Media Policy Out of the Box: Content Abundance, Attention Scarcity, and the Failures of Digital Markets

84 Pages Posted: 15 Sep 2004


Media policy debates are today marred by outdated and ultimately unworkable justifications for government intervention in media markets. Both proponents and opponents of such intervention have obscured the appropriate goals of media policy. Moreover, they have paid insufficient attention to the impact of digital media on the marketplace of ideas. This article proposes a new account of media policy goals and offers the first detailed analysis of how new media market dynamics should affect future media policies.

Policies that promote greater diversity in video products, whether through regulations or subsidies, serve both reactive and proactive purposes. In its reactive posture, media policy aims to correct what I call narrow market failures. These are failures of media markets to deliver content that small audience segments desire. But media policy must also pursue a proactive agenda by supplementing even well-functioning markets. This proactive thrust responds to broad failures of the market to deliver media content that audiences might not currently desire, but promotes democratic discourse and social solidarity. This article shows how digital networks substantially affect both reactive and proactive media policy objectives. Existing media policies are premised on the mid-twentieth century reality of scarce content and abundant audience attention. But in the digital era, it is attention that is scarce and content that is abundant. Drawing on empirical evidence and theory from several disciplines, I show how this shift changes the narrow market failures to which media policy must respond and undermines past responses to broad market failures. I conclude by applying these theories to media subsidies, arguing that subsidies for a robust public service media are the proper channel for media policy in the digital era from both a First Amendment and practical perspective

Keywords: Digital media, market failures, communications policy, first amendment, government subsidies

JEL Classification: D6, K23, L3, L82, M3

Suggested Citation

Goodman, Ellen P., Media Policy Out of the Box: Content Abundance, Attention Scarcity, and the Failures of Digital Markets. Berkeley Technology Law Journal, Vol. 19, 2004, Available at SSRN: or

Ellen P. Goodman (Contact Author)

Rutgers Law ( email )

217 N. 5th Street
Camden, NJ 08102
United States
856-225-6393 (Phone)
856-225-6516 (Fax)

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