"Finally, I was forced to admit that I work in a corrupted profession."
It is one of the great lines from a work of non-fiction, in the above case by Nick Davies in his book Flat Earth News*.
But the media industry as a whole continues to grow even while roiled by seismic changes in content production, distribution and monetisation.
There is an old saying that a society gets the politicians it deserves, but the framework and mechanism for discussion and debate about politics and society is often set through the prism of the Fourth Estate: the press and other media – the other three estates historically being church, nobility and commoners.
Thomas Carlyle, in his book On Heroes and Hero Worship, said: "[Edmund] Burke said there were three estates in [the UK’s] parliament; but, in the reporters’ gallery yonder, there sat a Fourth Estate more important far than they all. It is not a figure of speech, or a witty saying; it is a literal fact – very momentous to us in these times. Literature is our parliament too. Printing, which comes necessarily out of writing, I say often, is equivalent to democracy: invent writing, democracy is inevitable. Writing brings printing; brings universal everyday extempore printing, as we see at present [1840]. Whoever can speak, speaking now to the whole nation, becomes a power, a branch of government, with inalienable weight in law-making, in all acts of authority. It matters not what rank he has, what revenues or garnitures. The requisite thing is, that he have a tongue which others will listen to; this and nothing more is requisite."
In Carlyle’s eyes, therefore, we would be living in the greatest period of democratisation. Digital media and the internet means practically anyone with online access can be heard, while some of the most highly-valued new companies are being created to service this explosion of latent talent and as a vehicle for advertising.
With Google, Baidu and Yandex worth more than $200bn in market capitalisation and social media platforms from LinkedIn, Facebook, Vkontakte, Mixi, Orkut, Tencent and RenRen more still, the power of this handful of media companies can influence nations, and with an expected 66-fold rise in mobile data traffic between 2008 and 2013, according to network equipment maker Cisco, there is greater freedom of movement as well.
Corporate venturing groups from established media companies have backed most of the new-media names above. For some, such as South Africa-based Naspers’ MIH or US-based publisher International Data Group’s IDG Ventures, the insights and capital that have come from backing the entrepreneurs have helped the parent change and grow and influenced the new world order. IDG was the first overseas venture investor in China, for example, at a time when most independent firms regarded the move as foolish.
The top executives at these media firms would be incredulous if asked whether they would be in the same position without having a credible, long-term commitment to corporate venturing.
The lesson is getting through to others in the sector as well. With more than 20 corporate venturing programmes and funds set up in the past year – the most of any industry group tracked by Global Corporate Venturing (see main feature for our selection of this year’s most influential unit) – and an aggregate $6bn committed, there is, finally, an increase in supply of sophisticated risk capital for entrepreneurs.
But the potential for change in the $1.5 trillion media industry remains huge. As Martin Weber, managing partner of Holtzbrinck Ventures, which spun out from Germany- based media group Holtzbrinck earlier this year after a decade’s success, including being a shareholder in discount coupon provider Groupon, said by text: "No lack of entrepreneurs. No lack of ideas. Lack of sophisticated and risk-taking investors."
Corporate venturing’s time to help fill that gap has come, and, if governance issues are handled carefully, even so has a chance to turn the media industry to a less corrupted future**.
* I provided some research for the book.
** As a director of the London Press Club, please ask about membership or sponsorship.