.

    Others concentrate on investigative reporting. Some specialize in subjects like national politics, state government, or health care. Many are tax-exempt nonprofits, while others are trying to become profitable. Most publish only online, avoiding printing and delivery costs.

    However, some also collaborate with other news media to reach larger audiences through newspapers, radio, and television, as well as their own Web sites. Many of the startups are still quite small and financially fragile, but they are multiplying steadily. Several new local news organizations, each different from the others, can be found in San Diego.

    Financial journalism in today’s high-frequency news and information era

    The reporting staff of the daily newspaper there, The San Diego Union-Tribune , has been halved by a series of cuts both before and after its sale by the Copley family in May to a Los Angeles investment firm, Platinum Equity, which had no previous experience in journalism. The dozen reporters who work out of its light-filled newsroom in a new Spanish mission-style building near San Diego Bay focus on local accountability journalism. The site has no recipes or movie reviews or sports. The blogosphere and older media have become increasingly symbiotic. They share audiences, and they mimic each other through evolving digital journalistic innovation.

    To increase their reach, Voice journalists appear regularly on the local NBC television station, the all-news commercial radio station, and the public radio station, giving those outlets reporting they otherwise would not have. They rent newsroom space from one of their supporters, the San Diego Foundation, which, like hundreds of other community foundations around the country, is a collection of local family funds with a professional staff to offer advice to the donors of these funds. Lewis said the foundation recommends contributions to the Voice.

    At the same time, the national Knight Foundation has been encouraging such foundations to support news and information needs in their communities through a program of matching grants. SDNN aggregates news and information from its own small reporting staff, freelancers, San Diego-area weekly community newspapers, radio, and television stations, and bloggers. It covers most of the subjects the newspaper does, from local events, business, and sports to entertainment, food, and travel, but with less independent reporting.

    Jennewein said that he expects cities like San Diego, which long had a single dominant newspaper, to spawn many kinds of news entities.

    Profits and Losses: Business Journalism and Its Role in Society Profits and Losses: Business Journalism and Its Role in Society
    Profits and Losses: Business Journalism and Its Role in Society Profits and Losses: Business Journalism and Its Role in Society
    Profits and Losses: Business Journalism and Its Role in Society Profits and Losses: Business Journalism and Its Role in Society
    Profits and Losses: Business Journalism and Its Role in Society Profits and Losses: Business Journalism and Its Role in Society
    Profits and Losses: Business Journalism and Its Role in Society Profits and Losses: Business Journalism and Its Role in Society

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