CHAPTER 5
Recent Developments in Mass Media:
Digitization and Multitasking
Kenneth C. Wilbur
Rady School of Management, University of California, San Diego, CA, USA
Contents
5.1. Recent Trends in Mass Media Consumption 207
5.1.1 Digitization 210
5.1.2 Screen Proliferation 212
5.2. Effects of Digitization 213
5.2.1 Consumer Control over Advertising Exposure 213
5.2.2 Increased Targeting of Advertising 215
5.2.3 New Media Business Models 215
5.2.4 Media Market Outcomes 217
5.3. Effects of Media Multitasking 218
5.3.1 Media Complementarities 218
5.3.2 Competition for Attention 220
5.4. Discussion 221
Acknowledgments 222
References 222
Abstract
Technology and consumer behavior are changing supply and demand for mass media. Digitization has
increased consumer control over media content and advertising, with implications for advertising
avoidance, advertising targeting and personalization, competition among media platforms, and media
market outcomes. In addition, consumers increasingly use a “second screen” to multitask during
media programs, enabling immediate online response to program and advertising content, but also
offering new opportunities to divert attention. This chapter presents recent data showing that video
has remained the dominant mass medium and establishing the prevalence of digitization and multi-
tasking behavior. It then selectively reviews academic research on the antecedents and consequences
of the changing picture of mass media consumption, with a particular focus on the past 5–10 years.
Keywords
Advertising, Internet, Marketing, Mass media, Media economics, Television
JEL Codes
J22, L82, L96, M30, M37
205
Handbook of Media Economics,Volume1A © 2016 Elsevier B.V.
ISSN 2213-6630,
http://dx.doi.org/10.1016/B978-0-444-62721-6.00005-6 All rights reserved.
Consumers devote more than half of all available leisure time to mass media. The purpose
of this chapter is to survey recent changes in mass media consumption and research, with
a particular focus on the past 5–10 years. I begin with recent data on time and advertising
revenue allocations across mass media. I then selectively review academic research on
how two important trends—digitization and consumer multitasking—are changing mass
media industries.
To set boundaries on this review, this chapter considers mass media to be one-to-
many means of communication that convey information and entertainment of primarily
ephemeral value. I say “primarily ephemeral” in anticipation that, although there will be a
few enduring hits, the large majority of mass media content will be consumed immedi-
ately upon, or shortly after, its distribution. For example, while some television series are
archived by services like Amazon, Hulu, and Netflix, these series constitute a small frac-
tion of the tens of thousands of hours of new television content created and distributed
each year.
This definition of mass media includes television, radio, newspapers, magazines, and
many other forms of digital audio, text, and video communications. However, “one-to-
many” excludes personal communications services like telephony, email, search engines,
and (arguably) social networks and most other forms of user-generated content. Enter-
tainment and information content distinguish mass media from those that focus on purely
commercial communications such as yellow pages or product review sites. Ephemerality
excludes most books, movies, and video games, as the consumption value of these media
seems to diminish more slowly with time (despite a few prominent exceptions).
Mass media industries share a particular set of economic characteristics which often
distinguishes their analysis from more conventional economic settings:
• Mass media products are experience goods that are non-rival in consumption and dif-
fer in both quality and match value (i.e., horizontally and vertically differentiated
product characteristics). Mass media tend to be “hits” industries in which small oli-
gopolies of multiproduct firms compete for consumer attention.
• Many mass media recently shifted from analog to digital distribution, replacing the
traditional one-way flow of information with a two-way exchange between providers
and consumers. Digitization changes the information that media platforms can learn
about how their consumers consume and respond to content and advertising.
• Mass media are operated as platform businesses that enable interactions between con-
sumers and advertisers. Advertisers are charged piece rates for audiences or bundles or
audiences. Consumers are normally charged a mixture of subscription fees and atten-
tion devoted to advertising interruptions. Multitasking threatens the availability of
attention for advertisements, and digitization has increased control over consumer
exposure to advertising.
The next section uses recent market data to establish a few facts about mass media consump-
tion and the importance of digitization and consumer multitasking with media.
Section 5.2
206 Handbook of Media Economics
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