ABBM4303 Broadcast Management.
Course Guide xi - xv
Topic 1 Introduction 1
1.1 Telecommunications and Broadcasting 2
1.1.1 What is Telecommunications? 2
1.1.2 What is Broadcasting? 3
1.2 What is the Meaning of Management 5
1.2.1 What is Telecommunications Management? 5
1.3 Management Study Approach 6
1.3.1 Functional Discipline 7
1.3.2 Human Achievement 7
1.3.3 Management Science 8
1.4 Telecommunications Management Components 8
1.4.1 Telecommunications Management Skills 9
1.4.2 Telecommunications Management Functions 11
1.5 Telecommunications Management Roles 16
1.5.1 Interpersonal Aspects 17
1.5.2 Information Aspect 18
1.5.3 Decision Making Aspects 19
1.6 Types of Management Occupations 20
1.6.1 ManagersÊ Roles 22
1.7 Telecommunications and Leadership 23
Summary 24
Key Terms 25
Reference 25
Topic 2 Telecommunications Management Theory 26
2.1 Development of Management Theory 27
2.2 Classical Perspective (1890-1920Ês) 33
2.2.1 Scientific Management 34
2.2.2 Bureaucratic Management 37
2.2.3 Administrative Management 38
2.3 Behavioural Perspective (Beginning In 1920Ês) 41
2.3.1 Human Relations Movement 42
2.3.2 Human Resource Approach 42
2.3.3 Behavioural Science Approach 46
2.4 Quantitative Perspective (Early 1940Ês) 47
2.4.1 Management Science 47
Table of Contents
iv X TABLE OF CONTENTS
2.4.2 Operations Management 48
2.4.3 Management Information System 48
2.5 Contemporary Perspective (1950-2000) 48
2.5.1 Contemporary Management 49
2.6 Management by Objective ă MBO 50
2..6.1 System Approach 51
2.6.2 Contigency Theory 52
2.6.3 Japanese Management Approach 52
2.7 Management Styles 56
2.8 Telecommunications Organisation Management Model 58
Summary 60
Key Terms 60
Self Test 1 61
Self Test 2 61
Reference 62
Topic 3 Electronic Media and Information, Communication 64
and Technology (ICT)
3.1 Electronic Media 65
3.2 Information Technology and Communication 68
3.3 Aims of Telecommunications Management 70
3.3.1 Making Inaccurate Predictions of Audience Tastes 71
3.3.2 High Cost of Maintenance 71
3.4 Basic Activities of a Media Organisation 74
3.4.1 Development 74
3.4.2 Production 75
3.4.3 Distribution 76
3.4.4 Display 77
3.5 Electronic Media Landscape 77
3.5.1 Radio Broadcasting 78
3.5.2 Television Broadcasting (TV) 80
3.6 Development of Television Broadcast in Malaysia 82
Summary 84
Key Terms 85
Reference 86
Topic 4 Telecommunications Industry Structure 87
4.1 Telecommunications Industry Structure 88
4.1.1 Telecommunications Organisation 89
4.2 Market Structure Elements 90
4.2.1 Sellers Concentration 90
4.2.2 Product Differentiation 92
TABLE OF CONTENTS W v
4.2.3 Barriers of Entry 93
4.2.4 Buyers Concentration 94
4.2.5 Growth in Demand 94
4.3 Market Behaviour Principle 95
4.3.1 Price Determination Policy 95
4.3.2 Quality Control Policy 96
4.3.3 Competitive Policy 96
4.4 What are the Elements of Market Achievement? 96
4.4.1 Efficient Use of Resources 97
4.4.2 Stability of Prices and Employment 98
4.4.3 Fair Deal to All 98
4.4.4 Growth and Planning 98
4.5 Levels of Industry Development 101
4.5.1 Level I: Introduction 101
4.5.2 Level II: Development 102
4.5.3 Level III: Maturity 102
4.5.4 Level IV: Decline 102
Summary 102
Key Terms 103
Reference 103
Topic 5 Management of Educational TV Broadcasting 104
5.1 Background of Educational Television (ETV) 105
5.1.1 Vision and Mission of ETV 106
5.1.2 ETV Objectives 106
5.2 Effects of Changes in Broadcasting Policy 107
5.3 Organisational Structure 108
5.3.1 Educational TV Sector 108
5.3.2 Engineering Sector 108
5.4 Establishment 111
5.4.1 Producer 111
5.4.2 Script Assistant 112
5.4.3 Cameraman 113
5.4.4 Audio Technician 113
5.4.5 Lighting Technician 114
5.4.6 Editor 114
5.4.7 Technical Producer 115
5.4.8 Video System and Camera Control Unit (CCU) 115
Technician
5.4.9 Video Mixer 116
5.4.10 Graphic Designer 116
5.4.11 Make-up Artist 117
5.4.12 Photographer 117
vi X TABLE OF CONTENTS
5.4.13 Set Maker 118
5.4.14 Music Supervisor 118
5.5 Educational TV Programme 119
5.5.1 Preview 119
5.5.2 Educational TV Programmes Preview 120
5.5.3 Where a Preview is Made 120
5.5.4 Preview Committee 120
5.5.5 What Subjects are Evaluated? 120
5.6 Supporting Materials/Handouts Notes that must be 123
Prepared during Evaluation Session
5.7 Use of Educational TV in Schools 125
5.7.1 Use of Educational TV in Teaching and Learning 125
5.7.2 Educational TV Supporting Materials 126
5.7.3 Usage of Log Book 127
5.7.4 The Roles of State Educational Resource Centre 127
(SERC) and TeachersÊ Activity Centre (TAC)
5.7.5 Monitoring in Schools 128
5 .8 Use of Satellite TV 128
5.8.1 Satellite TV Equipment Supplied to Schools 128
5.8.2 Troubleshooting 129
5.8.3 Educational TV Broadcasting Time 129
5.9 The Future of Educational TV 129
5.10 Financial Management of Educational TV Programme 131
Summary 132
Key Terms 132
Reference 132
Topic 6 Marketing and Sales Management 133
6.1 Broadcasting Marketing 134
6.2 Advertisers, Agencies, Stations, Station Agents, 136
and Media Planners
6.2.1 Advertiser 136
6.2.2 Advertising Agency 137
6.2.3 Station 139
6.2.4 Station Agents 142
6.2.5 Media Planners 142
6.3 Media Objectives 146
6.3.1 Impression 147
6.3.2 Gross Rating Point 148
6.3.3 Access 148
6.3.4 Frequencies 150
6.4 Factor Influencing Media Selection 150
6.5 Ratings 152
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6.6 Media Product Promotion 153
Summary 153
Key Terms 154
Reference 154
Topic 7 Cable / Satellite Broadcasting System 155
7.1 Broadcasting Cable System 156
7.2 Cable System Structure 157
7.2.1 Headend Point 158
7.2.2 Distribution Network 158
7.2.3 Receiving Equipment (House Drop) 158
7.3 Cable TV Business 159
7.3.1 Cable TV Stations 159
7.3.2 Producer/Provider of Cable Programme 160
7.4 Cable System Management 160
7.5 Responsibilities of a Cable TV Manager 162
7.5.1 Cable TV Programme 162
7.6 Cable Management 165
7.7 Satellite Broadcasting 165
7.8 Components of Communication Satellite 167
7.9 Direct Broadcasting Satellite (DBS) 168
Summary 169
Key Terms 169
References 169
Topic 8 The Future of Telecommunications Management 171
8.1 Development of Telecommunications Sector in Malaysia 172
8.2 Regulator 174
8.3 Globalisation Impact in Telecommunications Field 175
8.3.1 Changes in Local media 175
8.3.2 TELCO and CELCO Sectors 176
8.3.3 Broadcasting Sector 177
8.4 Expansion of Global Telecommunications Industry 178
8.5 The Future of TELCO and CELCO 181
8.6 Challenges from Outside 182
8.7 Future Challenges of the Broadcasting Industry 185
8.7.1 Competition in Broadcasting Media 186
Environment
8.7.2 National Broadcasting Digitalisation Project 188
8.7.3 Digital Broadcasting Advantages 189
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8.8 Challenges to the Broadcasting Manager 190
8.8.1 Implications of Digitalisation Project 190
8.8.2 Roles of Manager in Facing Future Challenges in 193
Broadcasting Industry
Summary 196
Key Terms 197
Reference 197
Topic 1 focuses on definition of concepts used in the course. These are: definition
of telecommunications, broadcasting and management. Students are also exposed
to important components of telecommunication management.
Topic 2 allows students to understand managerial aspects more academically;
this topic focuses attention on management theory in general. Management
theory is considered essential in this context to enable students to apply it in the
actual organisational climate.
COURSE GUIDE xiii
Topic 3 exposes students to the participants involved in the broadcasting and
telecommunications industry. Discussions are about activities of media and ICT
industries, as well as requirements of the telecommunications industry pertaining
to managerial aspects.
Topic 4 discusses the important elements of the telecommunications industry
including market structure, behaviour, market performance and media maturity.
Topic 5 introduces one of the participants in the national broadcasting industry
which is Educational Television (ETV). ETVÊs participation is rather different
from other public and private media organisations because of its different target
audience and working styles. ETV is discussed in the course to allow students to
differentiate its role as one of broadcasting participants which is equally
important in broadcasting and telecommunications development.
Topic 6 discusses the marketing and sales process regarding broadcasting and
telecommunications industry. Essential elements in marketing and sales aspects
are advertising and advertising agencies, as well as ratings aspect which is
emphasised by media planners and the management of broadcasting and ICT
industry.
Topic 7 introduces cable TV and Satellite TV broadcasting systems, which is a
technologically innovative product which enables communication satellites to be
easily used without being assessed by terrestrial TV. Communications satellites
have facilitated information dissemination, entertainment and interactive
communications between the participants of national, regional and global
telecommunications industry.
Topic 8 discusses up-to-date media and telecommunications scenario as well as
various challenges currently facing the new media management. However, these
challenges must be handled wisely to be turned into opportunities taking the
organisation and the nation to a higher level, and creating a K-society as expected
by 2020.
xiv COURSE GUIDE
TEXT ARRANGEMENT GUIDE
Before you go through this module, it is important that you note the text
arrangement. Understanding the text arrangement will help you to organise your
study of this course in a more objective and effective way. Generally, the text
arrangement for each topic is as follows:
Learning Outcomes: This section refers to what you should achieve after you
have completely covered a topic. As you go through each topic, you should
frequently refer to these learning outcomes. By doing this, you can continuously
gauge your understanding of the topic.
Self-Check: This component of the module is inserted at strategic locations
throughout the module. It may be inserted after one sub-section or a few sub-
sections. It usually comes in the form of a question. When you come across this
component, try to reflect on what you have already learnt thus far. By attempting
to answer the question, you should be able to gauge how well you have
understood the sub-section(s). Most of the time, the answers to the questions can
be found directly from the module itself.
Activity: Like Self-Check, the Activity component is also placed at various
locations or junctures throughout the module. This component may require you
to solve questions, explore short case studies, or conduct an observation or
research. It may even require you to evaluate a given scenario. When you come
across an Activity, you should try to reflect on what you have gathered from the
module and apply it to real situations. You should, at the same time, engage
yourself in higher order thinking where you might be required to analyse,
synthesise and evaluate instead of only having to recall and define.
Summary: You will find this component at the end of each topic. This component
helps you to recap the whole topic. By going through the summary, you should
be able to gauge your knowledge retention level. Should you find points in the
summary that you do not fully understand, it would be a good idea for you to
revisit the details in the module.
Key Terms: This component can be found at the end of each topic. You should go
through this component to remind yourself of important terms or jargon used
throughout the module. Should you find terms here that you are not able to
explain, you should look for the terms in the module.
COURSE GUIDE xv
References: The References section is where a list of relevant and useful
textbooks, journals, articles, electronic contents or sources can be found. The list
can appear in a few locations such as in the Course Guide (at the References
section), at the end of every topic or at the back of the module. You are
encouraged to read or refer to the suggested sources to obtain the additional
information needed and to enhance your overall understanding of the course.
PRIOR KNOWLEDGE
Those of you who specialise in Web Broadcasting programme, which is one of the
Multimedia Communications programmes, should have taken the CBMM2103
course: Information Technology, Media and Society. However, students wishing
to take the course as an elective are not subject to any conditions.
ASSESSMENT METHOD
Please refer to myINSPIRE.
REFERENCES
Abbot, D. (1999) Cutting Edge Advertising, Singapore; Prentice-Hall
(Singapore) Pte. Ltd.
Albarran, A. B. (2002). Management of Electronic Media, (2nd. ed.). Belmont,
CA: Wadsworth Thomson Learning.
Craft, J. E., Leigh, F. A., & Godfrey, D. G. (2001), Electronic Media. Australia:
Wadsworth Thomson Learning.
Dominick, J. R. Messere, F., & Sherman, B. L. (2004) Broadcasting, Cable,
theInternet and Beyond: An introduction to Modern Electronic Media. (5th.
ed.). Boston, MA: McGraw-Hill.
Eastman, S. T. Ferguson, D. A., & Klein, R. A. (2002). Promotion and Marketing
for Broadcasting, Cable and the Web. (4th. ed.).Boston: Focal Press.
Gershon, R. A. (2001). Telecommunications Management: Industry Structures
and Planning Strategies. Mahwah, New Jersey: Lawrence Erlbaum Associates,
Publishers.
Green, J. H. (2001). The Irwin Handbook of Telecommunications Management.
(3rd. ed.). New York: McGraw-Hill.
xvi COURSE GUIDE
Gross, L. S. (2000). Telecommunications: An Introduction to Electronic Media
(7th. ed.). Boston, MA: McGraw-Hill.
Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. (2nd. Ed.). New York: Mcgraw-Hill.
TAN SRI DR ABDULLAH SANUSI (TSDAS) DIGITAL LIBRARY
The TSDAS Digital Library has a wide range of print and online resources for the
use of its learners. This comprehensive digital library, which is accessible through
the OUM portal, provides access to more than 30 online databases comprising
e-journals, e-theses, e-books and more. Examples of databases available are
EBSCOhost, ProQuest, SpringerLink, Books24x7, InfoSci Books, Emerald
Management Plus and Ebrary Electronic Books. As an OUM learner, you are
encouraged to make full use of the resources available through this library.
INTRODUCTION
This topic will introduce you to basic telecommunications and management
concepts. Through this first discussion, you are expected to understand the
meaning of management in the context of the telecommunications industry. You
will also be exposed to components of the telecommunications management. The
aim is to allow you to apply them in your career. In this course, the
telecommunications field will also include broadcasting and multimedia
communications.
Introduction
By the end of the topic, you should be able to:
1. Explain the definition of telecommunications, broadcasting and management;
2. Identify the three approaches of telecommunications study;
3. Identify three components of telecommunications management;
4. Discuss and explain the duties, functions, roles and responsibilities of
a media or communications manager in a telecommunications
organisation; and
5. Discuss the relationship between management and workers in a telecommunications organisation.
LEARNING OUTCOMES
TELECOMMUNICATIONS AND BROADCASTING.
1.1.1 What is Telecommunications?
The term „telecommunications‰ is made up of two words, which are "tele" and
"communication". In Greek, "tele" means long distance.
We also often find the prefix „tele‰ in words such as
telephone, telegram, telefax, teletext, television, teleprinter,
teleprompter, teleconference and teleport. What is the
meaning of each of these concepts? All refer to the use of
networks and communications at long distances.
When we communicate, we exchange ideas and
information through writing, talking, speaking and non-
verbal signals. If the communication involves long-distance communication,
equipment such as telephone, facsimile machine and others are used. There are
individuals who can communicate with other people without any equipment but
through what is called telepathy, which uses thought and spiritual channels, but
this is hard to prove empirically.
Sherman (1995) regards telecommunications organisations as private and public
organisations which are particularly involved in the business of developing,
Therefore, telecommunications refers to the science and
technology of communications, which channel or transmit
signals electronically through communications satellite
cables, telephones, telegraphy, radios or televisions.
According to Gershon (2001), telecommunications refers to communication
at a long distance.
SELF-CHECK 1.1
What crosses your mind when the word „broadcasting‰ is
mentioned? Make a list of anything you may relate to in broadcasting.
Check the list. Will the concepts be consistent with the importance of
broadcasting in your life activities?
publishing, distributing and showing of programmes with elements of
entertainment and information to the public through electronic media, that is,
non-print media.
In this course, the term „telecommunications‰ is used with two meanings:
(a) Electronic media (radio, television, online media); and
(b) Common carriers, such as people, companies or carriers/channels of
tangible products such as communications satellites, broadcasting
equipment and fibre optics or intangibles, such as information super
corridors.
1.1.2 What is Broadcasting?
The definition of broadcasting, according to E.S. Foster (1978) is as follows:
We give various definitions of broadcasting depending on the importance and
uniqueness of this field to us. In general, broadcasting is interpreted as the
channels for transmitting information, entertainment, education and economic
resources.
Figure 1.1: Channels of broadcasting
The concept of broadcasting may have a different meaning for different
individuals and organisations. The difference in meaning will depend on the
extent of its importance to an individual or an organisation. Our perception
towards broadcasting is influenced by our position in the field of broadcasting.
Broadcasting, by definition, is the transmission of radio and television signals
to the public wherever people may be ă in homes, in office, in automobiles, on
picnics, etc.
(Source: E.S. Foster, Understanding Broadcasting, 1978. p.18)
Below are perceptions of several individuals with different posts or positions in
broadcasting.
Shareholders in a broadcasting organisation may define
broadcasting from the economic viewpoint, that is whether
this field will earn him profits or not.
An advertiser who sponsors a broadcasting programme
will regard broadcasting as a medium to attract a target
audience and increase its source of funds.
The manager of a broadcasting station will regard
broadcasting as a source of income or professional prestige.
For a creative person, broadcasting is a platform to highlight
talents and a stepping stone to create a reputation and achieve
success in his career.
For workers such as broadcasting reporters, scriptwriters or
publishers, broadcasting is a medium to highlight their skills,
besides achieving their ambitions in the career.
Other participants in the broadcasting industry will think in terms
of profits they may obtain in the forms of power, popularity,
finance etc.
ACTIVITY 1.1
8TV managed an entertainment programme, Malaysian Idol, not long
ago. For its first winner, Jaclyn Victor, this programme was a platform
to highlight her singing talent and earn the opportunity to become a
popular singer. For the management of 8TV and advertisers, the
programme was a lucrative source of income for their organisations.
As a viewer, what can you conclude about the broadcasting field?
WHAT IS THE MEANING OF MANAGEMENT?
Management originates from a Latin term, that is, „manus‰ (hand). Originally,
the term referred to the task of looking after and training a horse. Since then it has
gradually been applied to the task of managing, training, governing, directing
and influencing other people (Sherman, 1995).
Figure 1.2: Management originates from a Latin term, „manus‰, that is hand
1.2.1 What is Telecommunications Management?
This is a task for a media manager with the responsibility of efficiently running a
media station with respect to human resource management and handling of
production studio equipment. Therefore, a successful station manager is a person
who is able to manage the Human Resource Department efficiently, besides
understanding the technical aspects of using station equipment.
When dealing with the theory of telecommunications management, focus will be
given on both micro and macro aspects. Figure 1.3 describes the micro and
macro aspects.
1.2
Telecommunications management refers to the ability to supervise,
motivate and handle equipment with low expenses.
Figure 1.3: Focus of telecommunications management theory
MANAGEMENT STUDIES APPROACH
There are three main points in the management study approach, which are:
(a) Functional discipline;
(b) Human achievement; and
(c) Management science.
Figure 1.4 briefly explains management study approaches.
Figure 1.4: Approaches of management study
Source: Sherman B. L. (1995). Telecommunications Management Broadcasting/Cable and
the New Technologies. NY: McGraw - Hill, Inc.
1.3.1 Functional Discipline
What do you understand by functional discipline? This aspect outlines the tasks,
roles and responsibilities of a media manager. Through guidelines of a functional
discipline, a media manager understands functions that must be performed. To
ensure the performance of responsibilities of a successful media manager, he/she
must carefully examine the characteristics and skills of a successful manager as a
guide. Even though the manager is encouraged to study the experience and skills
of an experienced manager, to be a successful manager he/she should not
necessarily follow an old style of management when he/she is given a
management responsibility.
1.3.2 Human Achievement
Human achievement emphasises individual roles in an organisation. The aim is
to manage workers' motivation, loyalty, satisfaction and to encourage individuals
to think of individual and organisational goals. Briefly, this approach states that
the media manager is responsible for encouraging workers to achieve excellent
job performance.
1.3.3 Management Science
Through management science, emphasis is given to complex organisational
behavioural structure. The media manager should understand that organisational
success depends on workersÊ excellence.
Besides understanding telecommunications management study approaches, a
media manager also needs a deeper understanding about the components of
telecommunications management.
TELECOMMUNICATIONS MANAGEMENT COMPONENTS.
Telecommunications management is divided into three components, namely:
(a) Skills;
(b) Functions;
(c) Roles.
1.4
ACTIVITY 1.2
After understanding the three components in telecommunications
management study approaches, make a list of similarities and
differences in telecommunications organisational management
(including broadcasting) compared with other organisations. To
facilitate this exercise, select a broadcasting station and a large
organisation (not in telecommunications) in Kuala Lumpur.
Table 1.1: Components of Telecommunications Management
SKILLS
(a) Technical
(b) Human
(c) Conceptual
FUNCTIONS
(a) Planning
(b) Organising
(c) Staff placement
(d) Controlling
(e) Innovation
ROLES (a) Interpersonal
(b) Information
(c) Decision making
(i) figure head
(ii) leader
(iii) mediator
(i) supervisor
(ii) information
disseminator
(iii) spokesperson
(i) distributor
(ii) judge
(iii) consultant
Source: Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. NY: McGraw-Hill, Inc. p.23
1.4.1 Telecommunications Management Skills
Figure 1.5 shows three things that must be emphasised regarding a media
managerÊs skills.
Figure 1.5: Media managerÊs skills
As the telecommunications industry is characterised by technology, technological
innovation cannot be avoided. Therefore, a manager handling a
telecommunications organisation or systems should have a high understanding
of technical aspects and up-to-date equipment needed by the station. Media
managers should understand the basics of radio waves, signal transmissions and
recording systems as well as media equipment and broadcasting technology so
that it will be easy for them to perform their duties excellently. Below is a more
detailed explanation regarding the three important aspects of a media managerÊs
skills.
(a) Technical Skills
A media manager should understand and have a good knowledge of all
technical aspects. This includes understanding and being able to efficiently
use production equipment such as camera and editing machine. If his/her
specialisation is in information technology, then he/she should be an expert
in handling information technology and always keep abreast of the latest
knowledge in the field.
(b) Human Skills
A successful media manager also possesses the ability or skill in human
aspects. This includes skills to interact as a leader with subordinates and
with other people in the organisation.
High human skills enable the media manager to generate a high level of
productivity and build a good working relation. This is not limited to the
management group only, but also includes staff and those in support
groups.
The ability to handle human matters is also important because there are
various groups of staff in the broadcasting station. These groups include
professional management groups, creative staff (scriptwriter and director)
as well as support group (production crew).
(c) Conceptual Skills
A media manager must act efficiently. This can be ensured only through
conceptual ability and skill. This skill refers to intellectual ability and
intelligence in making decisions. This also relates to the skill of
understanding intra-organisational and inter-organisational relations either
in the telecommunications industry, broadcasting and/or ICT at
community and world levels.
Every production will always face various problems. Therefore, a manager
should be smart in handling problems either relating to human resource or
marketing matters.
A managerÊs performance is also judged from the aspect of his/her skill in:
(i) Identifying, selecting and accessing certain and appropriate information for
the organization; and
(ii) Using available resources to achieve organisational goals.
1.4.2 Telecommunications Management Function
There are five telecommunications management functions, as shown in Table 1.2.
Table 1.2: Telecommunications Management Functions
Planning Organising Staff
Placement Controlling Innovation
• Plan
organisational
objectives
• How to
achieve
objectives
• What are the
ways to
achieve
objectives
• Organising
and
coordinating
tasks
• Recruit
• Training
• Evaluating
• Prepare
standards
• Communication
standards
• Measure
achievement
• Correct errors
Introducing
new
equipment
Source: Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. NY: McGraw-Hill, Inc. p.25
(a) Planning
In the planning process, a manager considers the station objectives and
ways of handling the station in achieving the objectives.
At this stage, planning is focused on:
(i) What is to be implemented;
(ii) How to implement; and
(iii) Who will implement it.
Planning refers to directing the future of the organisation and the ways
to achieve the formulated objectives.
If we refer to a television station, the he/she will consider what form of
programmes will be broadcasted. If it decides to broadcast a news
programme, who should be trusted to read the news and how much should
be charged for advertisements?
Telecommunications planning includes five basic planning stages. Figure
1.6 shows the five stages.
Figure 1.6: Basic telecommunications planning
The planning process requires the manager to make forecasts and
expectations to achieve the stationÊs objectives. A successful
telecommunications manager normally possesses such ability to forecast.
For example, in the early history of establishing RCA in the USA, David
Sarnoff in 1916 was able to predict the potential of the radio music box.
Similarly, Charles Dolan was successful in realising his idea of establishing
HBO, while Ted Turner established Cable News Network (CNN) .
OPIC 1 INTRODUCTION W 13
Figure 1.7 below explains a short history of Cable News Network (CNN).
Figure 1.7: Short history of Cable News Network (CNN)
(b) Organising
Bartol & Martin (1991) regard this function as a process of dividing and
organising human and non-human resource to achieve organisational
planning. Sherman (1995: 26-27) explains this function as distributing and
coordinating tasks in the corporation/organisation to ensure a maximum
level of efficiency in the efforts to achieve planning objectives. Since the job
of coordinating and distributing tasks is not easy, especially in the
telecommunications industry which has many varied job specifications,
organising has to be done based on the following:
(i) Organising the organisational structure by applying a specific
organisational model, coded job descriptions, clear evaluation,
procedure to present dissatisfactions, and so on.
(ii) Formation of departments for each particular function in the
organisation. For example, a television station has a particular
department or division for scheduling, sales, engineering, news,
promotion, public affairs, research, etc.
(iii) Delegation of responsibilities by the management to executives. .
Good management of expertise is essential at each management level.
Through the organising process, the manager identifies tasks and
coordinates responsibilities within the organisation. Therefore, it is essential
for a media manager to identify responsibilities and ensure that those
responsible perform such tasks.
The field of telecommunications needs the participation of many parties,
such as accountants, researchers, engineers, planning executives, salesmen
and others. To facilitate cooperation of each party, task organisation should
be done structurally, that is through the use of a clear model to evaluate
problems should they arise. In the structural organisation, each member of
the staff is given details of responsibilities through a specific flow chart.
Besides that, it is also through this system that tasks are distributed
according to units or departmental functions. The existence of different
departments requires systematic task delegation. Figure 1.8 shows an
example of an organisational chart.
Figure 1.8: Organisational chart
(c) Staff Placement
Besides creating the structure of organisation, what are other
responsibilities of the media manager? A media manager is also responsible
for recruiting new staff and executives, as well as providing training for
them. Until recently, the number of graduates in the field of media and
communications study has been increasing and this has provided an
opportunity for stations to get new and a highly qualified workforce.
However, some inexperienced graduates may not be prepared to accept
work requiring technical and conceptual expertise.
Therefore, a media manager must think of new ways of recruiting staff, that
is, either by searching for new talented staff, or by advertising for the job
with a sufficiently high salary. Hitz.fm sponsored nationwide voice tests in
order to get talented and interested news readers.
(d) Controlling
Organisational activities must be monitored and controlled so that they
adhere to an expected standard and achieve desired goals (Bartol & Martin,
1991:8-9)
Organisational control is a communication function. In this case, the
management should explain the corporate goals to the staff and determine
how organisational goals may be achieved. This function includes the
following tasks:
(i) Specifying organisational standards, that is, in quantitative and
qualitative terms. For example: In television broadcasting landscape
currently participated by various stations, standards include
advertising income, audience access and outreach.
(ii) Informing, explaining and disseminating information regarding
standards widely depending on organisational facilities and formats.
(iii) Measuring performance with standards through several modes of
feedback, i.e. formally and informally; and
ACTIVITY 1.3
You might have heard of and/or watched the programme Pengacara
Jemputan Nona on TV3. This is an example of an effort by the top
management of a television station in trying to get new faces to handle
programmes produced by the station. Can you think of any other
ways which television stations can use for the purpose of searching for
new talents?
(iv) Correcting any diversion or any action which is not consistent with
organisational vision.
To fulfil controlling responsibility, management should explain the
corporate vision and station's vision to all layers of organisational staff. This
process is essential in ensuring that the staff understands the station's
expectation and needs.
(e) Innovation
Telecommunications is a field which is generally exposed to innovation.
Creation of new equipment is not only aimed at replacing the functions of
old equipment, but also to upgrade them. Innovation may happen either by
involving internal or external aspects. This element is essential for the
development of the station and the management must follow this
development and quickly accept or adapt any technological innovation
which is important for the organisation.
TELECOMMUNICATIONS MANAGEMENT
ROLES
In telecommunications management, a chief operating officer plays three main
roles in developing the organisation. His/her roles are depicted in Figure 1.9.
Figure 1.9: Roles of the chief operating officer
1.5
ACTIVITY 1.4
In your view, why is control of organisational activities needed? If
controlling is not done, will it ever lead to destruction?
Table 1.3 below shows the roles of telecommunications management.
Table 1.3: The Roles of Telecommunications Management
INTERPERSONAL INFORMATION DECISION MAKING
• Leader
• Responsibility to manage
structure and functions
• Figurehead
• Special tasks
• Communicator/mediator
• Horizontal/vertical
Communication
• Information
disseminator
• Monitor
• Spokesperson
• Change agent
• Delegator
• Decision maker
1.5.1 Interpersonal Aspects
From the interpersonal aspect, the Chief Operating Officer acts as the
organisational leader. He/she is responsible to ensure the smooth management
with respect to structure and functions. In certain situations, the organisational
leader is seen as the carrier of organisational image. Normally situations arise
when they perform tasks outside the organisation. Besides that, a leader is also a
mediator or communicator of communications networks horizontally or
vertically inside or outside the organisation.
The tasks of a manager relating to interpersonal aspects are as follow:
Ć Leader;
Ć Figurehead;
Ć Liaison
(i) Leader
A manager is responsible to lead his/her organisation. He/she must create
relationships with subordinates or workers under him/her and effectively
communicate with all staff and workers in the organisation. A manager and
organisational leader must ensure that the organisational functions and
efforts of the entire staff are always moving forward.
(ii) Figurehead
A manager is regarded as a chief executive who carries out official
responsibilities for the organisation whether the tasks have legal or social
implications. Therefore, he/she will always be seen as a representative of
the organisation in official functions. For example, the General Manager of
ABC Network will represent his/her organisation in celebrating the
SultanÊs Birthday in his/her state; the Chief Engineer of station XYZ will
represent his/her organisation in a regional telecommunications conference
and a Marketing Manager will play his/her role in entertaining a potential
customer for the organisation.
(iii) Liaison
A manager is regarded as a communication channel for the organisation. As
a communicator between telecommunications organisations, he/she plays a
role to maintain network relationship and provide assistance and
information to certain parties outside the organisation.
1.5.2 Information Aspect
One of the important aspects of responsibilities handed to the manager of a
media and telecommunications organisation is the responsibility related to the
process of acquiring, collating and presenting information. In this role, the
manager needs to present information to the audience in and out of the
organisation. In this case, his/her role is divided into three parts, which are:
Ć Monitor;
Ć Disseminator/Distributor; and
Ć Spokesperson
(a) Monitor
A manager has to monitor and examine his/her communication
environment to identify if there is anything that may benefit the
organisation and its staff. To carry out the function successfully, the
manager normally subscribes published materials relevant to his/her area
and becomes a member of an organisation or association which is active in
his/her field of specialisation or skill.
(b) Disseminator/Distributor
After getting important and meaningful information from internal and
external sources, the manager presents the information in a meeting or
formal/informal gathering, through a memo or letter, notice board or
bulletin board, online, etc.
(c) Spokesperson
Consistent with his/her role as information disseminator, the manager is a
spokesman for the organisation in an internal or external function or as a
writer preparing and delivering the contents of statements, speech text, or
an editorial for the organisationÊs official newsletter.
1.5.3 Decision Making Aspect
A media manager has a big responsibility as a decision maker. In managing this
function, he/she is responsible to think and decide on the following:
As an example:
Ć The manager of a radio station A needs to think of the stationÊs format, what
kind of music is to be programmed, which DJ should be discharged, what is
the total cost for a 30-second spot advertisement, etc., and
Ć The manager of a cable TV station X needs to decide what kind of programme
his/her station should provide, how to charge the service cost and also how
to market services nationwide.
If a conflict arises among the staff, the manager acts as a judge to ensure the
conflict is addressed in the best possible manner without causing dissatisfaction
among the parties involved. Besides that, there may also be a conflict occurring
outside the organisation, needing the manager to handle, for example, a problem
with a shareholder or other external organisation which is not satisfied with the
broadcasting station.
Principally, the decision-making tasks of a manager are as follows:
Ć Allocator;
Ć Adjudicator; and
Ć Negotiator
(a) Allocator
The manager divides the allocation of funds, time, equipment or labour
force to units, divisions or branches in the organisation. He/she should be
seen as wise in creating and encouraging innovation so that the
organisation always maximises the potential of its staff and organisation.
(b) Adjudicator
The manager has to study and solve conflicts or disputes. He/she must
think of preventive measures besides preparing to face the possibilities of
the occurrence of any difficulty or tension.
(c) Negotiator
An organisational leader is regarded as a man who will come forward to
negotiate matters relating to the organisation either formally or informally,
technical issues, administrative matters, trade union matters, either
internally or externally.
Example:
The Chief Operating Officer of Media Prima TV network is Datuk Ahmad Farid
Ridzuan. While carrying out his duties in the organisation, not in view of the
public, he is responsible for ensuring the smooth running of the management
function of the private television station. When TV3Ês staff was busy touring the
nation with the Sure Heboh programme, Datuk Farid was always seen together
with his production crew. At that time, he was a symbol for TV3Ês corporate
image.
TYPES OF MANAGEMENT OCCUPATIONS
There are two types of management occupations: vertical and horizontal. The
vertical dimension refers to hierarchical management levels as follows:
Figure 1.10: Vertical dimension hierarchy
Horizontal dimension refers to functional areas or managerial responsibilities, as
shown in Figure 1.11.
Figure 1.11: Horizontal dimension hierarchy
Tasks and responsibilities of a manager are explained in Table 1.4.
Table 1.4: Tasks and Responsibilities of a Functional Manager,
General Manager and Project Manager
TASKS RESPONSIBILITIES
Functional
Manager
This is a manager in a specific area or aspect in the organisation. This
function includes supervision of individuals with special expertise e.g.
Human Resource Manager, Marketing Manager, Financial Manager,
Accounting Manager, Engineering Manager, Production/Operations
Manager, Quality Manager and others.
General
Manager
Responsible for the whole organisation or one particularly large sub-
unit, covering many specialised fields.
Project
Manager
Coordinate efforts involving individuals in several different
organisational units but are involved in a particular project.
1.6.1 Managers' Roles
The manager of an organisation has several roles, including entrepreneur, idea
champion, promoter and/or mobiliser.
(a) Entrepreneurial Role
A visionary manager often puts forward new ideas and thinks of ways of
improving processes, products or services.
(b) Idea Champion
A manager with calibre always generates new ideas which he believes to be
valuable; he/she is daring enough to implement these new ideas despite
barriers of all types.
(c) Promoter
A dynamic manager always tries to get the required funds for the
innovation development and accelerates its implementation.
(d) Mobiliser
A manager does not only put forward a new idea but also brings out these
new thoughts with confidence and creativity, seeks sufficient financial
resources to finance innovative activities and creates incentives for middle
managers to promote new ideas and protect people with many ideas.
ACTIVITY 1.5
After better understanding telecommunications management
components, does the list of important points you noted earlier meet
telecommunications management requirements?
TELECOMMUNICATIONS AND LEADERSHIP
Figure 1.12: Quotation about leadership
Source: J.M. Burns, Leadership, New York: Harper & Row, 1978: 19-2
In the quotation, Burns (1978: 19-2) regards a leader as someone who holds the
power centre. According to him, power is divided into two parts:
(a) Power of management or implementation; and
(b) Power to manage change or transformation.
Power of the first type takes place when a leader takes the initiative to create a
relationship with another person in order to exchange something of value. The
power to manage occurs when a person (or several persons) interacts with
another (or several persons) such that leaders and their followers improve
themselves in terms of motivation and morale.
In any telecommunications organisation (including broadcasting), the
management plays an important role in determining the direction of the
organisational achievement in the market. The management is normally assisted
directly or indirectly by groups of researchers, market analysts, lawyers,
accountants and others. In this course, the focus is on the roles of media and
communication managers, especially in telecommunications.
A leader determines the rise and fall of an organisation.
• In facing the digital technology era which is rapidly developing and full of
varied challenges, the media manager should be efficient in performing his/her
duties in order to ensure success of a media organisation. Hence, it is important
for the media manager to deepen his/her knowledge of telecommunications
management. This is true in view of the importance of telecommunications
managementÊs role in providing able and efficient media managers.
• Despite that, telecommunications is a unique industry, resulting from the
combination of human and hardware elements. Individuals who manage this
field should be sensitive to both elements, and skilled in communicating with
each area of staff and customers as well as know about the hardware being
used by advanced media stations.
• Unlike other organisations, a media organisation consists of staff having
different backgrounds such as management, professionals, creative, technical,
etc. Therefore, a manager plays an important role as a mediator or a
communicator between these groups. At the same time, he/she is also
responsible as a mediator between the organisation and the public. His/her
failure in handling these matters properly will adversely affect the smooth
operation of the station and tarnish the organisational image.
After finishing your study of this unit, draw a mind map of
telecommunications management.
Broadcasting
Management
Planning
Telecommunications
Telecommunications management
Bartol, K. M. & Martin, D.C. (1991). Management. New York: McGraw-Hill.
Burns, J. M. (1978). Leadership. New York: Harper & Row.
Foster, E.S. (1978). Understanding Broadcasting. CA: Addison-Wesley Publishing Co.
Gershon, R. A. (2001). Telecommunications Management: Industry Structures
and Planning Strategies. Mahwah, New Jersey: Lawrence Erlbaum
Associates, Publishers.
Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. (2nd. ed.). New York: McGraw-Hill.
* * *
TOPIC 2 TELECOMMUNICATIONS MANAGEMENT THEORY
INTRODUCTION
In Topic 1, we have learnt several explanations on telecommunications,
broadcasting and management. In this topic, we will focus specifically on
management.
Why must we know management theory? One of the reasons is that the theory
gives us a perspective to understand something. Management theory allows us to
know what is relevant in the context of organisational management. Management
theory also enables us to understand workersÊ relations, managers, employer and
environment currently and in the future. This topic also will focus on the
telecommunications environment.
We will learn several management approaches and perspectives so that we may
apply or identify whichever approach or perspective is the most appropriate to
be implemented in a telecommunications organisation. Directly or indirectly,
Topic 2 Telecommunications Management Theory.
INTRODUCTION
In Topic 1, we have learnt several explanations on telecommunications,
broadcasting and management. In this topic, we will focus specifically on
management.
Why must we know management theory? One of the reasons is that the theory
gives us a perspective to understand something. Management theory allows us to
know what is relevant in the context of organisational management. Management
theory also enables us to understand workersÊ relations, managers, employer and
environment currently and in the future. This topic also will focus on the
telecommunications environment.
We will learn several management approaches and perspectives so that we may
apply or identify whichever approach or perspective is the most appropriate to
be implemented in a telecommunications organisation. Directly or indirectly,
By the end of this topic, you should be able to:
1. Explain the development of management theory;
2. Identify four management perspectives;
3. Differentiate between one theoretical approach with another;
4. Explain contemporary management theory;
5. Discuss Telecommunications Management Model; and
6. Apply management theory in a selected telecommunications Oganisation.
LEARNING OUTCOMES
management theory helps to make an organisation more efficient, effective and
viable in a complex, challenging and changing environment.
DEVELOPMENT OF MANAGEMENT
THEORY
The management theories which we are going to learn are the past ideas of
several management figures that often observed, tried, tested, approached and
applied their theories in their era and environmental contexts.
Figure 2.1: Sun Tzu is one of the foremost Chinese philosophers
Source: www.taiuchi.org/aussi_texte23.htm
Early efforts on formal management theory began in the early 19th century
especially by Robert Owen (1771-1858) and Charles Babbage (1792-1871). Owen is
noted for his innovative ideas on human relations. Babbage is known for his
research on operations, profit sharing plan and job specialisation. In the Western
field of management, Owen and Babbage are known as the pre-classical figures
(Bartol & Martin, 1991: 42-45).
2.1
SELF-CHECK 2.1
To what extent can management theory help us in understanding the
management policy of a telecommunications organisation in Malaysia?
Besides Owen and Babbage, two more figures are noted as early experts of
management strategy, namely:
(a) Machiavelli, an early political philosopher during the renaissance era; and
(b) Sun Tzu, an ancient Chinese philosopher from more than 2000 years ago.
See Figure 2.1.
In the 20th century, there are several management approaches, each one taking
into account changes in era and requirements considered relevant to that time.
Figure 2.2 shows the development of management theory since 1900's.
Copyright © Open University Malaysia (OUM)
TOPIC 2 TELECOMMUNICATIONS MANAGEMENT THEORY W 29
Figure 2.2: Development of management theory
In this course, we will take into account several 20th century management
perspectives as depicted in the mind map.
Each of the four management perspectives is heralded by several management
figures. Each of them has a special rationale as to why they used different
management approaches. Table 2.1 provides a brief explanation for each of the
management perspectives.
Table 2.1: Management Perspectives
Year and
Perspectives
Management
Type Focus Figures
(1890-1920's)
Classical
(focus on
management's
efficiency)
Bureaucratic • Aims at improving
effectiveness of management
in organisations
• Emphasising management
rationality and not acting
arbitrarily
• Relying on guidelines of
procedures, rules, hierarchy,
and division of labour is
clear and detailed
Problems: rigid procedures
create red tape, delay
decisions, unable to change
fast enough to adapt to
requirements of the
environment and sometimes
imbalance exists.
Max Weber
(1864-1920)
Scientific • Aim at getting the best
work methods
Problems: Lack of labour force
and ways of improving
workersÊ performance
Frederick
Winslow Taylor
(1856-1915)
Frank Gilbreth
(1868-1924)
Lillian Gilbreth
(1878-1972)
Henry Gantt
(1861-1919)
Administrative Information flow is essential,
because organisation is a
system of communication
Henri Fayol
(1841-1925)
Chester Barnard
(1886-1961)
Year and
Perspectives
Management
Type Focus Figures
(Since
1920Ês)
Behavioural
Human
Relations
• Organisational behaviour;
making decisions in
organisation
• Management models
• Hierarchy of Needs Theory
• Theory X and Theory Y
Mary Parker Follett
(1868-1933)
Herbert Simon
Abraham Maslow
(1908-1970)
Douglas McGregor
(1904-1964)
Renesis Likert
Frederick Herzberg
David C. McClelland
(Since 1940's) Quantitative
Management Science
• Using scientific management
approach e.g. mathematical
methods, statistical methods
and other analytical methods
to make management decisions
• Capital Asset Pricing Model (CAPM)
H. Dodge
Ronald Fisher
Russell Ackoff
Thornton C. Fry
Operations Management
• Using scientific approach for
example combination of
statistics and metronomic
theory to manage organisational
operations system
Patrick Blackett
Information System Management
• Integrating computer system
(hardware, software, network
and recording media) in
organisational management to
assist decision making process
and organisational competitive
strategy.
Not identifiable
Source: http://iris.nyit.edu/~shartman/mba0120/chapter2.htm; http://ollie.dcccd.edu
Year and Perspectives.
Management Type Focus Figures Contemporary Thoughts.
• American Management, that is,
productivity improvement.
W. Edward Deming (1900-1994)
Management by Objective
• MBO concept, that is, management
strategic decisions are developed
through interactions and cooperation
of management and staff.
• Federal decentralisation concepts.
Peter Drucker (1909-now)
Systems Approach
• To synthesise and integrate various
management approaches as coherent
and cohesive management theory.
• All organisational components
inter-relate and interact with
environment.
• Organisations are open systems
Ludwig von
Bertalanffy
(1928)
Ref: Kast &
Rosenzweig
1972;
Scott 1981)
Contingency Approach
• Focusing main attention on
performance of each person practicing
management in controlling
organisational environment.
• Viewing conflict as inevitable but
manageable.
Chandler (1962)
Lawrence
& Lorsch (1969)
(1950
-2000)
Contemporary
Japanese
Approach
• Combination of teamwork and
individual efforts.
• Theory Z
William Ouchi
Management science which applies quantitative perspective is also known as
Operational Research (OR) which is multidisciplinary. In the business world,
management science is equivalent to Quantitative Management (QM),
Management Science (MS), Decision Science (DS) or Operations Management
(OM).
In the 21st century, management perspectives can no longer be easily categorised
as in Table 2.1 due to the tendency to apply various management approaches (old
and new) simultaneously.
CLASSICAL PERSPECTIVE (1890-1920’S)
Classical Perspective focuses on a rational and scientific approach to management
study. The main objective is to make organisation an efficient machine. There are
three types of approaches in classical perspective as shown in Figure 2.3.
Figure 2.3: Three approaches in the classical perspective
"Sapura's driving entrepreneurial spirit has always relied on the
teamwork and commitment of its employees to propel to the
forefront of technology. Taking its rightful place on the world stage
amongst the other leaders in technology, we at Sapura understand
that our technology is as good as the imagination ă that the mind is
the ultimate tool. A tool that unlocks the floodgates of innovation.
This is the world of Sapura. A world that combines technology and
imagination, making anything possible."
These words were extracted from one of 1997 Sapura Holdings Sdn.
Bhd. Publications. From the extract, can you identify the management
approach practiced by Sapura Holdings in 1997?
According to management theorists, management perspectives are
divided into four perspectives. Name these four perspectives. Give an
example of an organisation in Malaysia for each perspective.
2.2.1 Scientific Management
Scientific Management is applied in the era of P-Economy and emphasises
productivity. The main focus is on interaction between workers and machines. At
the same time, the focus is on efforts to improve organisational productivity
through efficient work methods and job specification for each worker. At the
time, there was only one problem which was lack of labour force, especially
skilled labour.
Figure 2.4: Frederick Taylor
Source: www.colby.edu
Among the foremost scientific management figures are Frederick W. Taylor,
Frank Gilbreth and Lillian Gilbreth, as well as Henry Gantt.
Frederick Taylor (1856-1915) was an American engineer and he is known as the
Father of Scientific Management.
How could an engineer be involved in organisational management aspects? To
understand TaylorÊs situation at the time, please read the book entitled
Management by K.M. Bartol & D. C. Martin (1991).
Figure 2.5: A short extract on Frederick Taylor
Source: Bartol & Martin, 1991, p. 43-44
Taylor carried out a „time and motion study‰ to identify productivity problems
at the workplace. Then he implemented a differential rate system and tried to
revolutionise work management to resolve workersÊ and management problems.
(a) Four Principles of Scientific Management (Taylor)
Figure 2.6 shows the four principles of scientific management outlined by
Taylor.
Figure 2.6: Four principles of scientific management
The scientific work management was successful in producing products much
faster than expected by Taylor. However, workers and trade unions disagreed
with the approach, as they worried that the production efficiency would exhaust
the jobs to be done and thereby workers would be discharged. As a result, many
workers joined the trade unions, reinforced their doubts and did not have any
more trust, which consequently worsened management-labour relations for
several decades.
Henry Gantt (1861-1919) used to work with Taylor, but later reiterated that the
differential rate system was not so successful in generating a high level of
motivation. Consequently, Taylor introduced a financial incentive system for
high performing workers and a bonus for supervisors who were able to produce
a high production level among workers. His way of awarding the rewards was to
record each workerÊs progress and then announce to the public using what is
called the Gantt chart, which is a graphic aid for project planning, scheduling and
controlling.
Frank B. Gilbreth (1868-1924) and Lillian M. Gilbreth (1878-1972) were a husband
and wife pair who made efforts to develop scientific management methods.
Frank and Lillian Gilbreth carried out fatigue and motion studies to eliminate
rate of fatigue in the workplace. Their attention was on the ways of improving
welfare and morale of workers. By using film cameras, Frank and Lillian looked
for the most economic movement to improve work performance and thereby
reduce fatigue, because in their conception, movement and fatigue were inter-
related.
Based on study findings, they proposed that movements should be reduced to
eliminate fatigue.
2.2.2 Bureaucratic Management
Bureaucratic management is related to Max Weber (1864-1920), a German
sociology professor and political economist. He was given the title of the Father
of Modern Sociology.
Figure 2.7: Max Weber is regarded as the Father of Modern Sociology
Source: webserv.nhl.nl
In the aspect of organisational management, Weber stated that bureaucracy is the
most rational and logical structure for large organisations. In the context of time
and era, the bureaucratic concept presented by Weber has a different implication
compared with the negative connotation related to the current bureaucracy.
WeberÊs bureaucratic management model was able to develop further large
organisations such as Ford Motor Company in early 20th century.
Weber identified three types of authority, that is:
• Rational authority (based on laws, procedures, rules, etc.)
• Top executives authority; and
• Charismatic authority (natural attributes of a person who is able to attract the
heart and respects of others to him)
(a) Bureaucratic Management Criteria
Below are several criteria identified by Weber to ensure an effective
administration:
(i) The roles of an authority and clear leadership responsibilities in
management;
(ii) Executives/managers are free to act and they are only subject to
organisational rules and laws;
(iii) Promotions should be based on expertise, efficiency and seniority, not
on cronyism and nepotism;
(iv) Clear division of labour, that is according to job specification;
(v) Executives are subject to strict discipline and display control in
carrying out duties;
(vi) All administrative actions and decisions must be recorded;
(vii) Written rules and procedures are equally applied on all individuals;
and
(viii) Separate the owners and management.
Weakness of the bureaucratic model is that it is not flexible in terms of
procedures and rules that must be obeyed, because it ignores the social and
human processes in an organisation.
2.2.3 Administrative Management
Administrative management focuses on internal affairs and activities of
organisation. The pioneer of administrative theory is Henri Fayol (1841-1925)
who was from France. He emphasised organisational principles and
administrative functions, which he defined as follows (Bartol & Martin, 1991):
Administration or management is planning, organising, commanding,
coordinating and controlling.
Table 2.2: A Brief Explanation of FayolÊs Management Principles
No. FayolÊs Management
Principles Brief Explanation
(i) Division of Labour According to job specialisations
(ii) Authority The right to give directions and power to be
obeyed
(iii) Discipline Based on respect and conforming
(iv) Unity of command A worker receives command from a leader only
(v) Unity of directing A leader makes a plan for a group activity with
a common objective.
(vi) Subordination of individual
interest
Placing a public interest above individualÊs
interest.
(vii) Remuneration Wage payments depend on many factors.
(viii) Centralisation Depends on situation and formal
communication channels
(ix) Chain of authority Formal communication channels
(x) Order A resource is available at the right place on the
right time.
(xi) Equity Staff is treated well and fairly.
(xii) Personnel tenure It requires a good human resource planning to
avoid frequent worker resignation.
(xiii) Initiative Workers are expected to work hard and sincerely
(xiv) Esprit de corps Unity yields strength, harmony and teamwork.
You may find it difficult to memorise all the 14 principles. Figure 2.8 may help
you.
Figure 2.8: FayolÊs 14 principles of management
In the 1990s, competition in the world market caused several organisations to
change from the bureaucratic approach which was regarded as slow and could
no longer act fast.
ACTIVITY 2.3
1. Give three distinct differences between scientific management,
bureaucratic management and administrative management
approaches.
2. Name one figure for management approach you have learnt
under the classical perspective.
BEHAVIOURAL PERSPECTIVE (BEGINNING IN 1920’S).
Behavioural perspective is a management perspective which emphasises the
importance of management understanding various factors that influence human
behaviour in an organisation. There are three approaches that use the behavioural
perspective, as shown in Figure 2.9.
Figure 2.9: Behavioural perspective
The figures for behavioural perspective are
Parker Follet and Chester Barnard. These two
people are the main founders of management
from the perspective of human behaviour. They
emphasised human behaviour, workersÊ needs,
workersÊ attitudes in the workplace, climate,
social interaction and group dynamics.
Mary Parker Follet (1868-1933) was a
philosopher and political scientist. She stressed
the importance of human issues, ethics, power
and good relations between management and
workers, including the effects of environmental
factors such as politics, economics and biology.
She put forward the integration concept, that is,
a management strategy seeking to settle conflict
by satisfying both parties.
Figure 2.10: Mary Parker Follet,
philosopher
and political scientist
Source: www./infed.org
The second figure, Chester I. Barnard, (1886-1961), introduced the theory of
acceptance of authority, that is, a worker may chose to follow or not to follow a
direction from the management. According to him, managers should treat their
workers well, as the acceptance of authority by workers is the main determinant
of organisational success. In his book entitled The Functions of Executives (1938),
Barnard discussed three universal elements that must be available in
organisational management, that is:
(a) Communication;
(b) Readiness to serve; and
(c) Common goals.
2.3.1 Human Relations Movement
If the management is able to attract workers to produce better output of work,
then the management is said to have effective human relations.
Human relations movement developed to wider extent due to several series of
studies known as the Hawthorne Studies. Fritz J. Roethlisberge and W.J Dickson
(1939), sociologists from Harvard University, carried out three series of
experiments at Western Electric Company, Hawthorne, and Chicago between
1924 and1933. The aim of the study was to study the relation between the
physical conditions (lighting) and productivity and workersÊ satisfaction.
Study results show that productivity kept on improving as lighting at the
workplace become brighter. What is surprising is that productivity kept on
increasing although light was then made darker. Researchers concluded that
productivity increased because workers got good treatment and received special
attention of the researchers, not because of the specific factors being studied. This
phenomenon is known as the Hawthorne effect. (Babbie 2001:220).
2.3.2 Human Resource Approach
The main activists of this movement combined job design with a motivation
theory. Among the figures linked to this approach were Abraham Maslow and
Douglas McGregor.
Abraham Maslow (1908-1970) was the first psychologist to formulate a
motivation theory based on human needs. He made three assumptions, that is:
The term human relations refers to how the managers interact with their
subordinate staff.
• Human beings will never be fully satisfied;
• Human beings behave because of certain aim to be achieved;
• Human needs are classified into a hierarchical structure in accordance with
importance, that is, from the lowest to highest level.
Refer to Figure 2.11 to know about MaslowÊs hierarchy of needs.
Figure 2.11: MaslowÊs hierarchy of needs
Source: http://web.utk.edu/~gwynne/maslow.htm
(a) Physiological Needs
This refers to basic needs such as water, air, food, sleep and sex. When these
basic needs are not fulfilled, human beings will feel pain, angry,
uncomfortable, etc. After they are fulfilled, human beings will think of other
needs.
(b) Security Needs
It refers to psychological needs which are fulfilled due to home stability,
harmonious feelings, peace and security of living place.
(c) Social Needs
This refers to the need to belong, and be accepted as a club member,
member of a work team, family, etc.
(d) Esteem Needs
There are two needs, that is, the need to be appreciated and recognised after
completing a job, and the need to be known and given attention.
(e) Self-actualisation Needs
This refers to aspiration to fulfil oneÊs potentials. A person who has
achieved his needs at level 1 to 4, wishes to maximise his potential by
seeking knowledge, aesthetical experiences, spiritual peace, involvement in
voluntary works, etc.
Douglas McGregor (1906-1964), a United States social psychologist was also
related to the human relations approach. He is well known for his Theory X and
Theory Y which describes human behaviour as a result of organisational
management styles. See Figure 2.13 to look for Theory X characteristics and the
differences with Theory Y.
Generally, McGregor sees two types of managers, that is:
(i) Theory X type of managers who believe workers must always be forced,
controlled, directed, threatened with punishment so that they may not
ignore their responsibilities; and
(ii) Theory Y managers who are of the opinion that human beings may show
their commitment to work objectives, while the commitment is a function of
rewards. In general, a worker will accept and look for responsibilities. In
Theory Y management, imagination and creativity is widely distributed,
but workersÊ potentials are not utilised fully.
The practices of Theory X may be easily found in organisations practicing
scientific management, especially in the 1950Ês. However, the principles of Theory
X and Theory Y are still being used in the management of several organisations today.
To understand media management, Sherman refers to Theory X and Theory Y
approach by Douglas McGregor (United States organisation). (Refer to Table 2.3).
Table 2.3: Theory X and Y approach
Theory X Theory Y
• Managing staff using force/threat,
imposing barriers, penalty or job
termination
• Based on ultimate concept of
authority
• Corporate objectives and ways of
achieving them transpire from top
executive thoughts and visions
• ManagersÊ goals are to create work
environment where staffÊs personal
goals are consistent with
organisational goals.
• An influential management style at the
beginning of industrial revolution
• Humans and their needs approach
• Managers try to influence
subordinates with best motivatorÊs
assumptions by involving
satisfaction in terms of basic human
physical and psychological needs ă
status, sense of respect, recognised
and appreciated.
• Good work is paid off by wage increases,
while bad work will be followed with
delayed promotion and pay rise, even
dismissal
• Rewards are not in financial terms,
but may be in emotional and
spiritual forms
• Loss of energy, morale and incentive to
work diligently due to fatigue (high
burnout rates). Close relation between
newly emerging media transaction and
the military (strong fortress for Theory X)
Satellite and other telecommunications
companies also have long ties with
defence contracts. Many first generation
managers learnt about radio, television,
films while in military service.
• Management is rather loose and
informal. Staff are encouraged to be
creative, motivated and not
structured to produce new products
and services.
• Handling broadcasting/cable system
requires fast and immediate decision
making. Media manager need to make
tens of decisions daily immediately and
pressured by time factor. (Theory X
approach deemed to be best suited for
telecommunications/media/broadcasting
functions).
2.3.3 Behavioural Science Approach
This approach highlights human behavioural theories based on scientific
methods and learning based on the fields of sociology, psychology, anthropology,
economics and other disciplines to understand workersÊ behaviour and
interaction in organisations. Among the researchers related to behavioural
science are Renesis Likert and Frederick Herzberg.
Likert is more inclined to support organisational leadership concepts which pay
attention to workersÊ welfare and the process of interpersonal communication in
bureaucratic organisations. In his conceptual framework, Likert identifies
four types of management. See Figure 2.12.
Figure 2.12: Types of management system
Source: http://www.ibilce.unesp.br/courseware/research/theories3.htm
System 1: Exploitative and authoritative; autocratic leader; discourages
feedback.
System 2: Benevolent but authoritative; manager is more sensitive than in
System 1.
System 3: Consultative, discusses with workers.
System 4: Participative, involves workers in decision making.
The four systems would result in different effects. According to Likert, System 4
is the most effective, because it is able to generate a high level of performance,
sense of responsibilities and motivation among the workers of the organisation
compared to System 1, which may result in reduced group loyalty. Instead,
System 1 may even generate more conflicts and lower productivity.
QUANTITATIVE PERSPECTIVE (EARLY
1940’S)
Quantitative perspective emerged during the Second World War and focused on
the use of mathematics, statistics and information support devices to support the
management in making decisions and thought of the strategy how to make the
organisation more effective. At the beginning this perspective was used by the
British Army for the purpose of handling ships and bombs. Figure 2.13 depicts
the quantitative perspective approach (Bartol & Martin, 1991: 61-63).
Figure 2.13: Quantitative perspective approach
2.4.1 Management Science
The management science approach aims at solving problems arising from the
consequences of the Second World War. Example: how to move equipment and
people quickly and efficiently.
2.4
ACTIVITY 2.4
What is meant by each of the following concepts?
1. Acceptance of authority
2. Theory X manager
3. Consultative system
4. Participative system
5. Hawthorne effect
6. Theory Y manager
7. Benevolent system
8. Work-centred leader
9. Hierarchy of needs
10. Exploitative system
This approach was made by the efforts of mathematicians, physicists and other
scientists to be applied to large firms.
2.4.2 Operations Management
The field of operations management is focused on the physical production of
products and services. The aim is to solve manufacturing problems. Its
commonly used methods are:
• Forecasting
• Inventory modelling
• Linear and non-linear programming
• Queuing theory
• Scheduling
• Simulation, and
• Break-even analysis.
2.4.3 Management Information System
The pioneers of the management information system create the system to provide
relevant information to managers at appropriate time and costs. The creation of
high speed digital computers has made a big contribution to management in
making decisions.
CONTEMPORARY PERSPECTIVE (1950-
2000)
There are several contemporary approaches being used by organisations
currently. Figure 2.14 shows the contemporary perspective approach.
2.5
ACTIVITY 2.5
What are the three management approaches according to quantitative
perspectives?
Give an example of a telecommunications organisation using the
approach in Malaysia, if any.
Figure 2.14: Approaches in contemporary perspective
2.5.1 Contemporary Management
One contemporary management figure is W. Edwards Deming (1900-1994). He
was an American statistics expert and the pioneer of quality movement. Japan
herself regards Deming as the main influence behind her post war economic
miracle. One of his well-known books is Out of the Crisis (1984).
(a) DemingÊs Management Criteria
There are several management criteria as outlined by Deming, that is:
(i) Creating the commitment to continuously improve product and
service quality;
(ii) Using new philosophy created by the Japanese;
(iii) Terminating reliance on group inspection;
(iv) Stopping awarding of contracts based on lowest price;
(v) Always improve process of planning, production and service;
(vi) Using modern methods for in service training;
(vii) Electing leaders with intention of helping others to produce improved
work;
(viii) Eliminating fear and encouraging effective two-way communication;
(ix) Eliminating barriers between areas of departments and staff;
(x) Throwing away notices/memos/reminders for workforce because
they will only bring in resistance;
(xi) Encouraging sense of pride with work output;
(xii) Encouraging lifetime learning and self-improvement for all people; and
(xiii) Outlining top management commitment to implement all of these
principles.
(b) DruckerÊs Management Criteria
One more contemporary management figure is Peter F. Drucker, a well
known American management guru at present. He was born in Vienna in
1909. He believes that a person cannot manage change but can always stay
one step forward. Among his principles are as follow:
(i) Apply scientific management;
(ii) The key to productivity and effectiveness is decentralisation;
(iii) Give emphasis to quality personnel management;
(iv) Training, educating and developing future managers;
(v) The key to successful decision making is high quality information;
(vi) Emphasise marketing;
(vii) Make long term planning;
(viii) Apply management by objective;
(ix) Apply management based on results;
(x) Profit-based organisation is seen as a social and human structure, not
as economic entity;
(xi) In the new information era, focus should be on information, not on
technology; and
(xii) Information workers are capital assets, not costs, but information
workers must manage themselves and their own careers.
MANAGEMENT BY OBJECTIVE – MBO
This approach is used by several organisations to facilitate efforts in fulfilling
organisational goals and planning by managing several objectives (MBO). MBO
is used to involve both management and workers at lower levels in order to set
goals at various layers of an organisation.
The person who introduced MBO is Peter Drucker. According to Bartol & Martin
(1991: 179), the first organisation to apply MBO was General Electric, USA.
(a) Steps in MBO
The MBO process involves six steps (Bartol & Martin, 1991: 180), that is, as
follows:
(i) Set organisational overall goals;
(ii) Set specific goals for various departments, sub-units and individuals;
(iii) Think of and implement several action plans;
(iv) Implement plans and maintain self-control;
(v) Revise plan progress from time to time;
(vi) Evaluate organisational performance.
As in other approaches, MBO also has advantages and weaknesses. The MBO
approach can fail because of the following reasons:
• Lack of support from the top management;
• Weak formulations of objectives or goals;
• Poor communication skills among managers who have to implement the
system.
2.6.1 System Approach
System theory was first proposed by Ludwig von Bertalanffy in 1928 but it was
never applied by any organisation till today. The System Approach looks at an
organisation as a unified system, and it has a purpose, as well as inter-related
divisions. This means, an activity in one segment may affect the others.
(a) The Characteristics of System Approach
There are several characteristics of System Approach which affect
management. They are as follow:
(i) Open system: a system which continues to interact with environment
(ii) Closed system: a system which does not interact with environment
(iii) Entropy: a tendency for a system to die off (eliminated)
(iv) Differentiation: a tendency for an open system to be more complex
(v) Synergy: the ability of an organisation to achieve a higher level of
success if it functions/becomes active as a stable team and not as
separate groups.
(b) System Theory Components
There are five components in system theory, that is:
(i) Input: equipment, human beings, finance or information resource
which are used to produce products or services.
(ii) Transformation process: use of production technology to transform
input into output.
(iii) Output: goods, services, or other types of output.
(iv) Feedback: information about results and organisational status.
(v) Environment: including social, political and economic influence.
2.6.2 Contingency Theory
The Contingency approach is also mentioned as a situational approach. This
approach was developed by managers, consultants and researchers who sought
to apply concepts of several main approaches in managing the actual situations.
In this approach, the functions of managers are to identify which technique can
give the best contribution to achieve management goals in particular conditions,
climate and time. The Contingency approach holds on to the view that the
suitability of a management action would depend on the situation, that is, factors
of environment, strategy, organisational design, technology and leadership. The
effectiveness of a manager to manage would depend on the extent of his ability to
adapt his management styles with the change in environment.
2.6.3 Japanese Management Approach
Theory Z, which is a Japanese management approach, is a combination of Theory
X and Theory Y. It was presented by William Ouchi based on Japanese industrial
organisational perspective. According to Ouchi, Theory Z organisation is
egalitarian, providing the right to participate for all staff in organisational matters
and emphasise the development of positive interpersonal relations between
employer and staff (Refer Sherman, 1995: 34-36).
The practice of Theory Z is as follow:
(a) Authority is still clear and not sacrificed; and
(b) Manager still makes planning and influential policy decisions. Compared to
management styles of Theory X and Theory Y, Theory Z management is
considered as democratic. Refer Figure 2.15.
Figure 2.15: Comparison of Theory X, Theory Y and Theory Z
Source: http://ollie.dcccd.edu
In general, organisations practising Theory Z attempt to do the best by applying
Japanese and American management practices. Refer Table 2.4.
Table 2.4: Theory Z
Subject Explanation
Integrity In the Japanese industrial model, a manager must get
workersÊ trust in terms of his integrity as a manager and
product integrity.
(A manager with integrity is believed to act consistently,
treating secretary and executives respectfully, approaching
subordinates with the same value and understanding when
he is with family members).
Company/Organisational
Philosophy
Company policy is clear at the beginning. Manager must
audit and examine the actual philosophy.
Participation at All Levels All levels of management must be involved. Communication
and openness is practiced at all levels.
Structure, Incentive,
Rewards
Some elements of structure are still needed. Incentives are
needed as a motivation and to maintain interests in Z
approach and improve workersÊ quality of life. Examples:
sharing profit, continuous training for workers, workersÊ
benefits, self-enrichment plan, maternity leave, child care
centres, and gymnasium/sports facilities.
Interpersonal Skill Quality circles. Round table discussions where all levels of
organisation, i.e. from top management to subordinates,
discuss a product openly.
Continuous Evaluation Done either informally (self evaluation) or formally
(through an objective test).
Organisational health must be monitored monthly, weekly
or daily.
Trade Unions Participation Trade unions must be involved fully in the
company/organisation.
Employment Stability Company/organisation is encouraged to limit workers
dismissals and accept short term loss. In critical conditions,
workers are willing to receive smaller pay and committed
and experienced workers will repay employersÊ kindness by
not quitting jobs, be more loyal, and attempt to raise
company profits.
Long Term Evaluation and
Promotion
Staff gain and organisational goals achieved in long term.
Promotion is defended.
Wider Career Paths Japanese, German and Dutch firms recognise managers
with many experiences and understand their tasks in the
firms in different sections. Even without promotions, they
have high morale, are fresh, confident and satisfied.
Sherman has also compared Theory X and Theory Y with Theory Z (Sherman,
1995: 32-50). Refer Table 2.5.
Table 2.5: Theory X, Y and Z
Theory X Theory Y Theory Z
• On the
average, an
individual
does not like
work and
would avoid
working
• Most
individuals
need to be
forced,
controlled,
directed and
threatened
with
punishment to
make them
work to
achieve
organisational
goals.
• On average,
individuals
want to be
directed, try to
stay away
from
responsibilitie
s, not
ambitious, and
what they like
most is a
feeling of job
security.
• Most individuals do not
hate work. Physical and
mental efforts in work are
natural. Rest must be done.
• An individual will exercise
self-control, is committed,
and possess self-direction
to achieve the given goals.
• External control and
threats are not the only
ways to ensure goal
accomplishment.
• Commitment to goal
achievement is a function
of awards/presents which
satisfy self-respect an self
realisation
• When conditions are
satisfactory, on average an
individual may learn to
accept and seek out
responsibilities.
• Many people have high
creative ability and high
level of innovation in
solving organisational
problems.
• The intellectual potentials
of individuals are only
partly used in most
organisations.
Type A (American)
• Work for short term.
• Make own decisions.
• Individual responsibility.
• Fast evaluation and promotion.
• Explicit and formal control.
• Specialised career paths.
• Segmented interests.
Type Z (Modified American)
• Work for long term.
• Consensus decisions.
• Individual responsibility.
• Slow evaluation and promotion.
• Implicit and informal control,
with explicit and formal control.
• Moderately specialised
• Career paths.
• Holistic interests including
family.
Type J (Japanese)
• Lifetime work
• Consensus decisions.
• Slow evaluation and promotion.
• Implicit and informal control.
• Not specific career paths.
• Holistic interests.
Source: Bartol, Kathryn M. & Martin, David, C. (1991).
Management, New York: McGraw-Hill, p.66
MANAGEMENT STYLES
Other than the approaches already discussed, there are still some other current
management styles that are being applied in organisations today. The other
current management styles are as shown in Table 2.6.
Table 2.6: Current Management Styles
No. Management Styles Explanation
1 Management by coaching and
development
• Managers look at themselves as trainers of
the workers.
2 Management by competitive
edge
• Individuals and groups in the organization
compete among themselves to achieve the
best accomplishment
3 Management by consensus • Managers build a system to enable every
individual worker produce output.
4 Management by decision
models
• Decision making is based on future
expectations generated not in actual
conditions, but based on artificially created
conditions.
5 Management by exception • Managers distribute jobs to subordinates
and will interfere when necessary only.
2.7
Answer the following questions:
Select one of the approaches under contemporary perspective.
1. Who is the figure presenting the theory?
2. What is the essence of the theory?
SELF-CHECK 2.2
ACTIVITY 2.6
After following management approaches used in the 20th century,
what other approaches do you know? In your view, what is the most
suitable approach that should be applied by a telecommunications
organisation in the 21st century?
6 Management by information
systems
• Managers depend on data which is
generated internally in the organisation to
assist them performing their tasks
efficiently and keep on communicating
among themselves.
7 Management by Interaction • Emphasising communications and
combination of male and female energy, as
well as integration of all human aspects
(mental, emotional, physical and spiritual).
• Creating powerful, energetic and highly
productive labour force.
8 Management by Matrix • Managers study variables outlined in the
matrix to understand its inter-relationships,
cause and effect relation that may exist, and
other choices.
9 Management by objectives • Organisation sets several objectives, and
then managers determine the objective for
each worker.
10 Management by
Organisational Development
• Managers often try to improve
communication and labour relations.
11 Management by performance • Managers look for a high performance
levels with quality through motivation and
labour relations.
12 Management by Styles • Managers adapt the approach to fulfil the
requirement of each condition.
13 Management by Walking
Around
• Managers walk around the
organisation/company to personally feel
workersÊ and operations environment.
Managers also meet workers and listen to
their opinions.
14 Management by Work
Simplification
• Managers always find ways to facilitate
work process and reduce expenses.
Source: http://www.itstime.com.newlet.htm
Select one of the current management perspectives and name a local
organisation applying such a style.
TELECOMMUNICATIONS ORGANISATION
MANAGEMENT MODEL
Table 2.7 lists several external and internal factors influencing
telecommunications organisation management including ICT factors and
challenging global competition.
Table 2.7: External and Internal factors influencing Telecommunications
EXTERNAL FORCES INTERNAL FORCES
• Customers' tastes and priorities
• Competitors' programmes and
sales policies
• Regional and state agencies, and
local authorities/legal agencies
• Commercial supporters
(customers, advertising agencies,
advertisers, station representatives,
investors).
• Networks, syndicators, consultants,
program suppliers.
• Industry supporter groups,
• Research/rating services,
equipment suppliers, etc
• Pressure groups, lobbyists, trade
associations, industry associations.
• Trade unions and professional
associations. Examples: artists,
singers, musicians, etc
• Technological change and ICT
innovation
• Economic change
• Population pattern changes/
movement
• Human rights
• Audience fragmentations
T
E
L
E
C
O
M
M
U
N
I
C
A
T
I
O
N
S
M
A
N
A
G
E
M
E
N
T
• Ownership
• Budgets and financial policies
• Organisational structure
• Staff/workers factor
• Scheduling/programme policies
• Sales policies
• Promotion policies/Public
Relations
• Media Management
• Myths vs. Friction/conflict
• Education, affirmative actions,
equal employment opportunities
• White man's, male world
• Typical American image
• Organisation man
• "Training ground"
Source: Adaptation of Fig.2-2. In B. L. Sherman, 1995,
Telecommunications Management, p.37
Telecommunications management works in a changing environment consistent
with telecommunications technological change, governmental policies, economic
market, human resource etc. This complex and competing environment is
depicted in Figure 2.16.
IXC = Interexchange Carrier; IS=Information Systems; LEC=Local Exchange Company
Figure2.16: Telecommunications Department Environment
Source: Translated from Figure 3-1, In J. H. Green, The Irwin Handbook of
Telecommunications Management, 2002, p.32
• Management Theory which started to appear formally in the 19th century
continued to develop in the 20th century and now it is being adapted to the
changing environment of the 21st century. As a result of the application of the
theories, there exists several management perspectives as you have seen in
the mind map and Table 2.1. Each of the theoretical approach differs from the
other approach.
• Contemporary management theory reflects several management approaches
practiced in the West and are related to some management figures such as
Deming, Drucker, Bertalanffy, Chandler, Lawrence and Lorsch. JapanÊs
economic achievement especially in 1960Ês and 1970Ês attracts Western
management thinkers to compare United States management formulas
(Theory X and Theory Y) with JapanÊs, that is, Theory Z, which was
popularised by Ouchi.
• Table 2.5 enlists and explains several current management styles including
MBCD, MBO, MBWA and MBWS. Whatever the approach or management
style, it is undeniable that management task is complex. Several external and
internal factors which are considered influential on telecommunications
organisational management have been presented in the Telecommunications
Management Model.
• Next, the module will discuss the electronic media landscape including
information technology and communications (ICT), which to a great extent
influences telecommunications management in the world.
Administrative Management
Behavioural Perspective
Bureaucratic Management
Classical View
Closed System
Contingency Approach
Hawthorne effect
Japanese Management
Management Information System
Management Science
Operations Management
Scientific Management
System Approach
Accel Team 2000), Employee Motivation, The Organisational Environment and
Productivity, Accessed 24 October 2005. URL: http://www.accel-team.com/
scientificscientific_02.html
Bartol, K. M. & Martin, D. C. (1991). Management. New York: McGraw-Hill.
Green, J. H. (2001). The Irwin Handbook of Telecommunications Management
(3rd ed.). New York: McGraw-Hill.
Grodsky, T. (undated), History of Management Thought. Accessed 21 October
2005. URL: http://polaris.umuc.edu/~tgrodsky/admn601/
managementhought.html
Module MGTP 2015, Prinsip Pengurusan, OUM 2003, p.13-21.
Sherman, B. L. (1995). Telecommunications Management: Broadcasting/ Cable
and the New Technologies, Singapore: McGraw-Hill, Inc.
Turnley, S. (Fall 2005). Management Concepts, Accessed 21 October 2005, URL:
http://info.cba.ksu.edu/turnleys/MANGT420/ch12.ppt.
Walonick, D. S. (2005). Organisational Theory and Behaviour. Accessed 24
October 2005. URL: http://www.survey-software-solutions.com/walonick/
organizational-theory.htm
Wertheim, E. G. (undated). Historical Background of Organisational Behaviour.
Accessed 21 October 2005. URL: http://web.cba.neu/~ewertheim/i
ntrod/history.htm
* * *
TOPIC 3 ELECTRONIC MEDIA AND INFORMATION, COMMUNICATION AND TECHNOLOGY (ICT).
INTRODUCTION
Broadcasting industries which are still using old hardware and software are now
facing stiff competition from industry participants who have already applied
digital technology. This means a media manager needs to be sensitive to changes
that occur and to always conduct research to update his knowledge about recent
technology in his field of expertise.
Since 1968, David Sarnoff, a pioneer writer in the television broadcasting industry
in the United States has expected rapid changes that would happen in the
broadcasting industry.
By the end of the topic, you should be able to:
1. Describe the definition of electronic media and ICT;
2. Identify the purpose of telecommunications management and two
causes for its failure;
3. Discuss four criteria of media and ICT organisations; and
4. Outline four requirements of the telecommunications industry from
the aspect of media management.
LEARNING OUTCOMES
He outlined the characteristics of a media manager as follow:
The needs of the time will bring forth perhaps a new type of executive, trained in
a manner not always associated with the requirements of business management.
He will have to reckon with the constant changes in industry, the changes that
scientific research is bringing. He will have to be able to approximate the value of
technical development, to understand the significance of research.
(Extracted from Sherman, 1995: 3)
Sarnoff's prediction turned out to be reality. Today, media organisations must be
run by media managers who not only have dynamic personalities but are also
competitive and able to deal with changes that are challenging and rapidly taking
place in the field of broadcasting and telecommunications.
ELECTRONIC MEDIA
The electronic media landscape exists in the wide and dynamic
telecommunications industry environment. Therefore, to define electronic media,
3.1
Do you still remember what you learnt in Topic 1? Before you
continue reading, try to explain the meaning of telecommunications.
Clarify the meaning in your own words.
discussions must be widened to include the telecommunications environment. If
you can recall, the definition of telecommunications has already been discussed
in Topic 1.
With regards to electronic media and the ICT landscape, discussions are not only
limited to electronic media organisations, such as radio stations and terrestrial
television (e.g.: RTM, TV3, ntv7, Radio IKIM, etc.) but also includes all industry
participants using satellite communications system to broadcast programmes
such as radio network and ASTRO (including NHK, ABC, CNN, BBC World,
STAR TV, Al-Jazeera and others). Besides radio and television, the electronic
media landscape also includes new and old telecommunications industry
participants (such as Telekom Malaysia Berhad, Maxis, AT&T, IBM, Nokia and
others) which operate at national and international levels.
Telecommunications organisations include commercial organisations (profit
oriented) and non-commercial organisations (non-profit oriented) owned by
public agencies, privately owned or owned by non-profit organisations (NPO).
These telecommunications organisations are involved in the development,
production, distribution and display of entertainment and information
programmes to the public through electronic media and ICT (Gershon, 2001;
Sherman, 1995). Figure 3.1 shows several communications technologies which
still exist today.
Figure 3.1: Telecommunications technology
Besides the above, you may also increase your knowledge about electronic media
by referring to the following book:
Sterling, C. (2004). The Electronic Media. CA: Wadsworth Thomson Learning.
INFORMATION TECHNOLOGY AND COMMUNICATION.
The combination of the two aspects of science and technology (S&T) has brought
about various changes in the community. When scientists and technologists
create and produce new ideas and discoveries, then technological innovation
takes place. The diffusion of technological innovation brings about changes not
only in science and technology but also to everyone in the community, from
family units, community and local community to the participants in the global
environment.
S&T development followed with the diffusion of technological innovation largely
involves communication processes. Figure 3.2 portrays the flow of
communication in assisting the development of S&T and the emergence of
information and communication technology (ICT).
3.2
From your reading so far, think how science and technology can
bring changes in the community.
Figure 3.2: Science, technology and its use
Source: Juggenheimer, D.W. (1972).Future Communication, Technological Advances and
Their Principal Implication for Advertising, Ph.D. thesis, University of Michigan, USA.
Figure 3.2 shows the existence of a vertical communication process either through
upward or downward flow between science and technology as well as between
technology and use. This movement may happen fast or slowly. Every movement
is related to the three elements. It is through the combination of the three
elements that the creation of information and communication technology (ICT)
takes place, which is being made use of by the community today.
Technological history has taken communication from wire to wireless and
back to wire, and early business patterns provided the foundation for todayÊs
industry.
To get further clarification on the pattern of changes in electronic media, refer
Craft et al. (2001), Electronic Media. CA: Wadsworth Thomson Learning, p. 12
Changes taking place in the ICT field largely influence and affect the current
electronic media landscape. Now, the ICT technology media, such as satellites,
fibre optics, Internet and computers, have changed the way people interact,
transact, receive, distribute and process information and knowledge. ICT has also
caused boundaries among countries to become less apparent.
AIMS OF TELECOMMUNICATIONS
MANAGEMENT
In general, media organisations (and ICT) operate with the objective of making
profits and generating income. In facing competitive conditions in the media
industry, the telecommunications industry now needs a media manager who can
identify and think of the following questions:
(a) What are the most popular products or services among the consumers?
(b) What are the most economical methods for process of production and
distribution of a product or service?
(c) Is the product or service potential for profit generation?
The media landscape is full of colourful success stories as well as failures due to
failures of management of the media products and services. These failures are
normally due to two factors, as shown in Figure 3.3.
3.3
Try to take two minutes to explain the aims of telecommunications
management according to your understanding and then explain the
causes of failure of telecommunications management.
Figure 3.3: Causes of telecommunications management failures
Below is an explanation on the two causes.
3.3.1 Making Inaccurate Predictions of Audience
Tastes
Some management of organisations think audiences will accept without question
whatever product or service is offered, that is, making inaccurate predictions.
Mega TV used to provide pay television services to the audiences in Malaysia.
The management of Mega TV expected the broadcast it offered (five channels)
would get the desired response from audiences, especially because the cost of
subscription to nearly 50 channels on ASTRO (a competitor)was much higher.
Unfortunately, the managementÊs expectations fell short. Consequently, Mega TV
had to stop operations in 2002 due to inability to get a cost-effective response that
could pay for the operational costs of the station.
3.3.2 Too High Cost of Maintenance
When Metrovision began operations in September 1994, audiences in the Klang
Valley knew something different was being offered compared to the then
operating television stations, which were TV1, TV2 and TV3. Although the new
station received a good response at the beginning, financial factors caused the
operations of the station to stop as it was unable to compete with the attraction of
the other television stations which had nationwide broadcasts. Firstly,
operational costs were found to be too high compared to income generated.
Secondly, the area of broadcast for Metrovision was limited and restricted to the
Klang Valley only. As a result, Metrovision could only survive for seven years
(1994-2002) competing in the media market.
When discussing the topic of electronic media organisational management, we
need to discuss the audience because the objective of electronic media is to
distribute information, education and entertainment to the audience. However,
not all of the electronic media broadcasts are targeted to the public audience.
There is a private electronic media station which implements the concept of
narrowcasting, that is operating for specific audience only. To generate income,
the station charges a fee to the clients to get the broadcast service. Although
private and non-private stations aim at meeting public demand, the private
stations need to take into account various needs and tastes of the audience.
Non-private stations must conform to government's rules. This occurs in
Malaysia also. Privately owned stations such as Sistem Televisyen (M) Berhad
(TV3) is facing a rather different kind of pressure compared to Radio Televisyen
Malaysia (RTM) which is owned by the government.
Electronic media and telecommunications management aims at marketing and
distributing the use of products and services to gain profits. The experiences of
Mega TV and Metrovision stations proved that the mission of operations of a
media organisation to highlight merely good values without taking a business
model appropriate with the environment usually ends up with a financial loss.
In your view, why did TV9 temporarily stop its broadcast in January
2005?
ACTIVITY 3.1
1. What type of pressure is faced by RTM but not by TV3?
2. What type of pressure is more focused towards TV3 as
compared to RTM?
Emphasis on the profit aspect may cause non-commercial broadcasts to be unable
to play an effective role in telecommunications landscape in Malaysia. When an
industry participant emphasises profit too much, it seems that it is not concerned
with non-commercial goals such as creating an informed and knowledgeable
society.
Below is a newspaper extract taken from The Star, 6 October 2004:
ETV FAILURE: A-G's report: Most schools do not watch Educational
programmes.
PETALING JAYA: The Educational Television (ETV) programme, which
costs the Government millions of ringgit each year, has failed to meet its
objective because most schools are not utilising the facility.
What is your view on the newspaper statement? If you are a non-
commercial media manager, what is your strategy so that your
organisation may still achieve success without emphasising financial
profit? Discuss.
ACTIVITY 3.3
Some people have the view that Educational Television in Malaysia
failed because of its programmes were produced without an
entertainment element and were not profit oriented. On the other
hand, the Public Broadcasting System (PBS) in the United States
stands strong until today even though it is not a commercial channel.
What is your view? You may interview executives working in
Educational Television to get information.
ACTIVITY 3.2
BASIC ACTIVITIES OF A MEDIA
ORGANISATION
Media industry transactions involve four main activities as shown in Figure 3.4
below.
Figure 3.4: Four main activities of a media organisation
Detailed explanation on the main activities of a media organisation is discussed
in the following section.
3.4.1 Development
The music recording industry began to expand with the invention of a talking
machine or phonograph by Thomas A. Edison in 1877. The machine was
improved by Emile Berliner and named a gramophone. Berliner, together with
Eldridge Johnson, marketed the gramophone for domestic use. However, the
gramophone was only affordable for the elite. Only in 1927, the electrical
gramophone could be sold to the public and 104 million gramophone disks were
sold (Wilson & Wilson 2001: 277-278).
Early development of radio broadcasting is related to such names as Guglielmo
Marconi, R.E. Fessenden, Lee de Forest and David Sarnoff either as inventor of
telecommunications and broadcasting technology or professional practitioners
who built up careers in the broadcasting field. Television linked us to electronic
experts such as Paul Nipkow, Vladimir Zworykin and P.T. Farnsworth (Refer
Wilson & Wilson 2001: 250-273; 306-339).
The development of electronic media highlighted several changes in the use of
wireless equipment. Trade fairs sponsored annually displays and introduced
various new telecommunications equipment to the public. Now, there are kinds
of many micro equipment such as mini microphones, mini cameras, mini
recorders which are of high quality, digital and suitable for broadcast. The
steadfastness of the European and American inventors in producing new gadgets
is now being largely taken over by innovators and inventors from Asia, especially
Japan and South Korea.
To know more in detail, on the history of music recording, radio and television
industry, refer to books on mass media including the following references:
(a) Biagi, S. (2005). Media Impact: An Introduction to Mass Media Impact (7th
ed.). Belmont, CA: Wadsworth.
(b) Wilson, J.R. & Wilson, S.R. (2001). (5th ed.). Mass Media, Mass Culture: An
Introduction. New York, NY: McGraw-Hill.
3.4.2 Production
Companies involved in the production of electronic
media are more interested in producing consumer
electronic products such as television sets, radios,
compact disc devices, video recorders and various
types of mobile phone equipment.
At the beginning of the media industry, American
companies were the main producers of electronic
media equipment. Now, Japan and South Korea are
more innovative, creative, and have high technology.
However, in the aspect of media programme
production, the United States still succeeds in leading
the global market with the production of films,
television programmes, music and fashion preferred
by youngsters.
This condition bothers the world community which is worried about the spread
of the countryÊs ideology into local community cultures. In reality, this already
exists in the 21st century. As a result, we find that there are many foreign
companies sharing ownership of local media organisations. For example, Rupert
Broadcast Asia 2002 is a good example of an exhibition showcasing
telecommunications products and services. The telecommunications
exhibition held in Singapore in 2002 displayed equipment such as
cameras, editing equipment, microphones and various other gadgets.
In your view, what other equipment could have also been displayed at
Broadcast Asia 2002 in Singapore?
ACTIVITY 3.4
Murdoch, the owner of a media organisation News Corporation originating from
Australia, now owns various print and electronic media in many parts of the
world including Sky Broadcasting in UK, Fox Corporation in the United States
and STAR TV in Hong Kong. In the United States, News Corporation competes
with three main American television networks, that is, NBC, CBS and ABC.
Figure 3.5: An extract on Fox Broadcasting Company
Source: Dominick et al. (2004). Broadcasting, Cable, the Internet, and Beyond. An
Introduction to Modern Electronic Media. NY: McGraw-Hill, p. 105
Sony Corporation, owned by Japan , has taken over Columbia Pictures, TriStar
Pictures and CBS Records, while Matsushita owns a majority share in MCA and
Universal Press.
You may refer to Global Media System in Topic 3, Module CBMM2103 for
additional reading.
3.4.3 Distribution
Distribution and spreading in the telecommunications industry is carried out by
multinational and international companies which strive to meet the needs and
tastes of producers and consumers, not only domestically but also for the global
audience. The broadcasting industry in the United States clearly shows this
relationship through television programmes from the three main channels (ABC,
CBS and NBC) to affiliate stations in small towns.
Besides the large organisations, there are also companies like Viacom and Unistar
which distribute programmes for the world market.
Fox Broadcasting Company
The Fox Broadcasting Company (FBC) was launched in 1968 by Australian
media magnate Rupert Murdoch. Murdoch had purchased the former
Metromedia stations and was interested in using his newly-acquired TV
studio (20th Century Fox) to produce programmes for these stations. The
decision was made to introduce programming slowly - first, one day of the
week (Sunday), then gradually extending it throughout the week. Today, Fox
network programming is available seven nights per week. Many successful
shows now attract audiences and advertisers to Fox, including 24, The
Simpsons, Boston Public and American Idol.
3.4.4 Display
This fourth level requires the telecommunications manager to plan and
implement display or broadcasting to attract the attention of its consumer
audience. With the development of new technology, product display nowadays is
no longer limited to media owners, managers, programme producers but also
includes listeners and viewers.
Now, communications rooms of media organisations have turned into a place to
broadcast a product direct to the consumers. To perform the task, a media room
is designed in a way to enable programmes to be broadcasted from the station to
homes. Therefore, it is no wonder if the media station is now equipped with a
wide screen, a quality video camera, and a high quality sound system. Such
quality recording has caused the falling rate of cinema viewing some time ago.
This situation influences the broadcasting industry.
Now, companies cooperate to produce made-for-TV-movies. ViewersÊ experience
in the comfort of their own homes now has replaced their habit of viewing films
in cinemas.
ELECTRONIC MEDIA LANDSCAPE
Subsequently we will analyse in detail the media which is included in the
electronic media category.
At the early stage of the broadcasting industry, there were only a few radio and
television stations. Now, the electronic media landscape has changed and
portrays a complex situation with the growth of many new stations including
web radio and web television. Refer Table 3.1.
3.5
Observe the media organisations in Malaysia. Briefly discuss the four
basic activities of a media organisation above, by including an example
of a local media organisation for each of the activities.
ACTIVITY 3.5
Table 3.1: Current Electronic Media Landscape
Functions Software Product Hardware
Entertainment
and Information
Television channels
Cable channels
Pay television
Pay viewing
Radio stations
Television stations
Cable systems
Satellite service
Video texts
Teletexts
Video equipment
Audio equipment
Satellite parabolic
Telephone
3.5.1 Radio Broadcasting
A name which is often linked to radio broadcasting is Guglielmo Marconi. He is
the person who identified the potentials of the radio as a long distance
communication channel. In the beginning the use of radio was limited to
communication equipment in ships. During the Second World War, the use of
radio was specially allocated to military needs. After the Second World War,
radios were used as an entertainment channel and for getting information.
In the beginning, the use of radio was limited to users within the reach of a
frequency between 30 to 300 kHz (kilohertz) only. Radio signals were
broadcasted through amplitude modulation or AM modulation wave.
The rise in radio stations has made the Federal Communications Commission
(FCC) introduce radio channel classification. Refer to Table 3.2 to know about
general radio channel classification in the U.S. With the classification, it is easier for
the FCC to monitor the performance of thousands of stations existing in the U.S.
To get more information regarding the Federal Communications Commission,
please browse the following website: http://www.fcc.gov
Malaysia's space is now crowded with various radio waves being used
by various stations. How many radio stations operate in Malaysia?
Where are the operational locations of these stations?
Table 3.2: Classification of AM Radio Channels in the United States
Classification I
Ć Dominant
Ć Clear broadcasting
Ć Has specific frequencies
Classification II Ć Clear, dominant broadcast
Classification III Ć District stations
Classification IV Ć Local broadcasting stations
Another radio broadcasting frequency is frequency modulation or FM. This is a
higher frequency for an area of 88 to 108 megacycles/sec (now called megahertz
or MHz). Use of FM frequency requires a wave that links the broadcasting tower
directly to radio sets. FM station classification is guided by the antenna power
and operational power.
Class B and Class C stations are preferred by the management of radio FM
stations companies which normally concentrate in city areas by erecting high
towers to ensure broadcasts reach target audience. For example, the broadcasting
tower owned by Shamrock Broadcasting in Atlanta, Georgia, USA is 1794 feet
high.
Most radio stations operate using FM. Its classification is as in Table 3.3.
Table 3.3: Classification of FM Radio Stations in the United States
Classification A Ć Using low broadcast of 50 kW
Ć Maximum distance of 30 miles
Classification B Ć Able to operate till 50kW power
Ć Maximum distance of 30 miles
Classification C Ć Able to operate till 100kW power
Ć Maximum distance of 70 miles
Source: Craft et al. (2001). Electronic Media. CA: Wadsworth Thomson Learning, p. 38.
By 1945 radio had become the most popular medium for both entertainment
and news, but looming on the horizon was a new medium that threatened to
render radio obsolete: television.
3.5.2 Television Broadcasting (TV)
Telecommunications technology developed rapidly after the Second World War and
the FCC began to issue licenses for television broadcasting. Priority was given to
stations operating using VHF (Very High Frequency). Most stations in the beginning
were also owned by large radio network organisations.
In the beginning, most of these stations broadcasted entertainment programmes. The
popularity of these relatively new media at the early stages attracted many
entrepreneurs to reap profits from television stations, forcing FCC to freeze license
issuance temporarily, from 1948 till 1952. Now, there are hundreds of television
stations in the United States. However, the main stations that lead the television
broadcasting are American Broadcasting Company (ABC is owned by Walt Disney),
Columbia Broadcasting System (CBS is owned by Viacom), National Broadcasting
Company (NBC is owned by General Electric), FOX Television (owned by News
Corporation) and a few other well known cable and satellite stations including
Home Box Office (HBO) and Cable News Network (CNN).
Other than the four main television stations, there are also several independent
stations either owned by an organisation or several organisations with no relation to
traditional channels. Public broadcasting began with the operation of public
broadcasting service (PBS) which operates not for profit. The aim is to provide
exposure on education, culture and human relations programmes such as Nova and
Sesame Street. There are 350 stations in the United States operating as public
broadcasting stations. PBS does not pay the stations for broadcasting programmes
prepared, but the stations sign a contract to broadcast them.
In the United States, television is an important medium for entertainment and
information. A total of 99% of the households in the United States have televisions,
and approximately 89% having recording machines (VCR/VTR). On average, each
household receives more than 40 channels and televisions are in use for seven hours
a day.
Table 3.4: Growth of Television in the United States (1950-2000)
Year
Total Number of Stations
Percent of Households Having Televisions
Total Number of Staff
1950
1970
2000
98
862
1,576
9
95
99
9000
58,400
175,000
Source: Dominick et al. (2004). Broadcasting, Cable, the Internet and Beyond. An
Introduction to Modern Electronic Media. NY: McGraw-Hill, p. 19
Besides television broadcasting, the media landscape includes Cable Television,
Pay Cable, Subscription Television (Pay to View), Master-Antenna Satellite
Television and Direct Broadcast Satellite. Table 3.5 shows types of television
broadcasts in the United States.
Table 3.5: Types of Television Broadcast in the United States
Types of Television
Broadcast Explanation
Cable Television • Late 1940Ês
• Covering the hinterland areas not getting television
broadcast. Each building subscribing to cable television
service must install cable coaxial connected to
building receiving the broadcast.
Video • Around 1970Ês
• Video recorder enables viewers to record television
broadcast for viewing again.
Pay Cable
(Pay Per View
Television)
• Additional channels only for viewers who subscribe television
• Example: HBO, Showtime, Cinemax, ESPN.
Master-Antenna
Television Satellite
(SMATV)
• SMATV company provides television broadcast for
viewers to a subscribing region/building through the
company. Satellite parabola is installed in a building area
to receive transmission which can be received by viewers
in the building.
Multichannel,
Multipoint
Distribution Service (MMDS)
• Broadcast is transmitted through microwave transmission.
A transmission device is installed at a building, which
subsequently retransmits the wave to clients.
Direct Broadcast Satellite
• Using parabola installed on the house roof top to receive
broadcast transmitted from satellite.
DEVELOPMENT OF TELEVISION
BROADCAST IN MALAYSIA
The history of broadcasting media development particularly radio is closely
related to British colonial era, i.e. on 1 April 1946. Radio broadcasting activities at
the time centred on Caldecott Hill, Singapore but beginning on 1st January 1959,
two years after the country obtained independence from the British, Radio
Malaya began operations from Kuala Lumpur. Television Malaysia broadcasting
began operations on 23 December 1963 in the Klang Valley. Six years later, a
second channel was launched to fulfil the governmentÊs broadcasting objectives.
With that, Radio and Television Malaysia (RTM) operates as a public broadcaster
under the Broadcasting Department of Malaysia. After the implementation of the
National Privatisation Policy in 1983, private television channels, beginning with
TV3, followed by several terrestrial television stations started. Technological
development has consequently enabled the operations of a satellite television
station, i.e. ASTRO. ASTRO was officially launched on 1 October 1996 and is one
of 89 broadcasting stations operating in Asia Pacific.
ASTRO is owned by MEASAT Broadcast Network Systems (MBNS) Sdn Bhd.
The shareholders of MBNS include Khazanah Nasional Berhad, Amanah Saham
Bumiputera and Usaha Tegas Entertainment Systems Sendirian Berhad. MBNS is
one of the subsidiaries of ASTRO All Asia Networks plc. (a holding company)
which offers services in terms of entertainment and information including
television and radio satellite programmes, karaoke channel, interactive game,
pay-per-view film, video-on-demand and others. Information services include
data delivery, broadcasting of television and radio programmes in the form of
information and interactive television service such as banking, shopping, long
distance learning, Internet and others.
MBNS has spent more than RM800million to build its broadcasting centre called
All-Asia Broadcast Centre (ABC) situated in Taman Teknologi Malaysia, Bukit
Jalil, Kuala Lumpur, that is in the middle of the Multimedia Super Corridor
(MSC). ABC is the heart of MEASAT operations for Malaysia and its other
markets in the world. At ABC, programmes received from other satellites in the
world will undergo various processes such as dubbing, subtitling, editing,
digitalising, bits rate reduction, error correction, digital modulation and changes
to code.
MEASAT Broadcast is a consortium licensed by the Government of Malaysia to
operate multimedia broadcasting service in Malaysia. MBNS uses MEASAT
(Malaysia East Asian Satellite) satellite system. Without MEASAT, satellite
television broadcast could not have operated.
The owner and operator of MEASAT I and II is Binariang Sendirian Berhad
which has changed its name to Maxis Communications Sendirian Berhad. The
owners of MBNS consist of a group of shareholders who also have shares in
Maxis Communications. The principal shareholder is Ananda Krishnan, the
owner of Syarikat Usaha Tegas Sendirian Berhad.
ASTRO services are based on subscription. Programmes broadcasted through
television channels in various languages (including three government-owned
television channels and three privately-owned television stations) and radio
channels in digital format are produced by local television stations, local
producers and purchased or imported from foreign owners/producers. ASTRO
programmes are broadcasted in Malay, English, Mandarin, Tamil, Arabic and
other languages.
MEASAT 1 and MEASAT II are owned by Malaysia. MEASAT 1 was launched on
13 January 1996 in Kourou, French Guiana while MEASAT II was launched
on 14 November 1996 also in French Guiana. MEASAT I and II is a satellite of
hybrid model HS376 made by Hughes Corporation, the United States. Both
satellites use C-band and Ku-band frequencies, is able to reach India, East Asia,
and eastern region of Australia. It is capable of providing telecommunications
services and data services. Both satellites are also capable of providing 112
digital TV and DTU (Direct-to-User) radio networks. MEASAT III is still
being planned.
ASTRO television channels clearly portray the participation of global media such
as CNN, BBC, HBO, STAR, Hallmark, ESPN, Al-Jazeera, Cinemax, TVB, ABC,
NBC, Disney, Bloomberg, Fox Network, etc. ASTRO has also involved global
participants such as ST Teleport Pte. Ltd., Hawaii Pacific Teleport, Phillip and
Nokia, which supply services, hardware, and/or digital technology to MBNS.
ASTRO in Malaysia has reached 1.4 million households and there were about 6
million viewers in 2004 (Annual Report 2004 ASTRO All Asia Networks plc., p.2).
ASTROÊs broadcast can also be accessed by viewers in India, the Philippines,
Vietnam, Taiwan, Laos, Cambodia, Brunei, Indonesia and parts of Australia.
Radio ASTRO (ERA, MY FM, hitz.fm, MIX FM and Light & Easy) is followed by
8.7 million listeners per week and able to attract 74% of the total amount of
advertising budget for radio. Refer Table 3.6.
Make a list of existing television channels in Malaysia and state the
years in which they started operating.
In your view, is the total number of existing channels sufficient for
audiences in Malaysia? Discuss.
Table 3.6: Financial Position of ASTRO 2004 (RM Million)
*FY02 *FY03 *FY04
Income
Multi-channel television
Radio
**Celestial
Others/inter-segment eliminations
867.9
781.4
71.8
3.4
11.3
1,142.7
1,034.5
8.7
8.3
11.2
1,418.8
1,265.6
108.0
36.3
8.9
Total Number of Clients of
ASTRO TV (Â000)
Residential
Total Number of Clients
777.7
854.4
984.3
1,069.9
1,283.0
1,392.7
Total Number of Clients of
ASTRO Radio (Â000) 6,738.0 8,376.0 8,740.0
*FY: financial year
**Celestial: Celestial Movies Channel shows films obtained from Chinese Film Library
owned by Shaw Brothers.
Source: Annual Report 2004
Beginning in September 2005, ASTRO faced stiff competition from a satellite
television station owned by a local company called MiTV.
• Electronic media organisation refers to commercial and non-commercial
organisations which are involved in the development, production,
distribution, display of products and services which provide entertainment
and information to the public channelled electronically. Discussion on the
electronic media landscape also involves media management, who should be
sensitive to changes in the environment of software and hardware technology
in the relevant industry and must function consistently with very competitive
and constantly changing conditions.
• In the recent two decades, the broadcasting and telecommunications field has
changed its appearance due to technological development in
telecommunications, computer and microelectronics which has left its mark
in the field of telecommunications and broadcasting media.
• In addition to technology, the viewing and listening audiences today are
exposed to hundreds of programme selections from various sources including
satellite radio and television; from local as well as foreign sources. Radio and
television are the main electronic media which also change consistently with
the technological changes in broadcasting and telecommunications, market
environment and target audienceÊs tastes. The broadcasting climate is now
dynamic and excellent, constantly changing and involving various industry
participants which extend to a global level. Therefore, a media manager must
be prepared to face this rapidly and frequently changing situation and
climate.
• A successful industry is the one that offers products and services efficiently
and to the consumers. Media industry in the United States is regarded as the
most efficient. The entire population has access to television and radio. Now,
access to the Internet has also reached the highest. All the three television
channels in the United States, that is, ABC, NBC and CBS, are examples of
efficient media organisations which are always sensitive to changes in
technology and society. Now, their audience is not only the United States, but
also the world community. Referring to the local broadcasting landscape,
RTM and TV3 are two stations which quite substantially offer products and
services to audience in the country.
Development
Display
Distribution
Electronic Media
Information and Communication Technology
Production
Craft, J. E., Leigh, F. A. & Godfrey, D. G. (2001). Electronic Media. Australia:
Wadsworth Thomson Learning.
Dominick, J. R., Messere, F. & Sherman, B. L. (2004). Broadcasting, Cable, The
Internet and Beyond: An Introduction to Modern Electronic Media. (5th ed.).
Boston, MA: McGraw-Hill.
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/ Cable
and The New Technologies (2nd ed.). NY: McGraw-Hill, Inc.
* * *
TOPIC 4 TELECOMMUNICATIONS INDUSTRY STRUCTURE
INTRODUCTION
This topic will discuss the telecommunications industry structure by focusing on
market structure elements, behaviour, market achievement and media maturity
level, i.e. product life cycles.
The main focus in broadcasting management is understanding various market
structures being practised in the telecommunications industry. Understanding
these elements helps media managers to arrange strategies, particularly in terms
of products and services. Besides this, media managers will be able to
understand competitors' strategies while thinking of product and service
innovation, which are able to compete with and overcome competition.
At the end of the topic, you should be able to:
1. Explain five elements in the telecommunications industry market
structure;
2. Explain three forms of transactions practised in the broadcasting
industry;
3. Discuss the limits and barriers to entry of new products into this
industry; and
4. Discuss the strategies for increasing broadcasting products and
services.
LEARNING OUTCOMES
TELECOMUNICATIONS INDUSTRY
STRUCTURE
Sherman (1995) emphasised the importance of examining market structure,
market behaviour and market achievement in the telecommunications industry.
According to Gershon (2001), different market structures form different patterns
of organisational behaviour. Besides that, the economy also affects the formation
of a market structure. This means a free economic system which encourages
competition forms a structure which is not the same with a monopolistic
economy.
The increase in electronic media operations itself is to obtain gains or profits.
Therefore, the cable system strategy is to capture as many customers as possible
to patronise their services, while the broadcasting stations sell their viewing and
listening audience to advertisers who are willing to sponsor programmes (Craft,
J.E. et al. 2001).
Table 4.1: Elements of Telecommunications Industry Structure
Market Types of Market Participants
Structure
Elements Monopoly Oligopoly Perfect Competition
Seller
concentration
A single firm
owning/controlli
ng a type of
product or service
in the
market/industry.
Several firms dominate
product/service in the
market / industry.
A large number of
firms compete in the
open market.
4.1
Market structure refers to the
characteristics of the market economy
which affect the behaviour of organisations.
Market behaviour refers to company policy regarding
product and competitorsÊ strategies to capture a market.
Market achievement means economic output that is the
ability to achieve maximum profit.
Copyright © Open University Malaysia (OUM)
TOPIC 4 TELECOMMUNICATIONS INDUSTRY STRUCTURE W 87
Product
differentiation
Product/service
with same image
and/or brand.
Products differ slightly
and not important.
There are various
choices and unique
images of a particular
product/service..
Barriers to
entry
Cost is the main
barrier because
transaction
requires huge
sum of capital.
Economy of scale is the
main barrier because of
long period required gain
profits.
Dominant old
organisation and
product/service
excellence which was
long established
becomes a challenge
to new competitors.
Buyer
concentration
Focus is on total
number of buyers
to get advertising
returns/income.
Depends on large
number of buyers to get
high economic returns.
Stiff competition raise
problem of buyer
fragmentation.
Fixed Costs
(continuous
expenses for
equipment)
Technological
innovation cost
will raise budget
costs but it is
unavoidable
although there is
no competition.
Technological innovation
forces purchase of new
hardware/software
(retooling) and raise
costs to attract investors
and audience
successfully.
Needs high
investment amount to
face competition.
Demand
Growth
(levels of
producersÊ/
customersÊ
demand)
High consumer
demand raise
demand for
product/ service
and profit, or
vice versa.
In telecommunications
industry, continuous
demand is no longer
certain. Demand growth
is a big challenge to
industry participants.
Demand growth is a
big challenge to
industry participants,
successful industry is
a participant which
can attract customersÊ
interest through
product/service
offered.
Source: B.L. Sherman (1995). Telecommunications Management. (2nd ed.), p. 52-60
4.1.1 Telecommunications Organisation
Telecommunications organisation includes electronic media organisations which
transact in producing information and entertainment to be broadcasted to the
audience. This means electronic media organisations depend on income from the
creative products of their task force and decisions made by the editorial group.
The transactions depend on strategies in selling and distribution of products and
services relating to information and entertainment.
MARKET STRUCTURE ELEMENTS
This structure influences organisational behaviour in the market. There are five
elements in the market structure, as shown in Figure 4.1.
Figure 4.1: Market structure elements
4.2.1 Sellers Concentration
Sellers concentration also takes into account competitive factors taking place in
the market and the effects of competition on quality and cost of services
rendered. Sellers concentration can also be measured by looking at the
Market structure elements refer to the
relationship between buyers and sellers
in the market.
Sellers Concentration is defined as the
total number of sellers of a product or
service in the market.
percentage of gross income received by the largest organisation in the industry.
Level of competition or types of market participants are divided into three, that
is:
Ć Monopoly;
Ć Oligopoly; and
Ć Perfect competition.
(a) Monopoly
In the context of telecommunications, monopoly refers to the conditions in
which there is only one organisation producing the product in the market.
The organisation will reap 100% profit in the market. In our country, for
example, the main provider of electricity for the whole nation is only
Tenaga Nasional Berhad (TNB). Previously, Radio Televisyen Malaysia was
the main source of national broadcasting until Sistem Televisyen (M)
Berhad (TV3) began to operate and broke the monopoly.
In the monopolistic category, the organisation providing the service acts to
control costs. Product quality is based on the organisationÊs own
measurement because customers have no choice to switch to another
provider. Besides that, the monopolistic conditions do not provide room for
reform. When these conditions happen, the organisation will feel that its
product is sufficient without any desire to improve product development or
offer new services.
(b) Oligopoly
For example, in the electronic media broadcasting industry in Malaysia,
local television stations, namely RTM, TV3, ntv7, 8TV, ASTRO and MiTV
must compete with each other to attract the audience. In markets that
practise an oligopolistic system, the organisations involved in a particular
Monopoly refers to the conditions in the
market which are controlled or
dominated by a product seller.
Oligopoly is a market situation which
portrays the involvement of a few
dominant sellers in the industry.
industry depend on each other to take action, for example, to raise prices or
change advertising strategies or make product innovations.
Oligopolistic market practices are carried out not only in Malaysia. In the
United States, there are also industries practising the oligopolistic system.
For example, television broadcasting in the United States comprises the
main networks - The Big Four, i.e. ABC, CBS, NBC and Fox while the
telephone industry is dominated by names like AT&T, WorldCom and
Sprint.
(c) Perfect Competition
Entry into the market by a new firm may often happen. Similarly, firms also
terminate their services frequently. One recent example is the computer
industry which shows that transactions take place in a climate of intense
competition. This condition provides opportunities for customers to obtain
the best product and service.
4.2.2 Product Differentiation
Product differentiation is the degree of difference between products produced by
one firm and those produced by another firm in the same industry. In the
entertainment media industry there is a tendency to produce differentiated
products. Therefore, stations would display various brands to highlight the
uniqueness and distinction of their products compared to the competitors.
As an example, TV3 previously used the slogan „Duniamu TV3‰ (TV3 is Your
World) as its broadcasting strategy. RTM presented its „Teman Setia Anda‰
(Your Loyal Friend). Now with competition from several other stations, each of
them has to strengthen their position by building a new branding image. Each
station will attempt to create something different to ensure that their own
product is distinct from those of other stations. These broadcasting stations also
create an image or identity in various ways including the broadcasted
programmes, music used, emblems, scheduling as well as selection of
newscasters on duty.
Perfect competition means there are
several organisations providing the same
product or service.
4.2.3 Barriers to Entry
What are the factors that prevent the entry of a new participant in an industry?
New firms usually cannot compete with long established media organisations
because the older organisations already have expertise and a loyal audience.
There are various barriers to entry. Among them are as follows:
(a) Absolute Cost Barrier
There are certain industries which require a huge sum of capital and usage
of sophisticated equipment. This condition hinders new firms from entering
the market.
(b) Scale of Economy Barrier
There are also businesses requiring a certain period of time to obtain profit.
This condition requires patience on the part of businessmen to wait for the
time to reap their profit. It happens in the media industry. The firms
owning media stations cannot reap instant profits because they have to first
invest a large amount of capital for the stationÊs infrastructure, as well as
train skilled human resources in their own respective fields. This will take a
long time, sometimes as long as seven years. An example is the cable
television MegaTV which required a large amount of capital but still took
as long as five to seven years before getting its profits.
You are required to watch news programmes for a week. On Monday
night you should watch the RTM news programme. On Tuesday night
you must see TV3Ês news programme and on Wednesday night the
news on ntv7. Make a list of differences between the news
programmes on these stations from the aspects of newscasters, ways of
casting, music, advertising and visuals broadcasted.
Barriers to Entry refers to the extent
competition is limited or barred by the
industry.
4.2.4 Buyers Concentration
If there are more buyers, it means higher profits will be gained. This makes
buyers concentration a critical factor. A low number of buyers will not only affect
profit adversely but also raise the problem of continuing the business activities.
Basically, we see television stations broadcasting programmes to millions of
viewers but that does not necessarily mean the broadcasted programmes may
reach the target audience. The determinant is the customers who have a choice
whether to view or not.
Besides the efforts to attract audiences, television and radio stations also sell the
viewers and listeners to advertisers to generate income through programme
sponsoring. A large audience, closely related to programme ratings, is a criterion to
get advertising purchase by the advertisers. This is also a contributing factor why we
are exposed to advertising whenever we watch television or listen to the radio.
4.2.5 Growth in Demand
The last element in telecommunications market structure is growth in demand.
Buyers Concentration refers to total number of
potential buyers to buy the products produced.
Growth in Demand refers to the level of
producer and consumer demand for the product
and service produced by the industry.
In your view, what caused Metrovision and Mega TV to cease their
broadcasting operations?
In principle, a rising demand would lead to an increase in income and profit.
This becomes an indicator for station programme ratings and popularity levels of
a radio or television station.
MARKET BEHAVIOUR PRINCIPLE
The formation of an industry is through market structure and market behaviour.
In whatever form of market economy, the main principle of the public and
private sectors is profit and increasing market share. Besides that, the market
structure can also be seen from the policy of the organisation towards its clients
and competitors. The issue of market behaviour can be seen through three types
of market behaviour as follows:
(a) Price determination policy;
(b) Quality control policy; and
(c) Competitive policy.
4.3.1 Price Determination Policy
In theory, a competitive market will be able to attract consumers with purchasing
power to set the market price. However, as the telecommunications industry is
more inclined to practice an oligopolistic system, there is interdependence among
the firms. This means, if a firm reduces its price, other firms will also reduce it.
Besides, the firms will agree on a fixed price. This factor is referred to as price
fixing. Such a practice takes place because producers collude to limit production
of products and limit entry of new firms.
4.3.2 Quality Control Policy
The second component of market behaviour principle is product quality control.
In a monopolistic system, consumers have no choice. In fact, quality maybe
ignored. In an oligopolistic system, the approach used is through the agreement
of all production firms involved. If a party improves quality, then others will
follow. However, all firms in the industry will first discuss quality improvement.
4.3
In your view, how can the increase in number of television stations
affect the growth in demand? Will the increased number of stations
create viewer fragmentation? Discuss.
Normally the firm which raises the price in the market is called a product leader.
Media organisations will spend a large sum of money in order to ensure they
become a product leader.
4.3.3 Competitive Policy
Although competitive practices are implemented in the telecommunications
industry particularly broadcasting, there are also forced practices by legal
agencies. This is done by making policies and laws to hinder growth of
competition. The following extract is an example of how competitive policy is
hindered in the broadcasting industry:
Figure 4.2: An extract on competitive policies hindered in broadcasting industry
Source: Gershon, R.A. 2001. Telecommunications Management. Industry Structures and
Planning Strategies. NJ: LEA, p. 12.
WHAT ARE THE ELEMENTS OF MARKET ACHIEVEMENT?.
The success of the industry is measured by comparing potential achievement in
four areas as in Figure 4.3.
4.4
The historic relationship between broadcasters and cable
television provides a good example. Between 1952 and 1977, U.S.
broadcasters and television/film supported a number of
regulatory measures designed to limit the growth of cable
television. In principle, broadcasters were concerned about
programme siphoning; that is the ability of the cable industry to
siphon programming intended for broadcast use. Broadcasters
were concerned that cable programmers would feature the said
programming on cable and thereby fragment the viewing
audience and inflate the cost of programme acquisition.
How do the price determination policy, quality control policy and
competitive policy affect television stations in Malaysia from the
aspect of their own programme production?
Figure 4.3: Success measures of an industry
4.4.1 Efficient Use of Resources
In an ideal situation, an industry is deemed to be efficient if it succeeds in getting
a high income using a given sum of resources. The industry is considered
successful if it can stabilise prices and product achievement by covering a large
number of customers. An efficient industry is able to provide products and
services to customers.
Supply and demand relationship explains the ratio between product turnover
and product costs.
To ensure success in the telecommunications industry, the management must be
efficient. For example, in ensuring there is no wastage in terms of unused
technical equipment. Old equipment should be replaced, updated or repaired.
Besides that, the management must take into account the human resource aspect,
which is sufficient and with no wastage taking place.
Make a brief research of the number of staff in the news room of two
local television stations. Mention the most visible aspects as a result of
your comparison.
4.4.2 Stability of Prices and Employment
Stability factor plays an important role in assisting the broadcasting industryÊs
success. When product prices rise, handling costs will also rise. This rise will
have an impact on advertising cost. Consequently, the rise in advertising costs
would help raise profitability of the station.
Employment patterns in the broadcasting industry are more stable compared to
product prices. We often hear about workers being dismissed, however, it is
obvious that the work force in this field is growing and expanding in total.
4.4.3 Fair Deal to All
At the early stage of broadcasting activities, females found it difficult to
participate in the broadcasting industry careers. However, time has changed the
scenario and we find there are increasingly more females involving themselves in
the broadcasting industry, while getting fairer deals from the employers.
Female involvement in the field is not only limited to the task of hosting
programmes but more of them are working behind the cameras either as
producers, directors or scriptwriters.
4.4.4 Growth and Planning
The last element used to measure telecommunications market success is growth
and planning. Planning is a critical aspect for the media manager in the
telecommunications technology industry and multimedia communication which
change frequently.
However, good planning will help the station to succeed. A media manager who
is able to plan well will ensure growth takes place by horizontal integration,
diversification and vertical integration.
(a) Horizontal Integration
Through horizontal integration, stations extend their influence to a wider
market. One local example is Sistem Televisyen (M) Berhad (TV3). At the
early stage of TV3Ês establishment, its programmes could only be viewed
by audiences in the Klang Valley. However, now after 20 years of
operations, TV3 programmes can be viewed by all people in Malaysia,
including Sabah and Sarawak.
(b) Diversification
Diversification is when the organisation expands its business to other
products related to the industry. In the United States, the larger television
stations such as CBS, expands its business to the music industry through
CBS Records. Even in our country, TV3Ês management attempted to
diversify its activities by expanding its wings and establishing the
subsidiary Grand Brilliance Sdn Bhd (now called Primeworks) to produce
films, handled by directors, scriptwriters, crew and actors as well as
marketing experts financed by the company itself.
Table 4.2 below shows an example on how General Electric Corporation
implemented the diversification principle.
Table 4.2: The Main Divisions of General Electric Corporation (1998)
Main Divisions of General Electric Corporation (1998)
Aircraft engines
Appliances
Capital services
Lighting
National Broadcasting Corp.(NBC)
Medical systems
Plastics
Power systems
Electric distribution and control
Motors and industrial systems
Information services
Transportation systems
Source: Gershon, R.A. 2001. Telecommunications Management. Industry Structures and
Planning Strategies. NJ: LEA, p. 19.
(c) Vertical Integration
Through vertical integration, the company widens its business from one
phase to another. For example, in the starting phase, the company focuses
its attention on the production of products. After succeeding in that and the
position is convincing, the company will concentrate on product
distribution.
Briefly, the planning aspect plays an important role in ensuring
organisational operations success particularly the operations of electronic
media station in the broadcasting industry. Failure of a station may occur
without good planning. This condition can be observed in the cable
television industry. The effect of bad planning has caused the cable
television station to fail. Below is an example of vertical integration as
explained by Gershon (2001).
Copyright © Open University Malaysia (OUM)
98 X TOPIC 4 TELECOMMUNICATIONS INDUSTRY STRUCTURE
Figure 4.4: An example of vertical integration
Source: Gershon, R.A. 2001. Telecommunications Management. Industry Structures and
Planning Strategies. NJ: LEA, p. 19-20.
LEVELS OF INDUSTRY DEVELOPMENT
The level of industry development shows four phases an industry goes through.
Figure 4.5: Levels of industry development
4.5.1 Level I: Introduction
At this level, consumers are sceptical of the products offered. Normally,
producers try to attract consumers by distributing product samples. At this level
also the industry activities are focused on research and development, that is,
carrying out research on various aspects. For example, before producing a
programme, a producer researches market trends, that is the viewing and
listening audienceÊs desires.
Stations must be sensitive to the wants and needs of their target audience. There
are various methods of research carried out such as observation and discussion
of focus groups. This method assists the stations to identify suitable products to
be offered to the audience.
Research is also closely related to the use of new equipment. Before the station
uses a new type of equipment, the management will carry out a research to
ensure that it will raise productivity.
4.5.2 Level II: Development
If the consumers give a sceptical reaction at the first level, the consumers will
begin to show interest towards the product at the next level. Producers will be
clever enough to ensure the products they produce have their own distinctive
special features. Producers will create a differentiating factor to make the
products looks different from the competitorsÊ products.
The same thing applies to telecommunications industry. Radio, television
stations and online media undergo their own level of development. Media
development clearly gives positive returns to the management which is sensitive
to the environment.
4.5.3 Level III: Maturity
Products existing at maturity level are already well known. Producers play the
role to ensure the products stay in the market. For that reason, producers will
raise marketing activities. Sometime this emphasis on marketing leads the
producers to ignore product quality.
4.5.4 Level IV: Decline
Products which have been long established in a market may undergo a decline.
Normally, the entry of a new competitor, which is more active, may affect
product acceptance in the market. In the broadcasting industry, the best example
is how well known television stations in the United States such as ABC, CBS and
NBC experienced pressure when Fox competed to capture audiences and was
able to raise its popularity in a brief period by offering programmes wanted by
the audience.
• This topic has discussed telecommunications market structure and elements
influencing telecommunications. Besides, discussions also focused on
different marketing practices in the telecommunications industry. The
telecommunications industry practises the oligopolistic system and this
condition lets the organisations control products and services offered to
consumers. However, the objectives of each organisation are still the same,
that is, to gain profit.
• In ensuring the achievement of the objectives, organisations will implement
various strategies such as widening broadcasting geographical scope,
establishing new companies in related transactions and implementing
vertical integration at the global level as a marketing strategy to multiply
profit.
Buyers Concentration
Competition
Elements Horizontal Integration
Vertical Integration
Market Achievement
Market Behaviour
Market Structure
Monopoly
Oligopoly
Sellers Concentration
Burns, J.M. (1978). Leadership. New York: Harper & Row.
Foster, E.S. (1978). Understanding Broadcasting. CA: Addison-Wesley Publishing
Co.
Gershon, R.A. (2001). Telecommunications Management. Industry Structures
and Planning Strategies. NJ: LEA.
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/Cable
and The New Technologies. NY: McGraw-Hill, Inc.
New York: McGraw-Hill.
* * *
TOPIC 5 MANAGEMENT OF EDUCATIONAL TV BROADCASTING
INTRODUCTION
Educational Television (ETV) is one of the television broadcasting industry's
participants in Malaysia. However, as a television station, the functions and roles
of ETV are very different from commercial television stations such as RTM2, TV3,
ntv7, ASTRO and MiTV. This topic aims at explaining ETV development in
Malaysia since it was established in 1972 till now.
ETV is subject to the authority of the Ministry of Education, Malaysia, while the
public broadcasting station is handled by the Ministry of Information, Malaysia,
and a privately owned broadcasting stations come under the authority of the
Ministry of Energy, Communications and Multimedia. Target audience and goals
of ETV are also different from those of publicly and privately owned stations.
This topic will focus on broadcasting management of Educational Television and
will not touch on educational radio organisation. This is because Educational
Radio service was terminated in December 1994 after operating for about 28
years.
TOPIC 5 MANAGEMENT OF EDUCATIONAL TV BROADCASTING
By the end of the topic, you should be able to:
1. Explain management patterns of Educational TV organisation;
2. Discuss the activities of Educational TV organisation;
3. Outline the need of non-commercial organisations such as ETV; and
4. Differentiating the aspects of media management and Educational TV
activities from other commercial television stations in Malaysia.
LEARNING OUTCOMES
BACKGROUND OF EDUCATIONAL TELEVISION (ETV).
If you stay in Tawau, Sabah or Saratok, Sarawak or Gua Musang, Kelantan (or
any location of your staying place), how do you watch Educational TV?
Educational Television (ETV) was introduced in 1972 together with the
establishment of Bahagian Perkhidmatan Sebaran Pendidikan (PSP), Ministry of
Education of Malaysia. Now PSP is known as the Educational Technology
Division (ETD). In general, the aim of establishing ETV was to give equitable and
quality educational opportunities to all schools through the television media.
Specific targets of ETV are the disadvantaged group of students who are largely
found in rural areas and in the hinterland.
ETV programmes were first broadcasted on TV2 in 1972, simultaneously with the
official launching by the second Prime Minister of Malaysia, that is, the late Tun
Abdul Razak Hussein. Since its launch 30 years ago, ETV has undergone several
changes as a result of:
(a) Changes in broadcasting and educational policies;
(b) Rapid development in information technology and communication; and
(c) Changes taking place in social and organisational environment.
What remains fixed and unchanged is ETV targetÊs audience. Refer to Table 5.1 to
see the total target audience for the year 2004.
Table 5.1: Educational TV Target Audience, 2004
ETV Specific Total Target Audience
Targets Students Teachers
Total
Schools/Colleges
Primary Schools 3,044,797 179,622 7557
Secondary Schools 2,093,645 130,372 1962
Teachers Colleges ă ă 23
Source: Policy Planning and Educational Research Division, December 2004.
Programmes broadcasted on ETV are bought from private companies or
produced by joint ventures between ETV and outside parties. ETV produced
approximately 48 specific programmes for the use of urban and rural schools in
Malaysia. Besides that, there are 88 programmes with general audience as the
target audience.
(Source: Five Year Strategic Planning, Educational TV Sector, 2003).
5.1.1 Vision and Mission of ETV
What is ETV vision?
What is ETVÊs Mission?
5.1.2 ETV Objectives
ETV objectives are as follows:
ETV vision is to make television the main media in teaching and learning and
ETV programmes can be used by all schools effectively.
ETV's mission is to produce ETV programmes of high quality and the best in
the educational field.
Acting as one of the main agents in
implementing educational system
and social changes
Serving as a channel for
distributing Ministry of
Education of MalaysiaÂs
information
Producing and acquiring attractive,
simple and relevant educational TV Developing and improving programmes studentsÊ achievement in
knowledge and skill aspects
Improving teachersÊ level
of professionalism Enriching schools, TeachersÊ
Colleges, State Educational
Resource Centres and Teachers
Activity Centres with teaching
and learning resources in the
forms of video and CD as
reference materials
Raising parentsÊ and society's knowledge about directions,
policies and fulfillment of the education system in Malaysia.
EFFECTS OF CHANGES IN BROADCASTING POLICY.
ETV is subject not only to legal rules and controls of the Ministry of Education of
Malaysia but must also take into account the requirements of the Ministry of
Information and the decisions of the MinistersÊ Council as a whole. These legal
agencies and controls clearly influenced ETV development from 1972 till now.
Table 5.2 shows the development of ETV in terms of total broadcasting time for a
day and a week. For about 27 years (1972 till 1998), ETV broadcasted for four
days at certain time on RTM2. However, since January 1999, RTM no longer
broadcasts ETV through RTM2 channel because (till the time this module was
prepared) RTM was still implementing its organisational corporatisation policy.
Table 5.2: Development of ETV
Year Total Broadcast
Time a Day
Total Broadcasting
Time in a Week Day of Broadcast
1972 ă 1992 8hours 32 hours Monday-Thursday
1992 ă Oct 1997 7 hours 28 hours Monday-Thursday
Nov 1997 ă May 1998 5 hours 20 hours Monday-Thursday
Jun 1998 ă Dec1999 4 hours 16 hours Monday-Thursday
Jan 2000 ă Dec 2004 4 hours 16 hours Monday-Thursday
Due to changes in RTMÊs policy, ETV had to find other channels to broadcast its
programmes to the target audience. Table 5.2 clearly shows reduction in ETV
broadcasting time from eight hours a day (1972 till 1992) to 4 hours a day in 2004.
Therefore, the Ministry of Education of Malaysia sent the Minister of EducationÊs
memorandum No: 508/2186/99 to MinistersÊ Council on 1 September 1999. As a
result, the MinistersÊ Council meeting agreed that after December 1999, ETV
should be channelled through private broadcasting stations using satellite
broadcasts, i.e. ASTRO.
With the change in broadcasting policy, Educational TV organisations were given
new conditions as follows:
(a) To produce programmes conforming to international broadcasting
standards [See sub topic 7.3 (b)];
(b) Ensure quality audio, video and programme contents so that they can
attract viewersÊ interests;
(c) Ensure existence of high quality research elements in each of its
presentations;
(d) To improve programme quality in accordance with total broadcasting time
so that repetitions of broadcasting are not too frequent;
(e) To produce quality Educational TV programmes.
In the efforts to improve production quality, Educational TV sector has given
focus and attention to the following matters in the period of five years (2003 till
2007), that is:
(a) Organisational structure;
(b) Establishment;
(c) Types of programmes and acquisitions;
(d) Programme evaluation;
(e) Training and human resource development;
(f) Equipment and facilities.
ORGANISATIONAL STRUCTURE
Educational TV was established under the Educational Technology Division
(ETD) of the Ministry of Education. ETV tasks are handled by two sectors, that is:
(a) Educational TV Sector; and
(b) Engineering Service Sector.
5.3.1 Educational TV Sector
This sector is responsible to ensure TV programmes conform to the following:
(a) Curriculum requirements in terms of content (knowledge, skill and value); and
(b) Academic requirements (thinking and creative skills as well as teaching and
learning which is attractive to student interests).
5.3.2 Engineering Service Sector
This sector is responsible for handling shooting tasks, maintenance of equipment
and contacts with ASTRO, RTM and Telecommunications Department of
Malaysia.
Both sectors of Educational TV and Engineering Service are responsible to ensure
that Educational TV programmes broadcasted through ASTRO conforms to
international standards of broadcasting.
Organisational structure of ETV is different from administrative management of
other divisions in the Ministry of Education. It has its own work structure
enabling it to operate smartly and is guided by a systematic work flow. New
organisational structure does not show tasks hierarchy and work quality control
as in the organisational structure at the early stage of Educational TV
establishment (see Figure 5.1). On the other hand, the old organisational structure
is more organised as practiced in the management of TV organisation at other TV
stations.
Organisational structure of Educational TV is as in Figure 5.1 (before 1999) and
Figure 5.2 (after 1999):
Figure 5.1: Organisational structure of educational TV, 1991
Figure 5.2: Organisational structure of educational TV, 2003
Figure 5.2 outlines the roles of the Principal Assistant Director and Television
Coordinator in all matters regarding operations management, finance and
programme products. On the other hand, the old organisational structure (Figure
5.1) looks more organised, as similarly practiced in Television Organisational
Management in other television stations.
Organisational structure before 1999 (Figure 5.2) was managed by a Principal
Assistant Director who was assisted by three coordinators (senior producers). A
senior producer manages operational matters, i.e. about sets and props, tapes
library, make up artists, and general workers. All these are related to matters of
support that help production to work well. The other senior producer manages
programme production operational matters, shooting activities, programme
production assistants (SA), stage and music managers. The tasks of a senior
producer include managing graphics, photography and the shots stock archive
system, i.e. selected pictures for storage and use (repeat show) in programmes.
This senior producer is also responsible for finance of TV sector in terms of
budget and programme selection.
ESTABLISHMENT
The Educational TV Production Team consists of several crew members
including the following:
(a) Producer;
(b) Script Assistant;
(c) Cameraman;
(d) Audio technician;
(e) Lighting Technician;
(f) Editor;
(g) Production Technician;
(h) Video System Technician and Camera Control Unit;
(i) Video Mixer;
(j) Graphic Designer;
(k) Make Up Artist
(l) Photographer;
(m) Set Maker; and
(n) Music Supervisor.
5.4.1 Producer
The producer is responsible for the following tasks:
(a) Producing various ETV programmes based on curriculum, general
programmes, educational news and interludes either for direct telecast or
recording;
(b) Carrying out needs research and preparing concept papers for programme
series;
(c) Attending preparation panel meetings and scriptwritersÊ briefing;
(d) Examining and working on scripts to make production scripts;
(e) Writing own script for camera script;
(f) Identifying, screen testing and training qualified artists to take part,
determine clothing, make up, set and props;
(g) Holding production meetings with officers and staff involved so that they
can contact outsiders and individuals to get their cooperation to ensure the
success of a programme.
(h) Leading a shooting team and be responsible to each member of the external
shoot team;
(i) Doing his own reconnaissance of surroundings and conditions of the place
or location of shoot;
(j) Holding external shoot meetings;
(k) Doing sufficient rehearsals before external/studio shooting;
(l) Carrying out directing of external and in studio shoots;
(m) Attending preview of a programme before it is broadcasted;
(n) Responsible to improve previewed programmes to upgrade programme quality;
(o) Determining artists/scriptwriters payment involved according to treasury
approvals;
(p) Preparing programme production reports; and
(q) Carrying out tasks issued from time to time.
5.4.2 Script Assistant
Script assistantÊs tasks in general include:
(a) Typing original scripts and camera scripts;
(b) Typing and distributing production meeting invitation letters;
(c) Attending programme production meeting and preparing necessary notes
in terms of programme production;
(d) Ordering for shoot production, transport, make up artists, props, set, still
photo, graphics, studio, production and recording for direct telecast;
(e) Typing permission letters for artists and location shoots;
(f) Getting and carrying tapes to location shoots;
(g) Accompanying team at the location shoot and studio to assist in ensuring
continuity;
(h) Preparing continuity sheet for video editing;
(i) Making orders for editing room, follow-up production and recording; and
(j) Carrying out tasks issued from time to time.
5.4.3 Cameraman
The cameraman is responsible for the following tasks:
(a) Handling Single Camera Production (SCP) and Multiple Camera
Production (MCP) for ETV programme production and news coverage in
studio and out of studio together with Programme Producer including
providing technical services;
(b) To create moods through lighting techniques and creativity or camera tricks
in producing quality visuals for ETV programmes;
(c) Ensuring quality of lighting and shooting techniques of a recording and
coverage of ETV programme to achieve broadcasting standards;
(d) Carrying out maintenance jobs and testing of equipment under his care so
that they are always in good order;
(e) Attending preview after completion of shooting.
5.4.4 Audio Technician
An audio technician is responsible for the following duties:
(a) Handling audio equipment during recording and direct telecast of ETV
programmes in and out of studio;
(b) Designing techniques of using microphone to suit recording location and
direct telecast of ETV programmes;
(c) Ensuring audio quality always conforms to the specified broadcasting standards;
(d) Making installation of radio equipment and testing the system in order to
record the audio properly;
(e) Attending previews of ETV programmes before being edited to identify
audio quality according to broadcasting standards;
(f) Attending preview sessions of ETV programmes, which have been edited,
to identify audio quality according to broadcasting standards before the
programmes are broadcasted; and
(g) Giving views to the producer from the aspect of audio equipment usage
techniques to suit them to programmes being recorded.
5.4.5 Lighting Technician
The tasks and responsibilities of the lighting system technician are as follows:
(a) Handling lighting equipment for production of ETV programmes in and
out of studio;
(b) Designing lighting to suit the forms of an ETV programmes in and out of
studio;
(c) Determining that lighting equipment is always functioning well and safe to use;
(d) Ensuring lighting quality conforms to broadcasting;
(e) Doing reconnaissance together with technical producer at specified
locations to determine lighting system positions before recording is carried
out;
(f) Attending preview of edited ETV programmes to identify that lighting
quality always conforms to broadcasting standards;
(g) Making sure installation of lighting equipment before rehearsal and
recording is carried out; and
(h) Giving views to producer and set designer on use of set materials and
artists clothing colour to get the right lighting quality that exactly conforms
to broadcasting standards.
5.4.6 Editor
The editor is responsible for the following tasks:
(a) Accepting edit list and materials for editing as well as scripts from producer;
(b) Viewing materials selected by a producer;
(c) Selecting visuals according to series;
(d) Compiling visuals according to script and creativity;
(e) Editing;
(f) Always discussing with the producer during editing process;
(g) Ensuring quality of audio and video conforms to broadcasting standards;
(h) Attending preview sessions;
(i) Making corrections based on preview;
(j) Compiling and arranging effects according to producerÊs wishes;
(k) Preparing broadcasting tapes according to broadcasting standards; and
(l) Making reports when damage occurs.
5.4.7 Technical Producer
The tasks and responsibilities of a technical producer are as follows:
(a) Organising work flow of technicians and staff under his care before and
during recording in and out of the studio;
(b) Ensuring audio and video systems are working well during recording and
also determining quality of audio and video conforms to specified
broadcasting standards;
(c) Doing reconnaissance together with the producer to selected locations to
determine camera position, audio system, lighting and electric power
supply for recording coverage using Multiple Camera Production (MCP);
(d) Ensuring all recording equipment requirements are sufficient and
functioning well according to recording and broadcasting order;
(e) Supervising technicians and staff tasks under his care while recording and
direct telecasts are being carried out;
(f) Giving views to the producer before and during recording, relating to
technical matters especially camera work, lighting, audio and audio mixing
technique; and
(g) Attending previews of edited ETV programmes to identify production
quality especially from technical aspects before broadcasting.
5.4.8 Video System and Camera Control Unit (CCU)
Technician
Video system and camera control unit (CCU) technicians are responsible for the
following tasks:
(a) Installing of video system equipment for ETV programmes in and out of
studio before recording is made;
(b) Testing equipment so that the system can function well;
(c) Determining video system functions well conforming to broadcasting
standards;
(d) Giving technical views to the technical producer about the use of recording
equipment needed in and out of studio either for recording or direct
telecast;
(e) Handling camera control unit (CCU) equipment during recording or direct
telecast in and out of studio;
(f) Determining the source of video signal has a satisfactory quality
conforming to specified standards; and
(g) Attending preview of edited ETV programmes to identify video quality is
at a high level according to broadcasting standards.
5.4.9 Video Mixer
The tasks and responsibilities of a video mixer are as follows:
(a) Handling video mixer equipment for ETV recording and direct telecast;
(b) Mixing video sources from various sources to make a good video picture
before being recorded;
(c) Designing effects available in the equipment to use as material for
improving ETV programmes; and
(d) Giving views to the producer on the use of video mixing equipment.
5.4.10 Graphic Designer
The tasks and responsibilities of a graphic designer are as follows:
(a) Giving ideas, designing and producing graphic and animation materials for
ETV programme production, namely:
(i) illustrations, diagrams, charts and maps
(ii) electronic graphics using caption generator
(iii) printed caption for labelling
(iv) sequence animation
(v) calligraphy
(vi) models, dolls and special effects
(vii) artistic elements for set construction
(b) Giving ideas and producing cover graphics design and layout for desktop
publishing:
(i) preparing layout work for production of books, brochures, flyers,
posters, leaflets and banners
(ii) preparing slides layout for presentations using LCD projector
(iii) preparing book cover design, VHS and CD boxes
(c) Contributing ideas, designing set model or backdrop and supervising
graphic works and artistic elements for studio, auditorium and external
shooting needs;
(d) Improving mastery and preparation about techniques and production of
graphic design, layout, animation, computer graphic and TV graphic
production techniques using multimedia; and
(e) Managing and maintaining equipment in the control of Design and Staging
Unit.
5.4.11 Make Up Artists
The tasks of a make up artist are as follows:
(a) Preparing sufficient, safe and comfortable make up sets by artists for
recording programmes in and out of studio and external shooting;
(b) Providing make up services to artists of an ETV either for a
recording/direct telecast in studio or at a location;
(c) Maintaining make-up rooms and make up material and equipment;
(d) Keeping records of inventory of make-up materials, equipment and clothing;
(e) Maintaining cleanliness and safety of make up rooms;
(f) Preparing requisition and recording wardrobe and suitable artists and actors;
(g) Maintaining wardrobe; and
(h) Making clothing selections for wardrobes, and suitable artists or actors.
5.4.12 Photographer
A photographer is responsible in handling the following:
(a) Planning activities of photographing for ETV sector and the whole ETD;
(b) Handling the process of producing photographs for the purposes of the
production of ETV programme, multimedia, leaflets, posters and others;
(c) Making efforts for storage and systematic records;
(d) Evaluating photographic works in terms of quality, suitability and effectiveness;
(e) Participating in external and in studio shooting activities with the objective
of recording a suitable scene for producing TeachersÊ Guide Book;
(f) Making inspection and evaluation of photographic equipment;
(g) Maintaining photographic room; and
(h) Checking stocks of equipment and tools and making orders or making
replacements etc.
5.4.13 Set Maker
The tasks and responsibilities of the maker of set and props are as follows:
(a) Making and preparing of set and props ordered by the producer for an ETV
programme;
(b) Designing and installing attractive, smart and quality sets for the use of TV
programmes;
(c) Taking care of equipment and machines at the workshop;
(d) Preparing costume and props ordered by the producer;
(e) Overhauling reused sets; and
(f) Making sets for orders by all sectors in ETD and other divisions of the
Ministry of Education for official purposes.
5.4.14 Music Supervisor
The music supervisor is responsible for:
(a) Discussing with the producer regarding required music;
(b) Creating, compiling and arranging the required music;
(c) Determining production work force;
(d) Training musicians and singers;
(e) Ensuring music recording runs well and according to broadcasting standards;
(f) Recording the form of CD to be submitted to the producer; and
(g) Attending master edit to ensure suitability of music arrangements.
EDUCATIONAL TV PROGRAMME
At the moment, broadcasted Educational TV programmes are the result of three
parties, which are:
(a) ETV;
(b) Joint venture of ETV and private companies; and
(c) Purchased from a supplier of syndicated programmes.
During the period of 2003-2007, the ETV Sector continued to acquire programmes
as practised then to fulfil the programme schedules which cannot be fulfilled
with programmes produced by ETV itself.
5.5.1 Previews
Specific previews are made by the control panel before programmes are
broadcasted. Its purpose is to study the programme suitability with target
viewers in local socio-cultural context. Usually all TV, film and advertising
programmes are previewed either by production firms or a government
censorship board.
Previews carried out by producers are based on technical studies and target
viewersÊ interests. Previews made by the Film Censorship Board (Lembaga
Previews can be briefly defined as a process to control programme quality
before being broadcasted for public viewing.
1. State two main objectives of Educational TV.
2. Explain briefly the tasks and roles of a producer.
3. Give three tasks of an assistant programme producer (SA) in
ensuring a well-run shooting process.
4. How can a graphic designer assist in a programme production?
5. Make a list of the tasks of a music supervisor.
6. How should the tasks of an editor be carried out?
Penapisan Filem or LPF) looks at the suitability of the programmes with socio-
cultural and religious aspects.
5.5.2 Educational TV Programmes Review
For Educational TV, previews are made after the post-production process is
completed. The producer will get a suitable date and time from the preview panel
chairman for a preview session. In this session, programme suitability is
reviewed in terms of content and quality of production to conform to
international broadcasting standards. The preview panel will decide whether the
programme is approved for broadcast, proposed for amendment or totally
rejected.
5.5.3 Where is a preview made?
In your mind, where is a preview usually made? It is usually made in the ETV
preview room, equipped with special equipment such as quality sound system,
big screen and a TV monitor installed to detect audio and visual to conform to
broadcasting standards.
5.5.4 Preview Committee
The evaluation Committee will only evaluate completed programmes (Broadcast
Copy) to be shown to the public. When the date and time is fixed, invitation
letters are circulated by the programme production assistant (SA) to preview
evaluating panel chaired by ETD Director.
5.5.5 What Subjects are evaluated?
In the preview process, evaluation forms distributed to evaluators are divided
into two aspects.
Figure 5.3: Two aspects evaluated in a preview process
(a) Programme Content Aspect
Content aspect is divided into several subjects. Refer Figure 5.4.
Figure 5.4: Subjects evaluated in programme content aspect
(i) Programme Introduction
Programme introduction is the broadcasted content after the montage.
Normally, the content which is broadcasted in the first five minutes is
evaluated in terms of appeal and programme content suitability.
(ii) Programme Development
It refers to the way to develop a narration whether it is attractive
(appealing) and has continuity or whether the narration is in
chronological order or based on other techniques suitable with the
topic and target viewers.
(iii) Programme Content
Programme content is evaluated based on its suitability with the
requirements of the educational syllabus and whether it contains
appropriate research and correct facts.
(iv) Dialogue
Evaluation is made based on suitability of language used in the
programme whether it is overdone, natural, stiff, too constrained by
script/dialogue memorising etc.
(v) Demonstration and Experiment (If Any);
Science, Mathematics, Vocational and Technical programmes
sometimes need experiments and demonstrations. Suitability of
experiments and demonstrations is determined in terms of process
and equipment suitability.
(vi) Public Comments on Programme Content
Public comments, in terms of content and presentation, are also taken
into account.
(b) Technical Aspects
Technical aspects are divided into eight subjects. Refer Figure 5.5.
Figure 5.5: Subjects evaluated in the technical aspect
(i) Camera Handling
Shots taken must be suitable for showing, i.e. non-vibrating picture
(steady shot) etc. From the continuity aspect, a good shot has no jump
shot, red visual or over exposure.
(ii) Visual Quality
It must be synchronised with the demand of script content. For
example, there are close-ups, mid-shots etc. It must not also be soft-
focus and must be clear for viewing. A high visual resolution must
not have any error. A good visual quality is as follows:
• Clear, bright and conforming to broadcasting standard.
• Not jumpy.
• Has a good continuity etc.
(iii) Editing Quality
There is continuity of story, there is no jump shot, insert, appropriate
pictures and use of attractive and suitable visual effect. Audio mix is
also evaluated following broadcasting standards.
(iv) Quality of Graphic Art/Set
Graphic writing may use graphics that can be read from a reasonable
distance. Animation/illustration is made well and clear. Attractive set
and props, as well as appropriate colour scheme that fits with
programme presentation.
(v) Lighting Quality
Precise lighting, not soft-focus, appropriate with the presented scene.
There is no electronic effect, white wash etc.
(vi) Quality of Sound Effect and Dialogue
Using natural, clear and suitable sound effect, consistent with the
object being shot and correct sound perspective.
(vii) Music Quality
Using background music, or a music that is suitable with visuals to
bring out the right mood.
(viii) Overall Technical Quality
Overall comments on technicality are whether it is qualified for
broadcasting/conforms technical aspect. If improvement is needed, it
must be noted precisely.
SUPPORTING MATERIALS/HAND-OUT
NOTES THAT MUST BE PREPARED
DURING EVALUATION SESSIONS
There are five supporting materials/hand-out notes that must be prepared
during the evaluation session. Refer Figure 5.6 and Table 5.3.
Select an Educational TV programme. In your view, what is the
difference between the ETV programme broadcast and those of RTM or TV3?
Figure 5.6: Circulation materials during evaluation sessions
Table 5.3: Supporting Material/Circulation that Must be
Prepared during Evaluation Sessions
Supporting Materials Explanation
Programme Synopsis Programme synopsis is prepared by the producer
and circulated to committee members to get input or
early ideas on the programme.
TeachersÊ Guide TeachersÊ guide is prepared by the scriptwriter after
programme is ready. Usually, teachersÊ guide is
circulated during preview for the evaluation panel to
see programme objectives, suitability and activity
before and after questions, as well as for teachersÊ
guide at schools.
Evaluation Forms Evaluation forms are distributed to all in the panel to
be filled in full as a reference material and proof of a
programme approval.
Attendance Log Book This book is noted as a proof for invited members to
contribute ideas and improving television
programmes quality. This book is revised and signed
by the Principal Assistant Director.
Preview Process During the preview process, programmes are shown
fully for evaluation viewing by committee members.
After viewing the whole programmes, reactions,
comments and views are provided to officers and
then discussions are made. All panel members will
fill in evaluation forms.
Discussions must be noted by programme
production assistant (SA). List of comments and
views of panel members will be taken account of by
the producer to improve the programmes following
chairman's decisions. Programmes will be packaged
for broadcasting.
USE OF EDUCATIONAL TV IN SCHOOLS.
Can teaching and learning technology in schools be used by the audience as a
substitute for teachers?
Educational TV programmes are teaching aids that can help teachers handle
teaching and learning in schools, but not replace teachers.
5.7.1 Use of Educational TV in Teaching and Learning
Schools which have been supplied with TV Satellite equipment must fully use the
Educational TV package provided. Among the things that schools must give
priorities in planning the use of ETV are:
(a) Schedule of Usage
Programme coordinator of ETV programmes must prepare an efficient
schedule of usage of the ETV in the school. The best measure is to include it
5.7
1. Why must Educational TV be previewed?
2. State the preparation that must be done before having a preview.
3. Explain how the preview process is carried out?
4. What is the importance of a log book in TV production? Explain.
in the learning timetable. If the schedule cannot be implemented, the
teacher must prepare a separate schedule.
(b) Viewing Room or Space
A special room or space must be provided by the school to be used as a
place for watching ETV. In most schools, this room is called Viewing Room
or Media Room. The teacher who manages this room must ensure several
things, that is:
(i) Students' comfort during viewing;
(ii) Proper position of the TV, i.e. not too low or too high; and
(iii) Minimum outside interference.
(c) TeachersÊ Functions
The teacher who takes their students to watch an ETV programme, plays an
essential role before, during and after the show. Based on Use of
Educational TV Programme Guide Book, the teacher concerned should:
(i) Prepare activities before viewing;
(ii) The aim is to stimulate students' thinking;
(iii) Be present and watch a programme in viewing room together with
students; and
(iv) Carry out appropriate activities after viewing.
5.7.2 Educational TV Supporting Materials
Educational TV Sector produces three main supporting materials to aid teachers
in using programmes. The materials are as shown in Figure 5.7.
Figure 5.7: Educational TV supporting materials
(a) Educational TV Programme Schedule
Functioning as a reference for programme topics, date and time of ETV
programmes broadcast.
(b) Educational TV Programme Usage Guide Book
Serves to facilitate teachers following ETV programmes. It contains
programme synopsis, activities before and after viewing, questions, lyrics
and examples of graphic compiler of Critical and Creative Thinking Skills
(CCTS) related to programme content.
(c) Catalogue
Functions as reference material for teachers to order programmes. It
contains programme synopsis, time period and reference number.
5.7.3 Usage of Log Book
The school must prepare a log book to record time and programmes watched.
This record also has a column for the teacher to give comments on the content
and development of the programme. This usage log book is also meant to give
data to ETD, State Educational Resource Centre, and TeachersÊ Activity Centre,
when monitoring is carried out.
5.7.4 The Roles of State Educational Resource Centre
(SERC) and Teachers’ Activity Centre (TAC)
The Roles of State Educational Resource Centre (SERC) and TeachersÊ Activity
Centre (TAC).
(a) The Roles of SERC
(i) Coordinating, monitoring, and assisting schools in using ETV
programmes and technical works at the State level;
(ii) Training resource teachers on the ways of using ETV programmes.
(b) The Roles of TAC
(i) Coordinating, monitoring, and assisting schools in using ETV
programmes and technical works TAC level.
(ii) Training resource teachers on the way of using ETV programmes in
teaching and learning; and
(iii) Giving advisory service to media teachers in technical aspects on the
use of Satellite TV equipment.
Copyright © Open University Malaysia (OUM)
126 X TOPIC 5 MANAGEMENT OF EDUCATIONAL TV BROADCASTING
5.7.5 Monitoring in Schools
Monitoring is a process of evaluation carried out by Educational Technology
Division and other divisions of the Ministry of Education in schools to evaluate
the ETV.
(a) What is Monitoring?
Evaluation of ETV programmes is based on three aspects as follows:
(i) Its usage in schools;
(ii) Its effectiveness in teaching and learning; and
(iii) Strength and weakness of a programme.
With the feedback received from the field, efforts will be made to revise and
improve further ETV programmes.
USE OF SATELLITE TV
5.8.1 Satellite TV Equipment Supplied to Schools
Primary and secondary schools in Peninsular Malaysia, Sabah and Sarawak, have
been supplied with Satellite TV equipment. Refer Figure 5.8.
Figure 5.8: Satellite TV equipment supplied to schools
5.8.2 Troubleshooting
If the schools face any technical problems in using Satellite TV or have lost the
Smart Card, they can contact the nearest Satellite TV Customer Service Centre.
The school is required to state the account number, and problem faced. The
school is also required to inform their TAC or SERC of the problem and action
taken.
5.8.3 Educational TV Broadcasting Time
ETV broadcasting time is four days a week (Mondays to Thursdays) for four
hours a day from 9am till 1pm and its repeat show from 1pm till 5pm.
THE FUTURE OF EDUCATIONAL TV
In the efforts to improve quality of work in programme production, ETV needs to
follow the organisational structure of actual television stations, be they local or
overseas, organise work processes and productivity in keeping abreast with
current situations.
(a) The ETV Sector must be led by a Principal Assistant Director, assisted by
senior producers who handle specific matters such as:
(i) Acquiring scripts, organising script writing course, programme
content research and management of TV tapes and stock shots library;
5.9
1. What is the function of the Educational TV coordinating teacher
in schools?
2. How can the Educational TV Usage Guide Book help in teaching
and learning?
3. What is the TV Satellite equipment supplied to schools?
4. If school A has lost its Smart Card, what is the action that must
be taken by the school?
(ii) Managing TV programme production operations including
programme production crew; and
(iii) Managing graphics, set and props, photographer, set maker,
laboratory and printed publication of TV Sector.
(b) To organise and improve management quality and ETV programme
production, ETV must create again the three TV coordinator posts (senior
producers) in the organisation structure so that financial and operational
matters can be managed in a more organised manner.
(c) The total number of producers is insufficient to handle production of all
basic educational subjects. For now, there are only producer posts for
Malay, English, Islamic Education, Science, Mathematics, Technical and
Vocational, Moral Education and Preschool. In other words, the existing
producer posts do not cover all producer posts for secondary and primary
schools, especially producers for Technical and Vocational, primary Islamic
Education and secondary Mathematics and Programme Producer for Form
6. Therefore, the programme producer posts must be increased to cover all
core subjects of Form 6.
(d) The assistant producer posts must be available to assist the producers to
bring out quality programmes on par with external programme production.
In this case, all TV programme productions overseas are assisted by
assistant producers to ensure programme production runs smoothly as
scheduled. The tasks of an assistant producer is to get suitable artists
identify location for shooting purposes, managing artists at location,
making artist casting suitable with scripts, observing continuity in a scene
and act as recording manager in studio and at external locations.
(e) Vacancies of various posts must be filled immediately in the Educational TV
Sector. If there is no qualified candidate in the near future, employment of
part-time workers must be done in order to ensure sufficient numbers and
programme production quality is not compromised.
(f) Production work often requires installation and loading of props and
shooting equipment in the studio or at location. Therefore, establishment
structures must take into account general workers to help in these tasks.
(g) Subject supervisors are needed to control programme quality in order to
conform to curriculum and academic. These supervisors are responsible for
managing workshops producing scripts and to supply approved scripts to
the production side to be produced. Officers in this unit must be taken from
among expert teachers who are already skilled in the subject being taught.
(h) For supervising a more stable programme production and geared towards
creation of higher quality programmes, several supervisors must be placed
again in the programme production sector as practised in all broadcasting
stations. Talent and arts group has nothing to do with engineering works.
They are more inclined towards producing arts production and trained
specially for the field of producing quality programmes. Ideas and
discussion of this group are more towards programme production and not
technical aspects. The views and ideas of the group should be combined
with the producer to produce quality programmes.
FINANCIAL MANAGEMENT OF EDUCATIONAL TV PROGRAMME
Low rate of payment for professional services has in a way affected Educational
TV programme production process. This is because the payment offered does not
attract talented artists, researchers and scriptwriters to give their services. This
has caused rather low quality of ETV programmes and fails to attract studentsÊ
interest to watch them. Therefore, in order to avoid such a situation, a review of
the payment needs to be done based on the following:
(a) The existing rate of payment is rather low compared to the price increase
for daily essential goods and other service payments;
(b) There are not many talented artists interested to take part in Educational TV
programmes, because of a payment which does not commensurate with the
efforts and time of their services;
(c) The difficulty of getting a professional actor because the existing payment is
not attractive compared to what is offered by other commercial TV stations.
(d) There are several talented actors and announcers in ETV who moved to
other commercial TV station having received a more attractive offer.
(e) Scriptwriters are not so interested in producing scripts for ETV because of
the low payment offered.
(f) A payment of RM100.00 is not reasonable for a researcherÊs work, who has
not only to buy reference materials, but also has to go the places,
institutions and locations where he can find the information or materials.
(g) The last revision of rate of payment for professional services for ETV was
made in 1994.
The revision of rate of payment for professional services for ETV programmes
was made more than 10 years ago. The rate is no longer appropriate with current
conditions. Therefore, a more viable rate of payment in handling customersÊ
needs must be prepared.
• This topic analyses the development of Educational Television (ETV)
organisation, being one of the participants in the television broadcasting
industry in Malaysia. ETV is fully financed by the government specially to
meet target audience requirements in primary and secondary schools as well
as teacher colleges in the whole country. ETV is different from other
terrestrial television because it is non-commercial. However, programme
production process is carried out by the Ministry of Education work force,
bound by policies and rules of national education. At the same time, the work
force still has to face creative work pressures as being faced by a production
crew working for commercial stations.
• In terms of establishment, the ETV work force is bound by service terms of
the Ministry of Education. However, in terms of tasks and operations, ETV
production division performs creative jobs similar to those of existing public
and private televisions. ETV management is closely tied to the bureaucracy of
public organisation but to ensure an excellent future of ETV and meeting
audience requirements, new strategies need to be considered so that ETV can
be viable and competitive with existing TV stations in Malaysia.
Educational Television
Educational TV Programme
Monitoring
Pedagogy
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/Cable
and The New Technologies. (2nd ed.). NY: McGraw-Hill, Inc.
* * *
TOPIC 6 MARKETING AND SALES MANAGEMENT
INTRODUCTION
In the current situation of global economy, the telecommunications industry
emerges as a field to integrate various elements such as entertainment, information
and communication services. Information dissemination is implemented through
various distribution media.
Chan-Olmsted & Gershon (2001) listed several current information distribution
channels such as the use of broadband, traditional broadcasting, cable television,
telephone, Internet, wireless communications and satellite.
There are various changes taking place in the telecommunications sector and these
developments also change the telecommunications landscape. Besides that, the
changes taking place in information and entertainment aspects are also shaping a
new face in the broadcasting world. For example, production of television reality
programmes broadcasted in large numbers currently combines traditional
production with the use of new media, such as the cellphone.
TOPIC 6 MARKETING AND SALES MANAGEMENT
By the end of the topic, you should be able to:
1. Identify elements influencing media sales such as the advertisers and
advertising agencies;
2. Discuss four advertising rating methods practised by television
stations; and
3. Identify marketing promotional activities which are frequently carried
out by radio and television stations.
LEARNING OUTCOMES
This development shows the active involvement of the audience and raises the
advertising income of the television station. Improvement in advertising income
means an increase in the station's income.
This topic will discuss the marketing and sales process related to the broadcasting
industry. Discussion is focused on marketing and advertising elements.
BROADCASTING MARKETING
One aspect that differentiates between broadcasting industry transactions and other
industries is the aspect of the product being offered to the consumers and buyers
audience. The product meant here is an invisible product, a product that cannot be
valued or measured physically. On the other hand, the products involved in the
industry are products such as public taste, art or picture.
Sale of space in print media has visible characteristics, i.e. the advertiser can keep a
newspaper cutting or the magazine publishing the advertisement, but sale of airtime
cannot be seen as such. One unique quality about airtime sales is that if a time space
is not purchased by the advertiser, that space will be gone, lost and eliminated.
The product meant in the broadcasting industry is the sale of airtime. Even though
the time transaction does not have a physical characteristic that can be seen or held,
this does not mean the product has no special terms as in other visible products. For
media sales agents, they use a term called „spot‰. Time space or spot is measured
based on total advertisement broadcast time, i.e. 10 seconds, 15 seconds, 30 seconds
or 60 seconds for each sales unit.
In general, unsold time space for an advertisement is included in the inventory
similar to what is done to other unsold products stacked on the racks in
supermarkets.
A radio station broadcasts for 20 hours a day with an average of 10 advertisement
broadcasts per hour. This means, every day the station must broadcast two thousand
60 minute advertisements or four thousand 30 minute advertisements. Without the
sale of a spot, the station will suffer a loss of income. Therefore, usually the sale is
made in a package form. Allocation of spot packages are prepared by taking into
account the total broadcasted advertisement hours for periods of several weeks or
months.
Below is an example of a news report on the transaction positions of TV3 and 8TV
for six months ending 30 June 2004. TV3 and 8TV controlled 44 percent of the Adex
market, putting both stations far in front of their rivals in the industry.
INCREASE IN TV3, 8TV VIEWERS ATTRACTS ADVERTISERS
By Azli Ayob
MEDIA Prima Bhd (Media Prima) expects the increase in number of viewers for the two
television networks it owns, TV3 and 8TV will attract advertisers, simultaneously raising
advertising income (Adex) for the next financial year.
The Chief Financial Officer of Media Prima Group, Amrin Awaluddin, says, in the past
six months ending 30 June, TV3 and 8TV controls 44 percent of Adex market, putting
them far in front of their rivals in the industry. According to AC Nielsen study, in terms
of numbers, TV3 and 8TV collectively records 49 percent of total viewers for the period.
„Media Prima is satisfied at being able to maintain the percentage and the emergence of
pay TV including MiTV is expected not to affect the position,‰ he says.
He made the statement at a media conference announcing TV3 and 8TV programmes at
Seri Kembangan yesterday. Also present were Manager Brand Management Group
(Kumpulan Pengurusan Jenama), Sistem Televisyen Malaysia Berhad, Anthony Firdauz
Bujang and Chief Operating Officer of Operasi Metropolitan TV Sdn Bhd, Ahmad Izham
Omar.
Meanwhile, Anthony said, TV3Ês performance for the first six months of this year proved
continued confidence of advertisers in the station. „Our enthusiasm in broadcasting the
best programmes is the formula giving victory to the station,‰ he said. He said that, the
range of programmes for 2005 season beginning this October promised a combination of
new programmes produced locally and overseas to ensure viewersÊ loyalty.
Latest report by AC Nielsen also shows the success of TV3 achieving 18 of 20 top
positions in the chart for broadcasted popular programmes.
To ensure continuity of best achievement, Anthony said, TV3 will line up its own
production of new season English popular programmes, Explorace and Samarinda, a
new slot of Malay drama targeted at youngsters. "The new season will also witness the
emergence of English programme The Apprentice, starred by Donald Trump," he said.
Meanwhile, Ahmad Izham said, although it is still new in the local broadcasting world,
8TV succeeded in attracting target viewers, aged 15 to 34, who speak English in the urban
areas of Peninsula west coast.
"These encouraging figures are the results of 8TVefforts in a campaign to promote
internal antenna sponsored by Sen Heng which enabled 100,000 units to be sold in June
alone, he said.
Ahmad Izham said, in the past six months ending June, 8TV gained 9 percent of Adex
and confirmed it as advertisers' alternative option. He said 8TV will increase three more
broadcasting stations, two in Seremban and Melaka while the other one is exclusively for
viewers around Kuantan.
Figure 6.1: Newspaper extract on the increase of viewers of TV3 and 8TV
Source: Berita Harian, 29 Sept. 2004
Advertising concept began with Volney Palmer's initiative who acted as a salesman
for advertising space (Keshishoglou & Aquilia 2005). Now, the activity is taken over
by media planners who combine systematic calculation methods to buy time of
advertising broadcast through broadcasting media. At the early stages of advertising
industry development, names such as N.W.Ayer & Son, J. Walter Thompson and
others are the agencies who explored the advertising industry. At present, big names
such as McCann-Erickson, Young & Rubicam, Ogilvy & Mather and others are
among well known international advertising agencies.
Changes taking place in the advertising industry leave effects on the functions of
advertising agencies. Although advertisers have wide opportunities to broadcast
messages about their own products or services, each broadcast is subject to
advertising codes of ethics.
Based on monitoring by Zenith Optimedia (2005), advertising expenses in Malaysia
show an increase of five percent in the first quarter of 2005. It was found that five top
categories which contributed to the increase were the interactive service of mobile
phones, mobile telephone lines service, housing estates, government institutions and
airline companies. Telecommunications industry continued to drive up local
advertising expenses. Turnover value was expected to reach RM5 billion for the year
2005, making the advertising industry an important contributor to national
economy.
ADVERTISERS, AGENCIES, STATIONS, STATION AGENTS AND MEDIA PLANNERS.
6.2.1 Advertisers
Advertisers are the main players who supply advertising financial resources.
6.2
What do you understand by the underlined words in the newspaper
extract on the previous page (See Figure 6.1)?
ACTIVITY 6.1
Advertisers refers to organisations which spend for investment purposes by
using media with the objectives of promoting products produced or services
rendered.
Advertisers may also produce products or render services (Belch & Belch 2001).
Among local names which are large advertisers are Celcom, Petronas, Malaysia
Airlines and others, while the large international advertisers are Pepsi-Cola, Nike and
McDonalds.
Figure 6.2: Large local advertisers
Most small advertisers are local advertisers who carry out their own advertising
activities. On the other hand, for large organisations, activities to advertise products
or services are managed by advertising agencies.
Flow of funds in broadcasting transactions are the result of investment in
advertising. Estimate of advertising expenses in 2004 stood at RM4.2 billion and 90
percent of the sum was advertising expenses of print and electronic media with
breakdown for newspaper advertising of 64 percent and television advertising of 27
percent (The Star, 21 September 2004). In 2005, the percentage changed a little, i.e.
with the newspaper getting 62 percent, television 28 percent, radio and magazine
each getting 4 percent, while theatres and other media getting 2 percent (Berita
Harian, 6 June 2005). The figures indicate the contribution of advertising to
marketing and sales aspects in the industry. Although the expense amounts are
indeed large for the Malaysian environment, when compared with advanced
countries such as the United States, the amount is rather small. Advertising expenses
in the United States in 1999 till 2000 amounted to US$111 billion (OÊGuinn, Allen &
Semenik 2003).
6.2.2 Advertising Agency
According to Shimp (2003), an advertising agency is a company operating to assist
advertisers preparing advertising messages to be presented by the advertisers to the
public audience. Among others, advertising agencies roles are to prepare various
American Association of Advertising Agencies or 4 AÊs defines an advertising
agency as a free organisation which is represented by creative staff who produce,
prepare and publish advertisements (Dominick 2002).
services such as doing research, preparing creative services and implementing
media planning.
When discussing advertising agencies, names such as J. Walter Thompson, McCann-
Erickson, BBDO, Young & Rubicam are among international advertising agencies
which are well known and operating in Malaysia. Most of these agencies develop
close relations with the advertisers or mentioned as clients or customers. There are
also relationships which have been established for tens of years and they are still
dealing till today. The following example indicates close relationships that have been
established by two participants in advertising industry.
Table 6.1: Close Relation between Advertisers and the Agency
Advertisers Agency Transaction Duration
Unilever
Sunkist Growers
Exxon
Del Monte Armstrong
Chevrolet General Electric
Kraft
DuPont Kellogg's Kodak
Hormel
Mars/Uncle Ben's Rice
Pontiac
Cadillac
Dow Chemical MetLife
Campbell Soup
J. Walter Thompson
FCB
McCann-Erickson
McCann-Erickson BBDO
Campbell-Ewald
BBDO
J. Walter Thompson
BBDO
J. Walter Thompson
J. Walter Thompson
BBDO
DMB&B DMB&B
DMB&B DMB&B
Young & Rubicam
BBDO
1902 ă now
1907 ă 1999
1912 ă 2000
1917 ă now
1917 ă now
1919 ă now
1920 ă now
1922 ă now
1929 ă now
1930 ă now
1930 ă 1999
1931 ă now
1932 ă now
1934 ă now
1935 ă now
1935 ă now
1940 ă now
1954 ă now
Source: Shimp, T.A. (2003). Advertising, Promotion & Supplemental Aspects of integrated
Marketing Communications Ohio: Thomson South-Western, p. 259.
Examine advertisers' names in Table 6.1, which are also active
advertisers in our country. Do you know the names of advertising
agencies listed in the table? Write down agencies that you recognise
from the list and explain some information that you know to your
friends during a tutorial session.
6.2.3 Station
In the broadcasting industry, stations also refer to electronic media, i.e. television
and radio as well as online media. Media functions as a link between an advertising
organisation (advertisers) and the customers. Media selection for the purpose of
advertising is based on the following four dimensions as in Figure 6.3.
Figure 6.3: Four dimensions of media selection
Note: Under reach, should be: How many will receive the message?
When discussing the topic of stations, we need to relate it to various media channels
available now. The viewing audience has a wide choice. This is not only caused by
media landscape which being diversified, but also the effect of increase and diversity
of electronic media at the moment.
Table 6.2 below explains in detail the four dimensions that are taken into account to
evaluate media which is regarded as the most effective in delivering advertising
messages to customers.
Station refers to a media channel used to deliver advertising messages to
audience.
Table 6.2: Various Media Advertising Characteristics
Media
Characteristics Newspaper Magazine Radio TV
External
Advertisement
Direct
Mail Internet
Reach High Low High High High High Medium
Frequency High Low High High High Medium Medium
Selectivity Low High High Medium Low High High
Efficiency Medium Low Low High High High Medium
Source: Dominick, J.R. (2002). The Dynamics of Mass Communication. Media In The Digital
Age (7th ed.). NY: McGraw-Hill, p. 379.
Figure 6.4 explains how television programmes raise the advertising income of a
station.
Figure 6.4: How television programs raise the advertising station
Source: Belch,G.E. & Belch, M.A. (2001). Advertising and Promotion.
An Integrated Marketing Communications Perspective (5th ed.). NY: McGraw-Hill. p. 353.
Table 6.3 shows advertising expenses in Malaysia till June 2004.
Table 6.3: Advertising Expenses 2004 (Till June)
MEDIUM ADVERTISING EXPENSES
(RM 2.06 BILLION)
NEWSPAPER 61.9%
TELEVISION 28.7 %
Source: The Star. 21 September 2004. AnalystsÊ Views/News, p. 3
Table 6.3 shows total expenses allocated to television media is less than the expenses
allocated to newspapers. Of the 28.7 percent advertising expenses for television,
distribution is made between television channels TV3, RTM, ntv7, TV9 and others.
Therefore, most stations expect that total advertising expenses channelled to their
own stations would be more than those channelled to others. This situation has
caused broadcasting stations to prepare their own targets in getting income from
advertising activities.
The following extract comments on income targets for advertising broadcast by
Radio Television Malaysia (RTM) in 2005.
RTM Targets RM150 million in Advertising Income
KOTA BHARU: Radio Televisyen Malaysia (RTM) targets income through advertising
broadcast on television for at least RM150 million this year consistent with the rebranding
of government owned stations. The target to raise income from advertising also involves
broadcasting in radio, because RTM beginning this year will by itself manage its
advertisement marketing.
Deputy Director General of Broadcasting (Programmes), Adilah Shek Omar, said
although getting advertising income from television and radio broadcast, the role of RTM
is more towards social responsibilities.
She said it is important that RTM continues its role to provide information and
entertainment to all layers of multi-racial society throughout the nation consistent with
current demand.
Figure 6.5: News extract on RTM advertising income target
Source: Berita Harian. Wednesday. 1 June 2005.
6.2.4 Station Agents
In advanced countries such as the United States, United Kingdom and others, the
total number of stations (radio and television) is big. This makes it difficult for
advertising agencies to contact these stations. To simplify the task of advertising
agencies, they contact particular station agents.
The situation in Malaysia is rather different because not only the number of stations
is small, they are concentrated around the Klang Valley area. Therefore, most
advertising agencies have direct contacts with radio and television stations.
6.2.5 Media Planners
Media selection is done by a media planner with the purpose of establishing brand
stability over a long term. Media selection is a complex process of decision making in
the marketing communication because of many selections choices.
A media planner is responsible in several matters shown in Figure 6.6.
After reading the news extract from the National column in Berita Harian
above, what is your view on the comments by Puan Adilah Shek Omar
that RTM, as a fully government owned agency, cannot be compared with
private television broadcasting stations.
ACTIVITY 6.3
"Last year the income from radio advertising amounted to about RM14 million and this
year the increase will be better because we are doing our own marketing. Last year
television RTM made RM120 million and this year the target is at least RM150 million,"
she said to reporters after chairing a Central Rebranding Committee of Radio Kelantan
meeting at RTM Kota Bharu here, yesterday.
Adilah said the position and role of RTM as a fully government owned agency cannot be
compared with private broadcasting stations which are totally dependent on advertising
income.
Figure 6.6: Responsibilities of a media planner
Bovee & Arens (1994), Arens (1999) and Wells et al. (2000) also has the opinion that
media planning is a process to use the media effectively and creatively with the
purpose of delivering an advertising message to target audience at an appropriate
time and place.
Therefore, media planning is said to be a continuous activity involving many
processes of decision making either to be changed, disposed of, or used throughout
the time the planning process is carried out. Figure 6.7 shows the elements of media
scheduling.
Media Planning Process can be defined as an activity to create a direction of
actions which shows how the advertising time and space is used to achieve
marketing objectives of a product or service.
According to Belch & Belch (2001), media planning process is defined as series of
decision making processes involving delivery of marketing communication
message of a product to a potential consumer and existing consumer.
(a) Media Scheduling Process
Figure 6.7: Media scheduling
Continuous Scheduling in the same media results in repetitive reactions in
the same audience. Changing the use of a media to another media will result
in continuity covering wider areas. To schedule advertisement continuously,
advertisers may use three methods, that is, continuous pattern, pulsing and
flighting methods.
(i) Continuous Scheduling
Continuous scheduling or continuity explains how advertising is
scheduled for a campaign period. Continuity is also a strategy and
technique used to schedule advertising in a period of an advertising
campaign. The term refers to the advertising campaign period and
overall message delivery patterns in a given period of time. Advertising
in television and newspaper may be scheduled simultaneously in a year
or may be focused on a certain season only.
Advertising Campaign using this schedule is continued for the whole
year. For example, an advertiser chooses to broadcast an advertisement
each week for 52 weeks or the advertisement is broadcasted each month
for broadcasting once a month for 12 months. Implementation of a
stable and continuous advertising campaign may create brand loyalty.
However, if it is too often it will incur a high cost. On the other hand, if
it is too infrequent, it will make an advertisement lose its effectiveness.
Factors that must be taken into account when using this method are
advertising cost, type of product advertised and the cycle of product
used. Advertisers should implement a continuous advertising campaign
for daily use products in an effort to assist consumers to make decisions
to purchase.
(ii) Seasonal Pulsing
Pulsing is a popular alternative for continuous advertising patterns
because of limited budget.
This advertising is carried out according to certain seasons such as
festivals of Hari Raya Aidil Fitri, Chinese New Year, etc.
(iii) Occasional Pulsing
A campaign carried out in this method has no relation with any festival.
On the other hand, a selection of this method is made by taking into
account a certain time regularly.
(iv) Initial Pulsing
It is a scheduling to initiate a campaign with strong effects.
(v) Progress Pulsing
A schedule created to develop a product or service or to support special
promotion.
(vi) Flighting (Schedule of Advertising Ordering)
According to this pattern of schedule, advertising is carried out at
various levels. Advertisers may implement an intensive advertising
activity, then followed by a period without advertising activity. Most
advertising of products for seasonal use is advertised through
scheduling of advertising ordered by this pattern.
Continuous schedule refers to advertising expenses that are
considered relatively stable while an advertising campaign is carried
out.
The definition for the term pulsing refers to the time and space of
continuous scheduling but it is not smooth, i.e. level of advertising
is low, followed by intensive level of activities
MEDIA OBJECTIVES
Strategy formulation and advertising objectives are important factors in the media
planning process. Media objectives should also be made suitable with marketing and
advertising objectives especially in determining the content of advertising message,
who the audiences are and where their positions are.
Besides that, media planners should also think of suitable media channels to
broadcast the message. These guidelines help media planners to focus on the total
audience exposed to advertisements, level of advertisement exposure, and the
effectiveness of the advertisement. The advertisers must ensure the effectiveness of
the broadcasted advertisement. This can be done through advertising effectiveness
measurement by measuring impression, gross rating, advertising coverage and
frequency. Figure 6.8 shows the methods of measuring advertising effectiveness.
Figure 6.8: Measurement of advertising effectiveness
By referring to the media scheduling method discussed, make a list of
three advertisements which you have seen on TV and discuss the type of
schedule for them.
ACTIVITY 6.4
In your opinion, should media objectives be consistent with marketing
objectives? If you feel they should, why do you say that? Explain.
ACTIVITY 6.5
Media objective means preparing specific objectives for media selection for
advertising broadcast.
The aim is to achieve a target audience, identifying coverage of target audience
locations and identifying total advertising messages for target audience.
6.3.1 Impression
Impression measures audience for a media at or a media mix. For example, assume
the Rindu Semakin Jauh, Samarinda slot is viewed by 100,000 people. Each time an
advertiser uses the slot to broadcast its advertisement, the impression is 100,000. If
the advertiser broadcasts four times, this means the impression is 100,000 multiplied
by four, i.e. the value is 400,000.
However, the advertiser usually measures gross impression, i.e. total target audience
based on media channel for each broadcast time. Such calculation is made because
the advertiser refers to the total in general, irrespective of whether a person is
exposed more than two or three times to the advertisement broadcast.
Understanding the element of impression facilitates a media planner to estimate
whether an advertisement broadcast in a space or selected time will succeed in
getting audienceÊs attention or not. This factor is essential because the exposure of an
advertisement to the audience can be interpreted as the first step in attracting an
audienceÊs interest to get additional information about the advertised product or
service. A simple example of the calculation is shown in Table 6.4
Table 6.4: Calculation of Exposure to Advertisement Media
Media Programme Total
Samarinda
WWF Championship
Buletin Utama
4,500,000
16,250,000
7,350,000
Television
Total TV Exposure 28,100,000
Utusan Malaysia
Berita Harian
450,000
1,900,000
Total newspaper exposure 2,350,000
28,100,000
Total exposure 2,350,000
Newspaper
Impression 30,450,000
Impression in the context is defined as the opportunity a person is exposed to
certain programme, news or magazine.
6.3.2 Gross Rating Point
Gross rating point is simpler for the advertiser to remember exposure percentage of
the audience than remembering gross impression. Gross rating point is calculated by
multiplying access stated in the percentage figure by frequency average. For
example, if 80 percent of families having radios is exposed to a Celcom
advertisement at four times on the average in a period of four weeks, gross rating
point will be as follow:
Access x Frequencies = Gross Rating Point
(80) x (4) = 320 Gross Rating Point
Gross rating point (GRP) is the total access multiplied by frequencies and is used to
explain total message influence for a media schedule without taking into account
audience expansion in a period.
A simple example of GRP (in percent) is as in Table 6.5.
Table 6.5: Example of Gross Rating Point
Media Programme Access Frequencies GRP
Akademi Fantasia
Majalah Tiga
20
25
4
4
80
100
180
6.3.3 Access
There are several factors determining the scope of an advertising campaign. In
general, if more than one media is used for an advertising campaign, more audience
will be accessed. This means that a diversity of media being used for an advertising
campaign would give more opportunities for exposing advertising messages to the
audience. For example, an advertiser advertising a product more frequently in two
Access is defined as a segment of the total population exposed to the
advertisement messages at least once a week in a determined period, usually four
weeks.
Access is also understood as the percentage of target audience exposed to the
broadcasted advertisement.
magazines gives less exposure as compared to an advertisement published in
various magazines.
In brief, access or coverage explains different numbers of audience exposed to
advertisement schedules in a period of time. Access is calculated as the percentage of
unduplicated viewers, exposed at least once to the advertisement message. Access
measures the media ability to attract different individuals in the target audience.
6.3.4 Frequencies
Frequency measures a specific media schedule. Frequency measures the intensity of
a specific media schedule. Normally, frequency is calculated as the average of the
frequency of an individual or a household exposure to advertisement messages.
Frequency is effective in determining the maximum or minimum limit of repetition
of the advertising messages. However, as a substitute for the frequency average,
media planners use frequency distribution as it shows minimum distribution for a
potential user to be exposed to advertising message and also the maximum
frequency needed to measure the effectiveness of the advertisement message.
However, what is troubling the media planners is getting frequency distribution as it
requires special research which takes a long time and involves a high cost.
Frequency may also be explained in two ways. First, as a direct percentage, or as a
cycle. If frequency is said as a 3.0 average, it means the potential customer who is
exposed to the advertisement message is three times in a period of four weeks of the
advertisement broadcast. However, not all of the potential customers will be
exposed three times, because it is possible that some maybe exposed more than three
times, while others maybe exposed less than three times.
To understand more about the calculation of average frequency you can try to think
of the following problem: If 4,000 of 10,000 TV viewers view the Waja advertisement
three times in the period of four weeks, and 4,000 more viewers watched five times,
the average frequency is calculated as follow:
Frequencies is the average total time, the customer audience is exposed to the
media, the average of a message reaching a household on or the same individual
at the same time.
Example of frequency calculation is as follow:
Assume an advertiser advertises an advertisement through a weekly programme by
getting 20 percent household coverage for four consecutive weeks. In the period of
four weeks the programme acquired 43 percent coverage. This means the target
audience has the opportunity to view the advertisement 1.9 times.
FACTORS INFLUENCING MEDIA
SELECTION
There are many types of expenses that must be thought of and paid for when an
advertiser chooses to advertise in a particular media. Each media has a certain rate
of charge, which is based on various factors. The type of media itself will influence
the advertising costs. For example, advertisements through TV and theatres have a
higher cost of purchase compared to other media. Similarly, the black and white
advertisement has a lower rate of payment for the space as compared to coloured
advertisements in magazines and newspapers.
Production cost is only one of the aspects that must be considered by the advertiser
in the process of media purchase. When making a decision for a media purchase, the
advertiser is responsible to ensure that the selected media is the most appropriate
and the best. However, in making decisions on media purchase, media planners
normally have no ability to control some factors influencing the media planning
6.4
Frequency = 20 X 4 = 1.9
43
Estimate the value or price of an advertisement with a one-page size in a
newspaper. In your opinion, will the size and price factors affect the
selection of media? How about the duration and number of
advertisements? Will they influence purchase of media?
SELF-CHECK 6.1
Average Frequency = Total access exposure
= (40000 X 3) + (4000 X 5)
8000
= 4
process, including media planning scope, different market potentials, competitors'
strategy, customers' buying patterns, and various other elements related to media.
Usually, a media planner would limit an advertisement to the area where the
product is sold. For example, if an advertiser decides to sell a product in a certain
region only, then a local media plan will be used. For a national market, the media
plan will be more general. Problems will arise if a product will be sold at
international level. Each country has its own advertising ethics. An advertisement
suitable for a Western country may not be suitable to be broadcasted through media
in Asian countries.
To overcome this problem, media managers must prepare an appropriate media
plan. Table 6.5 identifies factors that play a role in influencing media purchase for
advertising purposes.
The effectiveness of TV advertising is undoubted. TV is a very effective medium to
promote a product, disseminate news and declare information. However, the cost of
TV advertisements often causes it to be monopolised by large organisations having
large incomes. What happens is that the small companies may not be able to afford
to use this medium to advertise.
However, now with the increase in TV stations, there are changes seen in the
quotations for TV advertisement prices. Even small companies are beginning to
show their potential ability to advertise through TV. Besides, the preparation of TV
advertisement packages with attractive reasonable costs will make TV a medium to
reach a larger audience.
Table 6.6: Factor Influencing Media Purchase
Media Instruments Factors Influencing Rates and Costs
TV Broadcast
Local/district/national/international
• Area of broadcast
• Variety of channels
• Audience size
• Time of broadcast
• Duration of advertisement
• Number of advertisements
Radio broadcast
Local/district/national/international
• Sponsor package
• Production cost
Print Media ă Newspaper
Local/district/national/international
Daily/weekly
• Types of advertisement
• Position of advertisement
- page
• Style of advertisement
- colour
- graphics
- text only
Print Media ă Magazine
Local/district/national/international
Weekly/monthly/Annual
Consumers/business/commercial
Male/female
Associations/clubs/companies
Technical/professional
• Size of advertisement
- one page, etc
• Number of slots
- frequency
• Size and form of audience
• Cost of production/advertisement
• Product quality
• Production cost
To loosen large companiesÊ monopoly in TV advertising, TV9 has now made initial
steps to give way to most companies to use TV advertisements. This is in line with
the stationÊs aspiration to be a terrestrial TV station able to give space to all parties
wishing to advertise on TV.
Figure 6.9 is an extract of Berita Harian, 6 August 2004 which explained TV9Ês concept.
Figure 6.9: An extract of a news explaining TV9 concept
Source: Berita Harian, 6 August. 2004
RATINGS
How do ratings determine the popularity of a television station? Do you feel ratings
are something very important for a television station?
Rating is a practice for each media agency whether electronic or print. Because of its
importance to media management, most stations will make sure that their own
stations will be at high positions because a high rating is an indicator of stationÊs
popularity among the audience. This is also an attraction to sell advertising space.
When discussing the ratings topic, a name which is synonymous with ratings is AC
Nielsen, that is, an agency which prepares research data on ratings. In big markets,
ratings is a frequently changing figure and this situation causes many stations to try
to ensure high positions each time a rating figure is declared.
The same situation takes place in Malaysia. As the number of TV stations increases,
there are a fewer number of advertisements being obtained, because what is visible
is the race to get a high rating position, thereby reaping advertisement profits.
Rating activities are also closely related to audience research activities. Audience
evaluation is also used by advertisers to get initial feedback about target audience to
advertise their products or services. From such research also the advertisers would
identify target audience profiles.
On the side of the target audience, they will only know about the broadcasted
programmes if the station makes direct announcement. Therefore, as an effort to
attract viewersÊ audience, most stations would promote them to the advertisers.
6.5
⁄.Starting July, TV9 will feature programmes in five slots, which is Raaga
(4pmă6pm) for Tamils, Hindi Power for the Hindi-speaking viewers (6pmă
8pm), Gegar (8.30pmă10pm) targeted at the Malay viewers. Zhong Hua Shi
(Monday ă Friday, 10pmă12 midnight) and Treats (Sunday, 1pmă4pm).
Response from Tamil advertisers especially has been tremendous. According to
a report by AC Nielsen, Raaga managed to attain 74% on average from the total
viewers in two weeks after the introduction of the slots. This figure is the
highest if compared to any other TV station.
MEDIA PRODUCT PROMOTION
Most broadcasting stations sell their advertising time several months ahead of
the programme broadcast. As the programmes are still not broadcasted, both
sides, i.e. the advertisers and the stations will make estimates by referring to past
programmes to make price quotations.
In the United States, broadcasting stations will make their programme listing
by seasons, at least six months before the beginning of the seasons. During the
programme listing presentation sessions, advertisers will have the
opportunities to see what programmes will be broadcast for the next season. If
the previewed programmes are expected to make profits, the advertisers will
buy the prepared time.
This is also implemented by TV3. Several months before branding is broadcasted
by the station, advertisers will be entertained in a special occasion with the
objective of promoting and proposing to the advertisers to work with it.
• The marketing and sales process is closely related to the broadcasting and
communications industry. The main players of marketing and sales activities are
the advertisers, advertising agencies and the media planners. Besides the roles of
the advertisers and the advertising agencies, telecommunications industry
(including broadcasting) also plays a rather important role because both sides
need each other. Each has its own particular role to reap profits, especially the
media which becomes the medium to promote advertisersÊ products and
services.
• This topic has discussed important elements in the sales of media and marketing
as well as activities frequently made by radio and TV stations. Marketing and
sales managers who are smart will be able to raise the image and performance of
their agencies in an increasingly competitive environment.
Continuous Schedule
Efficiency
Frequency
Ordering
Pulsing Development
Reach
Schedule of Advertisement
Seasonal Pulsing
Selectivity
Starter Pulsing
Arens, W.F. (1999). Contemporary Advertising. Boston: Irwin McGraw-Hill.
Belch, G.E. & Belch, M.A. (2001). Advertising and Promotion. An Integrated
Marketing Communications Perspective. (5th ed.) NY: McGraw-Hill.
Dominick, J.R. (2002). The Dynamics of Mass Communication. Media in the
Digital Age. NY: McGraw-Hill.
Eastman, S.T. & Klein, R.A. (2002). Promotion and Marketing for Broadcasting,
Cable and the Web. (4th ed.). MA: Focal Press.
OÊGuinn, T., Allen, C. & Semenik. (2003). Advertising and Integrated Brand
Promotion. Cincinnati: South-Western.
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/ Cable
and The New Technologies. (2nd ed.) NY: McGraw-Hill, inc.
Shimp, T. A. (2003). Advertising, Promotion, & Supplemental aspects of
Integrated Marketing Communications. (6th ed.) OH: Thomson.
Well, W., Burnett, J. & Moriarty, S. (2000). Advertising: Principles and Practice
(5th ed.) NJ: Prentice-Hall.
* * *
TOPIC 7 CABLE/SATELLITE BROADCASTING SYSTEM
INTRODUCTION
The cable broadcasting system was introduced in the United States in the 1940Ês.
Now, the rapid development of telecommunications industry strengthens further
cable broadcasting system.
Do you know how many people use cable broadcasting service? It is estimated
that 26 million households are using the cable broadcasting service
(Keshishoglou & Aquilia 2005) and this is further strengthened by the increasing
use of video-on-demand (VoD) among cable viewers.
Cable television (Cable TV (CATV)) is also known as Community Antenna TV
(CATV). Cable TV is a TV broadcasting system using cabled communication. This
system is introduced to enable several communities in certain areas in the United
States to get TV broadcast. Among the reasons they cannot receive broadcast
signals is because their residential locations are hilly or in the midst of skyscrapers.
Topic 7 Cable/Satellite Broadcasting System.
By the end of the topic, you should be able to:
1. Discuss cable TV broadcasting system and satellite broadcast;
2. Explain the concept of cable TV broadcasting system and satellite TV;
3. Identify five elements of cable system management;
4. Discuss the development of satellite broadcasting; and
5. Identify three basic components of a satellite system.
LEARNING OUTCOMES
This has blocked their broadcast signals. One way to receive the broadcast is by
using special antennas channelled to the communities using cable.
Among the first areas to have been introduced the cable broadcasting system is
Astoria, Oregon. The cable system was introduced by Ed Parsons. The innovative
idea came up when he attended a convention sponsored by the National
Association of Broadcasters (USA) in Chicago in 1948. Parsons, who operated
KAST radio station, with an electrical engineering background was attracted to
TV usage. However, the geographical location of Astoria did not enable it to
receive TV broadcast signals. The nearest TV Station was 125 miles away, i.e. in
Seattle, Washington State. For the purpose of getting TV broadcast, Parsons
installed an antenna on the roof top of Astoria Hotel and joined the cable to his
apartment which had a TV. As a result of his experiment, Cable TV system was
born (Gershon 2001).
According to Keshishoglou & Aquila (2005), TV cable began in Ithaca, New York
in the 1950Ês. Failure to receive TV signals from Syracuse station, i.e. 50 miles
away from Ithaca, gave Anthony Ceracche an idea to use an antenna installed on
a hill near the area, which was connected to private homes. Now, cable TV
system is used widely. In Singapore, the cable TV system was started in 1978 by
Singapore Cable Vision (SCV), i.e. a company which cooperates with Singapore
International Media or SIM.
In Malaysia, the cable TV system began around 1995 when Mega TV began
broadcasting by charging RM40 (Ringgit Malaysia Forty) a month as a service
cost.
CABLE BROADCASTING SYSTEM
Cable TV Broadcasting system threatened the strength of conventional TV
stations at the early stage of establishment. In 1965, Congress imposed a strict
regulation to stunt the growth of cable TV broadcasting system. However, the
situation recovered in 1972, when FCC announced a newer and looser regulation
than the existing one. Thereafter, the cable TV broadcasting system expanded
again.
In 1991, there were about seven cable TV stations, giving service to 55 million
households. By 2000, cable TV system provided service to 68 million households.
Conditions became more stimulating when cable TV station ESPN got a three
year contract with the National Football League (NFL) (Dominick 2002).
The increase in the income of cable TV broadcasting system is also one of the
factors that influenced the development of broadcasting system. However, the
income is still low compared to the income of terrestrial TV system. The income
in 1990 was US$2 billion and rose to US$7 billion in 2000 (Dominick, 2002).
Figure 7.1: Ted Turner's success and CNN
Source: Dominick, J.R. 2002. The Dynamics of Mass Communication Media in the Digital
Age. NY: McGraw-Hill, p. 281
Copyright © Open University Malaysia (OUM)
TOPIC 7 CABLE/SATELLITE BROADCASTING SYSTEM W 157
CABLE SYSTEM STRUCTURE
Cable TV system is a telecommunications system using optic cables to link the
TV station and the TV at the clientÊs home. Basically, there are three elements
used for the purpose of a cable TV broadcast. The elements are as in Figure 7.2.
Figure 7.2: Three elements of cable broadcast
7.2.1 Headend Point
This section contains antenna and equipment for receiving waves transmitted
from TV stations to be sent to the clients. There are broadcasting stations which
also run cable system management; programmes produced by the stations will
be broadcasted to clients through cable network. This means the stations must be
at the same locations with the headend point.
7.2.2 Distribution Network
Distribution Network includes optic cables to be linked from the headend point
to the TV set at the clientsÊ home. This cable is usually buried along the route to
the area of clientsÊ homes.
7.2
In your opinion, how does cable TV function? What is used to link
the TV station and the TV at the clientÊs home?
SELF-CHECK 7.1
7.2.3 Receiving Equipment (House Drop)
The waves received by the headend point will be distributed to the clientsÊ
homes. The receiver has a one-way or two-way feature. Use of optic cable enables
cable stations to broadcast to as many as 500 clients.
Now, cable TV systems use coaxial cables which are mostly made of pure copper
or are wire-coated. This type of cable is found to be better.
Figure 7.3: TV cable network
Source: Adaptation from Gershon, R.A. 2001.Telecommunications Management Industry
Structures and Planning Strategies. NJ: Lawrence Earlbaum Associates, p. 61.
CABLE TV BUSINESS
Cable systems depend on two mains sources of income, namely:
(a) Subscription fees
(b) Advertising
Most cable TV stations charge subscription fees. Fees imposed are normally
different depending on the subscribed package. Advertising could also support
the cable system income. However, advertising through cable stations is still low
compared to advertising in TV stations which have been established for tens of years.
In the cable TV business deals, there are two aspects which play important roles,
that is, cable TV stations and producers/providers of cable programmes.
7.3.1 Cable TV Stations
Cable TV stations are responsible to provide cable TV service to clients. Normally,
stations would provide certain programme packages selected by clients.
7.3.2 Producer/Provider of Cable Programme
Programme producers and providers provide programmes to cable TV stations.
TV stations such as NBC, ABC, CBS and others also produce programmes and
become cable programmes producers/providers either for the stationsÊ own use
or for sale to other stations.
Figure 7.4: Cable TV broadcast in Malaysia (Mega TV and ASTRO)
CABLE TV BROADCAST IN MALAYSIA
MEGA TV
MEGA TV was a pay cable TV station launched in 1985. The station offered nine
channels, that is, CNN International, Discovery Channel, ESPN Super sports, HBO,
Cartoon Network and Korean Arirang TV. However, the station failed to penetrate
the market and at its peak it could only get 130,000 clients. MEGA TV ceased its
broadcast in 2001.
Astro Malaysia
Astro is a satellite service which offers more than 50 TV channels and 16 radio
channels to a million clients in Malaysia. The number obviously keeps rising; it
reached 20 million in 1996. Besides acting as a station having various programmes in
Malaysia, Astro is also the largest pay TV platform in Southeast Asia.
Astro provides 30 percent of the budget for local programmes and is responsible for
700 hours local broadcasting content a year. Although pay TV technology is still not
fully developed in Malaysia, Astro has succeeded in raising the total number of its
clients. It is estimated that between 2000 and 2001, there was an increase of 57 percent
of the number of homes with pay TV. Astro begun its operation in 1996 with only 22
channels and now, Astro has become a satellite TV service offering a very reasonable
subscription fee in Southeast Asia, that is about RM49.95 to RM124.95, for more than
125 channels including 8 HD channels and 17 radio channels offerred in four main
languages. The broadcasts include Malaysia and Brunei with over 2.7 million
subscribers.
CABLE SYSTEM MANAGEMENT
Cable TV system management scope is influenced by factors shown in Figure 7.5.
Explanation for each factor is shown in Table 7.1.
Figure 7.5: Factors influencing TV cable system management
Table 7.1: TV Cable System Management
Cable TV System
Management Explanation
Sales and Marketing
Sales and marketing department is responsible to ensure an increase
in total number of new clients as well as that existing clients remain
loyal.
Customer Service
Manager of Customer Service is responsible for various client
matters such as taking orders, making installation schedules,
managing repair works as well as attending to inquiries on bills and
payments.
Programme Programming Manager heads programming and is responsible to
ensure selection of suitable programmes. This department is
responsible to compile and schedule programmes for existing
channels and TV cable station service package.
Repair Service This department is responsible to give support assistance for repair
works, service to install and upgrade selected programme service.
Client Billing ClientsÊ monthly bills are handled by ClientsÊ Bills Department.
Staff in this department are responsible to manage monthly bills of
clients, performing the tasks of client service officers including
attending to telephone calls or counter service.
RESPONSIBILITIES OF A CABLE TV MANAGER
A Cable TV station manager is responsible for the efficient running of a cable
station. This means he or she is responsible for supervising each department. A
Cable TV manager will perform under the supervision of the owner of a cable TV
station or a senior manager. The task of a cable TV manager is similar to those of
a Chief Executive Officer of an organisation because the task requirements of a
Cable TV manager are also to coordinate management responsibilities in all
aspects such as marketing, engineering and public affairs. These tasks become a
heavy responsibility because Cable TV is a business emphasising clients.
Whether a cable TV is successful or not depends on clientsÊ ability to subscribe
and renew subscription. To ensure the management of the station achieves
success, a cable TV manager does not only emphasise the total number of clients
but is also concerned with:
• Cable TV programmes
• Client service and marketing; and
• Cable management and franchise agreement.
7.5.1 Cable TV Programme
The efforts to provide cable TV programmes are different from traditional TV
stations. This is because Cable TV management must provide programmes for a
greater number of channels, whereas traditional TV stations must prepare for
only one channel.
According to Gershon (2002), cable TV is similar to a magazine. A reader does
not read all articles of the magazines. Therefore, the management must ensure
the content is appealing to all layers of readers. The same thing applies to cable
TV. Viewers do not view all programmes which are broadcasted. Therefore,
management must ensure the creation of a programme package, which is
attractive to viewers.
There are four types of Cable TV programme services, that are:
• Basic cable;
• Pay TV Cable;
• Information service; and
• Community access.
(a) Basic Cable
Basic cable service is a package which must be subscribed if the client is
interested with the TV Cable offer. In general, basic service provides
additional programmes other than the traditional TV station channels
already included in the package. Basic Cable channel is also the cheapest
and has many clients. Most Basic Cable channels are supported by income
from advertising. Below is an example of a Basic Cable service prepared by
StarHub Singapore.
Table 7.2: Basic Cable Service Offered by StarHub Singapore
World News Education
Entertainment Kids Chinese
Infotainment
Chinese Entertainment
CNN
BBC
World
CNBC -
Asia
Discovery
Animal
Planet
National
Geographic
Discovery
Travel 3
Adventure
AXN
Hallmark
MTV SEA
STAR World
Cartoon
Network
Nickelodeon
TVBS Asia
CTI TV
MTV Mandarin
Phoenix
Chinese Channel
E City
Asia Plus
Source: Keshishoglou, J. & Aquilia, P. 2005. Electronic Broadcast Media in
Singapore and the Region (2nd ed.) Singapore: Thomson
Subscription cost is as follows:
(i) Three groups = S$20
(ii) Four groups = S$24
(iii) Five groups = S$27
(iv) All six = S$29
(b) Pay Cable (Pay-per-view (PPV))
Pay TV Cable Service charges an additional fee to clients to get additional
programmes. To use the service, client may subscribe based on monthly
charges or pay to receive certain broadcasted programmes only, that is,
ASTRO Cable TV station also provides selection packages for clients in
Malaysia. Guided by Table 7.2, sketch ASTROÊs programme package.
ACTIVITY 7.1
what is normally called pay-per-view (PPV). In general, sports direct
telecast attracts the interest of many clients. Boxing sport is the highest
income generator in the history of PPV, i.e. US$90 million from boxing
match between Holyfield and Tyson in 1997. PPV started in 2000 in the
United States with almost 30 million households subscribing to the service.
Table 7.3: Most Popular Cable Service in the United States (2000)
Channel Cable Client
(Million)
HBO
Encore
Cinemax Showtime
19.2
9.7
8.9
Source: Dominick, J.R. (2002). The Dynamics of Mass Communication Media in the
Digital Age. NY: McGraw-Hill. p. 286.
(c) Information Service
Cable TV provides various services to clients and this includes services
such as home shopping, cable modems and information service. In mid
1980's, consumers were introduced to a new method of shopping from
homes through Home Shopping Network (HSN). Producers provide
product catalogues as a means of announcing product information.
Through telephone numbers appearing on the TV screen, consumers may
make purchase orders. The same method is available through SmartShop,
aired on TV3 broadcast in our country.
(d) Community Access
Most Cable TV companies must provide education channels for the
community as well as government affairs channel. Through this channel,
educational and also government information may be announced to the
community. In the United States, Christian Broadcasting Network (CBN)
broadcasts live telecasts from the church to the community.
In Malaysia, cable channels providing community access is a new thing in
national broadcasting system compared to developed countries which can
Follow a SmartShop programme on TV3. Make a list of products sold
through the programme.
ACTIVITY 7.2
afford to provide such facilities. In the United States, for example, even City
Council broadcasts its meetings to the community.
CABLE MANAGEMENT
Cable management in the United States signs agreement with the local
government to conform to all rules and requirements of the Cable Act 1984.
Through the signed agreement, cable management has the right to provide cable
broadcast service for an agreed period.
As in other business systems, cable channel transactions also ensure that they get
returns equivalent to programmes subscribed. Besides, they have the right to
change programming systems.
Table 7.4: Cable TV Development
Year Operation System Client (Million) TV Ownership (%)
1960
1965
1970
1975
1980
1985
1990
1995
2000
640
1,325
2,490
3,366
4,048
6,600
10,200
13,000
9,947
0.7
1.3
4.5
9.8
15.5
37.7
54.0
60.0
73.1
1.4
2.4
7.6
14.3
20.5
43.7
58.0
63.0
70.0
Source: Dominick, J.R. et al. 2004. Broadcasting, Cable, The Internet and Beyond: An
Introduction to Modern Electronic Media. NY: McGraw-Hill, p. 32
SATELLITE BROADCASTING
The concept of satellite use in the aerospace was the original idea of Arthur C.
Clarke, a science fiction writer in 1945. The idea turned into a reality when USSR
launched the first satellite into space on 4 October 1957. This was followed by
Vanguard launched by the United States on 31 January 1958. Soviet Union then
continued with Sputnik II taking along a dog named Laika into orbit. The first
mission which carried an astronaut (Vostok) was also done by USSR,
popularising the name of Yuri Gagarin. This sparked the space race between the
USSR and the United States. In 1964 it was the United StatesÊ turn to surprise by
broadcasting the Olympics directly from Tokyo via satellite to audiences in the
United States and other nations all over the world.
There are various types of satellites in space and each one has its own distinctive
functions. Refer Figure 7.6.
Figure 7.6: Types of satellites
Between 1970Ês and 1980Ês, many nations in the world were in the race to launch
their own satellite (see Table 7.5).
Table 7.5: Satellite Development
Year Names of Satellite
1978
1979
1982
1984
1985
1988
1990
1993
1994
1994
1995
1995
1995
1996
1996 (JAN)
1996 (NOV)
1996 (FEB)
1996 (MAY)
Broadcasting Satellite for Experimental Purpose (BSE) - Japan
Experimental Communication Satellite - Japan
INSAT-I - India TELECOM I ăFrance BRAZILSAT ă Brazil ITALSAT
ă Italy SIASAT-1
INTELSAT-701
APSTAR ă 1
PANAMSAT PAS-2
JCSAT-3
PAS-4
ASIASAT-2
APSTAR- 1A MEASAT ă 1
MEASAT ă 2
PALAPA ă C1
PALAPA ă C2
MEASAT ă 1
MEASAT ă 2
MEASAT ă C1
MEASAT ă C2
Source: Hamisah Hasan. (1998). Satellite Communications: A Technical Paper. A Working
Paper Presented at Communication Technologies for Development Course, Communication
Department, Faculty of Human Ecology, Universiti Putra Malaysia, Serdang, Selangor.
Rapid development in satellite technology communication innovation finally
stimulates several telecommunications companies to launch their own satellites.
For example, RCA (Radio Corporation of America) launched SATCOM I in 1975
and SATCOM 2 in 1976. In August 1976, Indonesia launched PALAPA, that is, a
telecommunications broadcasting satellite with the aim of providing
telecommunications facilities to her 13,677 islands.
COMPONENTS OF COMMUNICATION SATELLITE.
A communication satellite system is divided into two parts, that is, aerospace
segment and earth segment.
Aerospace segment is the satellite while earth segment is earth station which
has a transmitter device and receiver for sending (uplink) and receiving
signals (downlink) from satellite.
There are three basic components of the satellite, that are;
(a) Parabola antenna;
(b) Earth station; and
(c) Transponder.
A parabola antenna (parabolic dish) is the signal receiver at the clientÊs premise.
Earth station functions to receive signals from the satellite and send signals to the
satellite (uplink and downlink). There are earth stations that function only to
receive signals, such as TVRO (TV Receive Only).
Figure 7.7 shows examples of satellites and parabola antenna.
Figure 7.7: Examples of satellites and parabola antennae
Source: http://www.voyager.in/Communications_satellite;
http://en.wikipedia.org/wiki/Satellite_dish
DIRECT BROADCASTING SATELLITE (DBS)
DBS is a new alternative to Cable TV. DBS broadcasting can be transmitted
through 200 TV channels to many clients in the whole world. In Malaysia, the
system that is carried out by ASTRO is not 100 percent DBS because TV signals
are ÂdownlinkedÊ from the satellite to an earth station at All-Asia Broadcasting
Centre at Bukit Jalil to be monitored before they are sent back to the satellite to be
received by clients. (Please refer to the article written by Rahmah Hashim entitled
„Television Technology in the Era of Infomedia (Teknologi Television Zaman
Infomedia)‰ in Kosmik, April 1996, p. 5-9).
• Topic 7 has discussed a broadcasting system using cable and/or
communication satellite and explained several management elements of both
broadcasting systems. Both systems were successfully implemented by the
end of the 20th century as a result of several advances in information and
communications technology. This clearly influences the development of the
broadcasting field particularly communication satellite innovation which
enables TV broadcasts to be directly received by the audience from Cable TV
stations or DBS. The change that occurs provided the audience wider choices
and more updated and rapid information.
Cable TV - CATV
Direct Broadcasting Satellite
Distribution Network
Downlink
Earth Station
Multichannel Mutltipoint Distribution
System (MMDS)
Parabola Antenna
Satellite Television
Transponder
TVRO (TV Receive Only)
Uplink
Video on Demand (VoD)
Dominick, J.R. (2002). The Dynamics of Mass Communication. Media in The
Digital Age. NY: McGraw-Hill.
Dominick, J. R., Messere, F. & Sherman, B. L. (2004). Broadcasting, Cable, The
Internet and Beyond: An Introduction to Modern Electronic Media. (5th ed.).
Boston, MA: McGraw-Hill.
Gershon, R.A. (2001).Telecommunications Management Industry Structures and
Planning Strategies. NJ: Lawrence Earlbaum Associates.
Glatzer, H. (1983). The Birds of Babel, Satellites for Human World. In: Howard
W. Sams & Co. Inc.
Hamisah Hasan. (1998). Satellite Communications A Technical Paper. A paper
presented at the Communication Technologies for Development Course,
Communication Department, Faculty of Human Ecology, Universiti Putra
Malaysia, Serdang, Selangor.
Keshishoglou, J. & Aquilia, P. (2005). Electronic Broadcast Media in Singapore
and The Region (2nd ed.). Singapore: Thomson.
* * *
TOPIC 8 THE FUTURE OF TELECOMMUNICATIONS MANAGEMENT
INTRODUCTION
This topic explains the future of telecommunications management from two
perspectives. The first perspective discusses telecommunications management in
terms of globalisation impact on the telecommunications industry and the second
perspective in terms of challenges and the future of the broadcasting industry in
Malaysia.
Telecommunications environment at the beginning of the third millennium is full
of colour with new technology and new infrastructure which has changed the
patterns of services and technology that can be supplied. The change is
constantly taking place due to the impact of globalisation. This section clarifies
the globalisation phenomenon from two viewpoints.
Firstly, how this phenomenon makes an impact on the telecommunications
industry. Secondly, how the most recent changes in the broadcasting industry
environment brings with them several challenges and opportunities. Focus is
TOPIC 8 THE FUTURE OF TELECOMMUNICATIONS MANAGEMENT
By the end of the topic, you should be able to:
1. Outline how the globalisation phenomenon can leave its effects on the
telecommunications industry in Malaysia;
2. Explain the advantages of digital broadcasting from the viewpoint of
the station management;
3. Discuss the implications of the digitalisation of the broadcasting
industry in Malaysia; and
4. Explain how the management could handle challenges and future
opportunities of the telecommunications industry in Malaysia.
LEARNING OUTCOMES
given on the broadcasting industry preparations to face the broadcasting
digitalisation era and management proposals to make the national project successful.
DEVELOPMENT OF TELECOMMUNICATIONS SECTOR IN MALAYSIA.
World telecommunications technological development is influencing developing
nations technologically, through applications and related services.
Telecommunications, particularly electronic media, now includes fixed line
telephones and mobile telephones, information and communication technology
(ICT), computers, cable broadcasting, radio and television, Internet, CD-ROM, etc
(Sherman,1995), even the daily newspaper has an online version. Rapid
development in the telecommunications sector with the globalisation
phenomenon challenges the implementation of the national vision but at the
same time promises various opportunities if handled wisely.
Telecommunications sector and broadcasting, the two main entities in the field of
telecommunications in Malaysia, are the prime movers of national progress.
Now, the broadcasting sector and ICT have developed as telecommunications
entities which are equally important to consumers. From a consumersÊ point of
view, communication service patterns have changed to be widened further. It
includes mass media service concepts in general and personal communication
services specifically. Consumer demand and market forces have motivated
entrepreneurs towards telecommunications services which result in the
combination of telecommunications sector, computerisation and broadcasting
(see Figure 8.1).
In the 1980Ês, the telecommunications sectorÊs roles as a progress mover had
begun to change to become commercial due to the economic policy,
telecommunications policy and broadcasting national policy transformation at
that time. The change has become appropriate due to the development of
privatisation policy, and free market and trade policy of the global
telecommunications industry. The growth and expansion of the
telecommunications sector, broadcasting sector and related support services are
highly necessary to manage globalisation effects.
What is the relationship between globalisation and the communication
industry? Give your comments.
Globalisation began to be felt through inflows of equity capital and takeovers by
foreign companies and their capital accumulation to build their infrastructure
and to strengthen their position. In this situation, market forces determine the
direction and roles of local telecommunications network which are becoming
profit oriented and defend commercial characteristics.
To manage the problems and challenges in the rapidly changing scene, several
decisions have been made by the government including the following:
(a) Establishing Malaysian Communications and Multimedia Commission
(MCMC) under the Ministry of Power, Water, and Communication
(MPWC) in 1998. MCMC acts as a coordinator and regulator of the
activities of telecommunications company (Telco), cellular company (Celco)
and private and public broadcasting sector.
(b) Strengthening the Broadcasting Department of Malaysia (RTM) as Public
Broadcaster for the peopleÊs interests.
(c) Strengthening telecommunications industry by issuing licenses to
telecommunications companies, radio broadcasting and private TV stations.
To know in detail about MCMC activities, please browse through the following
website: http://www.skmm.gov.my/
Figure 8.1: Structure of information industry
Source: OECD, 1992 p.12
REGULATOR
In a meeting of Public and Private Television and Radio Broadcasting Monitoring
Coordinating Committee No.2/2005 and No. 3/2005 [Jawatankuasa
Penyelarasan Pemantauan Siaran Awam serta Private (JKPPSTRAS)] at the
Ministry of Power, Water and Communication, Malaysia (MPWC), the meeting
chairman reminded the committee members consisting of public officers, and
entrepreneurs of public and private telecommunications industry about their
responsibility to the community. The chairman has also asked the entrepreneurs
to cooperate with MPWC in the matters of self-regulation and conforming to
broadcasting guidelines to achieve common aspirations, as noted below
(JKPPSTRAS/MCMC, 2005):
(a) Improving the quality of telecommunications service with high technology
which can meet the requirements of the industry and customersÊ tastes.
(b) Strengthening telecommunications infrastructure network which is capable
of facing future global competition and generate national economic growth.
(c) Active in building linkages and learning global telecommunications
development to obtain business opportunities in international
telecommunications arena.
(d) Always examine multimedia policies and rules, patents rights and
intellectual property governing telecommunications industry for
continuous improvement, besides ensuring that the telecommunications
industry helps to achieve the national vision.
The MCMC platform - as the enforcer of guidelines ă has become a place for
complaints, discussions and continuing debates between various parties of
telecommunications industry who compete to safeguard their own interests.
MCMC makes the effort towards providing a fair and just entrepreneurial
environment as a regulator and prevents the emergence of monopolistic
conditions. MCMC formulates policies and enforces guidelines and rules based
on the Multimedia Act 1998. In general, MCMC also helps to protect the
telecommunications industry from globalisation pressures for consumersÊ and
the countryÊs interests.
Consumers want access to telecommunications services with quality, which are
efficient and cheap. Consumers and stakeholders have asked that Telekom
Malaysia (incumbent) and other Celcos to loosen their monopoly to facilitate
interoperability between services (Pillai, et.al. 2005). The government is also
committed to widen services to all parts of the country to speed up a community
with knowledge (K-society) and to close the digital divide.
In the telecommunications arena of the Asian region and the world, radio and
television broadcasting industry participants are concerned with the expansion of
Telcos, Celcos and other wireless electronic media sectors. This media
development has enabled the partnership of frequency spectrum which is getting
narrower. Division of frequency is clearly very important to each participant in the
industry to deliver their products and services (Radio Asia/ABU News, 2005).
GLOBALISATION IMPACT IN TELECOMMUNICATIONS FIELD.
There are two explanations on how the globalisation phenomenon process can
happen in the field of telecommunications, i.e. globalisation through vertical and
horizontal integration (Sherman, 1995); and from the angle of four dimension, i.e.
economy, politics, culture and ideology (Abdul Rahman Embong, 2000).
The 8th Malaysia Plan clearly outlined the direction and strategy of the national
ICT project, while the 9th Malaysia Plan (2006 -2010) enables Malaysia
Broadcasting Department to implement Broadcasting Digitalisation Project
which will benefit the whole broadcasting industry in Malaysia. The top
management of the Ministry of Information of Malaysia have to exercise a
cautious attitude in enforcing in the case of telecommunications development
(including broadcasting and ICT), subject to current social, cultural and economic
conditions (Majlis Penerangan Projek Pendigitalan Nasional, 2005).
The stakeholders believe the government still needs additional information and
must learn more about globalisation impact on the field of telecommunications
particularly local broadcasting industry in the context of digital broadcasting
development. However, the globalisation issue continues to receive special
attention from Telecommunications entrepreneurs, media and ICT. However, the
ways they are overcoming the globalisation impact are diverse.
8.3.1 Change in Local Media
Local media manager, either in the field of printing, telecommunications,
broadcasting or new media is facing reformation process. They are constantly
8.3
In a study regarding economic investment and media globalisation effects in
Latin American countries, Waisbord (2002) emphasised the importance of
process negotiation ⁄process of perpetual negotiation⁄ and mediate
globalisation, outlining its limits and possibilities. States and market forces
continue to be locked in constant battles in which accommodation and mutual
benefits, rather than one-sided victories are the norm‰.
looking for solutions to overcome the globalisation impact. Media managers
cannot run away from changes in technology, market competition, policy
changes, culture and consumer needs.
In the local printing sector, for example, Sin Chew Media Corp. Bhd. succeeded
in strengthening its position through diversification ideology in the field of
printing and business expansion in the country and overseas by means of
acquisition of uncompetitive print media.
The New Straits Times press performed rebranding by changing to a new face in
tabloid form. The Sun newspaper distributes free copies and relies on advertising
only to continue business.
By increasing the number of readers, the printing sector diversifies its publication
and publicity, i.e. through spreadsheets, Internet, mobile phones and billboards.
Print media management clearly keeps abreast with technological development
and dares to change to deal with market pressure.
8.3.2 Telco and Celco Sector
In its rebranding plan, Telekom Malaysia (TM) Berhad announced various
development infrastructure and automation training at a cost of RM100 million
as its strategy. The TM company also continues searching for opportunities to
expand its business and reorganises overseas investment such as investments in
Indonesia, Indochina, Sri Lanka and Asia-Pacific (Berita Harian, 30 July 2005).
Such technology development strategy and business telecommunications is seen
as critical in handling the globalisation impact on the industry.
Local celco companies such as Celcom, DiGi and Maxis continue to expand their
activities. Their new development is 3G with the capability to streaming
television programmes. ASTRO, pay satellite television broadcaster, exploited
the 3G innovation by providing an additional service platform to all cellular
networks especially to its partner, i.e. Maxis. DiGi becomes the largest prepaid
mobile telephone network with subscription of 5 million by June 2005.
Telecommunications sector together with the ICT sector, as well as small and
medium industry (SMI) were active in research activities with Sirim Berhad
incubator programme. This programme has created small entrepreneurs
(vendors) in telecommunications and ICT sectors.
With dynamic cooperation between various sectors, SMI companies realised their
businesses in the field of information and communication technology. The
president of a foremost cellphone firm in Europe said, Malaysia will lead in
research activities and become a principal base to develop their product
competitiveness in the Asian region (Utusan Malaysia, 18 June 2005).
8.3.3 Broadcasting Sector
Kumpulan Media Prima Berhad, owner of TV3 took over Fly FM radio station
and Ch9 TV station which ceased operation because it was incurring losses.
Media observers believe that Media PrimaÊs action of controlling Ch9, an existing
broadcasting station, is to avoid the existence of another competitorÊs
broadcasting station (Lim Ai Leen, 2005). However, not long after that, Media
Prima made a decision to take over the ntv7 broadcasting station. This means,
Media Prima is now a master broadcaster controlling all private free-to-air (FTA)
stations i.e. TV3, 8TV, Ch9, and ntv7. See Figure 8.2.
Figure 8.2: Viewers share of local terrestrial TV station, 2004
ntv7 station with its branding „Your Feel Good Channel‰ and its own style of
news presentation, MyNews, has begun to attract its target viewers in towns
including Chinese-speaking viewers.
TV1 and TV2 as well as 32 public radio stations are owned by Radio Televisyen
Malaysia (RTM). RTM has also performed its rebranding of TV1, TV2 and 32
radio stations in 2004 and 2005. RTM service goals as a public broadcaster is
different from private broadcasters. RTM gives priority to its social obligations to
the community where entertainment alone or commercial features are not the
main objectives. However, RTM is not protected from competition or separated
from the globalisation impact. What happens in the environment of
telecommunications is clear and obvious. Every sector attempts to escape from
being overwhelmed by competitors by widening the scope of its business
operations.
If globalisation means industry practice without border entry of hardware,
software products and services without control, then cultural and political
implications will have an impact on the national economy. The entry of more
competitive foreign products will adversely affect local industry. In addition, in
the era of digitalisation, globalisation further widens the gap between a
community with resources and a community without resources, creating a digital
divide.
Waisbord (2002) is of the view that globalisation does not have the same impact
on all media in a country. Globalisation may stimulate business development
and at the same time cause a loss of opportunity and local businesses to
retrogress. He identifies several criteria that may overcome the globalisation
impact to local management. The criteria are as follow:
(a) Strengthen position in industry with sufficient capital to develop business
in the country and overseas, including in an economic crisis situation.
(b) Having a sufficient audience share (clientele) to achieve ratings and reach,
audience coverage which is attractive to the media planner and sponsor.
(c) Controlling advertising expenses (Adex) of telecommunications industry
and sufficient sources of additional income in order to sustain itself in the
industry.
(d) The existence of a regulator which can enforce policies and guidelines
which can protect industry interests from being monopolised by more
global and able entrepreneurs.
EXPANSION OF GLOBAL TELECOMMUNICATIONS INDUSTRY
Telecommunications branded products such as Ericsson, Nokia or STAR TV,
Sony-Columbia Pictures have become a common word among
telecommunications industry audiences. Products of these brands have
controlled a major share of the telecommunications industry in Malaysia. The
challenge to the local telecommunications industry is how to take advantage of
the advance of globalisation in Malaysia. Giant companies such as Satellite
Television Asia Region, STAR TV, Time-Warner, Sony Corporation, Fininvest,
8.4
TV3, together with 8TV, control 49% of viewers' share. Does this mean
that with the empowerment of private broadcasting stations, there is
no more space for the weak or non-commercial? What is your view?
News Corporation and Temasek Holdings are active global companies in cross-
border investment and own strategic interests in various media industries. See
Table 8.1.
Table 8.1: Global Telecommunications Companies Controlling Various Media
Name of Company Broadcasting Telecommunications Print
Media Film Production/Distribution
(a) Star TV
(b) Time Warner
(c) Sony Corporation
(d) Fininvest
(e) Temasek Holdings
Source: Robert W. Mc Chesney http://www.fair.org/extra/9711/gmg.html.
OECD (1992), p.52
STAR TV, owned by Rupert Murdoch, originally owned interests in newspaper
and print media. Then, he expanded his business to telecommunications media,
broadcasting, production and distribution of TV programmes and films. The
company which began as a print media from Australia, now owns interests in the
United States, China, India and Europe.
Similarly, Time-Warner, originating from the United States, Sony Corporation
from Japan, Fininvest from Italy and Temasek from Singapore. These companies
are successful in controlling various media through strategic investment and
cross ownership. What can be realised from the activities of these global
companies is that they are dominating the market through horizontal and
vertical integration strategies.
Business expansion models through integration activity are also found among
entrepreneurs of the telecommunications industry in Malaysia. Between Telekom
Malaysia (TM) and TV3 ă they have cross-ownership of interests in print media
such as New Straits Times Press; telecommunications companies/Celco
(Celcom), broadcasting station (Ch9 and 8TV) and production and distribution
company (Grand Brilliance). Refer Table 8.2 to know about telecommunications
companies in the country which control various media. MiTV and ASTRO, i.e.
two pay satellite broadcasting stations also have interests in various media
industries. Different from these privately owned companies, RTM, a government
owned station, cannot involve itself in business. However, under the Ministry of
Information, Malaysia, there are agencies involved in film production such as
Jabatan Filem Negara Malaysia while news services is by Bernama.
Table 8.2: Domestic Telecommunication Companies Controlling Various Media
Company
Name Broadcasting Telecommunications Print
Media
Film Production/Distribution
Telekom Malaysia
TV3
MiTV
ASTRO
RTM - -
Livedoor case, Japan: Livedoor, a company supplying Internet services
succeeded in buying a majority share of a radio company Nippon Broadcasting.
Nippon Broadcasting has the biggest share in Fuji Television network. Indirectly,
Livedoor has become the largest member of the board of directors for largest
group of media in Japan. This means the Internet media can now influence the
direction of the broadcasting media. This fact was only realised at a later stage by
the broadcasting group, when the stakeholders were rather restless with the new
developments. The administrative and regulation structure of the broadcasting
body in Japan gives priority to public view. Therefore, the takeover efforts were
renegotiated outside the court, by permitting Livedoor to buy a minority share
(The Malay Mail, 24 March 2005).
Investment case in India: Telekom Malaysia Berhad's (TM) proposal to buy
shares in Idea Cellular Ltd., a Celco company in India, could not be continued
because of several factors. At the same time, Temasek from Singapore succeeded
in buying shares of Bharati's Telecomunications and ICT Ventures company,
India. The Regulator of India did not allow TM Malaysia to bid to buy shares in
the same sector because Temasek had already had an interest in Telekom
Malaysia. At that time, a Celco company in Malaysia, i.e. Maxis qualified to bid
for shares in India.
Telekom Malaysia stated that they were continuing to try an alternative method
not only in India but also in Pakistan and other countries in the Asia-Pacific.
ASTRO also has begun to be established in Indonesia and the Sin Chew Media
Corp. has owned a daily newspaper in Papua New Guinea. Investment and
In your view, are all investment measures, business expansion and
takeovers successful and healthy in terms of public interest?
business activity expansion is a must to prove the existence of a strong
telecommunications industry not only in the country but also overseas.
THE FUTURE OF TELCO AND CELCO
The convergence of technology today influences how communication is
distributed by the media, telecommunications technology, television and
computing. Combination and technological innovation succeeded in developing
new ways of accessing information by interacting virtually. Methods of
communicating have developed from mass communication method to direct to
the individual. This trend occurs because access to information is of a ubiquitous
concept, i.e. capable of communicating from anywhere. The use of information
technology and communication has begun to move from a fixed medium to a
mobile medium. Even clients now have begun to control the form of
communication and information obtained, stored and how data is utilised
through ICT for further application. Refer Figure 8.3.
Figure 8.3: Concept of accessing information and interacting from anywhere
Malaysia is in line with other developed countries such as Japan and Korea in
migrating to new technology such as Voice Over Internet Protocol (VoIP), use of
Wireless Fidelity (Wi-Fi), Mobile Content Streaming service, broadband service
which supports Third Generation Advanced Cellular Telecommunications
Services (3G), on-demand video services through Internet. Internet Streaming
facilities and 3G service are still being improved, while the success of
telecommunications technology combination, broadcasting and computerisation
indicate the entry of Telco and Celco in Malaysia as competitors to traditional
broadcasters in Multimedia broadcasting service. The result of this Multimedia
technology enables various media products and services to be received at their
respective base as in Figure 8.4. The concept of information and entertainment
distribution to the audience (mass broadcast) has now shifted to the concept of
information and entertainment distribution directly to individual clients (mass
broadcast to personalised broadcast).
Figure 8.4: ClientsÊ TV, computer or mobile telephone screens
The climate and ways in which the clients view TV or communicate using
telephones are quite different now. Clients have begun to demand facilities in
accessing information, communication and entertainment according to their own
comforts. They want information wherever they are and at any time. This
ubiquitous concept means anywhere, anytime, any device. The capability of
traditional television or fixed line telephone is limited and unable to fulfil these
needs. Clients are beginning to switch to interactive TV or mobile telephones
with 3G capabilities. Television stations may start streaming programmes to
Internet clients and mobile telephone clients. Broadcasters have to chase viewers
to give them satisfaction by planning interactive programmes because todayÊs
viewers are capable of processing various kinds of information as in Figure 8.4.
Viewers are able to participate in quiz, games, contribute to forums, blog, browse
advertisements while viewing and listening to radio and TV broadcasts at the
same time.
CHALLENGE FROM OUTSIDE
Giunta (2005) stated the technology combination has stimulated growth in the
field of telecommunications aggressively in the Asia-Pacific region where its
clients enjoy a rising social standard of living. Countries in Asia have among the
highest number of users of mobile telephone services and wireless Internet.
Examples of clientsÊ involvement in SMS/MMS service are increasingly popular
in Malaysia as found in the following report:
Astro - AKADEMI FANTASIA
15 million SMS messages worth an estimated RM 7.5 million sent by fans since
June.
8TV - MALAYSIAN IDOL
On average, there are 1,300 to 1,500 chatters on air per hour on 8TVÊs chat.
220,000 SMS messages per month. At peak, 12 minutes before SMS can be
displayed on TV due waiting time.
ASTRO - Channel @ 15
3.5 million SMS in the last 13 months (since July 2003). In 2003, Malaysian sent a
total of 6.2 billion text messages.
Figure 8.5: Example of client involvement in SMS/MMS service in Malaysia
Source: The Star, 17 August 2004.
During the visit by representatives of the World Trade Organisation (WTO) to
MCMC on 21 June 2005, they referred to MalaysiaÊs agreement to a commitment
of opening 30% of telecommunications sector market to foreign investors while
in the pioneer status 100% equity maybe held by a foreign company if it operates
from the Multimedia Super Corridor or MSC. Opening of opportunities to more
advanced and more capable entrepreneurs from overseas through WTO and
pioneer status at MSC, also places a serious challenge to local
telecommunications industry (Pillai et. al. 2005).
The local Telco and Celco sectors- i.e. Telekom Malaysia Berhad (TM) and three
cellular companies (Celco), i.e. Maxis, DiGi and Celcom (a subsidiary of Telekom
Malaysia Berhad)- control almost all of the mobile telephone market. But that is
only 50% of the 26 million Malaysian population who have become users of
mobile telephones, and less than 1% become the clients for broadband facilities
which are prepared to develop their organisationsÊ operation value. So the Telco,
Celco companies and suppliers of various broadcasting platforms and services
take cautious steps in terms of capital expenses to face the challenges and
opportunities waiting for the telecommunications industry in Malaysia.
The hottest heat of competition will be felt especially by Celco companies and
small companies supplying services such as interactive SMS/MMS, software
program broadcasting and website builders. In the efforts to uplift business,
Telco and Celco companies highlight their brands of products and services with
various methods of promotion and positioning among the clientsÊ audience (See
Table 8.3). Companies attempt to capture part of the Celco business sector
through a war of slogans.
Table 8.3: Examples of Slogan Used among Celco Competitor
Company Celco Promotion/Slogan
Maxis Access Fee „0‰
One Country One Rate
Cost SMS 1 Sen
Celcom „This is Celcom Territory‰
„Everything is in your hands‰
DiGi „Use of the longest prepaid‰
„Lowest Prepaid‰
Beside challenges from overseas, management of local Telcos and Celcos face
their own specific problems to progress further in the industry. The problems are
as follows:
(a) Opportunities to develop business between Telcos and Celcos should be
balanced because sudden growth in telecommunications causes congestion
in the use of the frequency. MCMC may redistribute frequencies so that the
sector can give a more general service. Unbalanced distribution of
opportunities may create uneasiness of big/small companies and
monopolistic situation.
(b) Telcos and Celcos are less capable and slow in performing various services
which are available in the environment of telecommunications industry.
While waiting for them to fulfil clientsÊ demands, suppliers (vendors) who
are often weak in terms of resources are used. This opens the possibilities
for competitors from outside to enter the market.
(c) In using suppliersÊ service, there are various issues causing difficulties to
the industry and clients. Profit distribution ratios which benefit the Telcos
and Celcos become an issue to service suppliers. Problems of variations in
billing and delays in payment weaken service suppliers with small capital.
(d) Shortage of a skilled workforce and competencies in Multimedia
Technology often gives rise to problems such as server-down, which causes
dissatisfaction among clients.
How can the local community handle the effects of globalisation? What
are the positive and developmental effects of globalisation?
FUTURE CHALLENGES OF THE BROADCASTING INDUSTRY
Growth of TV households in the Asia Pacific Region was forecasted to reach 30
percent, i.e. 600 million before 2010 (ABU, 18th March 2005). The growth
represents fertile market for broadcasting media to expand their activities in the
region. Broadcasting industry in Asia Pacific began to feel the impact of
globalisation when giant companies such as Time Warner, Sony Corporation
began to supply more attractive programme content to broadcasting industry
participants in this region. These challenges became more serious to broadcasting
management operating with analogue and terrestrial when pay satellite TV
(ASTRO, Malaysia, LIPPO Group, Indonesia) and cable TV (Singapore;
Philippines and Thailand Pool TV) and direct to homes TV (DTH/DBS) began to
offer programmes at much higher levels of quality.
Planning of terrestrial radio began to show reformation in short term scheduling
and programme production (2000-2005) in the efforts to improve opportunities
and ratings in the market. Management began to focus attention to positioning of
their own brands among viewers and media planners. Scheduling method of
slots and belting became niche programming. From here, it changes to popular
programming which in general are viewersÊ selected popular programmes.
Media planners present prime time, other primes and fringe time as additional
attractive air space to advertisers.
Now, a new phenomenon in scheduling has begun to be used among the
broadcasters who are competing to attract listenersÊ/viewersÊ attention.
Broadcasting stations have begun to promote their new/main programmes in a
big way in the media and billboards by exhibiting times and dates of
broadcasting on the radio or TV. They invite listeners/viewers to make
appointments to view the stations concerned. For example, The Contender -
ASTRO, Majalah 3 - TV3, Mahligai Gading - RTM and Edisi Siasat - ntv7.
In your opinion, what are the challenges that may face the broadcasters
in future? Is competition the main challenge?
SELF-CHECK 8.2
8.7.1 Competition in Broadcasting Media
Environment
With the existence of a fertile environment for investment, media companies and
global telecommunications (TNC) may continue to find opportunities to expand
their operations in Malaysia. Syndicated programme distributors from western
countries, East Asia, India and Singapore strengthen their positions in the local
broadcasting schedule.
In the meantime, representatives of global media such as Fox and Time-Warner
have begun to creep in as suppliers of broadcasting schedules following popular
programming. They make strategic partnership agreements with local stations to
bring in their international service such as news of CNN, BBC, Deutsche Wella,
Al-Jazeera which become permanent programmes in daily broadcasting.
For broadcasters and listeners/viewers, radio and television broadcasting media
are the main channels for effective information distribution. This media has been
most sought after in the last decade (1995 -2005) as it is considered the most
lucrative and strategic to consolidate business transactions of other related
media. Until 2005, five free to air broadcasting organisations (FTA-TV) with
seven broadcasting channels had been in operations.
Two of them have ceased broadcasting for not being able to withstand
competition from the industry (See Table 8.4).
Table 8.4: Free Broadcasting Stations (FTA) in Malaysia
The first radio and television satellite broadcasting stations in Malaysia (ASTRO),
which offers more than 40 TV broadcasting channels and 12 radio channels, is in
operation successfully, while the second pay TV (MiTV was launched in
September 2005. In the meantime, Telekom Malaysia Berhad (TM) began to
participate in the field of broadcasting through broadband streaming services
FTA-TV Number of Channels in Operation
RTM
TV3
NTV7
8TV
2
1
1
1
FTA-TV Number of Channels which Ceased
Operation
METRO VISION
Ch9
1 (1999)
1 (2005)
which offers a package of TV and radio broadcasting, data to mobile telephone
and website.
The existence of the second pay TV stations (MiTV), the capture of three private
FTA stations by Media Prima and broadcasting of radio/TV programmes
through Internet toughened the competition to get viewer share and adverting
expenses (Adex) (refer Figure 8.6). AC Nielsen is of the opinion that with a small
size of viewers, i.e. as many as 16.7 million and a less encouraging increase in
advertising expenditure, compared to other media, the broadcasting industry in
Malaysia may not be able to support any more additional broadcasting channels.
Lim Ai Leen (2005) reports in The Edge that television industry only obtained
29% of Media Adex compared to the 60% controlled by newspapers. TV Adex
growth in 2004 was 30% but declined to 15% in 2005 and it is expected to fall
further to 10% in 2006.
Reports in the newspaper of The Star, 9 Mac 2005 and The Business Times on 13
March 2005 believe that there is still space to expand viewers share.
Figure 8.6: Adex TV 1996 ă 2004. Data for 2005 - 2007 are forecast
Source: The Edge Malaysia, 20th June 2005
"MiTV targets 100,00 subscribers in the first year" said Datuk Rosman Riduan,
the chairman of the 2nd Pay TV station in Malaysia. Subsequent media report
says,"ASTRO net profit surges 12-fold to RM155.4 million". There appears to
be profitable expansion opportunities despite the restrictive market place.
While the confidence raised by Rosman, and in his subsequent reports,
illustrates the resilient character of the television industry in Malaysia.
The newspaper report above gives a picture that the broadcasting industry in
MalaysiaÊs vibrant industry and can be profitable. Meanwhile, the management
of Media Prima attempts to combine all private TV FTA stations to avoid
competition, ASTRO feels viewers share in Malaysia is reaching saturation. The
satellite station has announced its broadcasting expansion to Indonesia with
confidence to capture 30%, 1.5 million of pay TV clients in the country. In
planning various strategies to capture a part of viewers share and advertising
expenses, competition between broadcasting stations in the country is getting
stiffer. This has caused many workers to lose jobs in both TV stations which
ceased their operations.
In the meantime, the Celco sector rushed to promote their services, Telco sector
offers Voluntary Separation Scheme (VSS) to 10% of its workers because of
automating part of their service and operations. These effects of globalisation
have revealed pressures on telecommunications management to expand their
services horizontally and vertically.
8.7.2 National Broadcasting Digitalisation Project
The building of Digital Broadcasting Hub (DBH), a national broadcasting vision,
will benefit the whole telecommunications industry. This pioneer digitalisation
project comes from careful planning since 2002. This project will provide
terrestrial digital radio and TV broadcasting service to clients in the Klang Valley
in phase 1 (2006), metropolitan area and subsequently the whole country by 2012.
Table 8.5 is a proposed road map of the digitalisation project implementation.
Table 8.5: Mapping of Broadcasting Digitalisation Implementation
IMPLEMENTATION SCHEDULE
Project Evaluation February 2005-April 2005
Project Offer May 2005-August 2005
Delivery August 2005-December 2005
Installation November 2005-May 2006
Training February 2006-June 2006
Testing May 2006-September 2006
Launching September 2006-November 2006
Source: Briefing to Telecommunication Industry of Malaysia, 2005
With the introduction of Radio and TV digital broadcasting, it could be extended
to telecommunications media and computerisation, i.e. Digital Multimedia
Broadcast (DMB). This digitalisation project is the building of new infrastructure
at a high cost. In this case, the broadcasting department of Malaysia, Radio
Televisyen Malaysia (RTM) is given the responsibility to introduce digital
broadcasting technology and culture to the audience.
Broadcasting stations such as Ch-9 and ASTRO were already equipped with
digital broadcasting infrastructure. TV3 and RTM stations have obviously shown
their preparedness towards full digital broadcasting by 2012. Their respective
managements have set up a special division of New Media and trained staff to
face digital broadcasting challenges. Their production format now contains
interactive elements such as SMS which is a starting point for the culture of
sending and receiving in radio/television broadcasting. The main part of the
programme format will contain interactive TV (iTV) characteristics, with viewers
as product and service clients, besides radio/TV programme through
Multimedia base.
The combination of Multimedia and Multimedia broadcasting becomes a reality
in an experiment in BBC when the station made its television news report from a
location through a mobile telephone with 3G facilities. A broadcasting company
TV station in Norway, NRK, also directly broadcasted a skiing competition from
Sweden using a mobile telephone camera (ABU, 18 March 2005).
8.7.3 Digital Broadcasting Advantages
Digital broadcasting introduces to the clients quality programmes which are as
good as quality digital video disc (DVD) in terms of picture and quality compact
disc (CD) from its video. Digital broadcasting systems enable broadcasting in
wide screen format with high resolution with Standard Definition TV (SDTV or
High Definition TV (HDTV). For radio broadcasting, it enables digital audio
broadcast (DAB). Both broadcasting formats are capable of producing audio and
video of more attractive quality compared to analogue broadcasting. Digital
broadcasting is capable of broadcasting simulcasting/multiplatform broadcast.
Clients can benefit from various value-added services with digital broadcasting
technology. Refer Table 8.6.
Table 8.6: Difference between Analogue and Digital Broadcasting
Analogue Broadcasting Digital Broadcasting
Two-way broadcasting
communication.
Two-way broadcasting communication through
set-top-box.
Information support material
according to broadcasting
programming.
Information support material is more like
Multimedia service controlled by viewers.
Horizontal programme Programmes having interactive elements
controlled by viewers.
Interactivity application which is passive and limited to call-
back and SMS/MMS.
Having additional facilities through interactivity
application involving computer network system,
back channel and remote-control.
Inactive commercial
broadcasting.
Enabling viewers to shop in real-time through e-
shopping.
Receiving broadcasting direct to
TV through UHF/VHF
technology.
Receiving broadcasting through technology UHF
and set-top-box (STB), satellite dish. In future
broadcasting reception does not require STB.
Current TV broadcasting form
Terrestrial Free-To-Air (FTA).
Futuristic TV Broadcasting Terrestrial Free-To-Air
(FTA),Partial Pay-TV, Satellite Pay-TV, Cable Pay-
TV.
Information service on
programmes through
programme summary and print
media.
Providing electronic programme guide (EPG)
accessible with a remote control.
Source: ABU ICT Forum, Kuala Lumpur, 2004 and ABU Study Tour, Seoul, 2005
CHALLENGES TO THE BROADCASTING
MANAGER
8.8.1 Implication of Digitalisation Project
Service and analogue devices as in the era of black-white TV will soon be
discarded because analogue system cannot fulfil the demand and expectation of
viewers. Developed countries have begun planning towards terrestrial digital
broadcasting service. The most popular broadcasting system is Video Broadcast-
Terrestrial (DVB-T) (See Table 8.7). Developing conventional FM/MW radio
broadcasting and analogue TV broadcasting no longer brings any benefit (ROI)
to management because it involves a high cost.
Figure 8.7: Development of TV broadcasting analogue TV broadcasting
Besides the government who has to bear a high cost from the stage of project
evaluation to implementation stage, the broadcasting management will have to
pay for the cost of setting up a creative Multimedia division, skills training for
staff and expenditure for preparing interactive programme content. The
broadcasting industry in Malaysia cannot be left behind in implementing this
project.
(a) Acceptance of Technology by Audience
Digital broadcasting technology can be used as a mechanism to collect,
analyse and distribute information interactively with viewers. Management
supplies information to raise understanding and involvement of the
community in activities sponsored by the broadcasting stations.
Reception of signals or digital radio and TV broadcasting at home, involves
changing the radio/TV set to those that can receive programmes in digital
form. As an alternative, clients may use Set-Top-Box (STB) or decoders for
changing signals to digital content. This is something that may raise
problems for the broadcasting management.
Broadcasting managers in Europe, Japan and South Korea also experience
the same problem. Digital format broadcasting in Australia only got 10%
response from existing TV viewers (ABU, 18 Mac 2005).
AC NielsenÊs study (2005) on viewersÊ interest in digital TV broadcasting
found that more than 2.4 million viewers stated that they are willing to pay
extra premium to get value added services. Service here means selection of
subtitle language, electronic programme guide (EPG), Internet browsing,
private video recorder, paying at each viewing, e-commerce and data
casting. In selecting this service, viewers involve themselves personally and
interactively.
Interactive TV (iTV) is an important feature of digital TV broadcasting. It is
a TV and programming system which is specifically provided to allow
viewers two-way interaction in real time (real time navigation) during
programme broadcasting. This means viewers can control a part of the
programme broadcasted and be able to communicate with the broadcaster.
For the time being, viewers need the Set-Top-Box facilities with EPG
application that can be controlled by using a remote control to enjoy
facilities provided in the programme.
(b) Management Burden
Coordinating decoder or Set-Top Box facilities and nurturing the culture of
viewing digital broadcasting with EPG application becomes the
responsibility of broadcasting management. Management examines digital
broadcasting planning from each angle to ensure that devices such as set
top box and receiving antenna may be made in Malaysia by the original
manufacturer (original equipment manufacturer). By this measure, not only
the cost to the clients may be reduced, but the set-top-box can be adjusted
to receive broadcasting from all stations.
By the time Multimedia broadcasting arrives, many clients are expected to
use a base or receiver devices such as a laptop and a mobile telephone in an
area that is hard to receive broadcasting signals. Management should also
cooperate with the suppliers of telecommunications networks to provide
service „outside the area‰ or areas which are regarded as gap fillers.
(c) Implementation
The task force of this national project proposed that RTM begin digital TV
broadcasting at the end of 2006, followed by other broadcasting stations in
the country. Various cost implications, technology applications, social and
clientsÊ acceptance, skilled workforce and private broadcasting capabilities
demanded the implementation of digitalisation project be carried out in
phases and cautiously.
Multi-channel Standard Digital TV (SDTV) broadcasting would be transmitted
to the Klang Valley area first. Various value added facilities for TV viewing
through digital broadcasting may be enjoyed through phase-by-phase planning
(please See Table 8.7).
Table 8.7: Implementation of Digitalisation Project through Phase-by-phase Planning
8.8.2 Roles of Manager in Facing Future Challenges
in Broadcasting Industry
Future broadcasting managers must be trained in broadcasting organisational
management which is changing constantly. They must have leadership qualities
and wide knowledge in modernising broadcasting industry, telecommunications
and ICT.
(a) Organisational Management
Ć To manage the negative influence of globalisation, broadcasting
industry managers of the country must strengthen their position in
dealing with the new environment. Broadcasting industry managers
should explore opportunities to expand business and strengthen
services and their respective organisational functions according to
Legend
DVB-S Digital Video Broadcasting ă Satellite
SDTV Standard Definition TV
DRM Digital Radio Mondiale
HDTV High Definition TV
DAB Digital Audio Broadcast
DVB-T Digital Video Broadcast - Terresterial
Why is Malaysia's broadcasting industry not active in the efforts
regarding broadcasting technology research?
ACTIVITY 8.4
Implementation of Technological Facilities in Digital Broadcast
Year 2005 2006 2007 2008 2009 2010
DVB-S SDTV HDTV DRM (HF)
DVB_T DRM (pilot) (pilot) DAB
vertical integration and horizontal integration concepts (Sherman,
1995). Managers should also be sensitive for dimensions of globalisation
as proposed by Abdul Rahman Embong (2000) and examine the ways of
handling these dimensions in the context of technological change,
policy change and market global forces from time to time.
Ć To raise broadcasting industry performance to a competitive level in the
international arena, managers should always use their position among
local broadcasting entrepreneurs with an open mind. Managers should
examine the differentiated approach being practised in world class
broadcasting industry such as BBC, NHK and KBS and be willing to
make changes in the local context.
Ć Among strategic actions of broadcasting managers, a platform for
discussion and cooperation between entrepreneurs of local
broadcasting industry should be created. The platform should be used
to build relationship network and subsequently for expanding
broadcasting and telecommunications activities regionally and at global
levels. While attempting to coordinate activities globally, managers
must be responsive to local needs.
Ć Create the philosophy of organisational human resource, i.e. appointing
the most suitable manager to a post in which he/she is able to plan a
strategy and implement it. For this purpose, there should be a strategic
management team and a management team which implements
planning at the operational platform. They together have and create a
strategy which is implemented responsibly. The performance of this
manager should be evaluated continuously.
Ć Understanding the socio-political needs of viewers/listeners in terms of
the reception methods of digital radio and interactive TV technology.
The broadcasted service and programmes should be those that can be
afforded by the audience and not a burden to them; for example, the
cost of buying an antenna and set-top-box.
(b) Management of Broadcasting Operations
Ć Carrying out modernisation of local broadcasting industry by taking
into account studies and the experience of successful global
broadcasting organisations, applied in local context, especially the
nooks and corners of broadcasting sector privatisation, in developing a
business planning which includes terrestrial analogue and interactive
digital broadcasting strategy in future.
Ć Continue to strengthen broadcasting sector excellence in the era of a
combination of telecommunications, computerisation and broadcasting
technology or multimedia. Expand the functions of broadcasting
stations with the setting up of new units according to the needs of
broadcasting multimedia. Based on current development and trend of
broadcasting, a new media unit should be created.
Ć Provide trained human resources and expertise. Match the multimedia
training needs with continuous training proposals to assure a quality
appointed and existing workforce in order to produce various contents
planned in the future.
Ć Organisation rebranding, either in telecommunications sector or in
broadcasting sector is a change from the external point of view and an
operation with the purpose of improving image performance of the
stations. Besides the change of the organisationÊs face, managers should
ensure that programming and interactive TV channel which were
previously planned to support the desired type of rebranding.
Ć Establish a network of interactive programme content suppliers and
ensure work process flow for fulfilling channels conforms to
programme evaluation guidelines supplied.
Ć Increase information flows to all levels of organisation. Marketing and
sales team should know about the role of advertisements which will be
different, i.e. future advertisements will be interactive and an additional
income source.
Ć Ensure Budget and Internal Audit Unit always monitors and performs
audits on management expenditure process.
Ć Identify smart partners who can cooperate with entrepreneurs of
broadcasting industry in strategy implementation as in Figure 8.8.
Figure 8.8: Smart Partnership between telecommunication entrepreneurs and
broadcasting managers
• The beginning of digital broadcasting and multimedia means radio and TV
management will have to face cross media broadcasting. This development
requires readjustment of technical operational standards and a system which
has wide implications. Preparation of programme content to fill up 24-hour
broadcasting and the elements of airtime marketing are new complexities for
future broadcasting management.
• In the effort to bring about progress to the telecommunications industry in
Malaysia, telecommunications management utilises the opportunity from
rapid developments and changes taking place in telecommunications field
environment. They should attempt to improve the telecommunications
technology facilities accessible by the audience. This effort will place
Malaysia in the category of an advanced country in the field of
telecommunications.
• Telecommunications management introduces various innovations especially
in the new media sector which enables consumers to access information from
any location with multimedia facilities. The existence of streaming
broadcasting through Internet and mobile telephone with broadband
facilities has brought the consumers closer to world knowledge and the
creation of K-community.
• ICT facilities, such as Internet broadband and teleconferencing, are a must in
order to progress further in business either in the country or overseas. Use of
these facilities is still low among businesses and trade communities.
• While there are many viewers and listeners who want interactivity and
involvement in programmes, marketing patterns are increasingly changing
where broadcasting network becomes a virtual marketing centre. In fact, if
the opportunity of the new revenue stream is not properly handled, a
competing media will control the broadcasting field.
• Symptoms of this phenomenon were clearly seen during the exhibition of
Broadcast Asia 2004 and 2005 where Mobile Phone-TV and Internet-TV
broadcasting already existed. It is possible that this broadcasting service
maybe extended to viewers and listeners onboard aeroplanes or ships
through Satellite Aided Internet Usage facilities. Now, it is the broadcasters
who go after viewers to deliver products and services wherever they are.
With the proper facilities, viewers can access broadcasting service in various
ways, and the roles of a broadcasting manager become more challenging.
• The last topic has outlined how the globalisation phenomenon can bring an
impact on, particularly, the telecommunications industry in Malaysia.
Digitalisation has a big implication on the telecommunications industry
(either new media or old media). This involves new planning for the human
resources development, hardware and national development, in general.
Many challenges must be faced proactively by media managers of each
organisation. These future challenges can be turned into opportunities to
bring about positive changes to the organisation, community and the
country.
Digital Audio Broadcast
Digital Video Broadcast
Globalisation
High Definition TV (HDTV)
Simulcasting/Multiplatform
Streaming Broadband
Technological Combination
Technological Leap
Television Digital
Abdul Rahman Embong. (2000).Wacana Globalisation. In Noraini Othman &
Mandal, S.K., Malaysia Menangani Globalisation: Peserta atau Mangsa.
Bangi: UKM.
ABU ICT Forum (2004). UNESCO-ITU-ABU Regional Convention: Serving
Communities Through ICTs. Kuala Lumpur. 26-29 July 2004.
ABU Study Tour (2005). KBS Multimedia Overviews. Presentation by KBS, Seoul,
Korea. 25-26 April 2005.
ABU. (18 Mac, 2005). ABU weekly News Digest.e-newsletter@abu.org.my
AC Nielsen (2005). Audience Needs in Digital Content. Presentation by AC
Nielsen, Petaling Jaya. 11 April 2005.
ABU. (2005). Broadcasters Must Defend Frequency Spectrum Turf. In ABU News,
Asia-Pacific Broadcasting Union publication, 24(2).
Broadcast Asia (2004). Mobile Phone TV Trials for Singapore? Broadcast Asia 2004.
Giunta, T.K. (2005). Introduction. In The Preston Gates Guide to
Telecomunications in Asia. Hong Kong: Preston Gates and Ellis.
Lim, A.L. (2005). Media PrimaÊs Costly Acquisition. In The Edge Malaysia. 20 Jun
2005,.20-22.
Pillai et.al. (2005). Introduction. In The Preston Gates Guide to Telecomunications
in Asia. Hong Kong: Preston Gates and Ellis.
OECD (1992). Telecommunications and Broadcasting: Convergence or Collision?
Paris. P52.
Sherman, B.L. (1995). Telecommunications Management. New York: McGraw Hill.
The Star. ( 9 Mac 2005 ). ÂMiTV targets 100,000 subscribers in 1st year.Ê
The Star. (17 August 2004). Â7.5 million in SMS votes for Akademi FantasiaÊ.
Waisboard (2002). TV in The Age of Globalisation: From the Viewpoint of Promoting
Mutual Understanding. In The 11th JAMCO International Symposium.
Available: http://www.Jamco.or.jp/2002_symposium/en/index.html
Course Guide xi - xv
Topic 1 Introduction 1
1.1 Telecommunications and Broadcasting 2
1.1.1 What is Telecommunications? 2
1.1.2 What is Broadcasting? 3
1.2 What is the Meaning of Management 5
1.2.1 What is Telecommunications Management? 5
1.3 Management Study Approach 6
1.3.1 Functional Discipline 7
1.3.2 Human Achievement 7
1.3.3 Management Science 8
1.4 Telecommunications Management Components 8
1.4.1 Telecommunications Management Skills 9
1.4.2 Telecommunications Management Functions 11
1.5 Telecommunications Management Roles 16
1.5.1 Interpersonal Aspects 17
1.5.2 Information Aspect 18
1.5.3 Decision Making Aspects 19
1.6 Types of Management Occupations 20
1.6.1 ManagersÊ Roles 22
1.7 Telecommunications and Leadership 23
Summary 24
Key Terms 25
Reference 25
Topic 2 Telecommunications Management Theory 26
2.1 Development of Management Theory 27
2.2 Classical Perspective (1890-1920Ês) 33
2.2.1 Scientific Management 34
2.2.2 Bureaucratic Management 37
2.2.3 Administrative Management 38
2.3 Behavioural Perspective (Beginning In 1920Ês) 41
2.3.1 Human Relations Movement 42
2.3.2 Human Resource Approach 42
2.3.3 Behavioural Science Approach 46
2.4 Quantitative Perspective (Early 1940Ês) 47
2.4.1 Management Science 47
Table of Contents
iv X TABLE OF CONTENTS
2.4.2 Operations Management 48
2.4.3 Management Information System 48
2.5 Contemporary Perspective (1950-2000) 48
2.5.1 Contemporary Management 49
2.6 Management by Objective ă MBO 50
2..6.1 System Approach 51
2.6.2 Contigency Theory 52
2.6.3 Japanese Management Approach 52
2.7 Management Styles 56
2.8 Telecommunications Organisation Management Model 58
Summary 60
Key Terms 60
Self Test 1 61
Self Test 2 61
Reference 62
Topic 3 Electronic Media and Information, Communication 64
and Technology (ICT)
3.1 Electronic Media 65
3.2 Information Technology and Communication 68
3.3 Aims of Telecommunications Management 70
3.3.1 Making Inaccurate Predictions of Audience Tastes 71
3.3.2 High Cost of Maintenance 71
3.4 Basic Activities of a Media Organisation 74
3.4.1 Development 74
3.4.2 Production 75
3.4.3 Distribution 76
3.4.4 Display 77
3.5 Electronic Media Landscape 77
3.5.1 Radio Broadcasting 78
3.5.2 Television Broadcasting (TV) 80
3.6 Development of Television Broadcast in Malaysia 82
Summary 84
Key Terms 85
Reference 86
Topic 4 Telecommunications Industry Structure 87
4.1 Telecommunications Industry Structure 88
4.1.1 Telecommunications Organisation 89
4.2 Market Structure Elements 90
4.2.1 Sellers Concentration 90
4.2.2 Product Differentiation 92
TABLE OF CONTENTS W v
4.2.3 Barriers of Entry 93
4.2.4 Buyers Concentration 94
4.2.5 Growth in Demand 94
4.3 Market Behaviour Principle 95
4.3.1 Price Determination Policy 95
4.3.2 Quality Control Policy 96
4.3.3 Competitive Policy 96
4.4 What are the Elements of Market Achievement? 96
4.4.1 Efficient Use of Resources 97
4.4.2 Stability of Prices and Employment 98
4.4.3 Fair Deal to All 98
4.4.4 Growth and Planning 98
4.5 Levels of Industry Development 101
4.5.1 Level I: Introduction 101
4.5.2 Level II: Development 102
4.5.3 Level III: Maturity 102
4.5.4 Level IV: Decline 102
Summary 102
Key Terms 103
Reference 103
Topic 5 Management of Educational TV Broadcasting 104
5.1 Background of Educational Television (ETV) 105
5.1.1 Vision and Mission of ETV 106
5.1.2 ETV Objectives 106
5.2 Effects of Changes in Broadcasting Policy 107
5.3 Organisational Structure 108
5.3.1 Educational TV Sector 108
5.3.2 Engineering Sector 108
5.4 Establishment 111
5.4.1 Producer 111
5.4.2 Script Assistant 112
5.4.3 Cameraman 113
5.4.4 Audio Technician 113
5.4.5 Lighting Technician 114
5.4.6 Editor 114
5.4.7 Technical Producer 115
5.4.8 Video System and Camera Control Unit (CCU) 115
Technician
5.4.9 Video Mixer 116
5.4.10 Graphic Designer 116
5.4.11 Make-up Artist 117
5.4.12 Photographer 117
vi X TABLE OF CONTENTS
5.4.13 Set Maker 118
5.4.14 Music Supervisor 118
5.5 Educational TV Programme 119
5.5.1 Preview 119
5.5.2 Educational TV Programmes Preview 120
5.5.3 Where a Preview is Made 120
5.5.4 Preview Committee 120
5.5.5 What Subjects are Evaluated? 120
5.6 Supporting Materials/Handouts Notes that must be 123
Prepared during Evaluation Session
5.7 Use of Educational TV in Schools 125
5.7.1 Use of Educational TV in Teaching and Learning 125
5.7.2 Educational TV Supporting Materials 126
5.7.3 Usage of Log Book 127
5.7.4 The Roles of State Educational Resource Centre 127
(SERC) and TeachersÊ Activity Centre (TAC)
5.7.5 Monitoring in Schools 128
5 .8 Use of Satellite TV 128
5.8.1 Satellite TV Equipment Supplied to Schools 128
5.8.2 Troubleshooting 129
5.8.3 Educational TV Broadcasting Time 129
5.9 The Future of Educational TV 129
5.10 Financial Management of Educational TV Programme 131
Summary 132
Key Terms 132
Reference 132
Topic 6 Marketing and Sales Management 133
6.1 Broadcasting Marketing 134
6.2 Advertisers, Agencies, Stations, Station Agents, 136
and Media Planners
6.2.1 Advertiser 136
6.2.2 Advertising Agency 137
6.2.3 Station 139
6.2.4 Station Agents 142
6.2.5 Media Planners 142
6.3 Media Objectives 146
6.3.1 Impression 147
6.3.2 Gross Rating Point 148
6.3.3 Access 148
6.3.4 Frequencies 150
6.4 Factor Influencing Media Selection 150
6.5 Ratings 152
TABLE OF CONTENTS W vii
6.6 Media Product Promotion 153
Summary 153
Key Terms 154
Reference 154
Topic 7 Cable / Satellite Broadcasting System 155
7.1 Broadcasting Cable System 156
7.2 Cable System Structure 157
7.2.1 Headend Point 158
7.2.2 Distribution Network 158
7.2.3 Receiving Equipment (House Drop) 158
7.3 Cable TV Business 159
7.3.1 Cable TV Stations 159
7.3.2 Producer/Provider of Cable Programme 160
7.4 Cable System Management 160
7.5 Responsibilities of a Cable TV Manager 162
7.5.1 Cable TV Programme 162
7.6 Cable Management 165
7.7 Satellite Broadcasting 165
7.8 Components of Communication Satellite 167
7.9 Direct Broadcasting Satellite (DBS) 168
Summary 169
Key Terms 169
References 169
Topic 8 The Future of Telecommunications Management 171
8.1 Development of Telecommunications Sector in Malaysia 172
8.2 Regulator 174
8.3 Globalisation Impact in Telecommunications Field 175
8.3.1 Changes in Local media 175
8.3.2 TELCO and CELCO Sectors 176
8.3.3 Broadcasting Sector 177
8.4 Expansion of Global Telecommunications Industry 178
8.5 The Future of TELCO and CELCO 181
8.6 Challenges from Outside 182
8.7 Future Challenges of the Broadcasting Industry 185
8.7.1 Competition in Broadcasting Media 186
Environment
8.7.2 National Broadcasting Digitalisation Project 188
8.7.3 Digital Broadcasting Advantages 189
viii X TABLE OF CONTENTS
8.8 Challenges to the Broadcasting Manager 190
8.8.1 Implications of Digitalisation Project 190
8.8.2 Roles of Manager in Facing Future Challenges in 193
Broadcasting Industry
Summary 196
Key Terms 197
Reference 197
Topic 1 focuses on definition of concepts used in the course. These are: definition
of telecommunications, broadcasting and management. Students are also exposed
to important components of telecommunication management.
Topic 2 allows students to understand managerial aspects more academically;
this topic focuses attention on management theory in general. Management
theory is considered essential in this context to enable students to apply it in the
actual organisational climate.
COURSE GUIDE xiii
Topic 3 exposes students to the participants involved in the broadcasting and
telecommunications industry. Discussions are about activities of media and ICT
industries, as well as requirements of the telecommunications industry pertaining
to managerial aspects.
Topic 4 discusses the important elements of the telecommunications industry
including market structure, behaviour, market performance and media maturity.
Topic 5 introduces one of the participants in the national broadcasting industry
which is Educational Television (ETV). ETVÊs participation is rather different
from other public and private media organisations because of its different target
audience and working styles. ETV is discussed in the course to allow students to
differentiate its role as one of broadcasting participants which is equally
important in broadcasting and telecommunications development.
Topic 6 discusses the marketing and sales process regarding broadcasting and
telecommunications industry. Essential elements in marketing and sales aspects
are advertising and advertising agencies, as well as ratings aspect which is
emphasised by media planners and the management of broadcasting and ICT
industry.
Topic 7 introduces cable TV and Satellite TV broadcasting systems, which is a
technologically innovative product which enables communication satellites to be
easily used without being assessed by terrestrial TV. Communications satellites
have facilitated information dissemination, entertainment and interactive
communications between the participants of national, regional and global
telecommunications industry.
Topic 8 discusses up-to-date media and telecommunications scenario as well as
various challenges currently facing the new media management. However, these
challenges must be handled wisely to be turned into opportunities taking the
organisation and the nation to a higher level, and creating a K-society as expected
by 2020.
xiv COURSE GUIDE
TEXT ARRANGEMENT GUIDE
Before you go through this module, it is important that you note the text
arrangement. Understanding the text arrangement will help you to organise your
study of this course in a more objective and effective way. Generally, the text
arrangement for each topic is as follows:
Learning Outcomes: This section refers to what you should achieve after you
have completely covered a topic. As you go through each topic, you should
frequently refer to these learning outcomes. By doing this, you can continuously
gauge your understanding of the topic.
Self-Check: This component of the module is inserted at strategic locations
throughout the module. It may be inserted after one sub-section or a few sub-
sections. It usually comes in the form of a question. When you come across this
component, try to reflect on what you have already learnt thus far. By attempting
to answer the question, you should be able to gauge how well you have
understood the sub-section(s). Most of the time, the answers to the questions can
be found directly from the module itself.
Activity: Like Self-Check, the Activity component is also placed at various
locations or junctures throughout the module. This component may require you
to solve questions, explore short case studies, or conduct an observation or
research. It may even require you to evaluate a given scenario. When you come
across an Activity, you should try to reflect on what you have gathered from the
module and apply it to real situations. You should, at the same time, engage
yourself in higher order thinking where you might be required to analyse,
synthesise and evaluate instead of only having to recall and define.
Summary: You will find this component at the end of each topic. This component
helps you to recap the whole topic. By going through the summary, you should
be able to gauge your knowledge retention level. Should you find points in the
summary that you do not fully understand, it would be a good idea for you to
revisit the details in the module.
Key Terms: This component can be found at the end of each topic. You should go
through this component to remind yourself of important terms or jargon used
throughout the module. Should you find terms here that you are not able to
explain, you should look for the terms in the module.
COURSE GUIDE xv
References: The References section is where a list of relevant and useful
textbooks, journals, articles, electronic contents or sources can be found. The list
can appear in a few locations such as in the Course Guide (at the References
section), at the end of every topic or at the back of the module. You are
encouraged to read or refer to the suggested sources to obtain the additional
information needed and to enhance your overall understanding of the course.
PRIOR KNOWLEDGE
Those of you who specialise in Web Broadcasting programme, which is one of the
Multimedia Communications programmes, should have taken the CBMM2103
course: Information Technology, Media and Society. However, students wishing
to take the course as an elective are not subject to any conditions.
ASSESSMENT METHOD
Please refer to myINSPIRE.
REFERENCES
Abbot, D. (1999) Cutting Edge Advertising, Singapore; Prentice-Hall
(Singapore) Pte. Ltd.
Albarran, A. B. (2002). Management of Electronic Media, (2nd. ed.). Belmont,
CA: Wadsworth Thomson Learning.
Craft, J. E., Leigh, F. A., & Godfrey, D. G. (2001), Electronic Media. Australia:
Wadsworth Thomson Learning.
Dominick, J. R. Messere, F., & Sherman, B. L. (2004) Broadcasting, Cable,
theInternet and Beyond: An introduction to Modern Electronic Media. (5th.
ed.). Boston, MA: McGraw-Hill.
Eastman, S. T. Ferguson, D. A., & Klein, R. A. (2002). Promotion and Marketing
for Broadcasting, Cable and the Web. (4th. ed.).Boston: Focal Press.
Gershon, R. A. (2001). Telecommunications Management: Industry Structures
and Planning Strategies. Mahwah, New Jersey: Lawrence Erlbaum Associates,
Publishers.
Green, J. H. (2001). The Irwin Handbook of Telecommunications Management.
(3rd. ed.). New York: McGraw-Hill.
xvi COURSE GUIDE
Gross, L. S. (2000). Telecommunications: An Introduction to Electronic Media
(7th. ed.). Boston, MA: McGraw-Hill.
Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. (2nd. Ed.). New York: Mcgraw-Hill.
TAN SRI DR ABDULLAH SANUSI (TSDAS) DIGITAL LIBRARY
The TSDAS Digital Library has a wide range of print and online resources for the
use of its learners. This comprehensive digital library, which is accessible through
the OUM portal, provides access to more than 30 online databases comprising
e-journals, e-theses, e-books and more. Examples of databases available are
EBSCOhost, ProQuest, SpringerLink, Books24x7, InfoSci Books, Emerald
Management Plus and Ebrary Electronic Books. As an OUM learner, you are
encouraged to make full use of the resources available through this library.
INTRODUCTION
This topic will introduce you to basic telecommunications and management
concepts. Through this first discussion, you are expected to understand the
meaning of management in the context of the telecommunications industry. You
will also be exposed to components of the telecommunications management. The
aim is to allow you to apply them in your career. In this course, the
telecommunications field will also include broadcasting and multimedia
communications.
Introduction
By the end of the topic, you should be able to:
1. Explain the definition of telecommunications, broadcasting and management;
2. Identify the three approaches of telecommunications study;
3. Identify three components of telecommunications management;
4. Discuss and explain the duties, functions, roles and responsibilities of
a media or communications manager in a telecommunications
organisation; and
5. Discuss the relationship between management and workers in a telecommunications organisation.
LEARNING OUTCOMES
TELECOMMUNICATIONS AND BROADCASTING.
1.1.1 What is Telecommunications?
The term „telecommunications‰ is made up of two words, which are "tele" and
"communication". In Greek, "tele" means long distance.
We also often find the prefix „tele‰ in words such as
telephone, telegram, telefax, teletext, television, teleprinter,
teleprompter, teleconference and teleport. What is the
meaning of each of these concepts? All refer to the use of
networks and communications at long distances.
When we communicate, we exchange ideas and
information through writing, talking, speaking and non-
verbal signals. If the communication involves long-distance communication,
equipment such as telephone, facsimile machine and others are used. There are
individuals who can communicate with other people without any equipment but
through what is called telepathy, which uses thought and spiritual channels, but
this is hard to prove empirically.
Sherman (1995) regards telecommunications organisations as private and public
organisations which are particularly involved in the business of developing,
Therefore, telecommunications refers to the science and
technology of communications, which channel or transmit
signals electronically through communications satellite
cables, telephones, telegraphy, radios or televisions.
According to Gershon (2001), telecommunications refers to communication
at a long distance.
SELF-CHECK 1.1
What crosses your mind when the word „broadcasting‰ is
mentioned? Make a list of anything you may relate to in broadcasting.
Check the list. Will the concepts be consistent with the importance of
broadcasting in your life activities?
publishing, distributing and showing of programmes with elements of
entertainment and information to the public through electronic media, that is,
non-print media.
In this course, the term „telecommunications‰ is used with two meanings:
(a) Electronic media (radio, television, online media); and
(b) Common carriers, such as people, companies or carriers/channels of
tangible products such as communications satellites, broadcasting
equipment and fibre optics or intangibles, such as information super
corridors.
1.1.2 What is Broadcasting?
The definition of broadcasting, according to E.S. Foster (1978) is as follows:
We give various definitions of broadcasting depending on the importance and
uniqueness of this field to us. In general, broadcasting is interpreted as the
channels for transmitting information, entertainment, education and economic
resources.
Figure 1.1: Channels of broadcasting
The concept of broadcasting may have a different meaning for different
individuals and organisations. The difference in meaning will depend on the
extent of its importance to an individual or an organisation. Our perception
towards broadcasting is influenced by our position in the field of broadcasting.
Broadcasting, by definition, is the transmission of radio and television signals
to the public wherever people may be ă in homes, in office, in automobiles, on
picnics, etc.
(Source: E.S. Foster, Understanding Broadcasting, 1978. p.18)
Below are perceptions of several individuals with different posts or positions in
broadcasting.
Shareholders in a broadcasting organisation may define
broadcasting from the economic viewpoint, that is whether
this field will earn him profits or not.
An advertiser who sponsors a broadcasting programme
will regard broadcasting as a medium to attract a target
audience and increase its source of funds.
The manager of a broadcasting station will regard
broadcasting as a source of income or professional prestige.
For a creative person, broadcasting is a platform to highlight
talents and a stepping stone to create a reputation and achieve
success in his career.
For workers such as broadcasting reporters, scriptwriters or
publishers, broadcasting is a medium to highlight their skills,
besides achieving their ambitions in the career.
Other participants in the broadcasting industry will think in terms
of profits they may obtain in the forms of power, popularity,
finance etc.
ACTIVITY 1.1
8TV managed an entertainment programme, Malaysian Idol, not long
ago. For its first winner, Jaclyn Victor, this programme was a platform
to highlight her singing talent and earn the opportunity to become a
popular singer. For the management of 8TV and advertisers, the
programme was a lucrative source of income for their organisations.
As a viewer, what can you conclude about the broadcasting field?
WHAT IS THE MEANING OF MANAGEMENT?
Management originates from a Latin term, that is, „manus‰ (hand). Originally,
the term referred to the task of looking after and training a horse. Since then it has
gradually been applied to the task of managing, training, governing, directing
and influencing other people (Sherman, 1995).
Figure 1.2: Management originates from a Latin term, „manus‰, that is hand
1.2.1 What is Telecommunications Management?
This is a task for a media manager with the responsibility of efficiently running a
media station with respect to human resource management and handling of
production studio equipment. Therefore, a successful station manager is a person
who is able to manage the Human Resource Department efficiently, besides
understanding the technical aspects of using station equipment.
When dealing with the theory of telecommunications management, focus will be
given on both micro and macro aspects. Figure 1.3 describes the micro and
macro aspects.
1.2
Telecommunications management refers to the ability to supervise,
motivate and handle equipment with low expenses.
Figure 1.3: Focus of telecommunications management theory
MANAGEMENT STUDIES APPROACH
There are three main points in the management study approach, which are:
(a) Functional discipline;
(b) Human achievement; and
(c) Management science.
Figure 1.4 briefly explains management study approaches.
Figure 1.4: Approaches of management study
Source: Sherman B. L. (1995). Telecommunications Management Broadcasting/Cable and
the New Technologies. NY: McGraw - Hill, Inc.
1.3.1 Functional Discipline
What do you understand by functional discipline? This aspect outlines the tasks,
roles and responsibilities of a media manager. Through guidelines of a functional
discipline, a media manager understands functions that must be performed. To
ensure the performance of responsibilities of a successful media manager, he/she
must carefully examine the characteristics and skills of a successful manager as a
guide. Even though the manager is encouraged to study the experience and skills
of an experienced manager, to be a successful manager he/she should not
necessarily follow an old style of management when he/she is given a
management responsibility.
1.3.2 Human Achievement
Human achievement emphasises individual roles in an organisation. The aim is
to manage workers' motivation, loyalty, satisfaction and to encourage individuals
to think of individual and organisational goals. Briefly, this approach states that
the media manager is responsible for encouraging workers to achieve excellent
job performance.
1.3.3 Management Science
Through management science, emphasis is given to complex organisational
behavioural structure. The media manager should understand that organisational
success depends on workersÊ excellence.
Besides understanding telecommunications management study approaches, a
media manager also needs a deeper understanding about the components of
telecommunications management.
TELECOMMUNICATIONS MANAGEMENT COMPONENTS.
Telecommunications management is divided into three components, namely:
(a) Skills;
(b) Functions;
(c) Roles.
1.4
ACTIVITY 1.2
After understanding the three components in telecommunications
management study approaches, make a list of similarities and
differences in telecommunications organisational management
(including broadcasting) compared with other organisations. To
facilitate this exercise, select a broadcasting station and a large
organisation (not in telecommunications) in Kuala Lumpur.
Table 1.1: Components of Telecommunications Management
SKILLS
(a) Technical
(b) Human
(c) Conceptual
FUNCTIONS
(a) Planning
(b) Organising
(c) Staff placement
(d) Controlling
(e) Innovation
ROLES (a) Interpersonal
(b) Information
(c) Decision making
(i) figure head
(ii) leader
(iii) mediator
(i) supervisor
(ii) information
disseminator
(iii) spokesperson
(i) distributor
(ii) judge
(iii) consultant
Source: Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. NY: McGraw-Hill, Inc. p.23
1.4.1 Telecommunications Management Skills
Figure 1.5 shows three things that must be emphasised regarding a media
managerÊs skills.
Figure 1.5: Media managerÊs skills
As the telecommunications industry is characterised by technology, technological
innovation cannot be avoided. Therefore, a manager handling a
telecommunications organisation or systems should have a high understanding
of technical aspects and up-to-date equipment needed by the station. Media
managers should understand the basics of radio waves, signal transmissions and
recording systems as well as media equipment and broadcasting technology so
that it will be easy for them to perform their duties excellently. Below is a more
detailed explanation regarding the three important aspects of a media managerÊs
skills.
(a) Technical Skills
A media manager should understand and have a good knowledge of all
technical aspects. This includes understanding and being able to efficiently
use production equipment such as camera and editing machine. If his/her
specialisation is in information technology, then he/she should be an expert
in handling information technology and always keep abreast of the latest
knowledge in the field.
(b) Human Skills
A successful media manager also possesses the ability or skill in human
aspects. This includes skills to interact as a leader with subordinates and
with other people in the organisation.
High human skills enable the media manager to generate a high level of
productivity and build a good working relation. This is not limited to the
management group only, but also includes staff and those in support
groups.
The ability to handle human matters is also important because there are
various groups of staff in the broadcasting station. These groups include
professional management groups, creative staff (scriptwriter and director)
as well as support group (production crew).
(c) Conceptual Skills
A media manager must act efficiently. This can be ensured only through
conceptual ability and skill. This skill refers to intellectual ability and
intelligence in making decisions. This also relates to the skill of
understanding intra-organisational and inter-organisational relations either
in the telecommunications industry, broadcasting and/or ICT at
community and world levels.
Every production will always face various problems. Therefore, a manager
should be smart in handling problems either relating to human resource or
marketing matters.
A managerÊs performance is also judged from the aspect of his/her skill in:
(i) Identifying, selecting and accessing certain and appropriate information for
the organization; and
(ii) Using available resources to achieve organisational goals.
1.4.2 Telecommunications Management Function
There are five telecommunications management functions, as shown in Table 1.2.
Table 1.2: Telecommunications Management Functions
Planning Organising Staff
Placement Controlling Innovation
• Plan
organisational
objectives
• How to
achieve
objectives
• What are the
ways to
achieve
objectives
• Organising
and
coordinating
tasks
• Recruit
• Training
• Evaluating
• Prepare
standards
• Communication
standards
• Measure
achievement
• Correct errors
Introducing
new
equipment
Source: Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. NY: McGraw-Hill, Inc. p.25
(a) Planning
In the planning process, a manager considers the station objectives and
ways of handling the station in achieving the objectives.
At this stage, planning is focused on:
(i) What is to be implemented;
(ii) How to implement; and
(iii) Who will implement it.
Planning refers to directing the future of the organisation and the ways
to achieve the formulated objectives.
If we refer to a television station, the he/she will consider what form of
programmes will be broadcasted. If it decides to broadcast a news
programme, who should be trusted to read the news and how much should
be charged for advertisements?
Telecommunications planning includes five basic planning stages. Figure
1.6 shows the five stages.
Figure 1.6: Basic telecommunications planning
The planning process requires the manager to make forecasts and
expectations to achieve the stationÊs objectives. A successful
telecommunications manager normally possesses such ability to forecast.
For example, in the early history of establishing RCA in the USA, David
Sarnoff in 1916 was able to predict the potential of the radio music box.
Similarly, Charles Dolan was successful in realising his idea of establishing
HBO, while Ted Turner established Cable News Network (CNN) .
OPIC 1 INTRODUCTION W 13
Figure 1.7 below explains a short history of Cable News Network (CNN).
Figure 1.7: Short history of Cable News Network (CNN)
(b) Organising
Bartol & Martin (1991) regard this function as a process of dividing and
organising human and non-human resource to achieve organisational
planning. Sherman (1995: 26-27) explains this function as distributing and
coordinating tasks in the corporation/organisation to ensure a maximum
level of efficiency in the efforts to achieve planning objectives. Since the job
of coordinating and distributing tasks is not easy, especially in the
telecommunications industry which has many varied job specifications,
organising has to be done based on the following:
(i) Organising the organisational structure by applying a specific
organisational model, coded job descriptions, clear evaluation,
procedure to present dissatisfactions, and so on.
(ii) Formation of departments for each particular function in the
organisation. For example, a television station has a particular
department or division for scheduling, sales, engineering, news,
promotion, public affairs, research, etc.
(iii) Delegation of responsibilities by the management to executives. .
Good management of expertise is essential at each management level.
Through the organising process, the manager identifies tasks and
coordinates responsibilities within the organisation. Therefore, it is essential
for a media manager to identify responsibilities and ensure that those
responsible perform such tasks.
The field of telecommunications needs the participation of many parties,
such as accountants, researchers, engineers, planning executives, salesmen
and others. To facilitate cooperation of each party, task organisation should
be done structurally, that is through the use of a clear model to evaluate
problems should they arise. In the structural organisation, each member of
the staff is given details of responsibilities through a specific flow chart.
Besides that, it is also through this system that tasks are distributed
according to units or departmental functions. The existence of different
departments requires systematic task delegation. Figure 1.8 shows an
example of an organisational chart.
Figure 1.8: Organisational chart
(c) Staff Placement
Besides creating the structure of organisation, what are other
responsibilities of the media manager? A media manager is also responsible
for recruiting new staff and executives, as well as providing training for
them. Until recently, the number of graduates in the field of media and
communications study has been increasing and this has provided an
opportunity for stations to get new and a highly qualified workforce.
However, some inexperienced graduates may not be prepared to accept
work requiring technical and conceptual expertise.
Therefore, a media manager must think of new ways of recruiting staff, that
is, either by searching for new talented staff, or by advertising for the job
with a sufficiently high salary. Hitz.fm sponsored nationwide voice tests in
order to get talented and interested news readers.
(d) Controlling
Organisational activities must be monitored and controlled so that they
adhere to an expected standard and achieve desired goals (Bartol & Martin,
1991:8-9)
Organisational control is a communication function. In this case, the
management should explain the corporate goals to the staff and determine
how organisational goals may be achieved. This function includes the
following tasks:
(i) Specifying organisational standards, that is, in quantitative and
qualitative terms. For example: In television broadcasting landscape
currently participated by various stations, standards include
advertising income, audience access and outreach.
(ii) Informing, explaining and disseminating information regarding
standards widely depending on organisational facilities and formats.
(iii) Measuring performance with standards through several modes of
feedback, i.e. formally and informally; and
ACTIVITY 1.3
You might have heard of and/or watched the programme Pengacara
Jemputan Nona on TV3. This is an example of an effort by the top
management of a television station in trying to get new faces to handle
programmes produced by the station. Can you think of any other
ways which television stations can use for the purpose of searching for
new talents?
(iv) Correcting any diversion or any action which is not consistent with
organisational vision.
To fulfil controlling responsibility, management should explain the
corporate vision and station's vision to all layers of organisational staff. This
process is essential in ensuring that the staff understands the station's
expectation and needs.
(e) Innovation
Telecommunications is a field which is generally exposed to innovation.
Creation of new equipment is not only aimed at replacing the functions of
old equipment, but also to upgrade them. Innovation may happen either by
involving internal or external aspects. This element is essential for the
development of the station and the management must follow this
development and quickly accept or adapt any technological innovation
which is important for the organisation.
TELECOMMUNICATIONS MANAGEMENT
ROLES
In telecommunications management, a chief operating officer plays three main
roles in developing the organisation. His/her roles are depicted in Figure 1.9.
Figure 1.9: Roles of the chief operating officer
1.5
ACTIVITY 1.4
In your view, why is control of organisational activities needed? If
controlling is not done, will it ever lead to destruction?
Table 1.3 below shows the roles of telecommunications management.
Table 1.3: The Roles of Telecommunications Management
INTERPERSONAL INFORMATION DECISION MAKING
• Leader
• Responsibility to manage
structure and functions
• Figurehead
• Special tasks
• Communicator/mediator
• Horizontal/vertical
Communication
• Information
disseminator
• Monitor
• Spokesperson
• Change agent
• Delegator
• Decision maker
1.5.1 Interpersonal Aspects
From the interpersonal aspect, the Chief Operating Officer acts as the
organisational leader. He/she is responsible to ensure the smooth management
with respect to structure and functions. In certain situations, the organisational
leader is seen as the carrier of organisational image. Normally situations arise
when they perform tasks outside the organisation. Besides that, a leader is also a
mediator or communicator of communications networks horizontally or
vertically inside or outside the organisation.
The tasks of a manager relating to interpersonal aspects are as follow:
Ć Leader;
Ć Figurehead;
Ć Liaison
(i) Leader
A manager is responsible to lead his/her organisation. He/she must create
relationships with subordinates or workers under him/her and effectively
communicate with all staff and workers in the organisation. A manager and
organisational leader must ensure that the organisational functions and
efforts of the entire staff are always moving forward.
(ii) Figurehead
A manager is regarded as a chief executive who carries out official
responsibilities for the organisation whether the tasks have legal or social
implications. Therefore, he/she will always be seen as a representative of
the organisation in official functions. For example, the General Manager of
ABC Network will represent his/her organisation in celebrating the
SultanÊs Birthday in his/her state; the Chief Engineer of station XYZ will
represent his/her organisation in a regional telecommunications conference
and a Marketing Manager will play his/her role in entertaining a potential
customer for the organisation.
(iii) Liaison
A manager is regarded as a communication channel for the organisation. As
a communicator between telecommunications organisations, he/she plays a
role to maintain network relationship and provide assistance and
information to certain parties outside the organisation.
1.5.2 Information Aspect
One of the important aspects of responsibilities handed to the manager of a
media and telecommunications organisation is the responsibility related to the
process of acquiring, collating and presenting information. In this role, the
manager needs to present information to the audience in and out of the
organisation. In this case, his/her role is divided into three parts, which are:
Ć Monitor;
Ć Disseminator/Distributor; and
Ć Spokesperson
(a) Monitor
A manager has to monitor and examine his/her communication
environment to identify if there is anything that may benefit the
organisation and its staff. To carry out the function successfully, the
manager normally subscribes published materials relevant to his/her area
and becomes a member of an organisation or association which is active in
his/her field of specialisation or skill.
(b) Disseminator/Distributor
After getting important and meaningful information from internal and
external sources, the manager presents the information in a meeting or
formal/informal gathering, through a memo or letter, notice board or
bulletin board, online, etc.
(c) Spokesperson
Consistent with his/her role as information disseminator, the manager is a
spokesman for the organisation in an internal or external function or as a
writer preparing and delivering the contents of statements, speech text, or
an editorial for the organisationÊs official newsletter.
1.5.3 Decision Making Aspect
A media manager has a big responsibility as a decision maker. In managing this
function, he/she is responsible to think and decide on the following:
As an example:
Ć The manager of a radio station A needs to think of the stationÊs format, what
kind of music is to be programmed, which DJ should be discharged, what is
the total cost for a 30-second spot advertisement, etc., and
Ć The manager of a cable TV station X needs to decide what kind of programme
his/her station should provide, how to charge the service cost and also how
to market services nationwide.
If a conflict arises among the staff, the manager acts as a judge to ensure the
conflict is addressed in the best possible manner without causing dissatisfaction
among the parties involved. Besides that, there may also be a conflict occurring
outside the organisation, needing the manager to handle, for example, a problem
with a shareholder or other external organisation which is not satisfied with the
broadcasting station.
Principally, the decision-making tasks of a manager are as follows:
Ć Allocator;
Ć Adjudicator; and
Ć Negotiator
(a) Allocator
The manager divides the allocation of funds, time, equipment or labour
force to units, divisions or branches in the organisation. He/she should be
seen as wise in creating and encouraging innovation so that the
organisation always maximises the potential of its staff and organisation.
(b) Adjudicator
The manager has to study and solve conflicts or disputes. He/she must
think of preventive measures besides preparing to face the possibilities of
the occurrence of any difficulty or tension.
(c) Negotiator
An organisational leader is regarded as a man who will come forward to
negotiate matters relating to the organisation either formally or informally,
technical issues, administrative matters, trade union matters, either
internally or externally.
Example:
The Chief Operating Officer of Media Prima TV network is Datuk Ahmad Farid
Ridzuan. While carrying out his duties in the organisation, not in view of the
public, he is responsible for ensuring the smooth running of the management
function of the private television station. When TV3Ês staff was busy touring the
nation with the Sure Heboh programme, Datuk Farid was always seen together
with his production crew. At that time, he was a symbol for TV3Ês corporate
image.
TYPES OF MANAGEMENT OCCUPATIONS
There are two types of management occupations: vertical and horizontal. The
vertical dimension refers to hierarchical management levels as follows:
Figure 1.10: Vertical dimension hierarchy
Horizontal dimension refers to functional areas or managerial responsibilities, as
shown in Figure 1.11.
Figure 1.11: Horizontal dimension hierarchy
Tasks and responsibilities of a manager are explained in Table 1.4.
Table 1.4: Tasks and Responsibilities of a Functional Manager,
General Manager and Project Manager
TASKS RESPONSIBILITIES
Functional
Manager
This is a manager in a specific area or aspect in the organisation. This
function includes supervision of individuals with special expertise e.g.
Human Resource Manager, Marketing Manager, Financial Manager,
Accounting Manager, Engineering Manager, Production/Operations
Manager, Quality Manager and others.
General
Manager
Responsible for the whole organisation or one particularly large sub-
unit, covering many specialised fields.
Project
Manager
Coordinate efforts involving individuals in several different
organisational units but are involved in a particular project.
1.6.1 Managers' Roles
The manager of an organisation has several roles, including entrepreneur, idea
champion, promoter and/or mobiliser.
(a) Entrepreneurial Role
A visionary manager often puts forward new ideas and thinks of ways of
improving processes, products or services.
(b) Idea Champion
A manager with calibre always generates new ideas which he believes to be
valuable; he/she is daring enough to implement these new ideas despite
barriers of all types.
(c) Promoter
A dynamic manager always tries to get the required funds for the
innovation development and accelerates its implementation.
(d) Mobiliser
A manager does not only put forward a new idea but also brings out these
new thoughts with confidence and creativity, seeks sufficient financial
resources to finance innovative activities and creates incentives for middle
managers to promote new ideas and protect people with many ideas.
ACTIVITY 1.5
After better understanding telecommunications management
components, does the list of important points you noted earlier meet
telecommunications management requirements?
TELECOMMUNICATIONS AND LEADERSHIP
Figure 1.12: Quotation about leadership
Source: J.M. Burns, Leadership, New York: Harper & Row, 1978: 19-2
In the quotation, Burns (1978: 19-2) regards a leader as someone who holds the
power centre. According to him, power is divided into two parts:
(a) Power of management or implementation; and
(b) Power to manage change or transformation.
Power of the first type takes place when a leader takes the initiative to create a
relationship with another person in order to exchange something of value. The
power to manage occurs when a person (or several persons) interacts with
another (or several persons) such that leaders and their followers improve
themselves in terms of motivation and morale.
In any telecommunications organisation (including broadcasting), the
management plays an important role in determining the direction of the
organisational achievement in the market. The management is normally assisted
directly or indirectly by groups of researchers, market analysts, lawyers,
accountants and others. In this course, the focus is on the roles of media and
communication managers, especially in telecommunications.
A leader determines the rise and fall of an organisation.
• In facing the digital technology era which is rapidly developing and full of
varied challenges, the media manager should be efficient in performing his/her
duties in order to ensure success of a media organisation. Hence, it is important
for the media manager to deepen his/her knowledge of telecommunications
management. This is true in view of the importance of telecommunications
managementÊs role in providing able and efficient media managers.
• Despite that, telecommunications is a unique industry, resulting from the
combination of human and hardware elements. Individuals who manage this
field should be sensitive to both elements, and skilled in communicating with
each area of staff and customers as well as know about the hardware being
used by advanced media stations.
• Unlike other organisations, a media organisation consists of staff having
different backgrounds such as management, professionals, creative, technical,
etc. Therefore, a manager plays an important role as a mediator or a
communicator between these groups. At the same time, he/she is also
responsible as a mediator between the organisation and the public. His/her
failure in handling these matters properly will adversely affect the smooth
operation of the station and tarnish the organisational image.
After finishing your study of this unit, draw a mind map of
telecommunications management.
Broadcasting
Management
Planning
Telecommunications
Telecommunications management
Bartol, K. M. & Martin, D.C. (1991). Management. New York: McGraw-Hill.
Burns, J. M. (1978). Leadership. New York: Harper & Row.
Foster, E.S. (1978). Understanding Broadcasting. CA: Addison-Wesley Publishing Co.
Gershon, R. A. (2001). Telecommunications Management: Industry Structures
and Planning Strategies. Mahwah, New Jersey: Lawrence Erlbaum
Associates, Publishers.
Sherman, B. L. (1995). Telecommunications Management: Broadcasting/Cable
and The New Technologies. (2nd. ed.). New York: McGraw-Hill.
* * *
TOPIC 2 TELECOMMUNICATIONS MANAGEMENT THEORY
INTRODUCTION
In Topic 1, we have learnt several explanations on telecommunications,
broadcasting and management. In this topic, we will focus specifically on
management.
Why must we know management theory? One of the reasons is that the theory
gives us a perspective to understand something. Management theory allows us to
know what is relevant in the context of organisational management. Management
theory also enables us to understand workersÊ relations, managers, employer and
environment currently and in the future. This topic also will focus on the
telecommunications environment.
We will learn several management approaches and perspectives so that we may
apply or identify whichever approach or perspective is the most appropriate to
be implemented in a telecommunications organisation. Directly or indirectly,
Topic 2 Telecommunications Management Theory.
INTRODUCTION
In Topic 1, we have learnt several explanations on telecommunications,
broadcasting and management. In this topic, we will focus specifically on
management.
Why must we know management theory? One of the reasons is that the theory
gives us a perspective to understand something. Management theory allows us to
know what is relevant in the context of organisational management. Management
theory also enables us to understand workersÊ relations, managers, employer and
environment currently and in the future. This topic also will focus on the
telecommunications environment.
We will learn several management approaches and perspectives so that we may
apply or identify whichever approach or perspective is the most appropriate to
be implemented in a telecommunications organisation. Directly or indirectly,
By the end of this topic, you should be able to:
1. Explain the development of management theory;
2. Identify four management perspectives;
3. Differentiate between one theoretical approach with another;
4. Explain contemporary management theory;
5. Discuss Telecommunications Management Model; and
6. Apply management theory in a selected telecommunications Oganisation.
LEARNING OUTCOMES
management theory helps to make an organisation more efficient, effective and
viable in a complex, challenging and changing environment.
DEVELOPMENT OF MANAGEMENT
THEORY
The management theories which we are going to learn are the past ideas of
several management figures that often observed, tried, tested, approached and
applied their theories in their era and environmental contexts.
Figure 2.1: Sun Tzu is one of the foremost Chinese philosophers
Source: www.taiuchi.org/aussi_texte23.htm
Early efforts on formal management theory began in the early 19th century
especially by Robert Owen (1771-1858) and Charles Babbage (1792-1871). Owen is
noted for his innovative ideas on human relations. Babbage is known for his
research on operations, profit sharing plan and job specialisation. In the Western
field of management, Owen and Babbage are known as the pre-classical figures
(Bartol & Martin, 1991: 42-45).
2.1
SELF-CHECK 2.1
To what extent can management theory help us in understanding the
management policy of a telecommunications organisation in Malaysia?
Besides Owen and Babbage, two more figures are noted as early experts of
management strategy, namely:
(a) Machiavelli, an early political philosopher during the renaissance era; and
(b) Sun Tzu, an ancient Chinese philosopher from more than 2000 years ago.
See Figure 2.1.
In the 20th century, there are several management approaches, each one taking
into account changes in era and requirements considered relevant to that time.
Figure 2.2 shows the development of management theory since 1900's.
Copyright © Open University Malaysia (OUM)
TOPIC 2 TELECOMMUNICATIONS MANAGEMENT THEORY W 29
Figure 2.2: Development of management theory
In this course, we will take into account several 20th century management
perspectives as depicted in the mind map.
Each of the four management perspectives is heralded by several management
figures. Each of them has a special rationale as to why they used different
management approaches. Table 2.1 provides a brief explanation for each of the
management perspectives.
Table 2.1: Management Perspectives
Year and
Perspectives
Management
Type Focus Figures
(1890-1920's)
Classical
(focus on
management's
efficiency)
Bureaucratic • Aims at improving
effectiveness of management
in organisations
• Emphasising management
rationality and not acting
arbitrarily
• Relying on guidelines of
procedures, rules, hierarchy,
and division of labour is
clear and detailed
Problems: rigid procedures
create red tape, delay
decisions, unable to change
fast enough to adapt to
requirements of the
environment and sometimes
imbalance exists.
Max Weber
(1864-1920)
Scientific • Aim at getting the best
work methods
Problems: Lack of labour force
and ways of improving
workersÊ performance
Frederick
Winslow Taylor
(1856-1915)
Frank Gilbreth
(1868-1924)
Lillian Gilbreth
(1878-1972)
Henry Gantt
(1861-1919)
Administrative Information flow is essential,
because organisation is a
system of communication
Henri Fayol
(1841-1925)
Chester Barnard
(1886-1961)
Year and
Perspectives
Management
Type Focus Figures
(Since
1920Ês)
Behavioural
Human
Relations
• Organisational behaviour;
making decisions in
organisation
• Management models
• Hierarchy of Needs Theory
• Theory X and Theory Y
Mary Parker Follett
(1868-1933)
Herbert Simon
Abraham Maslow
(1908-1970)
Douglas McGregor
(1904-1964)
Renesis Likert
Frederick Herzberg
David C. McClelland
(Since 1940's) Quantitative
Management Science
• Using scientific management
approach e.g. mathematical
methods, statistical methods
and other analytical methods
to make management decisions
• Capital Asset Pricing Model (CAPM)
H. Dodge
Ronald Fisher
Russell Ackoff
Thornton C. Fry
Operations Management
• Using scientific approach for
example combination of
statistics and metronomic
theory to manage organisational
operations system
Patrick Blackett
Information System Management
• Integrating computer system
(hardware, software, network
and recording media) in
organisational management to
assist decision making process
and organisational competitive
strategy.
Not identifiable
Source: http://iris.nyit.edu/~shartman/mba0120/chapter2.htm; http://ollie.dcccd.edu
Year and Perspectives.
Management Type Focus Figures Contemporary Thoughts.
• American Management, that is,
productivity improvement.
W. Edward Deming (1900-1994)
Management by Objective
• MBO concept, that is, management
strategic decisions are developed
through interactions and cooperation
of management and staff.
• Federal decentralisation concepts.
Peter Drucker (1909-now)
Systems Approach
• To synthesise and integrate various
management approaches as coherent
and cohesive management theory.
• All organisational components
inter-relate and interact with
environment.
• Organisations are open systems
Ludwig von
Bertalanffy
(1928)
Ref: Kast &
Rosenzweig
1972;
Scott 1981)
Contingency Approach
• Focusing main attention on
performance of each person practicing
management in controlling
organisational environment.
• Viewing conflict as inevitable but
manageable.
Chandler (1962)
Lawrence
& Lorsch (1969)
(1950
-2000)
Contemporary
Japanese
Approach
• Combination of teamwork and
individual efforts.
• Theory Z
William Ouchi
Management science which applies quantitative perspective is also known as
Operational Research (OR) which is multidisciplinary. In the business world,
management science is equivalent to Quantitative Management (QM),
Management Science (MS), Decision Science (DS) or Operations Management
(OM).
In the 21st century, management perspectives can no longer be easily categorised
as in Table 2.1 due to the tendency to apply various management approaches (old
and new) simultaneously.
CLASSICAL PERSPECTIVE (1890-1920’S)
Classical Perspective focuses on a rational and scientific approach to management
study. The main objective is to make organisation an efficient machine. There are
three types of approaches in classical perspective as shown in Figure 2.3.
Figure 2.3: Three approaches in the classical perspective
"Sapura's driving entrepreneurial spirit has always relied on the
teamwork and commitment of its employees to propel to the
forefront of technology. Taking its rightful place on the world stage
amongst the other leaders in technology, we at Sapura understand
that our technology is as good as the imagination ă that the mind is
the ultimate tool. A tool that unlocks the floodgates of innovation.
This is the world of Sapura. A world that combines technology and
imagination, making anything possible."
These words were extracted from one of 1997 Sapura Holdings Sdn.
Bhd. Publications. From the extract, can you identify the management
approach practiced by Sapura Holdings in 1997?
According to management theorists, management perspectives are
divided into four perspectives. Name these four perspectives. Give an
example of an organisation in Malaysia for each perspective.
2.2.1 Scientific Management
Scientific Management is applied in the era of P-Economy and emphasises
productivity. The main focus is on interaction between workers and machines. At
the same time, the focus is on efforts to improve organisational productivity
through efficient work methods and job specification for each worker. At the
time, there was only one problem which was lack of labour force, especially
skilled labour.
Figure 2.4: Frederick Taylor
Source: www.colby.edu
Among the foremost scientific management figures are Frederick W. Taylor,
Frank Gilbreth and Lillian Gilbreth, as well as Henry Gantt.
Frederick Taylor (1856-1915) was an American engineer and he is known as the
Father of Scientific Management.
How could an engineer be involved in organisational management aspects? To
understand TaylorÊs situation at the time, please read the book entitled
Management by K.M. Bartol & D. C. Martin (1991).
Figure 2.5: A short extract on Frederick Taylor
Source: Bartol & Martin, 1991, p. 43-44
Taylor carried out a „time and motion study‰ to identify productivity problems
at the workplace. Then he implemented a differential rate system and tried to
revolutionise work management to resolve workersÊ and management problems.
(a) Four Principles of Scientific Management (Taylor)
Figure 2.6 shows the four principles of scientific management outlined by
Taylor.
Figure 2.6: Four principles of scientific management
The scientific work management was successful in producing products much
faster than expected by Taylor. However, workers and trade unions disagreed
with the approach, as they worried that the production efficiency would exhaust
the jobs to be done and thereby workers would be discharged. As a result, many
workers joined the trade unions, reinforced their doubts and did not have any
more trust, which consequently worsened management-labour relations for
several decades.
Henry Gantt (1861-1919) used to work with Taylor, but later reiterated that the
differential rate system was not so successful in generating a high level of
motivation. Consequently, Taylor introduced a financial incentive system for
high performing workers and a bonus for supervisors who were able to produce
a high production level among workers. His way of awarding the rewards was to
record each workerÊs progress and then announce to the public using what is
called the Gantt chart, which is a graphic aid for project planning, scheduling and
controlling.
Frank B. Gilbreth (1868-1924) and Lillian M. Gilbreth (1878-1972) were a husband
and wife pair who made efforts to develop scientific management methods.
Frank and Lillian Gilbreth carried out fatigue and motion studies to eliminate
rate of fatigue in the workplace. Their attention was on the ways of improving
welfare and morale of workers. By using film cameras, Frank and Lillian looked
for the most economic movement to improve work performance and thereby
reduce fatigue, because in their conception, movement and fatigue were inter-
related.
Based on study findings, they proposed that movements should be reduced to
eliminate fatigue.
2.2.2 Bureaucratic Management
Bureaucratic management is related to Max Weber (1864-1920), a German
sociology professor and political economist. He was given the title of the Father
of Modern Sociology.
Figure 2.7: Max Weber is regarded as the Father of Modern Sociology
Source: webserv.nhl.nl
In the aspect of organisational management, Weber stated that bureaucracy is the
most rational and logical structure for large organisations. In the context of time
and era, the bureaucratic concept presented by Weber has a different implication
compared with the negative connotation related to the current bureaucracy.
WeberÊs bureaucratic management model was able to develop further large
organisations such as Ford Motor Company in early 20th century.
Weber identified three types of authority, that is:
• Rational authority (based on laws, procedures, rules, etc.)
• Top executives authority; and
• Charismatic authority (natural attributes of a person who is able to attract the
heart and respects of others to him)
(a) Bureaucratic Management Criteria
Below are several criteria identified by Weber to ensure an effective
administration:
(i) The roles of an authority and clear leadership responsibilities in
management;
(ii) Executives/managers are free to act and they are only subject to
organisational rules and laws;
(iii) Promotions should be based on expertise, efficiency and seniority, not
on cronyism and nepotism;
(iv) Clear division of labour, that is according to job specification;
(v) Executives are subject to strict discipline and display control in
carrying out duties;
(vi) All administrative actions and decisions must be recorded;
(vii) Written rules and procedures are equally applied on all individuals;
and
(viii) Separate the owners and management.
Weakness of the bureaucratic model is that it is not flexible in terms of
procedures and rules that must be obeyed, because it ignores the social and
human processes in an organisation.
2.2.3 Administrative Management
Administrative management focuses on internal affairs and activities of
organisation. The pioneer of administrative theory is Henri Fayol (1841-1925)
who was from France. He emphasised organisational principles and
administrative functions, which he defined as follows (Bartol & Martin, 1991):
Administration or management is planning, organising, commanding,
coordinating and controlling.
Table 2.2: A Brief Explanation of FayolÊs Management Principles
No. FayolÊs Management
Principles Brief Explanation
(i) Division of Labour According to job specialisations
(ii) Authority The right to give directions and power to be
obeyed
(iii) Discipline Based on respect and conforming
(iv) Unity of command A worker receives command from a leader only
(v) Unity of directing A leader makes a plan for a group activity with
a common objective.
(vi) Subordination of individual
interest
Placing a public interest above individualÊs
interest.
(vii) Remuneration Wage payments depend on many factors.
(viii) Centralisation Depends on situation and formal
communication channels
(ix) Chain of authority Formal communication channels
(x) Order A resource is available at the right place on the
right time.
(xi) Equity Staff is treated well and fairly.
(xii) Personnel tenure It requires a good human resource planning to
avoid frequent worker resignation.
(xiii) Initiative Workers are expected to work hard and sincerely
(xiv) Esprit de corps Unity yields strength, harmony and teamwork.
You may find it difficult to memorise all the 14 principles. Figure 2.8 may help
you.
Figure 2.8: FayolÊs 14 principles of management
In the 1990s, competition in the world market caused several organisations to
change from the bureaucratic approach which was regarded as slow and could
no longer act fast.
ACTIVITY 2.3
1. Give three distinct differences between scientific management,
bureaucratic management and administrative management
approaches.
2. Name one figure for management approach you have learnt
under the classical perspective.
BEHAVIOURAL PERSPECTIVE (BEGINNING IN 1920’S).
Behavioural perspective is a management perspective which emphasises the
importance of management understanding various factors that influence human
behaviour in an organisation. There are three approaches that use the behavioural
perspective, as shown in Figure 2.9.
Figure 2.9: Behavioural perspective
The figures for behavioural perspective are
Parker Follet and Chester Barnard. These two
people are the main founders of management
from the perspective of human behaviour. They
emphasised human behaviour, workersÊ needs,
workersÊ attitudes in the workplace, climate,
social interaction and group dynamics.
Mary Parker Follet (1868-1933) was a
philosopher and political scientist. She stressed
the importance of human issues, ethics, power
and good relations between management and
workers, including the effects of environmental
factors such as politics, economics and biology.
She put forward the integration concept, that is,
a management strategy seeking to settle conflict
by satisfying both parties.
Figure 2.10: Mary Parker Follet,
philosopher
and political scientist
Source: www./infed.org
The second figure, Chester I. Barnard, (1886-1961), introduced the theory of
acceptance of authority, that is, a worker may chose to follow or not to follow a
direction from the management. According to him, managers should treat their
workers well, as the acceptance of authority by workers is the main determinant
of organisational success. In his book entitled The Functions of Executives (1938),
Barnard discussed three universal elements that must be available in
organisational management, that is:
(a) Communication;
(b) Readiness to serve; and
(c) Common goals.
2.3.1 Human Relations Movement
If the management is able to attract workers to produce better output of work,
then the management is said to have effective human relations.
Human relations movement developed to wider extent due to several series of
studies known as the Hawthorne Studies. Fritz J. Roethlisberge and W.J Dickson
(1939), sociologists from Harvard University, carried out three series of
experiments at Western Electric Company, Hawthorne, and Chicago between
1924 and1933. The aim of the study was to study the relation between the
physical conditions (lighting) and productivity and workersÊ satisfaction.
Study results show that productivity kept on improving as lighting at the
workplace become brighter. What is surprising is that productivity kept on
increasing although light was then made darker. Researchers concluded that
productivity increased because workers got good treatment and received special
attention of the researchers, not because of the specific factors being studied. This
phenomenon is known as the Hawthorne effect. (Babbie 2001:220).
2.3.2 Human Resource Approach
The main activists of this movement combined job design with a motivation
theory. Among the figures linked to this approach were Abraham Maslow and
Douglas McGregor.
Abraham Maslow (1908-1970) was the first psychologist to formulate a
motivation theory based on human needs. He made three assumptions, that is:
The term human relations refers to how the managers interact with their
subordinate staff.
• Human beings will never be fully satisfied;
• Human beings behave because of certain aim to be achieved;
• Human needs are classified into a hierarchical structure in accordance with
importance, that is, from the lowest to highest level.
Refer to Figure 2.11 to know about MaslowÊs hierarchy of needs.
Figure 2.11: MaslowÊs hierarchy of needs
Source: http://web.utk.edu/~gwynne/maslow.htm
(a) Physiological Needs
This refers to basic needs such as water, air, food, sleep and sex. When these
basic needs are not fulfilled, human beings will feel pain, angry,
uncomfortable, etc. After they are fulfilled, human beings will think of other
needs.
(b) Security Needs
It refers to psychological needs which are fulfilled due to home stability,
harmonious feelings, peace and security of living place.
(c) Social Needs
This refers to the need to belong, and be accepted as a club member,
member of a work team, family, etc.
(d) Esteem Needs
There are two needs, that is, the need to be appreciated and recognised after
completing a job, and the need to be known and given attention.
(e) Self-actualisation Needs
This refers to aspiration to fulfil oneÊs potentials. A person who has
achieved his needs at level 1 to 4, wishes to maximise his potential by
seeking knowledge, aesthetical experiences, spiritual peace, involvement in
voluntary works, etc.
Douglas McGregor (1906-1964), a United States social psychologist was also
related to the human relations approach. He is well known for his Theory X and
Theory Y which describes human behaviour as a result of organisational
management styles. See Figure 2.13 to look for Theory X characteristics and the
differences with Theory Y.
Generally, McGregor sees two types of managers, that is:
(i) Theory X type of managers who believe workers must always be forced,
controlled, directed, threatened with punishment so that they may not
ignore their responsibilities; and
(ii) Theory Y managers who are of the opinion that human beings may show
their commitment to work objectives, while the commitment is a function of
rewards. In general, a worker will accept and look for responsibilities. In
Theory Y management, imagination and creativity is widely distributed,
but workersÊ potentials are not utilised fully.
The practices of Theory X may be easily found in organisations practicing
scientific management, especially in the 1950Ês. However, the principles of Theory
X and Theory Y are still being used in the management of several organisations today.
To understand media management, Sherman refers to Theory X and Theory Y
approach by Douglas McGregor (United States organisation). (Refer to Table 2.3).
Table 2.3: Theory X and Y approach
Theory X Theory Y
• Managing staff using force/threat,
imposing barriers, penalty or job
termination
• Based on ultimate concept of
authority
• Corporate objectives and ways of
achieving them transpire from top
executive thoughts and visions
• ManagersÊ goals are to create work
environment where staffÊs personal
goals are consistent with
organisational goals.
• An influential management style at the
beginning of industrial revolution
• Humans and their needs approach
• Managers try to influence
subordinates with best motivatorÊs
assumptions by involving
satisfaction in terms of basic human
physical and psychological needs ă
status, sense of respect, recognised
and appreciated.
• Good work is paid off by wage increases,
while bad work will be followed with
delayed promotion and pay rise, even
dismissal
• Rewards are not in financial terms,
but may be in emotional and
spiritual forms
• Loss of energy, morale and incentive to
work diligently due to fatigue (high
burnout rates). Close relation between
newly emerging media transaction and
the military (strong fortress for Theory X)
Satellite and other telecommunications
companies also have long ties with
defence contracts. Many first generation
managers learnt about radio, television,
films while in military service.
• Management is rather loose and
informal. Staff are encouraged to be
creative, motivated and not
structured to produce new products
and services.
• Handling broadcasting/cable system
requires fast and immediate decision
making. Media manager need to make
tens of decisions daily immediately and
pressured by time factor. (Theory X
approach deemed to be best suited for
telecommunications/media/broadcasting
functions).
2.3.3 Behavioural Science Approach
This approach highlights human behavioural theories based on scientific
methods and learning based on the fields of sociology, psychology, anthropology,
economics and other disciplines to understand workersÊ behaviour and
interaction in organisations. Among the researchers related to behavioural
science are Renesis Likert and Frederick Herzberg.
Likert is more inclined to support organisational leadership concepts which pay
attention to workersÊ welfare and the process of interpersonal communication in
bureaucratic organisations. In his conceptual framework, Likert identifies
four types of management. See Figure 2.12.
Figure 2.12: Types of management system
Source: http://www.ibilce.unesp.br/courseware/research/theories3.htm
System 1: Exploitative and authoritative; autocratic leader; discourages
feedback.
System 2: Benevolent but authoritative; manager is more sensitive than in
System 1.
System 3: Consultative, discusses with workers.
System 4: Participative, involves workers in decision making.
The four systems would result in different effects. According to Likert, System 4
is the most effective, because it is able to generate a high level of performance,
sense of responsibilities and motivation among the workers of the organisation
compared to System 1, which may result in reduced group loyalty. Instead,
System 1 may even generate more conflicts and lower productivity.
QUANTITATIVE PERSPECTIVE (EARLY
1940’S)
Quantitative perspective emerged during the Second World War and focused on
the use of mathematics, statistics and information support devices to support the
management in making decisions and thought of the strategy how to make the
organisation more effective. At the beginning this perspective was used by the
British Army for the purpose of handling ships and bombs. Figure 2.13 depicts
the quantitative perspective approach (Bartol & Martin, 1991: 61-63).
Figure 2.13: Quantitative perspective approach
2.4.1 Management Science
The management science approach aims at solving problems arising from the
consequences of the Second World War. Example: how to move equipment and
people quickly and efficiently.
2.4
ACTIVITY 2.4
What is meant by each of the following concepts?
1. Acceptance of authority
2. Theory X manager
3. Consultative system
4. Participative system
5. Hawthorne effect
6. Theory Y manager
7. Benevolent system
8. Work-centred leader
9. Hierarchy of needs
10. Exploitative system
This approach was made by the efforts of mathematicians, physicists and other
scientists to be applied to large firms.
2.4.2 Operations Management
The field of operations management is focused on the physical production of
products and services. The aim is to solve manufacturing problems. Its
commonly used methods are:
• Forecasting
• Inventory modelling
• Linear and non-linear programming
• Queuing theory
• Scheduling
• Simulation, and
• Break-even analysis.
2.4.3 Management Information System
The pioneers of the management information system create the system to provide
relevant information to managers at appropriate time and costs. The creation of
high speed digital computers has made a big contribution to management in
making decisions.
CONTEMPORARY PERSPECTIVE (1950-
2000)
There are several contemporary approaches being used by organisations
currently. Figure 2.14 shows the contemporary perspective approach.
2.5
ACTIVITY 2.5
What are the three management approaches according to quantitative
perspectives?
Give an example of a telecommunications organisation using the
approach in Malaysia, if any.
Figure 2.14: Approaches in contemporary perspective
2.5.1 Contemporary Management
One contemporary management figure is W. Edwards Deming (1900-1994). He
was an American statistics expert and the pioneer of quality movement. Japan
herself regards Deming as the main influence behind her post war economic
miracle. One of his well-known books is Out of the Crisis (1984).
(a) DemingÊs Management Criteria
There are several management criteria as outlined by Deming, that is:
(i) Creating the commitment to continuously improve product and
service quality;
(ii) Using new philosophy created by the Japanese;
(iii) Terminating reliance on group inspection;
(iv) Stopping awarding of contracts based on lowest price;
(v) Always improve process of planning, production and service;
(vi) Using modern methods for in service training;
(vii) Electing leaders with intention of helping others to produce improved
work;
(viii) Eliminating fear and encouraging effective two-way communication;
(ix) Eliminating barriers between areas of departments and staff;
(x) Throwing away notices/memos/reminders for workforce because
they will only bring in resistance;
(xi) Encouraging sense of pride with work output;
(xii) Encouraging lifetime learning and self-improvement for all people; and
(xiii) Outlining top management commitment to implement all of these
principles.
(b) DruckerÊs Management Criteria
One more contemporary management figure is Peter F. Drucker, a well
known American management guru at present. He was born in Vienna in
1909. He believes that a person cannot manage change but can always stay
one step forward. Among his principles are as follow:
(i) Apply scientific management;
(ii) The key to productivity and effectiveness is decentralisation;
(iii) Give emphasis to quality personnel management;
(iv) Training, educating and developing future managers;
(v) The key to successful decision making is high quality information;
(vi) Emphasise marketing;
(vii) Make long term planning;
(viii) Apply management by objective;
(ix) Apply management based on results;
(x) Profit-based organisation is seen as a social and human structure, not
as economic entity;
(xi) In the new information era, focus should be on information, not on
technology; and
(xii) Information workers are capital assets, not costs, but information
workers must manage themselves and their own careers.
MANAGEMENT BY OBJECTIVE – MBO
This approach is used by several organisations to facilitate efforts in fulfilling
organisational goals and planning by managing several objectives (MBO). MBO
is used to involve both management and workers at lower levels in order to set
goals at various layers of an organisation.
The person who introduced MBO is Peter Drucker. According to Bartol & Martin
(1991: 179), the first organisation to apply MBO was General Electric, USA.
(a) Steps in MBO
The MBO process involves six steps (Bartol & Martin, 1991: 180), that is, as
follows:
(i) Set organisational overall goals;
(ii) Set specific goals for various departments, sub-units and individuals;
(iii) Think of and implement several action plans;
(iv) Implement plans and maintain self-control;
(v) Revise plan progress from time to time;
(vi) Evaluate organisational performance.
As in other approaches, MBO also has advantages and weaknesses. The MBO
approach can fail because of the following reasons:
• Lack of support from the top management;
• Weak formulations of objectives or goals;
• Poor communication skills among managers who have to implement the
system.
2.6.1 System Approach
System theory was first proposed by Ludwig von Bertalanffy in 1928 but it was
never applied by any organisation till today. The System Approach looks at an
organisation as a unified system, and it has a purpose, as well as inter-related
divisions. This means, an activity in one segment may affect the others.
(a) The Characteristics of System Approach
There are several characteristics of System Approach which affect
management. They are as follow:
(i) Open system: a system which continues to interact with environment
(ii) Closed system: a system which does not interact with environment
(iii) Entropy: a tendency for a system to die off (eliminated)
(iv) Differentiation: a tendency for an open system to be more complex
(v) Synergy: the ability of an organisation to achieve a higher level of
success if it functions/becomes active as a stable team and not as
separate groups.
(b) System Theory Components
There are five components in system theory, that is:
(i) Input: equipment, human beings, finance or information resource
which are used to produce products or services.
(ii) Transformation process: use of production technology to transform
input into output.
(iii) Output: goods, services, or other types of output.
(iv) Feedback: information about results and organisational status.
(v) Environment: including social, political and economic influence.
2.6.2 Contingency Theory
The Contingency approach is also mentioned as a situational approach. This
approach was developed by managers, consultants and researchers who sought
to apply concepts of several main approaches in managing the actual situations.
In this approach, the functions of managers are to identify which technique can
give the best contribution to achieve management goals in particular conditions,
climate and time. The Contingency approach holds on to the view that the
suitability of a management action would depend on the situation, that is, factors
of environment, strategy, organisational design, technology and leadership. The
effectiveness of a manager to manage would depend on the extent of his ability to
adapt his management styles with the change in environment.
2.6.3 Japanese Management Approach
Theory Z, which is a Japanese management approach, is a combination of Theory
X and Theory Y. It was presented by William Ouchi based on Japanese industrial
organisational perspective. According to Ouchi, Theory Z organisation is
egalitarian, providing the right to participate for all staff in organisational matters
and emphasise the development of positive interpersonal relations between
employer and staff (Refer Sherman, 1995: 34-36).
The practice of Theory Z is as follow:
(a) Authority is still clear and not sacrificed; and
(b) Manager still makes planning and influential policy decisions. Compared to
management styles of Theory X and Theory Y, Theory Z management is
considered as democratic. Refer Figure 2.15.
Figure 2.15: Comparison of Theory X, Theory Y and Theory Z
Source: http://ollie.dcccd.edu
In general, organisations practising Theory Z attempt to do the best by applying
Japanese and American management practices. Refer Table 2.4.
Table 2.4: Theory Z
Subject Explanation
Integrity In the Japanese industrial model, a manager must get
workersÊ trust in terms of his integrity as a manager and
product integrity.
(A manager with integrity is believed to act consistently,
treating secretary and executives respectfully, approaching
subordinates with the same value and understanding when
he is with family members).
Company/Organisational
Philosophy
Company policy is clear at the beginning. Manager must
audit and examine the actual philosophy.
Participation at All Levels All levels of management must be involved. Communication
and openness is practiced at all levels.
Structure, Incentive,
Rewards
Some elements of structure are still needed. Incentives are
needed as a motivation and to maintain interests in Z
approach and improve workersÊ quality of life. Examples:
sharing profit, continuous training for workers, workersÊ
benefits, self-enrichment plan, maternity leave, child care
centres, and gymnasium/sports facilities.
Interpersonal Skill Quality circles. Round table discussions where all levels of
organisation, i.e. from top management to subordinates,
discuss a product openly.
Continuous Evaluation Done either informally (self evaluation) or formally
(through an objective test).
Organisational health must be monitored monthly, weekly
or daily.
Trade Unions Participation Trade unions must be involved fully in the
company/organisation.
Employment Stability Company/organisation is encouraged to limit workers
dismissals and accept short term loss. In critical conditions,
workers are willing to receive smaller pay and committed
and experienced workers will repay employersÊ kindness by
not quitting jobs, be more loyal, and attempt to raise
company profits.
Long Term Evaluation and
Promotion
Staff gain and organisational goals achieved in long term.
Promotion is defended.
Wider Career Paths Japanese, German and Dutch firms recognise managers
with many experiences and understand their tasks in the
firms in different sections. Even without promotions, they
have high morale, are fresh, confident and satisfied.
Sherman has also compared Theory X and Theory Y with Theory Z (Sherman,
1995: 32-50). Refer Table 2.5.
Table 2.5: Theory X, Y and Z
Theory X Theory Y Theory Z
• On the
average, an
individual
does not like
work and
would avoid
working
• Most
individuals
need to be
forced,
controlled,
directed and
threatened
with
punishment to
make them
work to
achieve
organisational
goals.
• On average,
individuals
want to be
directed, try to
stay away
from
responsibilitie
s, not
ambitious, and
what they like
most is a
feeling of job
security.
• Most individuals do not
hate work. Physical and
mental efforts in work are
natural. Rest must be done.
• An individual will exercise
self-control, is committed,
and possess self-direction
to achieve the given goals.
• External control and
threats are not the only
ways to ensure goal
accomplishment.
• Commitment to goal
achievement is a function
of awards/presents which
satisfy self-respect an self
realisation
• When conditions are
satisfactory, on average an
individual may learn to
accept and seek out
responsibilities.
• Many people have high
creative ability and high
level of innovation in
solving organisational
problems.
• The intellectual potentials
of individuals are only
partly used in most
organisations.
Type A (American)
• Work for short term.
• Make own decisions.
• Individual responsibility.
• Fast evaluation and promotion.
• Explicit and formal control.
• Specialised career paths.
• Segmented interests.
Type Z (Modified American)
• Work for long term.
• Consensus decisions.
• Individual responsibility.
• Slow evaluation and promotion.
• Implicit and informal control,
with explicit and formal control.
• Moderately specialised
• Career paths.
• Holistic interests including
family.
Type J (Japanese)
• Lifetime work
• Consensus decisions.
• Slow evaluation and promotion.
• Implicit and informal control.
• Not specific career paths.
• Holistic interests.
Source: Bartol, Kathryn M. & Martin, David, C. (1991).
Management, New York: McGraw-Hill, p.66
MANAGEMENT STYLES
Other than the approaches already discussed, there are still some other current
management styles that are being applied in organisations today. The other
current management styles are as shown in Table 2.6.
Table 2.6: Current Management Styles
No. Management Styles Explanation
1 Management by coaching and
development
• Managers look at themselves as trainers of
the workers.
2 Management by competitive
edge
• Individuals and groups in the organization
compete among themselves to achieve the
best accomplishment
3 Management by consensus • Managers build a system to enable every
individual worker produce output.
4 Management by decision
models
• Decision making is based on future
expectations generated not in actual
conditions, but based on artificially created
conditions.
5 Management by exception • Managers distribute jobs to subordinates
and will interfere when necessary only.
2.7
Answer the following questions:
Select one of the approaches under contemporary perspective.
1. Who is the figure presenting the theory?
2. What is the essence of the theory?
SELF-CHECK 2.2
ACTIVITY 2.6
After following management approaches used in the 20th century,
what other approaches do you know? In your view, what is the most
suitable approach that should be applied by a telecommunications
organisation in the 21st century?
6 Management by information
systems
• Managers depend on data which is
generated internally in the organisation to
assist them performing their tasks
efficiently and keep on communicating
among themselves.
7 Management by Interaction • Emphasising communications and
combination of male and female energy, as
well as integration of all human aspects
(mental, emotional, physical and spiritual).
• Creating powerful, energetic and highly
productive labour force.
8 Management by Matrix • Managers study variables outlined in the
matrix to understand its inter-relationships,
cause and effect relation that may exist, and
other choices.
9 Management by objectives • Organisation sets several objectives, and
then managers determine the objective for
each worker.
10 Management by
Organisational Development
• Managers often try to improve
communication and labour relations.
11 Management by performance • Managers look for a high performance
levels with quality through motivation and
labour relations.
12 Management by Styles • Managers adapt the approach to fulfil the
requirement of each condition.
13 Management by Walking
Around
• Managers walk around the
organisation/company to personally feel
workersÊ and operations environment.
Managers also meet workers and listen to
their opinions.
14 Management by Work
Simplification
• Managers always find ways to facilitate
work process and reduce expenses.
Source: http://www.itstime.com.newlet.htm
Select one of the current management perspectives and name a local
organisation applying such a style.
TELECOMMUNICATIONS ORGANISATION
MANAGEMENT MODEL
Table 2.7 lists several external and internal factors influencing
telecommunications organisation management including ICT factors and
challenging global competition.
Table 2.7: External and Internal factors influencing Telecommunications
EXTERNAL FORCES INTERNAL FORCES
• Customers' tastes and priorities
• Competitors' programmes and
sales policies
• Regional and state agencies, and
local authorities/legal agencies
• Commercial supporters
(customers, advertising agencies,
advertisers, station representatives,
investors).
• Networks, syndicators, consultants,
program suppliers.
• Industry supporter groups,
• Research/rating services,
equipment suppliers, etc
• Pressure groups, lobbyists, trade
associations, industry associations.
• Trade unions and professional
associations. Examples: artists,
singers, musicians, etc
• Technological change and ICT
innovation
• Economic change
• Population pattern changes/
movement
• Human rights
• Audience fragmentations
T
E
L
E
C
O
M
M
U
N
I
C
A
T
I
O
N
S
M
A
N
A
G
E
M
E
N
T
• Ownership
• Budgets and financial policies
• Organisational structure
• Staff/workers factor
• Scheduling/programme policies
• Sales policies
• Promotion policies/Public
Relations
• Media Management
• Myths vs. Friction/conflict
• Education, affirmative actions,
equal employment opportunities
• White man's, male world
• Typical American image
• Organisation man
• "Training ground"
Source: Adaptation of Fig.2-2. In B. L. Sherman, 1995,
Telecommunications Management, p.37
Telecommunications management works in a changing environment consistent
with telecommunications technological change, governmental policies, economic
market, human resource etc. This complex and competing environment is
depicted in Figure 2.16.
IXC = Interexchange Carrier; IS=Information Systems; LEC=Local Exchange Company
Figure2.16: Telecommunications Department Environment
Source: Translated from Figure 3-1, In J. H. Green, The Irwin Handbook of
Telecommunications Management, 2002, p.32
• Management Theory which started to appear formally in the 19th century
continued to develop in the 20th century and now it is being adapted to the
changing environment of the 21st century. As a result of the application of the
theories, there exists several management perspectives as you have seen in
the mind map and Table 2.1. Each of the theoretical approach differs from the
other approach.
• Contemporary management theory reflects several management approaches
practiced in the West and are related to some management figures such as
Deming, Drucker, Bertalanffy, Chandler, Lawrence and Lorsch. JapanÊs
economic achievement especially in 1960Ês and 1970Ês attracts Western
management thinkers to compare United States management formulas
(Theory X and Theory Y) with JapanÊs, that is, Theory Z, which was
popularised by Ouchi.
• Table 2.5 enlists and explains several current management styles including
MBCD, MBO, MBWA and MBWS. Whatever the approach or management
style, it is undeniable that management task is complex. Several external and
internal factors which are considered influential on telecommunications
organisational management have been presented in the Telecommunications
Management Model.
• Next, the module will discuss the electronic media landscape including
information technology and communications (ICT), which to a great extent
influences telecommunications management in the world.
Administrative Management
Behavioural Perspective
Bureaucratic Management
Classical View
Closed System
Contingency Approach
Hawthorne effect
Japanese Management
Management Information System
Management Science
Operations Management
Scientific Management
System Approach
Accel Team 2000), Employee Motivation, The Organisational Environment and
Productivity, Accessed 24 October 2005. URL: http://www.accel-team.com/
scientificscientific_02.html
Bartol, K. M. & Martin, D. C. (1991). Management. New York: McGraw-Hill.
Green, J. H. (2001). The Irwin Handbook of Telecommunications Management
(3rd ed.). New York: McGraw-Hill.
Grodsky, T. (undated), History of Management Thought. Accessed 21 October
2005. URL: http://polaris.umuc.edu/~tgrodsky/admn601/
managementhought.html
Module MGTP 2015, Prinsip Pengurusan, OUM 2003, p.13-21.
Sherman, B. L. (1995). Telecommunications Management: Broadcasting/ Cable
and the New Technologies, Singapore: McGraw-Hill, Inc.
Turnley, S. (Fall 2005). Management Concepts, Accessed 21 October 2005, URL:
http://info.cba.ksu.edu/turnleys/MANGT420/ch12.ppt.
Walonick, D. S. (2005). Organisational Theory and Behaviour. Accessed 24
October 2005. URL: http://www.survey-software-solutions.com/walonick/
organizational-theory.htm
Wertheim, E. G. (undated). Historical Background of Organisational Behaviour.
Accessed 21 October 2005. URL: http://web.cba.neu/~ewertheim/i
ntrod/history.htm
* * *
TOPIC 3 ELECTRONIC MEDIA AND INFORMATION, COMMUNICATION AND TECHNOLOGY (ICT).
INTRODUCTION
Broadcasting industries which are still using old hardware and software are now
facing stiff competition from industry participants who have already applied
digital technology. This means a media manager needs to be sensitive to changes
that occur and to always conduct research to update his knowledge about recent
technology in his field of expertise.
Since 1968, David Sarnoff, a pioneer writer in the television broadcasting industry
in the United States has expected rapid changes that would happen in the
broadcasting industry.
By the end of the topic, you should be able to:
1. Describe the definition of electronic media and ICT;
2. Identify the purpose of telecommunications management and two
causes for its failure;
3. Discuss four criteria of media and ICT organisations; and
4. Outline four requirements of the telecommunications industry from
the aspect of media management.
LEARNING OUTCOMES
He outlined the characteristics of a media manager as follow:
The needs of the time will bring forth perhaps a new type of executive, trained in
a manner not always associated with the requirements of business management.
He will have to reckon with the constant changes in industry, the changes that
scientific research is bringing. He will have to be able to approximate the value of
technical development, to understand the significance of research.
(Extracted from Sherman, 1995: 3)
Sarnoff's prediction turned out to be reality. Today, media organisations must be
run by media managers who not only have dynamic personalities but are also
competitive and able to deal with changes that are challenging and rapidly taking
place in the field of broadcasting and telecommunications.
ELECTRONIC MEDIA
The electronic media landscape exists in the wide and dynamic
telecommunications industry environment. Therefore, to define electronic media,
3.1
Do you still remember what you learnt in Topic 1? Before you
continue reading, try to explain the meaning of telecommunications.
Clarify the meaning in your own words.
discussions must be widened to include the telecommunications environment. If
you can recall, the definition of telecommunications has already been discussed
in Topic 1.
With regards to electronic media and the ICT landscape, discussions are not only
limited to electronic media organisations, such as radio stations and terrestrial
television (e.g.: RTM, TV3, ntv7, Radio IKIM, etc.) but also includes all industry
participants using satellite communications system to broadcast programmes
such as radio network and ASTRO (including NHK, ABC, CNN, BBC World,
STAR TV, Al-Jazeera and others). Besides radio and television, the electronic
media landscape also includes new and old telecommunications industry
participants (such as Telekom Malaysia Berhad, Maxis, AT&T, IBM, Nokia and
others) which operate at national and international levels.
Telecommunications organisations include commercial organisations (profit
oriented) and non-commercial organisations (non-profit oriented) owned by
public agencies, privately owned or owned by non-profit organisations (NPO).
These telecommunications organisations are involved in the development,
production, distribution and display of entertainment and information
programmes to the public through electronic media and ICT (Gershon, 2001;
Sherman, 1995). Figure 3.1 shows several communications technologies which
still exist today.
Figure 3.1: Telecommunications technology
Besides the above, you may also increase your knowledge about electronic media
by referring to the following book:
Sterling, C. (2004). The Electronic Media. CA: Wadsworth Thomson Learning.
INFORMATION TECHNOLOGY AND COMMUNICATION.
The combination of the two aspects of science and technology (S&T) has brought
about various changes in the community. When scientists and technologists
create and produce new ideas and discoveries, then technological innovation
takes place. The diffusion of technological innovation brings about changes not
only in science and technology but also to everyone in the community, from
family units, community and local community to the participants in the global
environment.
S&T development followed with the diffusion of technological innovation largely
involves communication processes. Figure 3.2 portrays the flow of
communication in assisting the development of S&T and the emergence of
information and communication technology (ICT).
3.2
From your reading so far, think how science and technology can
bring changes in the community.
Figure 3.2: Science, technology and its use
Source: Juggenheimer, D.W. (1972).Future Communication, Technological Advances and
Their Principal Implication for Advertising, Ph.D. thesis, University of Michigan, USA.
Figure 3.2 shows the existence of a vertical communication process either through
upward or downward flow between science and technology as well as between
technology and use. This movement may happen fast or slowly. Every movement
is related to the three elements. It is through the combination of the three
elements that the creation of information and communication technology (ICT)
takes place, which is being made use of by the community today.
Technological history has taken communication from wire to wireless and
back to wire, and early business patterns provided the foundation for todayÊs
industry.
To get further clarification on the pattern of changes in electronic media, refer
Craft et al. (2001), Electronic Media. CA: Wadsworth Thomson Learning, p. 12
Changes taking place in the ICT field largely influence and affect the current
electronic media landscape. Now, the ICT technology media, such as satellites,
fibre optics, Internet and computers, have changed the way people interact,
transact, receive, distribute and process information and knowledge. ICT has also
caused boundaries among countries to become less apparent.
AIMS OF TELECOMMUNICATIONS
MANAGEMENT
In general, media organisations (and ICT) operate with the objective of making
profits and generating income. In facing competitive conditions in the media
industry, the telecommunications industry now needs a media manager who can
identify and think of the following questions:
(a) What are the most popular products or services among the consumers?
(b) What are the most economical methods for process of production and
distribution of a product or service?
(c) Is the product or service potential for profit generation?
The media landscape is full of colourful success stories as well as failures due to
failures of management of the media products and services. These failures are
normally due to two factors, as shown in Figure 3.3.
3.3
Try to take two minutes to explain the aims of telecommunications
management according to your understanding and then explain the
causes of failure of telecommunications management.
Figure 3.3: Causes of telecommunications management failures
Below is an explanation on the two causes.
3.3.1 Making Inaccurate Predictions of Audience
Tastes
Some management of organisations think audiences will accept without question
whatever product or service is offered, that is, making inaccurate predictions.
Mega TV used to provide pay television services to the audiences in Malaysia.
The management of Mega TV expected the broadcast it offered (five channels)
would get the desired response from audiences, especially because the cost of
subscription to nearly 50 channels on ASTRO (a competitor)was much higher.
Unfortunately, the managementÊs expectations fell short. Consequently, Mega TV
had to stop operations in 2002 due to inability to get a cost-effective response that
could pay for the operational costs of the station.
3.3.2 Too High Cost of Maintenance
When Metrovision began operations in September 1994, audiences in the Klang
Valley knew something different was being offered compared to the then
operating television stations, which were TV1, TV2 and TV3. Although the new
station received a good response at the beginning, financial factors caused the
operations of the station to stop as it was unable to compete with the attraction of
the other television stations which had nationwide broadcasts. Firstly,
operational costs were found to be too high compared to income generated.
Secondly, the area of broadcast for Metrovision was limited and restricted to the
Klang Valley only. As a result, Metrovision could only survive for seven years
(1994-2002) competing in the media market.
When discussing the topic of electronic media organisational management, we
need to discuss the audience because the objective of electronic media is to
distribute information, education and entertainment to the audience. However,
not all of the electronic media broadcasts are targeted to the public audience.
There is a private electronic media station which implements the concept of
narrowcasting, that is operating for specific audience only. To generate income,
the station charges a fee to the clients to get the broadcast service. Although
private and non-private stations aim at meeting public demand, the private
stations need to take into account various needs and tastes of the audience.
Non-private stations must conform to government's rules. This occurs in
Malaysia also. Privately owned stations such as Sistem Televisyen (M) Berhad
(TV3) is facing a rather different kind of pressure compared to Radio Televisyen
Malaysia (RTM) which is owned by the government.
Electronic media and telecommunications management aims at marketing and
distributing the use of products and services to gain profits. The experiences of
Mega TV and Metrovision stations proved that the mission of operations of a
media organisation to highlight merely good values without taking a business
model appropriate with the environment usually ends up with a financial loss.
In your view, why did TV9 temporarily stop its broadcast in January
2005?
ACTIVITY 3.1
1. What type of pressure is faced by RTM but not by TV3?
2. What type of pressure is more focused towards TV3 as
compared to RTM?
Emphasis on the profit aspect may cause non-commercial broadcasts to be unable
to play an effective role in telecommunications landscape in Malaysia. When an
industry participant emphasises profit too much, it seems that it is not concerned
with non-commercial goals such as creating an informed and knowledgeable
society.
Below is a newspaper extract taken from The Star, 6 October 2004:
ETV FAILURE: A-G's report: Most schools do not watch Educational
programmes.
PETALING JAYA: The Educational Television (ETV) programme, which
costs the Government millions of ringgit each year, has failed to meet its
objective because most schools are not utilising the facility.
What is your view on the newspaper statement? If you are a non-
commercial media manager, what is your strategy so that your
organisation may still achieve success without emphasising financial
profit? Discuss.
ACTIVITY 3.3
Some people have the view that Educational Television in Malaysia
failed because of its programmes were produced without an
entertainment element and were not profit oriented. On the other
hand, the Public Broadcasting System (PBS) in the United States
stands strong until today even though it is not a commercial channel.
What is your view? You may interview executives working in
Educational Television to get information.
ACTIVITY 3.2
BASIC ACTIVITIES OF A MEDIA
ORGANISATION
Media industry transactions involve four main activities as shown in Figure 3.4
below.
Figure 3.4: Four main activities of a media organisation
Detailed explanation on the main activities of a media organisation is discussed
in the following section.
3.4.1 Development
The music recording industry began to expand with the invention of a talking
machine or phonograph by Thomas A. Edison in 1877. The machine was
improved by Emile Berliner and named a gramophone. Berliner, together with
Eldridge Johnson, marketed the gramophone for domestic use. However, the
gramophone was only affordable for the elite. Only in 1927, the electrical
gramophone could be sold to the public and 104 million gramophone disks were
sold (Wilson & Wilson 2001: 277-278).
Early development of radio broadcasting is related to such names as Guglielmo
Marconi, R.E. Fessenden, Lee de Forest and David Sarnoff either as inventor of
telecommunications and broadcasting technology or professional practitioners
who built up careers in the broadcasting field. Television linked us to electronic
experts such as Paul Nipkow, Vladimir Zworykin and P.T. Farnsworth (Refer
Wilson & Wilson 2001: 250-273; 306-339).
The development of electronic media highlighted several changes in the use of
wireless equipment. Trade fairs sponsored annually displays and introduced
various new telecommunications equipment to the public. Now, there are kinds
of many micro equipment such as mini microphones, mini cameras, mini
recorders which are of high quality, digital and suitable for broadcast. The
steadfastness of the European and American inventors in producing new gadgets
is now being largely taken over by innovators and inventors from Asia, especially
Japan and South Korea.
To know more in detail, on the history of music recording, radio and television
industry, refer to books on mass media including the following references:
(a) Biagi, S. (2005). Media Impact: An Introduction to Mass Media Impact (7th
ed.). Belmont, CA: Wadsworth.
(b) Wilson, J.R. & Wilson, S.R. (2001). (5th ed.). Mass Media, Mass Culture: An
Introduction. New York, NY: McGraw-Hill.
3.4.2 Production
Companies involved in the production of electronic
media are more interested in producing consumer
electronic products such as television sets, radios,
compact disc devices, video recorders and various
types of mobile phone equipment.
At the beginning of the media industry, American
companies were the main producers of electronic
media equipment. Now, Japan and South Korea are
more innovative, creative, and have high technology.
However, in the aspect of media programme
production, the United States still succeeds in leading
the global market with the production of films,
television programmes, music and fashion preferred
by youngsters.
This condition bothers the world community which is worried about the spread
of the countryÊs ideology into local community cultures. In reality, this already
exists in the 21st century. As a result, we find that there are many foreign
companies sharing ownership of local media organisations. For example, Rupert
Broadcast Asia 2002 is a good example of an exhibition showcasing
telecommunications products and services. The telecommunications
exhibition held in Singapore in 2002 displayed equipment such as
cameras, editing equipment, microphones and various other gadgets.
In your view, what other equipment could have also been displayed at
Broadcast Asia 2002 in Singapore?
ACTIVITY 3.4
Murdoch, the owner of a media organisation News Corporation originating from
Australia, now owns various print and electronic media in many parts of the
world including Sky Broadcasting in UK, Fox Corporation in the United States
and STAR TV in Hong Kong. In the United States, News Corporation competes
with three main American television networks, that is, NBC, CBS and ABC.
Figure 3.5: An extract on Fox Broadcasting Company
Source: Dominick et al. (2004). Broadcasting, Cable, the Internet, and Beyond. An
Introduction to Modern Electronic Media. NY: McGraw-Hill, p. 105
Sony Corporation, owned by Japan , has taken over Columbia Pictures, TriStar
Pictures and CBS Records, while Matsushita owns a majority share in MCA and
Universal Press.
You may refer to Global Media System in Topic 3, Module CBMM2103 for
additional reading.
3.4.3 Distribution
Distribution and spreading in the telecommunications industry is carried out by
multinational and international companies which strive to meet the needs and
tastes of producers and consumers, not only domestically but also for the global
audience. The broadcasting industry in the United States clearly shows this
relationship through television programmes from the three main channels (ABC,
CBS and NBC) to affiliate stations in small towns.
Besides the large organisations, there are also companies like Viacom and Unistar
which distribute programmes for the world market.
Fox Broadcasting Company
The Fox Broadcasting Company (FBC) was launched in 1968 by Australian
media magnate Rupert Murdoch. Murdoch had purchased the former
Metromedia stations and was interested in using his newly-acquired TV
studio (20th Century Fox) to produce programmes for these stations. The
decision was made to introduce programming slowly - first, one day of the
week (Sunday), then gradually extending it throughout the week. Today, Fox
network programming is available seven nights per week. Many successful
shows now attract audiences and advertisers to Fox, including 24, The
Simpsons, Boston Public and American Idol.
3.4.4 Display
This fourth level requires the telecommunications manager to plan and
implement display or broadcasting to attract the attention of its consumer
audience. With the development of new technology, product display nowadays is
no longer limited to media owners, managers, programme producers but also
includes listeners and viewers.
Now, communications rooms of media organisations have turned into a place to
broadcast a product direct to the consumers. To perform the task, a media room
is designed in a way to enable programmes to be broadcasted from the station to
homes. Therefore, it is no wonder if the media station is now equipped with a
wide screen, a quality video camera, and a high quality sound system. Such
quality recording has caused the falling rate of cinema viewing some time ago.
This situation influences the broadcasting industry.
Now, companies cooperate to produce made-for-TV-movies. ViewersÊ experience
in the comfort of their own homes now has replaced their habit of viewing films
in cinemas.
ELECTRONIC MEDIA LANDSCAPE
Subsequently we will analyse in detail the media which is included in the
electronic media category.
At the early stage of the broadcasting industry, there were only a few radio and
television stations. Now, the electronic media landscape has changed and
portrays a complex situation with the growth of many new stations including
web radio and web television. Refer Table 3.1.
3.5
Observe the media organisations in Malaysia. Briefly discuss the four
basic activities of a media organisation above, by including an example
of a local media organisation for each of the activities.
ACTIVITY 3.5
Table 3.1: Current Electronic Media Landscape
Functions Software Product Hardware
Entertainment
and Information
Television channels
Cable channels
Pay television
Pay viewing
Radio stations
Television stations
Cable systems
Satellite service
Video texts
Teletexts
Video equipment
Audio equipment
Satellite parabolic
Telephone
3.5.1 Radio Broadcasting
A name which is often linked to radio broadcasting is Guglielmo Marconi. He is
the person who identified the potentials of the radio as a long distance
communication channel. In the beginning the use of radio was limited to
communication equipment in ships. During the Second World War, the use of
radio was specially allocated to military needs. After the Second World War,
radios were used as an entertainment channel and for getting information.
In the beginning, the use of radio was limited to users within the reach of a
frequency between 30 to 300 kHz (kilohertz) only. Radio signals were
broadcasted through amplitude modulation or AM modulation wave.
The rise in radio stations has made the Federal Communications Commission
(FCC) introduce radio channel classification. Refer to Table 3.2 to know about
general radio channel classification in the U.S. With the classification, it is easier for
the FCC to monitor the performance of thousands of stations existing in the U.S.
To get more information regarding the Federal Communications Commission,
please browse the following website: http://www.fcc.gov
Malaysia's space is now crowded with various radio waves being used
by various stations. How many radio stations operate in Malaysia?
Where are the operational locations of these stations?
Table 3.2: Classification of AM Radio Channels in the United States
Classification I
Ć Dominant
Ć Clear broadcasting
Ć Has specific frequencies
Classification II Ć Clear, dominant broadcast
Classification III Ć District stations
Classification IV Ć Local broadcasting stations
Another radio broadcasting frequency is frequency modulation or FM. This is a
higher frequency for an area of 88 to 108 megacycles/sec (now called megahertz
or MHz). Use of FM frequency requires a wave that links the broadcasting tower
directly to radio sets. FM station classification is guided by the antenna power
and operational power.
Class B and Class C stations are preferred by the management of radio FM
stations companies which normally concentrate in city areas by erecting high
towers to ensure broadcasts reach target audience. For example, the broadcasting
tower owned by Shamrock Broadcasting in Atlanta, Georgia, USA is 1794 feet
high.
Most radio stations operate using FM. Its classification is as in Table 3.3.
Table 3.3: Classification of FM Radio Stations in the United States
Classification A Ć Using low broadcast of 50 kW
Ć Maximum distance of 30 miles
Classification B Ć Able to operate till 50kW power
Ć Maximum distance of 30 miles
Classification C Ć Able to operate till 100kW power
Ć Maximum distance of 70 miles
Source: Craft et al. (2001). Electronic Media. CA: Wadsworth Thomson Learning, p. 38.
By 1945 radio had become the most popular medium for both entertainment
and news, but looming on the horizon was a new medium that threatened to
render radio obsolete: television.
3.5.2 Television Broadcasting (TV)
Telecommunications technology developed rapidly after the Second World War and
the FCC began to issue licenses for television broadcasting. Priority was given to
stations operating using VHF (Very High Frequency). Most stations in the beginning
were also owned by large radio network organisations.
In the beginning, most of these stations broadcasted entertainment programmes. The
popularity of these relatively new media at the early stages attracted many
entrepreneurs to reap profits from television stations, forcing FCC to freeze license
issuance temporarily, from 1948 till 1952. Now, there are hundreds of television
stations in the United States. However, the main stations that lead the television
broadcasting are American Broadcasting Company (ABC is owned by Walt Disney),
Columbia Broadcasting System (CBS is owned by Viacom), National Broadcasting
Company (NBC is owned by General Electric), FOX Television (owned by News
Corporation) and a few other well known cable and satellite stations including
Home Box Office (HBO) and Cable News Network (CNN).
Other than the four main television stations, there are also several independent
stations either owned by an organisation or several organisations with no relation to
traditional channels. Public broadcasting began with the operation of public
broadcasting service (PBS) which operates not for profit. The aim is to provide
exposure on education, culture and human relations programmes such as Nova and
Sesame Street. There are 350 stations in the United States operating as public
broadcasting stations. PBS does not pay the stations for broadcasting programmes
prepared, but the stations sign a contract to broadcast them.
In the United States, television is an important medium for entertainment and
information. A total of 99% of the households in the United States have televisions,
and approximately 89% having recording machines (VCR/VTR). On average, each
household receives more than 40 channels and televisions are in use for seven hours
a day.
Table 3.4: Growth of Television in the United States (1950-2000)
Year
Total Number of Stations
Percent of Households Having Televisions
Total Number of Staff
1950
1970
2000
98
862
1,576
9
95
99
9000
58,400
175,000
Source: Dominick et al. (2004). Broadcasting, Cable, the Internet and Beyond. An
Introduction to Modern Electronic Media. NY: McGraw-Hill, p. 19
Besides television broadcasting, the media landscape includes Cable Television,
Pay Cable, Subscription Television (Pay to View), Master-Antenna Satellite
Television and Direct Broadcast Satellite. Table 3.5 shows types of television
broadcasts in the United States.
Table 3.5: Types of Television Broadcast in the United States
Types of Television
Broadcast Explanation
Cable Television • Late 1940Ês
• Covering the hinterland areas not getting television
broadcast. Each building subscribing to cable television
service must install cable coaxial connected to
building receiving the broadcast.
Video • Around 1970Ês
• Video recorder enables viewers to record television
broadcast for viewing again.
Pay Cable
(Pay Per View
Television)
• Additional channels only for viewers who subscribe television
• Example: HBO, Showtime, Cinemax, ESPN.
Master-Antenna
Television Satellite
(SMATV)
• SMATV company provides television broadcast for
viewers to a subscribing region/building through the
company. Satellite parabola is installed in a building area
to receive transmission which can be received by viewers
in the building.
Multichannel,
Multipoint
Distribution Service (MMDS)
• Broadcast is transmitted through microwave transmission.
A transmission device is installed at a building, which
subsequently retransmits the wave to clients.
Direct Broadcast Satellite
• Using parabola installed on the house roof top to receive
broadcast transmitted from satellite.
DEVELOPMENT OF TELEVISION
BROADCAST IN MALAYSIA
The history of broadcasting media development particularly radio is closely
related to British colonial era, i.e. on 1 April 1946. Radio broadcasting activities at
the time centred on Caldecott Hill, Singapore but beginning on 1st January 1959,
two years after the country obtained independence from the British, Radio
Malaya began operations from Kuala Lumpur. Television Malaysia broadcasting
began operations on 23 December 1963 in the Klang Valley. Six years later, a
second channel was launched to fulfil the governmentÊs broadcasting objectives.
With that, Radio and Television Malaysia (RTM) operates as a public broadcaster
under the Broadcasting Department of Malaysia. After the implementation of the
National Privatisation Policy in 1983, private television channels, beginning with
TV3, followed by several terrestrial television stations started. Technological
development has consequently enabled the operations of a satellite television
station, i.e. ASTRO. ASTRO was officially launched on 1 October 1996 and is one
of 89 broadcasting stations operating in Asia Pacific.
ASTRO is owned by MEASAT Broadcast Network Systems (MBNS) Sdn Bhd.
The shareholders of MBNS include Khazanah Nasional Berhad, Amanah Saham
Bumiputera and Usaha Tegas Entertainment Systems Sendirian Berhad. MBNS is
one of the subsidiaries of ASTRO All Asia Networks plc. (a holding company)
which offers services in terms of entertainment and information including
television and radio satellite programmes, karaoke channel, interactive game,
pay-per-view film, video-on-demand and others. Information services include
data delivery, broadcasting of television and radio programmes in the form of
information and interactive television service such as banking, shopping, long
distance learning, Internet and others.
MBNS has spent more than RM800million to build its broadcasting centre called
All-Asia Broadcast Centre (ABC) situated in Taman Teknologi Malaysia, Bukit
Jalil, Kuala Lumpur, that is in the middle of the Multimedia Super Corridor
(MSC). ABC is the heart of MEASAT operations for Malaysia and its other
markets in the world. At ABC, programmes received from other satellites in the
world will undergo various processes such as dubbing, subtitling, editing,
digitalising, bits rate reduction, error correction, digital modulation and changes
to code.
MEASAT Broadcast is a consortium licensed by the Government of Malaysia to
operate multimedia broadcasting service in Malaysia. MBNS uses MEASAT
(Malaysia East Asian Satellite) satellite system. Without MEASAT, satellite
television broadcast could not have operated.
The owner and operator of MEASAT I and II is Binariang Sendirian Berhad
which has changed its name to Maxis Communications Sendirian Berhad. The
owners of MBNS consist of a group of shareholders who also have shares in
Maxis Communications. The principal shareholder is Ananda Krishnan, the
owner of Syarikat Usaha Tegas Sendirian Berhad.
ASTRO services are based on subscription. Programmes broadcasted through
television channels in various languages (including three government-owned
television channels and three privately-owned television stations) and radio
channels in digital format are produced by local television stations, local
producers and purchased or imported from foreign owners/producers. ASTRO
programmes are broadcasted in Malay, English, Mandarin, Tamil, Arabic and
other languages.
MEASAT 1 and MEASAT II are owned by Malaysia. MEASAT 1 was launched on
13 January 1996 in Kourou, French Guiana while MEASAT II was launched
on 14 November 1996 also in French Guiana. MEASAT I and II is a satellite of
hybrid model HS376 made by Hughes Corporation, the United States. Both
satellites use C-band and Ku-band frequencies, is able to reach India, East Asia,
and eastern region of Australia. It is capable of providing telecommunications
services and data services. Both satellites are also capable of providing 112
digital TV and DTU (Direct-to-User) radio networks. MEASAT III is still
being planned.
ASTRO television channels clearly portray the participation of global media such
as CNN, BBC, HBO, STAR, Hallmark, ESPN, Al-Jazeera, Cinemax, TVB, ABC,
NBC, Disney, Bloomberg, Fox Network, etc. ASTRO has also involved global
participants such as ST Teleport Pte. Ltd., Hawaii Pacific Teleport, Phillip and
Nokia, which supply services, hardware, and/or digital technology to MBNS.
ASTRO in Malaysia has reached 1.4 million households and there were about 6
million viewers in 2004 (Annual Report 2004 ASTRO All Asia Networks plc., p.2).
ASTROÊs broadcast can also be accessed by viewers in India, the Philippines,
Vietnam, Taiwan, Laos, Cambodia, Brunei, Indonesia and parts of Australia.
Radio ASTRO (ERA, MY FM, hitz.fm, MIX FM and Light & Easy) is followed by
8.7 million listeners per week and able to attract 74% of the total amount of
advertising budget for radio. Refer Table 3.6.
Make a list of existing television channels in Malaysia and state the
years in which they started operating.
In your view, is the total number of existing channels sufficient for
audiences in Malaysia? Discuss.
Table 3.6: Financial Position of ASTRO 2004 (RM Million)
*FY02 *FY03 *FY04
Income
Multi-channel television
Radio
**Celestial
Others/inter-segment eliminations
867.9
781.4
71.8
3.4
11.3
1,142.7
1,034.5
8.7
8.3
11.2
1,418.8
1,265.6
108.0
36.3
8.9
Total Number of Clients of
ASTRO TV (Â000)
Residential
Total Number of Clients
777.7
854.4
984.3
1,069.9
1,283.0
1,392.7
Total Number of Clients of
ASTRO Radio (Â000) 6,738.0 8,376.0 8,740.0
*FY: financial year
**Celestial: Celestial Movies Channel shows films obtained from Chinese Film Library
owned by Shaw Brothers.
Source: Annual Report 2004
Beginning in September 2005, ASTRO faced stiff competition from a satellite
television station owned by a local company called MiTV.
• Electronic media organisation refers to commercial and non-commercial
organisations which are involved in the development, production,
distribution, display of products and services which provide entertainment
and information to the public channelled electronically. Discussion on the
electronic media landscape also involves media management, who should be
sensitive to changes in the environment of software and hardware technology
in the relevant industry and must function consistently with very competitive
and constantly changing conditions.
• In the recent two decades, the broadcasting and telecommunications field has
changed its appearance due to technological development in
telecommunications, computer and microelectronics which has left its mark
in the field of telecommunications and broadcasting media.
• In addition to technology, the viewing and listening audiences today are
exposed to hundreds of programme selections from various sources including
satellite radio and television; from local as well as foreign sources. Radio and
television are the main electronic media which also change consistently with
the technological changes in broadcasting and telecommunications, market
environment and target audienceÊs tastes. The broadcasting climate is now
dynamic and excellent, constantly changing and involving various industry
participants which extend to a global level. Therefore, a media manager must
be prepared to face this rapidly and frequently changing situation and
climate.
• A successful industry is the one that offers products and services efficiently
and to the consumers. Media industry in the United States is regarded as the
most efficient. The entire population has access to television and radio. Now,
access to the Internet has also reached the highest. All the three television
channels in the United States, that is, ABC, NBC and CBS, are examples of
efficient media organisations which are always sensitive to changes in
technology and society. Now, their audience is not only the United States, but
also the world community. Referring to the local broadcasting landscape,
RTM and TV3 are two stations which quite substantially offer products and
services to audience in the country.
Development
Display
Distribution
Electronic Media
Information and Communication Technology
Production
Craft, J. E., Leigh, F. A. & Godfrey, D. G. (2001). Electronic Media. Australia:
Wadsworth Thomson Learning.
Dominick, J. R., Messere, F. & Sherman, B. L. (2004). Broadcasting, Cable, The
Internet and Beyond: An Introduction to Modern Electronic Media. (5th ed.).
Boston, MA: McGraw-Hill.
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/ Cable
and The New Technologies (2nd ed.). NY: McGraw-Hill, Inc.
* * *
TOPIC 4 TELECOMMUNICATIONS INDUSTRY STRUCTURE
INTRODUCTION
This topic will discuss the telecommunications industry structure by focusing on
market structure elements, behaviour, market achievement and media maturity
level, i.e. product life cycles.
The main focus in broadcasting management is understanding various market
structures being practised in the telecommunications industry. Understanding
these elements helps media managers to arrange strategies, particularly in terms
of products and services. Besides this, media managers will be able to
understand competitors' strategies while thinking of product and service
innovation, which are able to compete with and overcome competition.
At the end of the topic, you should be able to:
1. Explain five elements in the telecommunications industry market
structure;
2. Explain three forms of transactions practised in the broadcasting
industry;
3. Discuss the limits and barriers to entry of new products into this
industry; and
4. Discuss the strategies for increasing broadcasting products and
services.
LEARNING OUTCOMES
TELECOMUNICATIONS INDUSTRY
STRUCTURE
Sherman (1995) emphasised the importance of examining market structure,
market behaviour and market achievement in the telecommunications industry.
According to Gershon (2001), different market structures form different patterns
of organisational behaviour. Besides that, the economy also affects the formation
of a market structure. This means a free economic system which encourages
competition forms a structure which is not the same with a monopolistic
economy.
The increase in electronic media operations itself is to obtain gains or profits.
Therefore, the cable system strategy is to capture as many customers as possible
to patronise their services, while the broadcasting stations sell their viewing and
listening audience to advertisers who are willing to sponsor programmes (Craft,
J.E. et al. 2001).
Table 4.1: Elements of Telecommunications Industry Structure
Market Types of Market Participants
Structure
Elements Monopoly Oligopoly Perfect Competition
Seller
concentration
A single firm
owning/controlli
ng a type of
product or service
in the
market/industry.
Several firms dominate
product/service in the
market / industry.
A large number of
firms compete in the
open market.
4.1
Market structure refers to the
characteristics of the market economy
which affect the behaviour of organisations.
Market behaviour refers to company policy regarding
product and competitorsÊ strategies to capture a market.
Market achievement means economic output that is the
ability to achieve maximum profit.
Copyright © Open University Malaysia (OUM)
TOPIC 4 TELECOMMUNICATIONS INDUSTRY STRUCTURE W 87
Product
differentiation
Product/service
with same image
and/or brand.
Products differ slightly
and not important.
There are various
choices and unique
images of a particular
product/service..
Barriers to
entry
Cost is the main
barrier because
transaction
requires huge
sum of capital.
Economy of scale is the
main barrier because of
long period required gain
profits.
Dominant old
organisation and
product/service
excellence which was
long established
becomes a challenge
to new competitors.
Buyer
concentration
Focus is on total
number of buyers
to get advertising
returns/income.
Depends on large
number of buyers to get
high economic returns.
Stiff competition raise
problem of buyer
fragmentation.
Fixed Costs
(continuous
expenses for
equipment)
Technological
innovation cost
will raise budget
costs but it is
unavoidable
although there is
no competition.
Technological innovation
forces purchase of new
hardware/software
(retooling) and raise
costs to attract investors
and audience
successfully.
Needs high
investment amount to
face competition.
Demand
Growth
(levels of
producersÊ/
customersÊ
demand)
High consumer
demand raise
demand for
product/ service
and profit, or
vice versa.
In telecommunications
industry, continuous
demand is no longer
certain. Demand growth
is a big challenge to
industry participants.
Demand growth is a
big challenge to
industry participants,
successful industry is
a participant which
can attract customersÊ
interest through
product/service
offered.
Source: B.L. Sherman (1995). Telecommunications Management. (2nd ed.), p. 52-60
4.1.1 Telecommunications Organisation
Telecommunications organisation includes electronic media organisations which
transact in producing information and entertainment to be broadcasted to the
audience. This means electronic media organisations depend on income from the
creative products of their task force and decisions made by the editorial group.
The transactions depend on strategies in selling and distribution of products and
services relating to information and entertainment.
MARKET STRUCTURE ELEMENTS
This structure influences organisational behaviour in the market. There are five
elements in the market structure, as shown in Figure 4.1.
Figure 4.1: Market structure elements
4.2.1 Sellers Concentration
Sellers concentration also takes into account competitive factors taking place in
the market and the effects of competition on quality and cost of services
rendered. Sellers concentration can also be measured by looking at the
Market structure elements refer to the
relationship between buyers and sellers
in the market.
Sellers Concentration is defined as the
total number of sellers of a product or
service in the market.
percentage of gross income received by the largest organisation in the industry.
Level of competition or types of market participants are divided into three, that
is:
Ć Monopoly;
Ć Oligopoly; and
Ć Perfect competition.
(a) Monopoly
In the context of telecommunications, monopoly refers to the conditions in
which there is only one organisation producing the product in the market.
The organisation will reap 100% profit in the market. In our country, for
example, the main provider of electricity for the whole nation is only
Tenaga Nasional Berhad (TNB). Previously, Radio Televisyen Malaysia was
the main source of national broadcasting until Sistem Televisyen (M)
Berhad (TV3) began to operate and broke the monopoly.
In the monopolistic category, the organisation providing the service acts to
control costs. Product quality is based on the organisationÊs own
measurement because customers have no choice to switch to another
provider. Besides that, the monopolistic conditions do not provide room for
reform. When these conditions happen, the organisation will feel that its
product is sufficient without any desire to improve product development or
offer new services.
(b) Oligopoly
For example, in the electronic media broadcasting industry in Malaysia,
local television stations, namely RTM, TV3, ntv7, 8TV, ASTRO and MiTV
must compete with each other to attract the audience. In markets that
practise an oligopolistic system, the organisations involved in a particular
Monopoly refers to the conditions in the
market which are controlled or
dominated by a product seller.
Oligopoly is a market situation which
portrays the involvement of a few
dominant sellers in the industry.
industry depend on each other to take action, for example, to raise prices or
change advertising strategies or make product innovations.
Oligopolistic market practices are carried out not only in Malaysia. In the
United States, there are also industries practising the oligopolistic system.
For example, television broadcasting in the United States comprises the
main networks - The Big Four, i.e. ABC, CBS, NBC and Fox while the
telephone industry is dominated by names like AT&T, WorldCom and
Sprint.
(c) Perfect Competition
Entry into the market by a new firm may often happen. Similarly, firms also
terminate their services frequently. One recent example is the computer
industry which shows that transactions take place in a climate of intense
competition. This condition provides opportunities for customers to obtain
the best product and service.
4.2.2 Product Differentiation
Product differentiation is the degree of difference between products produced by
one firm and those produced by another firm in the same industry. In the
entertainment media industry there is a tendency to produce differentiated
products. Therefore, stations would display various brands to highlight the
uniqueness and distinction of their products compared to the competitors.
As an example, TV3 previously used the slogan „Duniamu TV3‰ (TV3 is Your
World) as its broadcasting strategy. RTM presented its „Teman Setia Anda‰
(Your Loyal Friend). Now with competition from several other stations, each of
them has to strengthen their position by building a new branding image. Each
station will attempt to create something different to ensure that their own
product is distinct from those of other stations. These broadcasting stations also
create an image or identity in various ways including the broadcasted
programmes, music used, emblems, scheduling as well as selection of
newscasters on duty.
Perfect competition means there are
several organisations providing the same
product or service.
4.2.3 Barriers to Entry
What are the factors that prevent the entry of a new participant in an industry?
New firms usually cannot compete with long established media organisations
because the older organisations already have expertise and a loyal audience.
There are various barriers to entry. Among them are as follows:
(a) Absolute Cost Barrier
There are certain industries which require a huge sum of capital and usage
of sophisticated equipment. This condition hinders new firms from entering
the market.
(b) Scale of Economy Barrier
There are also businesses requiring a certain period of time to obtain profit.
This condition requires patience on the part of businessmen to wait for the
time to reap their profit. It happens in the media industry. The firms
owning media stations cannot reap instant profits because they have to first
invest a large amount of capital for the stationÊs infrastructure, as well as
train skilled human resources in their own respective fields. This will take a
long time, sometimes as long as seven years. An example is the cable
television MegaTV which required a large amount of capital but still took
as long as five to seven years before getting its profits.
You are required to watch news programmes for a week. On Monday
night you should watch the RTM news programme. On Tuesday night
you must see TV3Ês news programme and on Wednesday night the
news on ntv7. Make a list of differences between the news
programmes on these stations from the aspects of newscasters, ways of
casting, music, advertising and visuals broadcasted.
Barriers to Entry refers to the extent
competition is limited or barred by the
industry.
4.2.4 Buyers Concentration
If there are more buyers, it means higher profits will be gained. This makes
buyers concentration a critical factor. A low number of buyers will not only affect
profit adversely but also raise the problem of continuing the business activities.
Basically, we see television stations broadcasting programmes to millions of
viewers but that does not necessarily mean the broadcasted programmes may
reach the target audience. The determinant is the customers who have a choice
whether to view or not.
Besides the efforts to attract audiences, television and radio stations also sell the
viewers and listeners to advertisers to generate income through programme
sponsoring. A large audience, closely related to programme ratings, is a criterion to
get advertising purchase by the advertisers. This is also a contributing factor why we
are exposed to advertising whenever we watch television or listen to the radio.
4.2.5 Growth in Demand
The last element in telecommunications market structure is growth in demand.
Buyers Concentration refers to total number of
potential buyers to buy the products produced.
Growth in Demand refers to the level of
producer and consumer demand for the product
and service produced by the industry.
In your view, what caused Metrovision and Mega TV to cease their
broadcasting operations?
In principle, a rising demand would lead to an increase in income and profit.
This becomes an indicator for station programme ratings and popularity levels of
a radio or television station.
MARKET BEHAVIOUR PRINCIPLE
The formation of an industry is through market structure and market behaviour.
In whatever form of market economy, the main principle of the public and
private sectors is profit and increasing market share. Besides that, the market
structure can also be seen from the policy of the organisation towards its clients
and competitors. The issue of market behaviour can be seen through three types
of market behaviour as follows:
(a) Price determination policy;
(b) Quality control policy; and
(c) Competitive policy.
4.3.1 Price Determination Policy
In theory, a competitive market will be able to attract consumers with purchasing
power to set the market price. However, as the telecommunications industry is
more inclined to practice an oligopolistic system, there is interdependence among
the firms. This means, if a firm reduces its price, other firms will also reduce it.
Besides, the firms will agree on a fixed price. This factor is referred to as price
fixing. Such a practice takes place because producers collude to limit production
of products and limit entry of new firms.
4.3.2 Quality Control Policy
The second component of market behaviour principle is product quality control.
In a monopolistic system, consumers have no choice. In fact, quality maybe
ignored. In an oligopolistic system, the approach used is through the agreement
of all production firms involved. If a party improves quality, then others will
follow. However, all firms in the industry will first discuss quality improvement.
4.3
In your view, how can the increase in number of television stations
affect the growth in demand? Will the increased number of stations
create viewer fragmentation? Discuss.
Normally the firm which raises the price in the market is called a product leader.
Media organisations will spend a large sum of money in order to ensure they
become a product leader.
4.3.3 Competitive Policy
Although competitive practices are implemented in the telecommunications
industry particularly broadcasting, there are also forced practices by legal
agencies. This is done by making policies and laws to hinder growth of
competition. The following extract is an example of how competitive policy is
hindered in the broadcasting industry:
Figure 4.2: An extract on competitive policies hindered in broadcasting industry
Source: Gershon, R.A. 2001. Telecommunications Management. Industry Structures and
Planning Strategies. NJ: LEA, p. 12.
WHAT ARE THE ELEMENTS OF MARKET ACHIEVEMENT?.
The success of the industry is measured by comparing potential achievement in
four areas as in Figure 4.3.
4.4
The historic relationship between broadcasters and cable
television provides a good example. Between 1952 and 1977, U.S.
broadcasters and television/film supported a number of
regulatory measures designed to limit the growth of cable
television. In principle, broadcasters were concerned about
programme siphoning; that is the ability of the cable industry to
siphon programming intended for broadcast use. Broadcasters
were concerned that cable programmers would feature the said
programming on cable and thereby fragment the viewing
audience and inflate the cost of programme acquisition.
How do the price determination policy, quality control policy and
competitive policy affect television stations in Malaysia from the
aspect of their own programme production?
Figure 4.3: Success measures of an industry
4.4.1 Efficient Use of Resources
In an ideal situation, an industry is deemed to be efficient if it succeeds in getting
a high income using a given sum of resources. The industry is considered
successful if it can stabilise prices and product achievement by covering a large
number of customers. An efficient industry is able to provide products and
services to customers.
Supply and demand relationship explains the ratio between product turnover
and product costs.
To ensure success in the telecommunications industry, the management must be
efficient. For example, in ensuring there is no wastage in terms of unused
technical equipment. Old equipment should be replaced, updated or repaired.
Besides that, the management must take into account the human resource aspect,
which is sufficient and with no wastage taking place.
Make a brief research of the number of staff in the news room of two
local television stations. Mention the most visible aspects as a result of
your comparison.
4.4.2 Stability of Prices and Employment
Stability factor plays an important role in assisting the broadcasting industryÊs
success. When product prices rise, handling costs will also rise. This rise will
have an impact on advertising cost. Consequently, the rise in advertising costs
would help raise profitability of the station.
Employment patterns in the broadcasting industry are more stable compared to
product prices. We often hear about workers being dismissed, however, it is
obvious that the work force in this field is growing and expanding in total.
4.4.3 Fair Deal to All
At the early stage of broadcasting activities, females found it difficult to
participate in the broadcasting industry careers. However, time has changed the
scenario and we find there are increasingly more females involving themselves in
the broadcasting industry, while getting fairer deals from the employers.
Female involvement in the field is not only limited to the task of hosting
programmes but more of them are working behind the cameras either as
producers, directors or scriptwriters.
4.4.4 Growth and Planning
The last element used to measure telecommunications market success is growth
and planning. Planning is a critical aspect for the media manager in the
telecommunications technology industry and multimedia communication which
change frequently.
However, good planning will help the station to succeed. A media manager who
is able to plan well will ensure growth takes place by horizontal integration,
diversification and vertical integration.
(a) Horizontal Integration
Through horizontal integration, stations extend their influence to a wider
market. One local example is Sistem Televisyen (M) Berhad (TV3). At the
early stage of TV3Ês establishment, its programmes could only be viewed
by audiences in the Klang Valley. However, now after 20 years of
operations, TV3 programmes can be viewed by all people in Malaysia,
including Sabah and Sarawak.
(b) Diversification
Diversification is when the organisation expands its business to other
products related to the industry. In the United States, the larger television
stations such as CBS, expands its business to the music industry through
CBS Records. Even in our country, TV3Ês management attempted to
diversify its activities by expanding its wings and establishing the
subsidiary Grand Brilliance Sdn Bhd (now called Primeworks) to produce
films, handled by directors, scriptwriters, crew and actors as well as
marketing experts financed by the company itself.
Table 4.2 below shows an example on how General Electric Corporation
implemented the diversification principle.
Table 4.2: The Main Divisions of General Electric Corporation (1998)
Main Divisions of General Electric Corporation (1998)
Aircraft engines
Appliances
Capital services
Lighting
National Broadcasting Corp.(NBC)
Medical systems
Plastics
Power systems
Electric distribution and control
Motors and industrial systems
Information services
Transportation systems
Source: Gershon, R.A. 2001. Telecommunications Management. Industry Structures and
Planning Strategies. NJ: LEA, p. 19.
(c) Vertical Integration
Through vertical integration, the company widens its business from one
phase to another. For example, in the starting phase, the company focuses
its attention on the production of products. After succeeding in that and the
position is convincing, the company will concentrate on product
distribution.
Briefly, the planning aspect plays an important role in ensuring
organisational operations success particularly the operations of electronic
media station in the broadcasting industry. Failure of a station may occur
without good planning. This condition can be observed in the cable
television industry. The effect of bad planning has caused the cable
television station to fail. Below is an example of vertical integration as
explained by Gershon (2001).
Copyright © Open University Malaysia (OUM)
98 X TOPIC 4 TELECOMMUNICATIONS INDUSTRY STRUCTURE
Figure 4.4: An example of vertical integration
Source: Gershon, R.A. 2001. Telecommunications Management. Industry Structures and
Planning Strategies. NJ: LEA, p. 19-20.
LEVELS OF INDUSTRY DEVELOPMENT
The level of industry development shows four phases an industry goes through.
Figure 4.5: Levels of industry development
4.5.1 Level I: Introduction
At this level, consumers are sceptical of the products offered. Normally,
producers try to attract consumers by distributing product samples. At this level
also the industry activities are focused on research and development, that is,
carrying out research on various aspects. For example, before producing a
programme, a producer researches market trends, that is the viewing and
listening audienceÊs desires.
Stations must be sensitive to the wants and needs of their target audience. There
are various methods of research carried out such as observation and discussion
of focus groups. This method assists the stations to identify suitable products to
be offered to the audience.
Research is also closely related to the use of new equipment. Before the station
uses a new type of equipment, the management will carry out a research to
ensure that it will raise productivity.
4.5.2 Level II: Development
If the consumers give a sceptical reaction at the first level, the consumers will
begin to show interest towards the product at the next level. Producers will be
clever enough to ensure the products they produce have their own distinctive
special features. Producers will create a differentiating factor to make the
products looks different from the competitorsÊ products.
The same thing applies to telecommunications industry. Radio, television
stations and online media undergo their own level of development. Media
development clearly gives positive returns to the management which is sensitive
to the environment.
4.5.3 Level III: Maturity
Products existing at maturity level are already well known. Producers play the
role to ensure the products stay in the market. For that reason, producers will
raise marketing activities. Sometime this emphasis on marketing leads the
producers to ignore product quality.
4.5.4 Level IV: Decline
Products which have been long established in a market may undergo a decline.
Normally, the entry of a new competitor, which is more active, may affect
product acceptance in the market. In the broadcasting industry, the best example
is how well known television stations in the United States such as ABC, CBS and
NBC experienced pressure when Fox competed to capture audiences and was
able to raise its popularity in a brief period by offering programmes wanted by
the audience.
• This topic has discussed telecommunications market structure and elements
influencing telecommunications. Besides, discussions also focused on
different marketing practices in the telecommunications industry. The
telecommunications industry practises the oligopolistic system and this
condition lets the organisations control products and services offered to
consumers. However, the objectives of each organisation are still the same,
that is, to gain profit.
• In ensuring the achievement of the objectives, organisations will implement
various strategies such as widening broadcasting geographical scope,
establishing new companies in related transactions and implementing
vertical integration at the global level as a marketing strategy to multiply
profit.
Buyers Concentration
Competition
Elements Horizontal Integration
Vertical Integration
Market Achievement
Market Behaviour
Market Structure
Monopoly
Oligopoly
Sellers Concentration
Burns, J.M. (1978). Leadership. New York: Harper & Row.
Foster, E.S. (1978). Understanding Broadcasting. CA: Addison-Wesley Publishing
Co.
Gershon, R.A. (2001). Telecommunications Management. Industry Structures
and Planning Strategies. NJ: LEA.
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/Cable
and The New Technologies. NY: McGraw-Hill, Inc.
New York: McGraw-Hill.
* * *
TOPIC 5 MANAGEMENT OF EDUCATIONAL TV BROADCASTING
INTRODUCTION
Educational Television (ETV) is one of the television broadcasting industry's
participants in Malaysia. However, as a television station, the functions and roles
of ETV are very different from commercial television stations such as RTM2, TV3,
ntv7, ASTRO and MiTV. This topic aims at explaining ETV development in
Malaysia since it was established in 1972 till now.
ETV is subject to the authority of the Ministry of Education, Malaysia, while the
public broadcasting station is handled by the Ministry of Information, Malaysia,
and a privately owned broadcasting stations come under the authority of the
Ministry of Energy, Communications and Multimedia. Target audience and goals
of ETV are also different from those of publicly and privately owned stations.
This topic will focus on broadcasting management of Educational Television and
will not touch on educational radio organisation. This is because Educational
Radio service was terminated in December 1994 after operating for about 28
years.
TOPIC 5 MANAGEMENT OF EDUCATIONAL TV BROADCASTING
By the end of the topic, you should be able to:
1. Explain management patterns of Educational TV organisation;
2. Discuss the activities of Educational TV organisation;
3. Outline the need of non-commercial organisations such as ETV; and
4. Differentiating the aspects of media management and Educational TV
activities from other commercial television stations in Malaysia.
LEARNING OUTCOMES
BACKGROUND OF EDUCATIONAL TELEVISION (ETV).
If you stay in Tawau, Sabah or Saratok, Sarawak or Gua Musang, Kelantan (or
any location of your staying place), how do you watch Educational TV?
Educational Television (ETV) was introduced in 1972 together with the
establishment of Bahagian Perkhidmatan Sebaran Pendidikan (PSP), Ministry of
Education of Malaysia. Now PSP is known as the Educational Technology
Division (ETD). In general, the aim of establishing ETV was to give equitable and
quality educational opportunities to all schools through the television media.
Specific targets of ETV are the disadvantaged group of students who are largely
found in rural areas and in the hinterland.
ETV programmes were first broadcasted on TV2 in 1972, simultaneously with the
official launching by the second Prime Minister of Malaysia, that is, the late Tun
Abdul Razak Hussein. Since its launch 30 years ago, ETV has undergone several
changes as a result of:
(a) Changes in broadcasting and educational policies;
(b) Rapid development in information technology and communication; and
(c) Changes taking place in social and organisational environment.
What remains fixed and unchanged is ETV targetÊs audience. Refer to Table 5.1 to
see the total target audience for the year 2004.
Table 5.1: Educational TV Target Audience, 2004
ETV Specific Total Target Audience
Targets Students Teachers
Total
Schools/Colleges
Primary Schools 3,044,797 179,622 7557
Secondary Schools 2,093,645 130,372 1962
Teachers Colleges ă ă 23
Source: Policy Planning and Educational Research Division, December 2004.
Programmes broadcasted on ETV are bought from private companies or
produced by joint ventures between ETV and outside parties. ETV produced
approximately 48 specific programmes for the use of urban and rural schools in
Malaysia. Besides that, there are 88 programmes with general audience as the
target audience.
(Source: Five Year Strategic Planning, Educational TV Sector, 2003).
5.1.1 Vision and Mission of ETV
What is ETV vision?
What is ETVÊs Mission?
5.1.2 ETV Objectives
ETV objectives are as follows:
ETV vision is to make television the main media in teaching and learning and
ETV programmes can be used by all schools effectively.
ETV's mission is to produce ETV programmes of high quality and the best in
the educational field.
Acting as one of the main agents in
implementing educational system
and social changes
Serving as a channel for
distributing Ministry of
Education of MalaysiaÂs
information
Producing and acquiring attractive,
simple and relevant educational TV Developing and improving programmes studentsÊ achievement in
knowledge and skill aspects
Improving teachersÊ level
of professionalism Enriching schools, TeachersÊ
Colleges, State Educational
Resource Centres and Teachers
Activity Centres with teaching
and learning resources in the
forms of video and CD as
reference materials
Raising parentsÊ and society's knowledge about directions,
policies and fulfillment of the education system in Malaysia.
EFFECTS OF CHANGES IN BROADCASTING POLICY.
ETV is subject not only to legal rules and controls of the Ministry of Education of
Malaysia but must also take into account the requirements of the Ministry of
Information and the decisions of the MinistersÊ Council as a whole. These legal
agencies and controls clearly influenced ETV development from 1972 till now.
Table 5.2 shows the development of ETV in terms of total broadcasting time for a
day and a week. For about 27 years (1972 till 1998), ETV broadcasted for four
days at certain time on RTM2. However, since January 1999, RTM no longer
broadcasts ETV through RTM2 channel because (till the time this module was
prepared) RTM was still implementing its organisational corporatisation policy.
Table 5.2: Development of ETV
Year Total Broadcast
Time a Day
Total Broadcasting
Time in a Week Day of Broadcast
1972 ă 1992 8hours 32 hours Monday-Thursday
1992 ă Oct 1997 7 hours 28 hours Monday-Thursday
Nov 1997 ă May 1998 5 hours 20 hours Monday-Thursday
Jun 1998 ă Dec1999 4 hours 16 hours Monday-Thursday
Jan 2000 ă Dec 2004 4 hours 16 hours Monday-Thursday
Due to changes in RTMÊs policy, ETV had to find other channels to broadcast its
programmes to the target audience. Table 5.2 clearly shows reduction in ETV
broadcasting time from eight hours a day (1972 till 1992) to 4 hours a day in 2004.
Therefore, the Ministry of Education of Malaysia sent the Minister of EducationÊs
memorandum No: 508/2186/99 to MinistersÊ Council on 1 September 1999. As a
result, the MinistersÊ Council meeting agreed that after December 1999, ETV
should be channelled through private broadcasting stations using satellite
broadcasts, i.e. ASTRO.
With the change in broadcasting policy, Educational TV organisations were given
new conditions as follows:
(a) To produce programmes conforming to international broadcasting
standards [See sub topic 7.3 (b)];
(b) Ensure quality audio, video and programme contents so that they can
attract viewersÊ interests;
(c) Ensure existence of high quality research elements in each of its
presentations;
(d) To improve programme quality in accordance with total broadcasting time
so that repetitions of broadcasting are not too frequent;
(e) To produce quality Educational TV programmes.
In the efforts to improve production quality, Educational TV sector has given
focus and attention to the following matters in the period of five years (2003 till
2007), that is:
(a) Organisational structure;
(b) Establishment;
(c) Types of programmes and acquisitions;
(d) Programme evaluation;
(e) Training and human resource development;
(f) Equipment and facilities.
ORGANISATIONAL STRUCTURE
Educational TV was established under the Educational Technology Division
(ETD) of the Ministry of Education. ETV tasks are handled by two sectors, that is:
(a) Educational TV Sector; and
(b) Engineering Service Sector.
5.3.1 Educational TV Sector
This sector is responsible to ensure TV programmes conform to the following:
(a) Curriculum requirements in terms of content (knowledge, skill and value); and
(b) Academic requirements (thinking and creative skills as well as teaching and
learning which is attractive to student interests).
5.3.2 Engineering Service Sector
This sector is responsible for handling shooting tasks, maintenance of equipment
and contacts with ASTRO, RTM and Telecommunications Department of
Malaysia.
Both sectors of Educational TV and Engineering Service are responsible to ensure
that Educational TV programmes broadcasted through ASTRO conforms to
international standards of broadcasting.
Organisational structure of ETV is different from administrative management of
other divisions in the Ministry of Education. It has its own work structure
enabling it to operate smartly and is guided by a systematic work flow. New
organisational structure does not show tasks hierarchy and work quality control
as in the organisational structure at the early stage of Educational TV
establishment (see Figure 5.1). On the other hand, the old organisational structure
is more organised as practiced in the management of TV organisation at other TV
stations.
Organisational structure of Educational TV is as in Figure 5.1 (before 1999) and
Figure 5.2 (after 1999):
Figure 5.1: Organisational structure of educational TV, 1991
Figure 5.2: Organisational structure of educational TV, 2003
Figure 5.2 outlines the roles of the Principal Assistant Director and Television
Coordinator in all matters regarding operations management, finance and
programme products. On the other hand, the old organisational structure (Figure
5.1) looks more organised, as similarly practiced in Television Organisational
Management in other television stations.
Organisational structure before 1999 (Figure 5.2) was managed by a Principal
Assistant Director who was assisted by three coordinators (senior producers). A
senior producer manages operational matters, i.e. about sets and props, tapes
library, make up artists, and general workers. All these are related to matters of
support that help production to work well. The other senior producer manages
programme production operational matters, shooting activities, programme
production assistants (SA), stage and music managers. The tasks of a senior
producer include managing graphics, photography and the shots stock archive
system, i.e. selected pictures for storage and use (repeat show) in programmes.
This senior producer is also responsible for finance of TV sector in terms of
budget and programme selection.
ESTABLISHMENT
The Educational TV Production Team consists of several crew members
including the following:
(a) Producer;
(b) Script Assistant;
(c) Cameraman;
(d) Audio technician;
(e) Lighting Technician;
(f) Editor;
(g) Production Technician;
(h) Video System Technician and Camera Control Unit;
(i) Video Mixer;
(j) Graphic Designer;
(k) Make Up Artist
(l) Photographer;
(m) Set Maker; and
(n) Music Supervisor.
5.4.1 Producer
The producer is responsible for the following tasks:
(a) Producing various ETV programmes based on curriculum, general
programmes, educational news and interludes either for direct telecast or
recording;
(b) Carrying out needs research and preparing concept papers for programme
series;
(c) Attending preparation panel meetings and scriptwritersÊ briefing;
(d) Examining and working on scripts to make production scripts;
(e) Writing own script for camera script;
(f) Identifying, screen testing and training qualified artists to take part,
determine clothing, make up, set and props;
(g) Holding production meetings with officers and staff involved so that they
can contact outsiders and individuals to get their cooperation to ensure the
success of a programme.
(h) Leading a shooting team and be responsible to each member of the external
shoot team;
(i) Doing his own reconnaissance of surroundings and conditions of the place
or location of shoot;
(j) Holding external shoot meetings;
(k) Doing sufficient rehearsals before external/studio shooting;
(l) Carrying out directing of external and in studio shoots;
(m) Attending preview of a programme before it is broadcasted;
(n) Responsible to improve previewed programmes to upgrade programme quality;
(o) Determining artists/scriptwriters payment involved according to treasury
approvals;
(p) Preparing programme production reports; and
(q) Carrying out tasks issued from time to time.
5.4.2 Script Assistant
Script assistantÊs tasks in general include:
(a) Typing original scripts and camera scripts;
(b) Typing and distributing production meeting invitation letters;
(c) Attending programme production meeting and preparing necessary notes
in terms of programme production;
(d) Ordering for shoot production, transport, make up artists, props, set, still
photo, graphics, studio, production and recording for direct telecast;
(e) Typing permission letters for artists and location shoots;
(f) Getting and carrying tapes to location shoots;
(g) Accompanying team at the location shoot and studio to assist in ensuring
continuity;
(h) Preparing continuity sheet for video editing;
(i) Making orders for editing room, follow-up production and recording; and
(j) Carrying out tasks issued from time to time.
5.4.3 Cameraman
The cameraman is responsible for the following tasks:
(a) Handling Single Camera Production (SCP) and Multiple Camera
Production (MCP) for ETV programme production and news coverage in
studio and out of studio together with Programme Producer including
providing technical services;
(b) To create moods through lighting techniques and creativity or camera tricks
in producing quality visuals for ETV programmes;
(c) Ensuring quality of lighting and shooting techniques of a recording and
coverage of ETV programme to achieve broadcasting standards;
(d) Carrying out maintenance jobs and testing of equipment under his care so
that they are always in good order;
(e) Attending preview after completion of shooting.
5.4.4 Audio Technician
An audio technician is responsible for the following duties:
(a) Handling audio equipment during recording and direct telecast of ETV
programmes in and out of studio;
(b) Designing techniques of using microphone to suit recording location and
direct telecast of ETV programmes;
(c) Ensuring audio quality always conforms to the specified broadcasting standards;
(d) Making installation of radio equipment and testing the system in order to
record the audio properly;
(e) Attending previews of ETV programmes before being edited to identify
audio quality according to broadcasting standards;
(f) Attending preview sessions of ETV programmes, which have been edited,
to identify audio quality according to broadcasting standards before the
programmes are broadcasted; and
(g) Giving views to the producer from the aspect of audio equipment usage
techniques to suit them to programmes being recorded.
5.4.5 Lighting Technician
The tasks and responsibilities of the lighting system technician are as follows:
(a) Handling lighting equipment for production of ETV programmes in and
out of studio;
(b) Designing lighting to suit the forms of an ETV programmes in and out of
studio;
(c) Determining that lighting equipment is always functioning well and safe to use;
(d) Ensuring lighting quality conforms to broadcasting;
(e) Doing reconnaissance together with technical producer at specified
locations to determine lighting system positions before recording is carried
out;
(f) Attending preview of edited ETV programmes to identify that lighting
quality always conforms to broadcasting standards;
(g) Making sure installation of lighting equipment before rehearsal and
recording is carried out; and
(h) Giving views to producer and set designer on use of set materials and
artists clothing colour to get the right lighting quality that exactly conforms
to broadcasting standards.
5.4.6 Editor
The editor is responsible for the following tasks:
(a) Accepting edit list and materials for editing as well as scripts from producer;
(b) Viewing materials selected by a producer;
(c) Selecting visuals according to series;
(d) Compiling visuals according to script and creativity;
(e) Editing;
(f) Always discussing with the producer during editing process;
(g) Ensuring quality of audio and video conforms to broadcasting standards;
(h) Attending preview sessions;
(i) Making corrections based on preview;
(j) Compiling and arranging effects according to producerÊs wishes;
(k) Preparing broadcasting tapes according to broadcasting standards; and
(l) Making reports when damage occurs.
5.4.7 Technical Producer
The tasks and responsibilities of a technical producer are as follows:
(a) Organising work flow of technicians and staff under his care before and
during recording in and out of the studio;
(b) Ensuring audio and video systems are working well during recording and
also determining quality of audio and video conforms to specified
broadcasting standards;
(c) Doing reconnaissance together with the producer to selected locations to
determine camera position, audio system, lighting and electric power
supply for recording coverage using Multiple Camera Production (MCP);
(d) Ensuring all recording equipment requirements are sufficient and
functioning well according to recording and broadcasting order;
(e) Supervising technicians and staff tasks under his care while recording and
direct telecasts are being carried out;
(f) Giving views to the producer before and during recording, relating to
technical matters especially camera work, lighting, audio and audio mixing
technique; and
(g) Attending previews of edited ETV programmes to identify production
quality especially from technical aspects before broadcasting.
5.4.8 Video System and Camera Control Unit (CCU)
Technician
Video system and camera control unit (CCU) technicians are responsible for the
following tasks:
(a) Installing of video system equipment for ETV programmes in and out of
studio before recording is made;
(b) Testing equipment so that the system can function well;
(c) Determining video system functions well conforming to broadcasting
standards;
(d) Giving technical views to the technical producer about the use of recording
equipment needed in and out of studio either for recording or direct
telecast;
(e) Handling camera control unit (CCU) equipment during recording or direct
telecast in and out of studio;
(f) Determining the source of video signal has a satisfactory quality
conforming to specified standards; and
(g) Attending preview of edited ETV programmes to identify video quality is
at a high level according to broadcasting standards.
5.4.9 Video Mixer
The tasks and responsibilities of a video mixer are as follows:
(a) Handling video mixer equipment for ETV recording and direct telecast;
(b) Mixing video sources from various sources to make a good video picture
before being recorded;
(c) Designing effects available in the equipment to use as material for
improving ETV programmes; and
(d) Giving views to the producer on the use of video mixing equipment.
5.4.10 Graphic Designer
The tasks and responsibilities of a graphic designer are as follows:
(a) Giving ideas, designing and producing graphic and animation materials for
ETV programme production, namely:
(i) illustrations, diagrams, charts and maps
(ii) electronic graphics using caption generator
(iii) printed caption for labelling
(iv) sequence animation
(v) calligraphy
(vi) models, dolls and special effects
(vii) artistic elements for set construction
(b) Giving ideas and producing cover graphics design and layout for desktop
publishing:
(i) preparing layout work for production of books, brochures, flyers,
posters, leaflets and banners
(ii) preparing slides layout for presentations using LCD projector
(iii) preparing book cover design, VHS and CD boxes
(c) Contributing ideas, designing set model or backdrop and supervising
graphic works and artistic elements for studio, auditorium and external
shooting needs;
(d) Improving mastery and preparation about techniques and production of
graphic design, layout, animation, computer graphic and TV graphic
production techniques using multimedia; and
(e) Managing and maintaining equipment in the control of Design and Staging
Unit.
5.4.11 Make Up Artists
The tasks of a make up artist are as follows:
(a) Preparing sufficient, safe and comfortable make up sets by artists for
recording programmes in and out of studio and external shooting;
(b) Providing make up services to artists of an ETV either for a
recording/direct telecast in studio or at a location;
(c) Maintaining make-up rooms and make up material and equipment;
(d) Keeping records of inventory of make-up materials, equipment and clothing;
(e) Maintaining cleanliness and safety of make up rooms;
(f) Preparing requisition and recording wardrobe and suitable artists and actors;
(g) Maintaining wardrobe; and
(h) Making clothing selections for wardrobes, and suitable artists or actors.
5.4.12 Photographer
A photographer is responsible in handling the following:
(a) Planning activities of photographing for ETV sector and the whole ETD;
(b) Handling the process of producing photographs for the purposes of the
production of ETV programme, multimedia, leaflets, posters and others;
(c) Making efforts for storage and systematic records;
(d) Evaluating photographic works in terms of quality, suitability and effectiveness;
(e) Participating in external and in studio shooting activities with the objective
of recording a suitable scene for producing TeachersÊ Guide Book;
(f) Making inspection and evaluation of photographic equipment;
(g) Maintaining photographic room; and
(h) Checking stocks of equipment and tools and making orders or making
replacements etc.
5.4.13 Set Maker
The tasks and responsibilities of the maker of set and props are as follows:
(a) Making and preparing of set and props ordered by the producer for an ETV
programme;
(b) Designing and installing attractive, smart and quality sets for the use of TV
programmes;
(c) Taking care of equipment and machines at the workshop;
(d) Preparing costume and props ordered by the producer;
(e) Overhauling reused sets; and
(f) Making sets for orders by all sectors in ETD and other divisions of the
Ministry of Education for official purposes.
5.4.14 Music Supervisor
The music supervisor is responsible for:
(a) Discussing with the producer regarding required music;
(b) Creating, compiling and arranging the required music;
(c) Determining production work force;
(d) Training musicians and singers;
(e) Ensuring music recording runs well and according to broadcasting standards;
(f) Recording the form of CD to be submitted to the producer; and
(g) Attending master edit to ensure suitability of music arrangements.
EDUCATIONAL TV PROGRAMME
At the moment, broadcasted Educational TV programmes are the result of three
parties, which are:
(a) ETV;
(b) Joint venture of ETV and private companies; and
(c) Purchased from a supplier of syndicated programmes.
During the period of 2003-2007, the ETV Sector continued to acquire programmes
as practised then to fulfil the programme schedules which cannot be fulfilled
with programmes produced by ETV itself.
5.5.1 Previews
Specific previews are made by the control panel before programmes are
broadcasted. Its purpose is to study the programme suitability with target
viewers in local socio-cultural context. Usually all TV, film and advertising
programmes are previewed either by production firms or a government
censorship board.
Previews carried out by producers are based on technical studies and target
viewersÊ interests. Previews made by the Film Censorship Board (Lembaga
Previews can be briefly defined as a process to control programme quality
before being broadcasted for public viewing.
1. State two main objectives of Educational TV.
2. Explain briefly the tasks and roles of a producer.
3. Give three tasks of an assistant programme producer (SA) in
ensuring a well-run shooting process.
4. How can a graphic designer assist in a programme production?
5. Make a list of the tasks of a music supervisor.
6. How should the tasks of an editor be carried out?
Penapisan Filem or LPF) looks at the suitability of the programmes with socio-
cultural and religious aspects.
5.5.2 Educational TV Programmes Review
For Educational TV, previews are made after the post-production process is
completed. The producer will get a suitable date and time from the preview panel
chairman for a preview session. In this session, programme suitability is
reviewed in terms of content and quality of production to conform to
international broadcasting standards. The preview panel will decide whether the
programme is approved for broadcast, proposed for amendment or totally
rejected.
5.5.3 Where is a preview made?
In your mind, where is a preview usually made? It is usually made in the ETV
preview room, equipped with special equipment such as quality sound system,
big screen and a TV monitor installed to detect audio and visual to conform to
broadcasting standards.
5.5.4 Preview Committee
The evaluation Committee will only evaluate completed programmes (Broadcast
Copy) to be shown to the public. When the date and time is fixed, invitation
letters are circulated by the programme production assistant (SA) to preview
evaluating panel chaired by ETD Director.
5.5.5 What Subjects are evaluated?
In the preview process, evaluation forms distributed to evaluators are divided
into two aspects.
Figure 5.3: Two aspects evaluated in a preview process
(a) Programme Content Aspect
Content aspect is divided into several subjects. Refer Figure 5.4.
Figure 5.4: Subjects evaluated in programme content aspect
(i) Programme Introduction
Programme introduction is the broadcasted content after the montage.
Normally, the content which is broadcasted in the first five minutes is
evaluated in terms of appeal and programme content suitability.
(ii) Programme Development
It refers to the way to develop a narration whether it is attractive
(appealing) and has continuity or whether the narration is in
chronological order or based on other techniques suitable with the
topic and target viewers.
(iii) Programme Content
Programme content is evaluated based on its suitability with the
requirements of the educational syllabus and whether it contains
appropriate research and correct facts.
(iv) Dialogue
Evaluation is made based on suitability of language used in the
programme whether it is overdone, natural, stiff, too constrained by
script/dialogue memorising etc.
(v) Demonstration and Experiment (If Any);
Science, Mathematics, Vocational and Technical programmes
sometimes need experiments and demonstrations. Suitability of
experiments and demonstrations is determined in terms of process
and equipment suitability.
(vi) Public Comments on Programme Content
Public comments, in terms of content and presentation, are also taken
into account.
(b) Technical Aspects
Technical aspects are divided into eight subjects. Refer Figure 5.5.
Figure 5.5: Subjects evaluated in the technical aspect
(i) Camera Handling
Shots taken must be suitable for showing, i.e. non-vibrating picture
(steady shot) etc. From the continuity aspect, a good shot has no jump
shot, red visual or over exposure.
(ii) Visual Quality
It must be synchronised with the demand of script content. For
example, there are close-ups, mid-shots etc. It must not also be soft-
focus and must be clear for viewing. A high visual resolution must
not have any error. A good visual quality is as follows:
• Clear, bright and conforming to broadcasting standard.
• Not jumpy.
• Has a good continuity etc.
(iii) Editing Quality
There is continuity of story, there is no jump shot, insert, appropriate
pictures and use of attractive and suitable visual effect. Audio mix is
also evaluated following broadcasting standards.
(iv) Quality of Graphic Art/Set
Graphic writing may use graphics that can be read from a reasonable
distance. Animation/illustration is made well and clear. Attractive set
and props, as well as appropriate colour scheme that fits with
programme presentation.
(v) Lighting Quality
Precise lighting, not soft-focus, appropriate with the presented scene.
There is no electronic effect, white wash etc.
(vi) Quality of Sound Effect and Dialogue
Using natural, clear and suitable sound effect, consistent with the
object being shot and correct sound perspective.
(vii) Music Quality
Using background music, or a music that is suitable with visuals to
bring out the right mood.
(viii) Overall Technical Quality
Overall comments on technicality are whether it is qualified for
broadcasting/conforms technical aspect. If improvement is needed, it
must be noted precisely.
SUPPORTING MATERIALS/HAND-OUT
NOTES THAT MUST BE PREPARED
DURING EVALUATION SESSIONS
There are five supporting materials/hand-out notes that must be prepared
during the evaluation session. Refer Figure 5.6 and Table 5.3.
Select an Educational TV programme. In your view, what is the
difference between the ETV programme broadcast and those of RTM or TV3?
Figure 5.6: Circulation materials during evaluation sessions
Table 5.3: Supporting Material/Circulation that Must be
Prepared during Evaluation Sessions
Supporting Materials Explanation
Programme Synopsis Programme synopsis is prepared by the producer
and circulated to committee members to get input or
early ideas on the programme.
TeachersÊ Guide TeachersÊ guide is prepared by the scriptwriter after
programme is ready. Usually, teachersÊ guide is
circulated during preview for the evaluation panel to
see programme objectives, suitability and activity
before and after questions, as well as for teachersÊ
guide at schools.
Evaluation Forms Evaluation forms are distributed to all in the panel to
be filled in full as a reference material and proof of a
programme approval.
Attendance Log Book This book is noted as a proof for invited members to
contribute ideas and improving television
programmes quality. This book is revised and signed
by the Principal Assistant Director.
Preview Process During the preview process, programmes are shown
fully for evaluation viewing by committee members.
After viewing the whole programmes, reactions,
comments and views are provided to officers and
then discussions are made. All panel members will
fill in evaluation forms.
Discussions must be noted by programme
production assistant (SA). List of comments and
views of panel members will be taken account of by
the producer to improve the programmes following
chairman's decisions. Programmes will be packaged
for broadcasting.
USE OF EDUCATIONAL TV IN SCHOOLS.
Can teaching and learning technology in schools be used by the audience as a
substitute for teachers?
Educational TV programmes are teaching aids that can help teachers handle
teaching and learning in schools, but not replace teachers.
5.7.1 Use of Educational TV in Teaching and Learning
Schools which have been supplied with TV Satellite equipment must fully use the
Educational TV package provided. Among the things that schools must give
priorities in planning the use of ETV are:
(a) Schedule of Usage
Programme coordinator of ETV programmes must prepare an efficient
schedule of usage of the ETV in the school. The best measure is to include it
5.7
1. Why must Educational TV be previewed?
2. State the preparation that must be done before having a preview.
3. Explain how the preview process is carried out?
4. What is the importance of a log book in TV production? Explain.
in the learning timetable. If the schedule cannot be implemented, the
teacher must prepare a separate schedule.
(b) Viewing Room or Space
A special room or space must be provided by the school to be used as a
place for watching ETV. In most schools, this room is called Viewing Room
or Media Room. The teacher who manages this room must ensure several
things, that is:
(i) Students' comfort during viewing;
(ii) Proper position of the TV, i.e. not too low or too high; and
(iii) Minimum outside interference.
(c) TeachersÊ Functions
The teacher who takes their students to watch an ETV programme, plays an
essential role before, during and after the show. Based on Use of
Educational TV Programme Guide Book, the teacher concerned should:
(i) Prepare activities before viewing;
(ii) The aim is to stimulate students' thinking;
(iii) Be present and watch a programme in viewing room together with
students; and
(iv) Carry out appropriate activities after viewing.
5.7.2 Educational TV Supporting Materials
Educational TV Sector produces three main supporting materials to aid teachers
in using programmes. The materials are as shown in Figure 5.7.
Figure 5.7: Educational TV supporting materials
(a) Educational TV Programme Schedule
Functioning as a reference for programme topics, date and time of ETV
programmes broadcast.
(b) Educational TV Programme Usage Guide Book
Serves to facilitate teachers following ETV programmes. It contains
programme synopsis, activities before and after viewing, questions, lyrics
and examples of graphic compiler of Critical and Creative Thinking Skills
(CCTS) related to programme content.
(c) Catalogue
Functions as reference material for teachers to order programmes. It
contains programme synopsis, time period and reference number.
5.7.3 Usage of Log Book
The school must prepare a log book to record time and programmes watched.
This record also has a column for the teacher to give comments on the content
and development of the programme. This usage log book is also meant to give
data to ETD, State Educational Resource Centre, and TeachersÊ Activity Centre,
when monitoring is carried out.
5.7.4 The Roles of State Educational Resource Centre
(SERC) and Teachers’ Activity Centre (TAC)
The Roles of State Educational Resource Centre (SERC) and TeachersÊ Activity
Centre (TAC).
(a) The Roles of SERC
(i) Coordinating, monitoring, and assisting schools in using ETV
programmes and technical works at the State level;
(ii) Training resource teachers on the ways of using ETV programmes.
(b) The Roles of TAC
(i) Coordinating, monitoring, and assisting schools in using ETV
programmes and technical works TAC level.
(ii) Training resource teachers on the way of using ETV programmes in
teaching and learning; and
(iii) Giving advisory service to media teachers in technical aspects on the
use of Satellite TV equipment.
Copyright © Open University Malaysia (OUM)
126 X TOPIC 5 MANAGEMENT OF EDUCATIONAL TV BROADCASTING
5.7.5 Monitoring in Schools
Monitoring is a process of evaluation carried out by Educational Technology
Division and other divisions of the Ministry of Education in schools to evaluate
the ETV.
(a) What is Monitoring?
Evaluation of ETV programmes is based on three aspects as follows:
(i) Its usage in schools;
(ii) Its effectiveness in teaching and learning; and
(iii) Strength and weakness of a programme.
With the feedback received from the field, efforts will be made to revise and
improve further ETV programmes.
USE OF SATELLITE TV
5.8.1 Satellite TV Equipment Supplied to Schools
Primary and secondary schools in Peninsular Malaysia, Sabah and Sarawak, have
been supplied with Satellite TV equipment. Refer Figure 5.8.
Figure 5.8: Satellite TV equipment supplied to schools
5.8.2 Troubleshooting
If the schools face any technical problems in using Satellite TV or have lost the
Smart Card, they can contact the nearest Satellite TV Customer Service Centre.
The school is required to state the account number, and problem faced. The
school is also required to inform their TAC or SERC of the problem and action
taken.
5.8.3 Educational TV Broadcasting Time
ETV broadcasting time is four days a week (Mondays to Thursdays) for four
hours a day from 9am till 1pm and its repeat show from 1pm till 5pm.
THE FUTURE OF EDUCATIONAL TV
In the efforts to improve quality of work in programme production, ETV needs to
follow the organisational structure of actual television stations, be they local or
overseas, organise work processes and productivity in keeping abreast with
current situations.
(a) The ETV Sector must be led by a Principal Assistant Director, assisted by
senior producers who handle specific matters such as:
(i) Acquiring scripts, organising script writing course, programme
content research and management of TV tapes and stock shots library;
5.9
1. What is the function of the Educational TV coordinating teacher
in schools?
2. How can the Educational TV Usage Guide Book help in teaching
and learning?
3. What is the TV Satellite equipment supplied to schools?
4. If school A has lost its Smart Card, what is the action that must
be taken by the school?
(ii) Managing TV programme production operations including
programme production crew; and
(iii) Managing graphics, set and props, photographer, set maker,
laboratory and printed publication of TV Sector.
(b) To organise and improve management quality and ETV programme
production, ETV must create again the three TV coordinator posts (senior
producers) in the organisation structure so that financial and operational
matters can be managed in a more organised manner.
(c) The total number of producers is insufficient to handle production of all
basic educational subjects. For now, there are only producer posts for
Malay, English, Islamic Education, Science, Mathematics, Technical and
Vocational, Moral Education and Preschool. In other words, the existing
producer posts do not cover all producer posts for secondary and primary
schools, especially producers for Technical and Vocational, primary Islamic
Education and secondary Mathematics and Programme Producer for Form
6. Therefore, the programme producer posts must be increased to cover all
core subjects of Form 6.
(d) The assistant producer posts must be available to assist the producers to
bring out quality programmes on par with external programme production.
In this case, all TV programme productions overseas are assisted by
assistant producers to ensure programme production runs smoothly as
scheduled. The tasks of an assistant producer is to get suitable artists
identify location for shooting purposes, managing artists at location,
making artist casting suitable with scripts, observing continuity in a scene
and act as recording manager in studio and at external locations.
(e) Vacancies of various posts must be filled immediately in the Educational TV
Sector. If there is no qualified candidate in the near future, employment of
part-time workers must be done in order to ensure sufficient numbers and
programme production quality is not compromised.
(f) Production work often requires installation and loading of props and
shooting equipment in the studio or at location. Therefore, establishment
structures must take into account general workers to help in these tasks.
(g) Subject supervisors are needed to control programme quality in order to
conform to curriculum and academic. These supervisors are responsible for
managing workshops producing scripts and to supply approved scripts to
the production side to be produced. Officers in this unit must be taken from
among expert teachers who are already skilled in the subject being taught.
(h) For supervising a more stable programme production and geared towards
creation of higher quality programmes, several supervisors must be placed
again in the programme production sector as practised in all broadcasting
stations. Talent and arts group has nothing to do with engineering works.
They are more inclined towards producing arts production and trained
specially for the field of producing quality programmes. Ideas and
discussion of this group are more towards programme production and not
technical aspects. The views and ideas of the group should be combined
with the producer to produce quality programmes.
FINANCIAL MANAGEMENT OF EDUCATIONAL TV PROGRAMME
Low rate of payment for professional services has in a way affected Educational
TV programme production process. This is because the payment offered does not
attract talented artists, researchers and scriptwriters to give their services. This
has caused rather low quality of ETV programmes and fails to attract studentsÊ
interest to watch them. Therefore, in order to avoid such a situation, a review of
the payment needs to be done based on the following:
(a) The existing rate of payment is rather low compared to the price increase
for daily essential goods and other service payments;
(b) There are not many talented artists interested to take part in Educational TV
programmes, because of a payment which does not commensurate with the
efforts and time of their services;
(c) The difficulty of getting a professional actor because the existing payment is
not attractive compared to what is offered by other commercial TV stations.
(d) There are several talented actors and announcers in ETV who moved to
other commercial TV station having received a more attractive offer.
(e) Scriptwriters are not so interested in producing scripts for ETV because of
the low payment offered.
(f) A payment of RM100.00 is not reasonable for a researcherÊs work, who has
not only to buy reference materials, but also has to go the places,
institutions and locations where he can find the information or materials.
(g) The last revision of rate of payment for professional services for ETV was
made in 1994.
The revision of rate of payment for professional services for ETV programmes
was made more than 10 years ago. The rate is no longer appropriate with current
conditions. Therefore, a more viable rate of payment in handling customersÊ
needs must be prepared.
• This topic analyses the development of Educational Television (ETV)
organisation, being one of the participants in the television broadcasting
industry in Malaysia. ETV is fully financed by the government specially to
meet target audience requirements in primary and secondary schools as well
as teacher colleges in the whole country. ETV is different from other
terrestrial television because it is non-commercial. However, programme
production process is carried out by the Ministry of Education work force,
bound by policies and rules of national education. At the same time, the work
force still has to face creative work pressures as being faced by a production
crew working for commercial stations.
• In terms of establishment, the ETV work force is bound by service terms of
the Ministry of Education. However, in terms of tasks and operations, ETV
production division performs creative jobs similar to those of existing public
and private televisions. ETV management is closely tied to the bureaucracy of
public organisation but to ensure an excellent future of ETV and meeting
audience requirements, new strategies need to be considered so that ETV can
be viable and competitive with existing TV stations in Malaysia.
Educational Television
Educational TV Programme
Monitoring
Pedagogy
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/Cable
and The New Technologies. (2nd ed.). NY: McGraw-Hill, Inc.
* * *
TOPIC 6 MARKETING AND SALES MANAGEMENT
INTRODUCTION
In the current situation of global economy, the telecommunications industry
emerges as a field to integrate various elements such as entertainment, information
and communication services. Information dissemination is implemented through
various distribution media.
Chan-Olmsted & Gershon (2001) listed several current information distribution
channels such as the use of broadband, traditional broadcasting, cable television,
telephone, Internet, wireless communications and satellite.
There are various changes taking place in the telecommunications sector and these
developments also change the telecommunications landscape. Besides that, the
changes taking place in information and entertainment aspects are also shaping a
new face in the broadcasting world. For example, production of television reality
programmes broadcasted in large numbers currently combines traditional
production with the use of new media, such as the cellphone.
TOPIC 6 MARKETING AND SALES MANAGEMENT
By the end of the topic, you should be able to:
1. Identify elements influencing media sales such as the advertisers and
advertising agencies;
2. Discuss four advertising rating methods practised by television
stations; and
3. Identify marketing promotional activities which are frequently carried
out by radio and television stations.
LEARNING OUTCOMES
This development shows the active involvement of the audience and raises the
advertising income of the television station. Improvement in advertising income
means an increase in the station's income.
This topic will discuss the marketing and sales process related to the broadcasting
industry. Discussion is focused on marketing and advertising elements.
BROADCASTING MARKETING
One aspect that differentiates between broadcasting industry transactions and other
industries is the aspect of the product being offered to the consumers and buyers
audience. The product meant here is an invisible product, a product that cannot be
valued or measured physically. On the other hand, the products involved in the
industry are products such as public taste, art or picture.
Sale of space in print media has visible characteristics, i.e. the advertiser can keep a
newspaper cutting or the magazine publishing the advertisement, but sale of airtime
cannot be seen as such. One unique quality about airtime sales is that if a time space
is not purchased by the advertiser, that space will be gone, lost and eliminated.
The product meant in the broadcasting industry is the sale of airtime. Even though
the time transaction does not have a physical characteristic that can be seen or held,
this does not mean the product has no special terms as in other visible products. For
media sales agents, they use a term called „spot‰. Time space or spot is measured
based on total advertisement broadcast time, i.e. 10 seconds, 15 seconds, 30 seconds
or 60 seconds for each sales unit.
In general, unsold time space for an advertisement is included in the inventory
similar to what is done to other unsold products stacked on the racks in
supermarkets.
A radio station broadcasts for 20 hours a day with an average of 10 advertisement
broadcasts per hour. This means, every day the station must broadcast two thousand
60 minute advertisements or four thousand 30 minute advertisements. Without the
sale of a spot, the station will suffer a loss of income. Therefore, usually the sale is
made in a package form. Allocation of spot packages are prepared by taking into
account the total broadcasted advertisement hours for periods of several weeks or
months.
Below is an example of a news report on the transaction positions of TV3 and 8TV
for six months ending 30 June 2004. TV3 and 8TV controlled 44 percent of the Adex
market, putting both stations far in front of their rivals in the industry.
INCREASE IN TV3, 8TV VIEWERS ATTRACTS ADVERTISERS
By Azli Ayob
MEDIA Prima Bhd (Media Prima) expects the increase in number of viewers for the two
television networks it owns, TV3 and 8TV will attract advertisers, simultaneously raising
advertising income (Adex) for the next financial year.
The Chief Financial Officer of Media Prima Group, Amrin Awaluddin, says, in the past
six months ending 30 June, TV3 and 8TV controls 44 percent of Adex market, putting
them far in front of their rivals in the industry. According to AC Nielsen study, in terms
of numbers, TV3 and 8TV collectively records 49 percent of total viewers for the period.
„Media Prima is satisfied at being able to maintain the percentage and the emergence of
pay TV including MiTV is expected not to affect the position,‰ he says.
He made the statement at a media conference announcing TV3 and 8TV programmes at
Seri Kembangan yesterday. Also present were Manager Brand Management Group
(Kumpulan Pengurusan Jenama), Sistem Televisyen Malaysia Berhad, Anthony Firdauz
Bujang and Chief Operating Officer of Operasi Metropolitan TV Sdn Bhd, Ahmad Izham
Omar.
Meanwhile, Anthony said, TV3Ês performance for the first six months of this year proved
continued confidence of advertisers in the station. „Our enthusiasm in broadcasting the
best programmes is the formula giving victory to the station,‰ he said. He said that, the
range of programmes for 2005 season beginning this October promised a combination of
new programmes produced locally and overseas to ensure viewersÊ loyalty.
Latest report by AC Nielsen also shows the success of TV3 achieving 18 of 20 top
positions in the chart for broadcasted popular programmes.
To ensure continuity of best achievement, Anthony said, TV3 will line up its own
production of new season English popular programmes, Explorace and Samarinda, a
new slot of Malay drama targeted at youngsters. "The new season will also witness the
emergence of English programme The Apprentice, starred by Donald Trump," he said.
Meanwhile, Ahmad Izham said, although it is still new in the local broadcasting world,
8TV succeeded in attracting target viewers, aged 15 to 34, who speak English in the urban
areas of Peninsula west coast.
"These encouraging figures are the results of 8TVefforts in a campaign to promote
internal antenna sponsored by Sen Heng which enabled 100,000 units to be sold in June
alone, he said.
Ahmad Izham said, in the past six months ending June, 8TV gained 9 percent of Adex
and confirmed it as advertisers' alternative option. He said 8TV will increase three more
broadcasting stations, two in Seremban and Melaka while the other one is exclusively for
viewers around Kuantan.
Figure 6.1: Newspaper extract on the increase of viewers of TV3 and 8TV
Source: Berita Harian, 29 Sept. 2004
Advertising concept began with Volney Palmer's initiative who acted as a salesman
for advertising space (Keshishoglou & Aquilia 2005). Now, the activity is taken over
by media planners who combine systematic calculation methods to buy time of
advertising broadcast through broadcasting media. At the early stages of advertising
industry development, names such as N.W.Ayer & Son, J. Walter Thompson and
others are the agencies who explored the advertising industry. At present, big names
such as McCann-Erickson, Young & Rubicam, Ogilvy & Mather and others are
among well known international advertising agencies.
Changes taking place in the advertising industry leave effects on the functions of
advertising agencies. Although advertisers have wide opportunities to broadcast
messages about their own products or services, each broadcast is subject to
advertising codes of ethics.
Based on monitoring by Zenith Optimedia (2005), advertising expenses in Malaysia
show an increase of five percent in the first quarter of 2005. It was found that five top
categories which contributed to the increase were the interactive service of mobile
phones, mobile telephone lines service, housing estates, government institutions and
airline companies. Telecommunications industry continued to drive up local
advertising expenses. Turnover value was expected to reach RM5 billion for the year
2005, making the advertising industry an important contributor to national
economy.
ADVERTISERS, AGENCIES, STATIONS, STATION AGENTS AND MEDIA PLANNERS.
6.2.1 Advertisers
Advertisers are the main players who supply advertising financial resources.
6.2
What do you understand by the underlined words in the newspaper
extract on the previous page (See Figure 6.1)?
ACTIVITY 6.1
Advertisers refers to organisations which spend for investment purposes by
using media with the objectives of promoting products produced or services
rendered.
Advertisers may also produce products or render services (Belch & Belch 2001).
Among local names which are large advertisers are Celcom, Petronas, Malaysia
Airlines and others, while the large international advertisers are Pepsi-Cola, Nike and
McDonalds.
Figure 6.2: Large local advertisers
Most small advertisers are local advertisers who carry out their own advertising
activities. On the other hand, for large organisations, activities to advertise products
or services are managed by advertising agencies.
Flow of funds in broadcasting transactions are the result of investment in
advertising. Estimate of advertising expenses in 2004 stood at RM4.2 billion and 90
percent of the sum was advertising expenses of print and electronic media with
breakdown for newspaper advertising of 64 percent and television advertising of 27
percent (The Star, 21 September 2004). In 2005, the percentage changed a little, i.e.
with the newspaper getting 62 percent, television 28 percent, radio and magazine
each getting 4 percent, while theatres and other media getting 2 percent (Berita
Harian, 6 June 2005). The figures indicate the contribution of advertising to
marketing and sales aspects in the industry. Although the expense amounts are
indeed large for the Malaysian environment, when compared with advanced
countries such as the United States, the amount is rather small. Advertising expenses
in the United States in 1999 till 2000 amounted to US$111 billion (OÊGuinn, Allen &
Semenik 2003).
6.2.2 Advertising Agency
According to Shimp (2003), an advertising agency is a company operating to assist
advertisers preparing advertising messages to be presented by the advertisers to the
public audience. Among others, advertising agencies roles are to prepare various
American Association of Advertising Agencies or 4 AÊs defines an advertising
agency as a free organisation which is represented by creative staff who produce,
prepare and publish advertisements (Dominick 2002).
services such as doing research, preparing creative services and implementing
media planning.
When discussing advertising agencies, names such as J. Walter Thompson, McCann-
Erickson, BBDO, Young & Rubicam are among international advertising agencies
which are well known and operating in Malaysia. Most of these agencies develop
close relations with the advertisers or mentioned as clients or customers. There are
also relationships which have been established for tens of years and they are still
dealing till today. The following example indicates close relationships that have been
established by two participants in advertising industry.
Table 6.1: Close Relation between Advertisers and the Agency
Advertisers Agency Transaction Duration
Unilever
Sunkist Growers
Exxon
Del Monte Armstrong
Chevrolet General Electric
Kraft
DuPont Kellogg's Kodak
Hormel
Mars/Uncle Ben's Rice
Pontiac
Cadillac
Dow Chemical MetLife
Campbell Soup
J. Walter Thompson
FCB
McCann-Erickson
McCann-Erickson BBDO
Campbell-Ewald
BBDO
J. Walter Thompson
BBDO
J. Walter Thompson
J. Walter Thompson
BBDO
DMB&B DMB&B
DMB&B DMB&B
Young & Rubicam
BBDO
1902 ă now
1907 ă 1999
1912 ă 2000
1917 ă now
1917 ă now
1919 ă now
1920 ă now
1922 ă now
1929 ă now
1930 ă now
1930 ă 1999
1931 ă now
1932 ă now
1934 ă now
1935 ă now
1935 ă now
1940 ă now
1954 ă now
Source: Shimp, T.A. (2003). Advertising, Promotion & Supplemental Aspects of integrated
Marketing Communications Ohio: Thomson South-Western, p. 259.
Examine advertisers' names in Table 6.1, which are also active
advertisers in our country. Do you know the names of advertising
agencies listed in the table? Write down agencies that you recognise
from the list and explain some information that you know to your
friends during a tutorial session.
6.2.3 Station
In the broadcasting industry, stations also refer to electronic media, i.e. television
and radio as well as online media. Media functions as a link between an advertising
organisation (advertisers) and the customers. Media selection for the purpose of
advertising is based on the following four dimensions as in Figure 6.3.
Figure 6.3: Four dimensions of media selection
Note: Under reach, should be: How many will receive the message?
When discussing the topic of stations, we need to relate it to various media channels
available now. The viewing audience has a wide choice. This is not only caused by
media landscape which being diversified, but also the effect of increase and diversity
of electronic media at the moment.
Table 6.2 below explains in detail the four dimensions that are taken into account to
evaluate media which is regarded as the most effective in delivering advertising
messages to customers.
Station refers to a media channel used to deliver advertising messages to
audience.
Table 6.2: Various Media Advertising Characteristics
Media
Characteristics Newspaper Magazine Radio TV
External
Advertisement
Direct
Mail Internet
Reach High Low High High High High Medium
Frequency High Low High High High Medium Medium
Selectivity Low High High Medium Low High High
Efficiency Medium Low Low High High High Medium
Source: Dominick, J.R. (2002). The Dynamics of Mass Communication. Media In The Digital
Age (7th ed.). NY: McGraw-Hill, p. 379.
Figure 6.4 explains how television programmes raise the advertising income of a
station.
Figure 6.4: How television programs raise the advertising station
Source: Belch,G.E. & Belch, M.A. (2001). Advertising and Promotion.
An Integrated Marketing Communications Perspective (5th ed.). NY: McGraw-Hill. p. 353.
Table 6.3 shows advertising expenses in Malaysia till June 2004.
Table 6.3: Advertising Expenses 2004 (Till June)
MEDIUM ADVERTISING EXPENSES
(RM 2.06 BILLION)
NEWSPAPER 61.9%
TELEVISION 28.7 %
Source: The Star. 21 September 2004. AnalystsÊ Views/News, p. 3
Table 6.3 shows total expenses allocated to television media is less than the expenses
allocated to newspapers. Of the 28.7 percent advertising expenses for television,
distribution is made between television channels TV3, RTM, ntv7, TV9 and others.
Therefore, most stations expect that total advertising expenses channelled to their
own stations would be more than those channelled to others. This situation has
caused broadcasting stations to prepare their own targets in getting income from
advertising activities.
The following extract comments on income targets for advertising broadcast by
Radio Television Malaysia (RTM) in 2005.
RTM Targets RM150 million in Advertising Income
KOTA BHARU: Radio Televisyen Malaysia (RTM) targets income through advertising
broadcast on television for at least RM150 million this year consistent with the rebranding
of government owned stations. The target to raise income from advertising also involves
broadcasting in radio, because RTM beginning this year will by itself manage its
advertisement marketing.
Deputy Director General of Broadcasting (Programmes), Adilah Shek Omar, said
although getting advertising income from television and radio broadcast, the role of RTM
is more towards social responsibilities.
She said it is important that RTM continues its role to provide information and
entertainment to all layers of multi-racial society throughout the nation consistent with
current demand.
Figure 6.5: News extract on RTM advertising income target
Source: Berita Harian. Wednesday. 1 June 2005.
6.2.4 Station Agents
In advanced countries such as the United States, United Kingdom and others, the
total number of stations (radio and television) is big. This makes it difficult for
advertising agencies to contact these stations. To simplify the task of advertising
agencies, they contact particular station agents.
The situation in Malaysia is rather different because not only the number of stations
is small, they are concentrated around the Klang Valley area. Therefore, most
advertising agencies have direct contacts with radio and television stations.
6.2.5 Media Planners
Media selection is done by a media planner with the purpose of establishing brand
stability over a long term. Media selection is a complex process of decision making in
the marketing communication because of many selections choices.
A media planner is responsible in several matters shown in Figure 6.6.
After reading the news extract from the National column in Berita Harian
above, what is your view on the comments by Puan Adilah Shek Omar
that RTM, as a fully government owned agency, cannot be compared with
private television broadcasting stations.
ACTIVITY 6.3
"Last year the income from radio advertising amounted to about RM14 million and this
year the increase will be better because we are doing our own marketing. Last year
television RTM made RM120 million and this year the target is at least RM150 million,"
she said to reporters after chairing a Central Rebranding Committee of Radio Kelantan
meeting at RTM Kota Bharu here, yesterday.
Adilah said the position and role of RTM as a fully government owned agency cannot be
compared with private broadcasting stations which are totally dependent on advertising
income.
Figure 6.6: Responsibilities of a media planner
Bovee & Arens (1994), Arens (1999) and Wells et al. (2000) also has the opinion that
media planning is a process to use the media effectively and creatively with the
purpose of delivering an advertising message to target audience at an appropriate
time and place.
Therefore, media planning is said to be a continuous activity involving many
processes of decision making either to be changed, disposed of, or used throughout
the time the planning process is carried out. Figure 6.7 shows the elements of media
scheduling.
Media Planning Process can be defined as an activity to create a direction of
actions which shows how the advertising time and space is used to achieve
marketing objectives of a product or service.
According to Belch & Belch (2001), media planning process is defined as series of
decision making processes involving delivery of marketing communication
message of a product to a potential consumer and existing consumer.
(a) Media Scheduling Process
Figure 6.7: Media scheduling
Continuous Scheduling in the same media results in repetitive reactions in
the same audience. Changing the use of a media to another media will result
in continuity covering wider areas. To schedule advertisement continuously,
advertisers may use three methods, that is, continuous pattern, pulsing and
flighting methods.
(i) Continuous Scheduling
Continuous scheduling or continuity explains how advertising is
scheduled for a campaign period. Continuity is also a strategy and
technique used to schedule advertising in a period of an advertising
campaign. The term refers to the advertising campaign period and
overall message delivery patterns in a given period of time. Advertising
in television and newspaper may be scheduled simultaneously in a year
or may be focused on a certain season only.
Advertising Campaign using this schedule is continued for the whole
year. For example, an advertiser chooses to broadcast an advertisement
each week for 52 weeks or the advertisement is broadcasted each month
for broadcasting once a month for 12 months. Implementation of a
stable and continuous advertising campaign may create brand loyalty.
However, if it is too often it will incur a high cost. On the other hand, if
it is too infrequent, it will make an advertisement lose its effectiveness.
Factors that must be taken into account when using this method are
advertising cost, type of product advertised and the cycle of product
used. Advertisers should implement a continuous advertising campaign
for daily use products in an effort to assist consumers to make decisions
to purchase.
(ii) Seasonal Pulsing
Pulsing is a popular alternative for continuous advertising patterns
because of limited budget.
This advertising is carried out according to certain seasons such as
festivals of Hari Raya Aidil Fitri, Chinese New Year, etc.
(iii) Occasional Pulsing
A campaign carried out in this method has no relation with any festival.
On the other hand, a selection of this method is made by taking into
account a certain time regularly.
(iv) Initial Pulsing
It is a scheduling to initiate a campaign with strong effects.
(v) Progress Pulsing
A schedule created to develop a product or service or to support special
promotion.
(vi) Flighting (Schedule of Advertising Ordering)
According to this pattern of schedule, advertising is carried out at
various levels. Advertisers may implement an intensive advertising
activity, then followed by a period without advertising activity. Most
advertising of products for seasonal use is advertised through
scheduling of advertising ordered by this pattern.
Continuous schedule refers to advertising expenses that are
considered relatively stable while an advertising campaign is carried
out.
The definition for the term pulsing refers to the time and space of
continuous scheduling but it is not smooth, i.e. level of advertising
is low, followed by intensive level of activities
MEDIA OBJECTIVES
Strategy formulation and advertising objectives are important factors in the media
planning process. Media objectives should also be made suitable with marketing and
advertising objectives especially in determining the content of advertising message,
who the audiences are and where their positions are.
Besides that, media planners should also think of suitable media channels to
broadcast the message. These guidelines help media planners to focus on the total
audience exposed to advertisements, level of advertisement exposure, and the
effectiveness of the advertisement. The advertisers must ensure the effectiveness of
the broadcasted advertisement. This can be done through advertising effectiveness
measurement by measuring impression, gross rating, advertising coverage and
frequency. Figure 6.8 shows the methods of measuring advertising effectiveness.
Figure 6.8: Measurement of advertising effectiveness
By referring to the media scheduling method discussed, make a list of
three advertisements which you have seen on TV and discuss the type of
schedule for them.
ACTIVITY 6.4
In your opinion, should media objectives be consistent with marketing
objectives? If you feel they should, why do you say that? Explain.
ACTIVITY 6.5
Media objective means preparing specific objectives for media selection for
advertising broadcast.
The aim is to achieve a target audience, identifying coverage of target audience
locations and identifying total advertising messages for target audience.
6.3.1 Impression
Impression measures audience for a media at or a media mix. For example, assume
the Rindu Semakin Jauh, Samarinda slot is viewed by 100,000 people. Each time an
advertiser uses the slot to broadcast its advertisement, the impression is 100,000. If
the advertiser broadcasts four times, this means the impression is 100,000 multiplied
by four, i.e. the value is 400,000.
However, the advertiser usually measures gross impression, i.e. total target audience
based on media channel for each broadcast time. Such calculation is made because
the advertiser refers to the total in general, irrespective of whether a person is
exposed more than two or three times to the advertisement broadcast.
Understanding the element of impression facilitates a media planner to estimate
whether an advertisement broadcast in a space or selected time will succeed in
getting audienceÊs attention or not. This factor is essential because the exposure of an
advertisement to the audience can be interpreted as the first step in attracting an
audienceÊs interest to get additional information about the advertised product or
service. A simple example of the calculation is shown in Table 6.4
Table 6.4: Calculation of Exposure to Advertisement Media
Media Programme Total
Samarinda
WWF Championship
Buletin Utama
4,500,000
16,250,000
7,350,000
Television
Total TV Exposure 28,100,000
Utusan Malaysia
Berita Harian
450,000
1,900,000
Total newspaper exposure 2,350,000
28,100,000
Total exposure 2,350,000
Newspaper
Impression 30,450,000
Impression in the context is defined as the opportunity a person is exposed to
certain programme, news or magazine.
6.3.2 Gross Rating Point
Gross rating point is simpler for the advertiser to remember exposure percentage of
the audience than remembering gross impression. Gross rating point is calculated by
multiplying access stated in the percentage figure by frequency average. For
example, if 80 percent of families having radios is exposed to a Celcom
advertisement at four times on the average in a period of four weeks, gross rating
point will be as follow:
Access x Frequencies = Gross Rating Point
(80) x (4) = 320 Gross Rating Point
Gross rating point (GRP) is the total access multiplied by frequencies and is used to
explain total message influence for a media schedule without taking into account
audience expansion in a period.
A simple example of GRP (in percent) is as in Table 6.5.
Table 6.5: Example of Gross Rating Point
Media Programme Access Frequencies GRP
Akademi Fantasia
Majalah Tiga
20
25
4
4
80
100
180
6.3.3 Access
There are several factors determining the scope of an advertising campaign. In
general, if more than one media is used for an advertising campaign, more audience
will be accessed. This means that a diversity of media being used for an advertising
campaign would give more opportunities for exposing advertising messages to the
audience. For example, an advertiser advertising a product more frequently in two
Access is defined as a segment of the total population exposed to the
advertisement messages at least once a week in a determined period, usually four
weeks.
Access is also understood as the percentage of target audience exposed to the
broadcasted advertisement.
magazines gives less exposure as compared to an advertisement published in
various magazines.
In brief, access or coverage explains different numbers of audience exposed to
advertisement schedules in a period of time. Access is calculated as the percentage of
unduplicated viewers, exposed at least once to the advertisement message. Access
measures the media ability to attract different individuals in the target audience.
6.3.4 Frequencies
Frequency measures a specific media schedule. Frequency measures the intensity of
a specific media schedule. Normally, frequency is calculated as the average of the
frequency of an individual or a household exposure to advertisement messages.
Frequency is effective in determining the maximum or minimum limit of repetition
of the advertising messages. However, as a substitute for the frequency average,
media planners use frequency distribution as it shows minimum distribution for a
potential user to be exposed to advertising message and also the maximum
frequency needed to measure the effectiveness of the advertisement message.
However, what is troubling the media planners is getting frequency distribution as it
requires special research which takes a long time and involves a high cost.
Frequency may also be explained in two ways. First, as a direct percentage, or as a
cycle. If frequency is said as a 3.0 average, it means the potential customer who is
exposed to the advertisement message is three times in a period of four weeks of the
advertisement broadcast. However, not all of the potential customers will be
exposed three times, because it is possible that some maybe exposed more than three
times, while others maybe exposed less than three times.
To understand more about the calculation of average frequency you can try to think
of the following problem: If 4,000 of 10,000 TV viewers view the Waja advertisement
three times in the period of four weeks, and 4,000 more viewers watched five times,
the average frequency is calculated as follow:
Frequencies is the average total time, the customer audience is exposed to the
media, the average of a message reaching a household on or the same individual
at the same time.
Example of frequency calculation is as follow:
Assume an advertiser advertises an advertisement through a weekly programme by
getting 20 percent household coverage for four consecutive weeks. In the period of
four weeks the programme acquired 43 percent coverage. This means the target
audience has the opportunity to view the advertisement 1.9 times.
FACTORS INFLUENCING MEDIA
SELECTION
There are many types of expenses that must be thought of and paid for when an
advertiser chooses to advertise in a particular media. Each media has a certain rate
of charge, which is based on various factors. The type of media itself will influence
the advertising costs. For example, advertisements through TV and theatres have a
higher cost of purchase compared to other media. Similarly, the black and white
advertisement has a lower rate of payment for the space as compared to coloured
advertisements in magazines and newspapers.
Production cost is only one of the aspects that must be considered by the advertiser
in the process of media purchase. When making a decision for a media purchase, the
advertiser is responsible to ensure that the selected media is the most appropriate
and the best. However, in making decisions on media purchase, media planners
normally have no ability to control some factors influencing the media planning
6.4
Frequency = 20 X 4 = 1.9
43
Estimate the value or price of an advertisement with a one-page size in a
newspaper. In your opinion, will the size and price factors affect the
selection of media? How about the duration and number of
advertisements? Will they influence purchase of media?
SELF-CHECK 6.1
Average Frequency = Total access exposure
= (40000 X 3) + (4000 X 5)
8000
= 4
process, including media planning scope, different market potentials, competitors'
strategy, customers' buying patterns, and various other elements related to media.
Usually, a media planner would limit an advertisement to the area where the
product is sold. For example, if an advertiser decides to sell a product in a certain
region only, then a local media plan will be used. For a national market, the media
plan will be more general. Problems will arise if a product will be sold at
international level. Each country has its own advertising ethics. An advertisement
suitable for a Western country may not be suitable to be broadcasted through media
in Asian countries.
To overcome this problem, media managers must prepare an appropriate media
plan. Table 6.5 identifies factors that play a role in influencing media purchase for
advertising purposes.
The effectiveness of TV advertising is undoubted. TV is a very effective medium to
promote a product, disseminate news and declare information. However, the cost of
TV advertisements often causes it to be monopolised by large organisations having
large incomes. What happens is that the small companies may not be able to afford
to use this medium to advertise.
However, now with the increase in TV stations, there are changes seen in the
quotations for TV advertisement prices. Even small companies are beginning to
show their potential ability to advertise through TV. Besides, the preparation of TV
advertisement packages with attractive reasonable costs will make TV a medium to
reach a larger audience.
Table 6.6: Factor Influencing Media Purchase
Media Instruments Factors Influencing Rates and Costs
TV Broadcast
Local/district/national/international
• Area of broadcast
• Variety of channels
• Audience size
• Time of broadcast
• Duration of advertisement
• Number of advertisements
Radio broadcast
Local/district/national/international
• Sponsor package
• Production cost
Print Media ă Newspaper
Local/district/national/international
Daily/weekly
• Types of advertisement
• Position of advertisement
- page
• Style of advertisement
- colour
- graphics
- text only
Print Media ă Magazine
Local/district/national/international
Weekly/monthly/Annual
Consumers/business/commercial
Male/female
Associations/clubs/companies
Technical/professional
• Size of advertisement
- one page, etc
• Number of slots
- frequency
• Size and form of audience
• Cost of production/advertisement
• Product quality
• Production cost
To loosen large companiesÊ monopoly in TV advertising, TV9 has now made initial
steps to give way to most companies to use TV advertisements. This is in line with
the stationÊs aspiration to be a terrestrial TV station able to give space to all parties
wishing to advertise on TV.
Figure 6.9 is an extract of Berita Harian, 6 August 2004 which explained TV9Ês concept.
Figure 6.9: An extract of a news explaining TV9 concept
Source: Berita Harian, 6 August. 2004
RATINGS
How do ratings determine the popularity of a television station? Do you feel ratings
are something very important for a television station?
Rating is a practice for each media agency whether electronic or print. Because of its
importance to media management, most stations will make sure that their own
stations will be at high positions because a high rating is an indicator of stationÊs
popularity among the audience. This is also an attraction to sell advertising space.
When discussing the ratings topic, a name which is synonymous with ratings is AC
Nielsen, that is, an agency which prepares research data on ratings. In big markets,
ratings is a frequently changing figure and this situation causes many stations to try
to ensure high positions each time a rating figure is declared.
The same situation takes place in Malaysia. As the number of TV stations increases,
there are a fewer number of advertisements being obtained, because what is visible
is the race to get a high rating position, thereby reaping advertisement profits.
Rating activities are also closely related to audience research activities. Audience
evaluation is also used by advertisers to get initial feedback about target audience to
advertise their products or services. From such research also the advertisers would
identify target audience profiles.
On the side of the target audience, they will only know about the broadcasted
programmes if the station makes direct announcement. Therefore, as an effort to
attract viewersÊ audience, most stations would promote them to the advertisers.
6.5
⁄.Starting July, TV9 will feature programmes in five slots, which is Raaga
(4pmă6pm) for Tamils, Hindi Power for the Hindi-speaking viewers (6pmă
8pm), Gegar (8.30pmă10pm) targeted at the Malay viewers. Zhong Hua Shi
(Monday ă Friday, 10pmă12 midnight) and Treats (Sunday, 1pmă4pm).
Response from Tamil advertisers especially has been tremendous. According to
a report by AC Nielsen, Raaga managed to attain 74% on average from the total
viewers in two weeks after the introduction of the slots. This figure is the
highest if compared to any other TV station.
MEDIA PRODUCT PROMOTION
Most broadcasting stations sell their advertising time several months ahead of
the programme broadcast. As the programmes are still not broadcasted, both
sides, i.e. the advertisers and the stations will make estimates by referring to past
programmes to make price quotations.
In the United States, broadcasting stations will make their programme listing
by seasons, at least six months before the beginning of the seasons. During the
programme listing presentation sessions, advertisers will have the
opportunities to see what programmes will be broadcast for the next season. If
the previewed programmes are expected to make profits, the advertisers will
buy the prepared time.
This is also implemented by TV3. Several months before branding is broadcasted
by the station, advertisers will be entertained in a special occasion with the
objective of promoting and proposing to the advertisers to work with it.
• The marketing and sales process is closely related to the broadcasting and
communications industry. The main players of marketing and sales activities are
the advertisers, advertising agencies and the media planners. Besides the roles of
the advertisers and the advertising agencies, telecommunications industry
(including broadcasting) also plays a rather important role because both sides
need each other. Each has its own particular role to reap profits, especially the
media which becomes the medium to promote advertisersÊ products and
services.
• This topic has discussed important elements in the sales of media and marketing
as well as activities frequently made by radio and TV stations. Marketing and
sales managers who are smart will be able to raise the image and performance of
their agencies in an increasingly competitive environment.
Continuous Schedule
Efficiency
Frequency
Ordering
Pulsing Development
Reach
Schedule of Advertisement
Seasonal Pulsing
Selectivity
Starter Pulsing
Arens, W.F. (1999). Contemporary Advertising. Boston: Irwin McGraw-Hill.
Belch, G.E. & Belch, M.A. (2001). Advertising and Promotion. An Integrated
Marketing Communications Perspective. (5th ed.) NY: McGraw-Hill.
Dominick, J.R. (2002). The Dynamics of Mass Communication. Media in the
Digital Age. NY: McGraw-Hill.
Eastman, S.T. & Klein, R.A. (2002). Promotion and Marketing for Broadcasting,
Cable and the Web. (4th ed.). MA: Focal Press.
OÊGuinn, T., Allen, C. & Semenik. (2003). Advertising and Integrated Brand
Promotion. Cincinnati: South-Western.
Sherman, B.L. (1995). Telecommunications Management. Broadcasting/ Cable
and The New Technologies. (2nd ed.) NY: McGraw-Hill, inc.
Shimp, T. A. (2003). Advertising, Promotion, & Supplemental aspects of
Integrated Marketing Communications. (6th ed.) OH: Thomson.
Well, W., Burnett, J. & Moriarty, S. (2000). Advertising: Principles and Practice
(5th ed.) NJ: Prentice-Hall.
* * *
TOPIC 7 CABLE/SATELLITE BROADCASTING SYSTEM
INTRODUCTION
The cable broadcasting system was introduced in the United States in the 1940Ês.
Now, the rapid development of telecommunications industry strengthens further
cable broadcasting system.
Do you know how many people use cable broadcasting service? It is estimated
that 26 million households are using the cable broadcasting service
(Keshishoglou & Aquilia 2005) and this is further strengthened by the increasing
use of video-on-demand (VoD) among cable viewers.
Cable television (Cable TV (CATV)) is also known as Community Antenna TV
(CATV). Cable TV is a TV broadcasting system using cabled communication. This
system is introduced to enable several communities in certain areas in the United
States to get TV broadcast. Among the reasons they cannot receive broadcast
signals is because their residential locations are hilly or in the midst of skyscrapers.
Topic 7 Cable/Satellite Broadcasting System.
By the end of the topic, you should be able to:
1. Discuss cable TV broadcasting system and satellite broadcast;
2. Explain the concept of cable TV broadcasting system and satellite TV;
3. Identify five elements of cable system management;
4. Discuss the development of satellite broadcasting; and
5. Identify three basic components of a satellite system.
LEARNING OUTCOMES
This has blocked their broadcast signals. One way to receive the broadcast is by
using special antennas channelled to the communities using cable.
Among the first areas to have been introduced the cable broadcasting system is
Astoria, Oregon. The cable system was introduced by Ed Parsons. The innovative
idea came up when he attended a convention sponsored by the National
Association of Broadcasters (USA) in Chicago in 1948. Parsons, who operated
KAST radio station, with an electrical engineering background was attracted to
TV usage. However, the geographical location of Astoria did not enable it to
receive TV broadcast signals. The nearest TV Station was 125 miles away, i.e. in
Seattle, Washington State. For the purpose of getting TV broadcast, Parsons
installed an antenna on the roof top of Astoria Hotel and joined the cable to his
apartment which had a TV. As a result of his experiment, Cable TV system was
born (Gershon 2001).
According to Keshishoglou & Aquila (2005), TV cable began in Ithaca, New York
in the 1950Ês. Failure to receive TV signals from Syracuse station, i.e. 50 miles
away from Ithaca, gave Anthony Ceracche an idea to use an antenna installed on
a hill near the area, which was connected to private homes. Now, cable TV
system is used widely. In Singapore, the cable TV system was started in 1978 by
Singapore Cable Vision (SCV), i.e. a company which cooperates with Singapore
International Media or SIM.
In Malaysia, the cable TV system began around 1995 when Mega TV began
broadcasting by charging RM40 (Ringgit Malaysia Forty) a month as a service
cost.
CABLE BROADCASTING SYSTEM
Cable TV Broadcasting system threatened the strength of conventional TV
stations at the early stage of establishment. In 1965, Congress imposed a strict
regulation to stunt the growth of cable TV broadcasting system. However, the
situation recovered in 1972, when FCC announced a newer and looser regulation
than the existing one. Thereafter, the cable TV broadcasting system expanded
again.
In 1991, there were about seven cable TV stations, giving service to 55 million
households. By 2000, cable TV system provided service to 68 million households.
Conditions became more stimulating when cable TV station ESPN got a three
year contract with the National Football League (NFL) (Dominick 2002).
The increase in the income of cable TV broadcasting system is also one of the
factors that influenced the development of broadcasting system. However, the
income is still low compared to the income of terrestrial TV system. The income
in 1990 was US$2 billion and rose to US$7 billion in 2000 (Dominick, 2002).
Figure 7.1: Ted Turner's success and CNN
Source: Dominick, J.R. 2002. The Dynamics of Mass Communication Media in the Digital
Age. NY: McGraw-Hill, p. 281
Copyright © Open University Malaysia (OUM)
TOPIC 7 CABLE/SATELLITE BROADCASTING SYSTEM W 157
CABLE SYSTEM STRUCTURE
Cable TV system is a telecommunications system using optic cables to link the
TV station and the TV at the clientÊs home. Basically, there are three elements
used for the purpose of a cable TV broadcast. The elements are as in Figure 7.2.
Figure 7.2: Three elements of cable broadcast
7.2.1 Headend Point
This section contains antenna and equipment for receiving waves transmitted
from TV stations to be sent to the clients. There are broadcasting stations which
also run cable system management; programmes produced by the stations will
be broadcasted to clients through cable network. This means the stations must be
at the same locations with the headend point.
7.2.2 Distribution Network
Distribution Network includes optic cables to be linked from the headend point
to the TV set at the clientsÊ home. This cable is usually buried along the route to
the area of clientsÊ homes.
7.2
In your opinion, how does cable TV function? What is used to link
the TV station and the TV at the clientÊs home?
SELF-CHECK 7.1
7.2.3 Receiving Equipment (House Drop)
The waves received by the headend point will be distributed to the clientsÊ
homes. The receiver has a one-way or two-way feature. Use of optic cable enables
cable stations to broadcast to as many as 500 clients.
Now, cable TV systems use coaxial cables which are mostly made of pure copper
or are wire-coated. This type of cable is found to be better.
Figure 7.3: TV cable network
Source: Adaptation from Gershon, R.A. 2001.Telecommunications Management Industry
Structures and Planning Strategies. NJ: Lawrence Earlbaum Associates, p. 61.
CABLE TV BUSINESS
Cable systems depend on two mains sources of income, namely:
(a) Subscription fees
(b) Advertising
Most cable TV stations charge subscription fees. Fees imposed are normally
different depending on the subscribed package. Advertising could also support
the cable system income. However, advertising through cable stations is still low
compared to advertising in TV stations which have been established for tens of years.
In the cable TV business deals, there are two aspects which play important roles,
that is, cable TV stations and producers/providers of cable programmes.
7.3.1 Cable TV Stations
Cable TV stations are responsible to provide cable TV service to clients. Normally,
stations would provide certain programme packages selected by clients.
7.3.2 Producer/Provider of Cable Programme
Programme producers and providers provide programmes to cable TV stations.
TV stations such as NBC, ABC, CBS and others also produce programmes and
become cable programmes producers/providers either for the stationsÊ own use
or for sale to other stations.
Figure 7.4: Cable TV broadcast in Malaysia (Mega TV and ASTRO)
CABLE TV BROADCAST IN MALAYSIA
MEGA TV
MEGA TV was a pay cable TV station launched in 1985. The station offered nine
channels, that is, CNN International, Discovery Channel, ESPN Super sports, HBO,
Cartoon Network and Korean Arirang TV. However, the station failed to penetrate
the market and at its peak it could only get 130,000 clients. MEGA TV ceased its
broadcast in 2001.
Astro Malaysia
Astro is a satellite service which offers more than 50 TV channels and 16 radio
channels to a million clients in Malaysia. The number obviously keeps rising; it
reached 20 million in 1996. Besides acting as a station having various programmes in
Malaysia, Astro is also the largest pay TV platform in Southeast Asia.
Astro provides 30 percent of the budget for local programmes and is responsible for
700 hours local broadcasting content a year. Although pay TV technology is still not
fully developed in Malaysia, Astro has succeeded in raising the total number of its
clients. It is estimated that between 2000 and 2001, there was an increase of 57 percent
of the number of homes with pay TV. Astro begun its operation in 1996 with only 22
channels and now, Astro has become a satellite TV service offering a very reasonable
subscription fee in Southeast Asia, that is about RM49.95 to RM124.95, for more than
125 channels including 8 HD channels and 17 radio channels offerred in four main
languages. The broadcasts include Malaysia and Brunei with over 2.7 million
subscribers.
CABLE SYSTEM MANAGEMENT
Cable TV system management scope is influenced by factors shown in Figure 7.5.
Explanation for each factor is shown in Table 7.1.
Figure 7.5: Factors influencing TV cable system management
Table 7.1: TV Cable System Management
Cable TV System
Management Explanation
Sales and Marketing
Sales and marketing department is responsible to ensure an increase
in total number of new clients as well as that existing clients remain
loyal.
Customer Service
Manager of Customer Service is responsible for various client
matters such as taking orders, making installation schedules,
managing repair works as well as attending to inquiries on bills and
payments.
Programme Programming Manager heads programming and is responsible to
ensure selection of suitable programmes. This department is
responsible to compile and schedule programmes for existing
channels and TV cable station service package.
Repair Service This department is responsible to give support assistance for repair
works, service to install and upgrade selected programme service.
Client Billing ClientsÊ monthly bills are handled by ClientsÊ Bills Department.
Staff in this department are responsible to manage monthly bills of
clients, performing the tasks of client service officers including
attending to telephone calls or counter service.
RESPONSIBILITIES OF A CABLE TV MANAGER
A Cable TV station manager is responsible for the efficient running of a cable
station. This means he or she is responsible for supervising each department. A
Cable TV manager will perform under the supervision of the owner of a cable TV
station or a senior manager. The task of a cable TV manager is similar to those of
a Chief Executive Officer of an organisation because the task requirements of a
Cable TV manager are also to coordinate management responsibilities in all
aspects such as marketing, engineering and public affairs. These tasks become a
heavy responsibility because Cable TV is a business emphasising clients.
Whether a cable TV is successful or not depends on clientsÊ ability to subscribe
and renew subscription. To ensure the management of the station achieves
success, a cable TV manager does not only emphasise the total number of clients
but is also concerned with:
• Cable TV programmes
• Client service and marketing; and
• Cable management and franchise agreement.
7.5.1 Cable TV Programme
The efforts to provide cable TV programmes are different from traditional TV
stations. This is because Cable TV management must provide programmes for a
greater number of channels, whereas traditional TV stations must prepare for
only one channel.
According to Gershon (2002), cable TV is similar to a magazine. A reader does
not read all articles of the magazines. Therefore, the management must ensure
the content is appealing to all layers of readers. The same thing applies to cable
TV. Viewers do not view all programmes which are broadcasted. Therefore,
management must ensure the creation of a programme package, which is
attractive to viewers.
There are four types of Cable TV programme services, that are:
• Basic cable;
• Pay TV Cable;
• Information service; and
• Community access.
(a) Basic Cable
Basic cable service is a package which must be subscribed if the client is
interested with the TV Cable offer. In general, basic service provides
additional programmes other than the traditional TV station channels
already included in the package. Basic Cable channel is also the cheapest
and has many clients. Most Basic Cable channels are supported by income
from advertising. Below is an example of a Basic Cable service prepared by
StarHub Singapore.
Table 7.2: Basic Cable Service Offered by StarHub Singapore
World News Education
Entertainment Kids Chinese
Infotainment
Chinese Entertainment
CNN
BBC
World
CNBC -
Asia
Discovery
Animal
Planet
National
Geographic
Discovery
Travel 3
Adventure
AXN
Hallmark
MTV SEA
STAR World
Cartoon
Network
Nickelodeon
TVBS Asia
CTI TV
MTV Mandarin
Phoenix
Chinese Channel
E City
Asia Plus
Source: Keshishoglou, J. & Aquilia, P. 2005. Electronic Broadcast Media in
Singapore and the Region (2nd ed.) Singapore: Thomson
Subscription cost is as follows:
(i) Three groups = S$20
(ii) Four groups = S$24
(iii) Five groups = S$27
(iv) All six = S$29
(b) Pay Cable (Pay-per-view (PPV))
Pay TV Cable Service charges an additional fee to clients to get additional
programmes. To use the service, client may subscribe based on monthly
charges or pay to receive certain broadcasted programmes only, that is,
ASTRO Cable TV station also provides selection packages for clients in
Malaysia. Guided by Table 7.2, sketch ASTROÊs programme package.
ACTIVITY 7.1
what is normally called pay-per-view (PPV). In general, sports direct
telecast attracts the interest of many clients. Boxing sport is the highest
income generator in the history of PPV, i.e. US$90 million from boxing
match between Holyfield and Tyson in 1997. PPV started in 2000 in the
United States with almost 30 million households subscribing to the service.
Table 7.3: Most Popular Cable Service in the United States (2000)
Channel Cable Client
(Million)
HBO
Encore
Cinemax Showtime
19.2
9.7
8.9
Source: Dominick, J.R. (2002). The Dynamics of Mass Communication Media in the
Digital Age. NY: McGraw-Hill. p. 286.
(c) Information Service
Cable TV provides various services to clients and this includes services
such as home shopping, cable modems and information service. In mid
1980's, consumers were introduced to a new method of shopping from
homes through Home Shopping Network (HSN). Producers provide
product catalogues as a means of announcing product information.
Through telephone numbers appearing on the TV screen, consumers may
make purchase orders. The same method is available through SmartShop,
aired on TV3 broadcast in our country.
(d) Community Access
Most Cable TV companies must provide education channels for the
community as well as government affairs channel. Through this channel,
educational and also government information may be announced to the
community. In the United States, Christian Broadcasting Network (CBN)
broadcasts live telecasts from the church to the community.
In Malaysia, cable channels providing community access is a new thing in
national broadcasting system compared to developed countries which can
Follow a SmartShop programme on TV3. Make a list of products sold
through the programme.
ACTIVITY 7.2
afford to provide such facilities. In the United States, for example, even City
Council broadcasts its meetings to the community.
CABLE MANAGEMENT
Cable management in the United States signs agreement with the local
government to conform to all rules and requirements of the Cable Act 1984.
Through the signed agreement, cable management has the right to provide cable
broadcast service for an agreed period.
As in other business systems, cable channel transactions also ensure that they get
returns equivalent to programmes subscribed. Besides, they have the right to
change programming systems.
Table 7.4: Cable TV Development
Year Operation System Client (Million) TV Ownership (%)
1960
1965
1970
1975
1980
1985
1990
1995
2000
640
1,325
2,490
3,366
4,048
6,600
10,200
13,000
9,947
0.7
1.3
4.5
9.8
15.5
37.7
54.0
60.0
73.1
1.4
2.4
7.6
14.3
20.5
43.7
58.0
63.0
70.0
Source: Dominick, J.R. et al. 2004. Broadcasting, Cable, The Internet and Beyond: An
Introduction to Modern Electronic Media. NY: McGraw-Hill, p. 32
SATELLITE BROADCASTING
The concept of satellite use in the aerospace was the original idea of Arthur C.
Clarke, a science fiction writer in 1945. The idea turned into a reality when USSR
launched the first satellite into space on 4 October 1957. This was followed by
Vanguard launched by the United States on 31 January 1958. Soviet Union then
continued with Sputnik II taking along a dog named Laika into orbit. The first
mission which carried an astronaut (Vostok) was also done by USSR,
popularising the name of Yuri Gagarin. This sparked the space race between the
USSR and the United States. In 1964 it was the United StatesÊ turn to surprise by
broadcasting the Olympics directly from Tokyo via satellite to audiences in the
United States and other nations all over the world.
There are various types of satellites in space and each one has its own distinctive
functions. Refer Figure 7.6.
Figure 7.6: Types of satellites
Between 1970Ês and 1980Ês, many nations in the world were in the race to launch
their own satellite (see Table 7.5).
Table 7.5: Satellite Development
Year Names of Satellite
1978
1979
1982
1984
1985
1988
1990
1993
1994
1994
1995
1995
1995
1996
1996 (JAN)
1996 (NOV)
1996 (FEB)
1996 (MAY)
Broadcasting Satellite for Experimental Purpose (BSE) - Japan
Experimental Communication Satellite - Japan
INSAT-I - India TELECOM I ăFrance BRAZILSAT ă Brazil ITALSAT
ă Italy SIASAT-1
INTELSAT-701
APSTAR ă 1
PANAMSAT PAS-2
JCSAT-3
PAS-4
ASIASAT-2
APSTAR- 1A MEASAT ă 1
MEASAT ă 2
PALAPA ă C1
PALAPA ă C2
MEASAT ă 1
MEASAT ă 2
MEASAT ă C1
MEASAT ă C2
Source: Hamisah Hasan. (1998). Satellite Communications: A Technical Paper. A Working
Paper Presented at Communication Technologies for Development Course, Communication
Department, Faculty of Human Ecology, Universiti Putra Malaysia, Serdang, Selangor.
Rapid development in satellite technology communication innovation finally
stimulates several telecommunications companies to launch their own satellites.
For example, RCA (Radio Corporation of America) launched SATCOM I in 1975
and SATCOM 2 in 1976. In August 1976, Indonesia launched PALAPA, that is, a
telecommunications broadcasting satellite with the aim of providing
telecommunications facilities to her 13,677 islands.
COMPONENTS OF COMMUNICATION SATELLITE.
A communication satellite system is divided into two parts, that is, aerospace
segment and earth segment.
Aerospace segment is the satellite while earth segment is earth station which
has a transmitter device and receiver for sending (uplink) and receiving
signals (downlink) from satellite.
There are three basic components of the satellite, that are;
(a) Parabola antenna;
(b) Earth station; and
(c) Transponder.
A parabola antenna (parabolic dish) is the signal receiver at the clientÊs premise.
Earth station functions to receive signals from the satellite and send signals to the
satellite (uplink and downlink). There are earth stations that function only to
receive signals, such as TVRO (TV Receive Only).
Figure 7.7 shows examples of satellites and parabola antenna.
Figure 7.7: Examples of satellites and parabola antennae
Source: http://www.voyager.in/Communications_satellite;
http://en.wikipedia.org/wiki/Satellite_dish
DIRECT BROADCASTING SATELLITE (DBS)
DBS is a new alternative to Cable TV. DBS broadcasting can be transmitted
through 200 TV channels to many clients in the whole world. In Malaysia, the
system that is carried out by ASTRO is not 100 percent DBS because TV signals
are ÂdownlinkedÊ from the satellite to an earth station at All-Asia Broadcasting
Centre at Bukit Jalil to be monitored before they are sent back to the satellite to be
received by clients. (Please refer to the article written by Rahmah Hashim entitled
„Television Technology in the Era of Infomedia (Teknologi Television Zaman
Infomedia)‰ in Kosmik, April 1996, p. 5-9).
• Topic 7 has discussed a broadcasting system using cable and/or
communication satellite and explained several management elements of both
broadcasting systems. Both systems were successfully implemented by the
end of the 20th century as a result of several advances in information and
communications technology. This clearly influences the development of the
broadcasting field particularly communication satellite innovation which
enables TV broadcasts to be directly received by the audience from Cable TV
stations or DBS. The change that occurs provided the audience wider choices
and more updated and rapid information.
Cable TV - CATV
Direct Broadcasting Satellite
Distribution Network
Downlink
Earth Station
Multichannel Mutltipoint Distribution
System (MMDS)
Parabola Antenna
Satellite Television
Transponder
TVRO (TV Receive Only)
Uplink
Video on Demand (VoD)
Dominick, J.R. (2002). The Dynamics of Mass Communication. Media in The
Digital Age. NY: McGraw-Hill.
Dominick, J. R., Messere, F. & Sherman, B. L. (2004). Broadcasting, Cable, The
Internet and Beyond: An Introduction to Modern Electronic Media. (5th ed.).
Boston, MA: McGraw-Hill.
Gershon, R.A. (2001).Telecommunications Management Industry Structures and
Planning Strategies. NJ: Lawrence Earlbaum Associates.
Glatzer, H. (1983). The Birds of Babel, Satellites for Human World. In: Howard
W. Sams & Co. Inc.
Hamisah Hasan. (1998). Satellite Communications A Technical Paper. A paper
presented at the Communication Technologies for Development Course,
Communication Department, Faculty of Human Ecology, Universiti Putra
Malaysia, Serdang, Selangor.
Keshishoglou, J. & Aquilia, P. (2005). Electronic Broadcast Media in Singapore
and The Region (2nd ed.). Singapore: Thomson.
* * *
TOPIC 8 THE FUTURE OF TELECOMMUNICATIONS MANAGEMENT
INTRODUCTION
This topic explains the future of telecommunications management from two
perspectives. The first perspective discusses telecommunications management in
terms of globalisation impact on the telecommunications industry and the second
perspective in terms of challenges and the future of the broadcasting industry in
Malaysia.
Telecommunications environment at the beginning of the third millennium is full
of colour with new technology and new infrastructure which has changed the
patterns of services and technology that can be supplied. The change is
constantly taking place due to the impact of globalisation. This section clarifies
the globalisation phenomenon from two viewpoints.
Firstly, how this phenomenon makes an impact on the telecommunications
industry. Secondly, how the most recent changes in the broadcasting industry
environment brings with them several challenges and opportunities. Focus is
TOPIC 8 THE FUTURE OF TELECOMMUNICATIONS MANAGEMENT
By the end of the topic, you should be able to:
1. Outline how the globalisation phenomenon can leave its effects on the
telecommunications industry in Malaysia;
2. Explain the advantages of digital broadcasting from the viewpoint of
the station management;
3. Discuss the implications of the digitalisation of the broadcasting
industry in Malaysia; and
4. Explain how the management could handle challenges and future
opportunities of the telecommunications industry in Malaysia.
LEARNING OUTCOMES
given on the broadcasting industry preparations to face the broadcasting
digitalisation era and management proposals to make the national project successful.
DEVELOPMENT OF TELECOMMUNICATIONS SECTOR IN MALAYSIA.
World telecommunications technological development is influencing developing
nations technologically, through applications and related services.
Telecommunications, particularly electronic media, now includes fixed line
telephones and mobile telephones, information and communication technology
(ICT), computers, cable broadcasting, radio and television, Internet, CD-ROM, etc
(Sherman,1995), even the daily newspaper has an online version. Rapid
development in the telecommunications sector with the globalisation
phenomenon challenges the implementation of the national vision but at the
same time promises various opportunities if handled wisely.
Telecommunications sector and broadcasting, the two main entities in the field of
telecommunications in Malaysia, are the prime movers of national progress.
Now, the broadcasting sector and ICT have developed as telecommunications
entities which are equally important to consumers. From a consumersÊ point of
view, communication service patterns have changed to be widened further. It
includes mass media service concepts in general and personal communication
services specifically. Consumer demand and market forces have motivated
entrepreneurs towards telecommunications services which result in the
combination of telecommunications sector, computerisation and broadcasting
(see Figure 8.1).
In the 1980Ês, the telecommunications sectorÊs roles as a progress mover had
begun to change to become commercial due to the economic policy,
telecommunications policy and broadcasting national policy transformation at
that time. The change has become appropriate due to the development of
privatisation policy, and free market and trade policy of the global
telecommunications industry. The growth and expansion of the
telecommunications sector, broadcasting sector and related support services are
highly necessary to manage globalisation effects.
What is the relationship between globalisation and the communication
industry? Give your comments.
Globalisation began to be felt through inflows of equity capital and takeovers by
foreign companies and their capital accumulation to build their infrastructure
and to strengthen their position. In this situation, market forces determine the
direction and roles of local telecommunications network which are becoming
profit oriented and defend commercial characteristics.
To manage the problems and challenges in the rapidly changing scene, several
decisions have been made by the government including the following:
(a) Establishing Malaysian Communications and Multimedia Commission
(MCMC) under the Ministry of Power, Water, and Communication
(MPWC) in 1998. MCMC acts as a coordinator and regulator of the
activities of telecommunications company (Telco), cellular company (Celco)
and private and public broadcasting sector.
(b) Strengthening the Broadcasting Department of Malaysia (RTM) as Public
Broadcaster for the peopleÊs interests.
(c) Strengthening telecommunications industry by issuing licenses to
telecommunications companies, radio broadcasting and private TV stations.
To know in detail about MCMC activities, please browse through the following
website: http://www.skmm.gov.my/
Figure 8.1: Structure of information industry
Source: OECD, 1992 p.12
REGULATOR
In a meeting of Public and Private Television and Radio Broadcasting Monitoring
Coordinating Committee No.2/2005 and No. 3/2005 [Jawatankuasa
Penyelarasan Pemantauan Siaran Awam serta Private (JKPPSTRAS)] at the
Ministry of Power, Water and Communication, Malaysia (MPWC), the meeting
chairman reminded the committee members consisting of public officers, and
entrepreneurs of public and private telecommunications industry about their
responsibility to the community. The chairman has also asked the entrepreneurs
to cooperate with MPWC in the matters of self-regulation and conforming to
broadcasting guidelines to achieve common aspirations, as noted below
(JKPPSTRAS/MCMC, 2005):
(a) Improving the quality of telecommunications service with high technology
which can meet the requirements of the industry and customersÊ tastes.
(b) Strengthening telecommunications infrastructure network which is capable
of facing future global competition and generate national economic growth.
(c) Active in building linkages and learning global telecommunications
development to obtain business opportunities in international
telecommunications arena.
(d) Always examine multimedia policies and rules, patents rights and
intellectual property governing telecommunications industry for
continuous improvement, besides ensuring that the telecommunications
industry helps to achieve the national vision.
The MCMC platform - as the enforcer of guidelines ă has become a place for
complaints, discussions and continuing debates between various parties of
telecommunications industry who compete to safeguard their own interests.
MCMC makes the effort towards providing a fair and just entrepreneurial
environment as a regulator and prevents the emergence of monopolistic
conditions. MCMC formulates policies and enforces guidelines and rules based
on the Multimedia Act 1998. In general, MCMC also helps to protect the
telecommunications industry from globalisation pressures for consumersÊ and
the countryÊs interests.
Consumers want access to telecommunications services with quality, which are
efficient and cheap. Consumers and stakeholders have asked that Telekom
Malaysia (incumbent) and other Celcos to loosen their monopoly to facilitate
interoperability between services (Pillai, et.al. 2005). The government is also
committed to widen services to all parts of the country to speed up a community
with knowledge (K-society) and to close the digital divide.
In the telecommunications arena of the Asian region and the world, radio and
television broadcasting industry participants are concerned with the expansion of
Telcos, Celcos and other wireless electronic media sectors. This media
development has enabled the partnership of frequency spectrum which is getting
narrower. Division of frequency is clearly very important to each participant in the
industry to deliver their products and services (Radio Asia/ABU News, 2005).
GLOBALISATION IMPACT IN TELECOMMUNICATIONS FIELD.
There are two explanations on how the globalisation phenomenon process can
happen in the field of telecommunications, i.e. globalisation through vertical and
horizontal integration (Sherman, 1995); and from the angle of four dimension, i.e.
economy, politics, culture and ideology (Abdul Rahman Embong, 2000).
The 8th Malaysia Plan clearly outlined the direction and strategy of the national
ICT project, while the 9th Malaysia Plan (2006 -2010) enables Malaysia
Broadcasting Department to implement Broadcasting Digitalisation Project
which will benefit the whole broadcasting industry in Malaysia. The top
management of the Ministry of Information of Malaysia have to exercise a
cautious attitude in enforcing in the case of telecommunications development
(including broadcasting and ICT), subject to current social, cultural and economic
conditions (Majlis Penerangan Projek Pendigitalan Nasional, 2005).
The stakeholders believe the government still needs additional information and
must learn more about globalisation impact on the field of telecommunications
particularly local broadcasting industry in the context of digital broadcasting
development. However, the globalisation issue continues to receive special
attention from Telecommunications entrepreneurs, media and ICT. However, the
ways they are overcoming the globalisation impact are diverse.
8.3.1 Change in Local Media
Local media manager, either in the field of printing, telecommunications,
broadcasting or new media is facing reformation process. They are constantly
8.3
In a study regarding economic investment and media globalisation effects in
Latin American countries, Waisbord (2002) emphasised the importance of
process negotiation ⁄process of perpetual negotiation⁄ and mediate
globalisation, outlining its limits and possibilities. States and market forces
continue to be locked in constant battles in which accommodation and mutual
benefits, rather than one-sided victories are the norm‰.
looking for solutions to overcome the globalisation impact. Media managers
cannot run away from changes in technology, market competition, policy
changes, culture and consumer needs.
In the local printing sector, for example, Sin Chew Media Corp. Bhd. succeeded
in strengthening its position through diversification ideology in the field of
printing and business expansion in the country and overseas by means of
acquisition of uncompetitive print media.
The New Straits Times press performed rebranding by changing to a new face in
tabloid form. The Sun newspaper distributes free copies and relies on advertising
only to continue business.
By increasing the number of readers, the printing sector diversifies its publication
and publicity, i.e. through spreadsheets, Internet, mobile phones and billboards.
Print media management clearly keeps abreast with technological development
and dares to change to deal with market pressure.
8.3.2 Telco and Celco Sector
In its rebranding plan, Telekom Malaysia (TM) Berhad announced various
development infrastructure and automation training at a cost of RM100 million
as its strategy. The TM company also continues searching for opportunities to
expand its business and reorganises overseas investment such as investments in
Indonesia, Indochina, Sri Lanka and Asia-Pacific (Berita Harian, 30 July 2005).
Such technology development strategy and business telecommunications is seen
as critical in handling the globalisation impact on the industry.
Local celco companies such as Celcom, DiGi and Maxis continue to expand their
activities. Their new development is 3G with the capability to streaming
television programmes. ASTRO, pay satellite television broadcaster, exploited
the 3G innovation by providing an additional service platform to all cellular
networks especially to its partner, i.e. Maxis. DiGi becomes the largest prepaid
mobile telephone network with subscription of 5 million by June 2005.
Telecommunications sector together with the ICT sector, as well as small and
medium industry (SMI) were active in research activities with Sirim Berhad
incubator programme. This programme has created small entrepreneurs
(vendors) in telecommunications and ICT sectors.
With dynamic cooperation between various sectors, SMI companies realised their
businesses in the field of information and communication technology. The
president of a foremost cellphone firm in Europe said, Malaysia will lead in
research activities and become a principal base to develop their product
competitiveness in the Asian region (Utusan Malaysia, 18 June 2005).
8.3.3 Broadcasting Sector
Kumpulan Media Prima Berhad, owner of TV3 took over Fly FM radio station
and Ch9 TV station which ceased operation because it was incurring losses.
Media observers believe that Media PrimaÊs action of controlling Ch9, an existing
broadcasting station, is to avoid the existence of another competitorÊs
broadcasting station (Lim Ai Leen, 2005). However, not long after that, Media
Prima made a decision to take over the ntv7 broadcasting station. This means,
Media Prima is now a master broadcaster controlling all private free-to-air (FTA)
stations i.e. TV3, 8TV, Ch9, and ntv7. See Figure 8.2.
Figure 8.2: Viewers share of local terrestrial TV station, 2004
ntv7 station with its branding „Your Feel Good Channel‰ and its own style of
news presentation, MyNews, has begun to attract its target viewers in towns
including Chinese-speaking viewers.
TV1 and TV2 as well as 32 public radio stations are owned by Radio Televisyen
Malaysia (RTM). RTM has also performed its rebranding of TV1, TV2 and 32
radio stations in 2004 and 2005. RTM service goals as a public broadcaster is
different from private broadcasters. RTM gives priority to its social obligations to
the community where entertainment alone or commercial features are not the
main objectives. However, RTM is not protected from competition or separated
from the globalisation impact. What happens in the environment of
telecommunications is clear and obvious. Every sector attempts to escape from
being overwhelmed by competitors by widening the scope of its business
operations.
If globalisation means industry practice without border entry of hardware,
software products and services without control, then cultural and political
implications will have an impact on the national economy. The entry of more
competitive foreign products will adversely affect local industry. In addition, in
the era of digitalisation, globalisation further widens the gap between a
community with resources and a community without resources, creating a digital
divide.
Waisbord (2002) is of the view that globalisation does not have the same impact
on all media in a country. Globalisation may stimulate business development
and at the same time cause a loss of opportunity and local businesses to
retrogress. He identifies several criteria that may overcome the globalisation
impact to local management. The criteria are as follow:
(a) Strengthen position in industry with sufficient capital to develop business
in the country and overseas, including in an economic crisis situation.
(b) Having a sufficient audience share (clientele) to achieve ratings and reach,
audience coverage which is attractive to the media planner and sponsor.
(c) Controlling advertising expenses (Adex) of telecommunications industry
and sufficient sources of additional income in order to sustain itself in the
industry.
(d) The existence of a regulator which can enforce policies and guidelines
which can protect industry interests from being monopolised by more
global and able entrepreneurs.
EXPANSION OF GLOBAL TELECOMMUNICATIONS INDUSTRY
Telecommunications branded products such as Ericsson, Nokia or STAR TV,
Sony-Columbia Pictures have become a common word among
telecommunications industry audiences. Products of these brands have
controlled a major share of the telecommunications industry in Malaysia. The
challenge to the local telecommunications industry is how to take advantage of
the advance of globalisation in Malaysia. Giant companies such as Satellite
Television Asia Region, STAR TV, Time-Warner, Sony Corporation, Fininvest,
8.4
TV3, together with 8TV, control 49% of viewers' share. Does this mean
that with the empowerment of private broadcasting stations, there is
no more space for the weak or non-commercial? What is your view?
News Corporation and Temasek Holdings are active global companies in cross-
border investment and own strategic interests in various media industries. See
Table 8.1.
Table 8.1: Global Telecommunications Companies Controlling Various Media
Name of Company Broadcasting Telecommunications Print
Media Film Production/Distribution
(a) Star TV
(b) Time Warner
(c) Sony Corporation
(d) Fininvest
(e) Temasek Holdings
Source: Robert W. Mc Chesney http://www.fair.org/extra/9711/gmg.html.
OECD (1992), p.52
STAR TV, owned by Rupert Murdoch, originally owned interests in newspaper
and print media. Then, he expanded his business to telecommunications media,
broadcasting, production and distribution of TV programmes and films. The
company which began as a print media from Australia, now owns interests in the
United States, China, India and Europe.
Similarly, Time-Warner, originating from the United States, Sony Corporation
from Japan, Fininvest from Italy and Temasek from Singapore. These companies
are successful in controlling various media through strategic investment and
cross ownership. What can be realised from the activities of these global
companies is that they are dominating the market through horizontal and
vertical integration strategies.
Business expansion models through integration activity are also found among
entrepreneurs of the telecommunications industry in Malaysia. Between Telekom
Malaysia (TM) and TV3 ă they have cross-ownership of interests in print media
such as New Straits Times Press; telecommunications companies/Celco
(Celcom), broadcasting station (Ch9 and 8TV) and production and distribution
company (Grand Brilliance). Refer Table 8.2 to know about telecommunications
companies in the country which control various media. MiTV and ASTRO, i.e.
two pay satellite broadcasting stations also have interests in various media
industries. Different from these privately owned companies, RTM, a government
owned station, cannot involve itself in business. However, under the Ministry of
Information, Malaysia, there are agencies involved in film production such as
Jabatan Filem Negara Malaysia while news services is by Bernama.
Table 8.2: Domestic Telecommunication Companies Controlling Various Media
Company
Name Broadcasting Telecommunications Print
Media
Film Production/Distribution
Telekom Malaysia
TV3
MiTV
ASTRO
RTM - -
Livedoor case, Japan: Livedoor, a company supplying Internet services
succeeded in buying a majority share of a radio company Nippon Broadcasting.
Nippon Broadcasting has the biggest share in Fuji Television network. Indirectly,
Livedoor has become the largest member of the board of directors for largest
group of media in Japan. This means the Internet media can now influence the
direction of the broadcasting media. This fact was only realised at a later stage by
the broadcasting group, when the stakeholders were rather restless with the new
developments. The administrative and regulation structure of the broadcasting
body in Japan gives priority to public view. Therefore, the takeover efforts were
renegotiated outside the court, by permitting Livedoor to buy a minority share
(The Malay Mail, 24 March 2005).
Investment case in India: Telekom Malaysia Berhad's (TM) proposal to buy
shares in Idea Cellular Ltd., a Celco company in India, could not be continued
because of several factors. At the same time, Temasek from Singapore succeeded
in buying shares of Bharati's Telecomunications and ICT Ventures company,
India. The Regulator of India did not allow TM Malaysia to bid to buy shares in
the same sector because Temasek had already had an interest in Telekom
Malaysia. At that time, a Celco company in Malaysia, i.e. Maxis qualified to bid
for shares in India.
Telekom Malaysia stated that they were continuing to try an alternative method
not only in India but also in Pakistan and other countries in the Asia-Pacific.
ASTRO also has begun to be established in Indonesia and the Sin Chew Media
Corp. has owned a daily newspaper in Papua New Guinea. Investment and
In your view, are all investment measures, business expansion and
takeovers successful and healthy in terms of public interest?
business activity expansion is a must to prove the existence of a strong
telecommunications industry not only in the country but also overseas.
THE FUTURE OF TELCO AND CELCO
The convergence of technology today influences how communication is
distributed by the media, telecommunications technology, television and
computing. Combination and technological innovation succeeded in developing
new ways of accessing information by interacting virtually. Methods of
communicating have developed from mass communication method to direct to
the individual. This trend occurs because access to information is of a ubiquitous
concept, i.e. capable of communicating from anywhere. The use of information
technology and communication has begun to move from a fixed medium to a
mobile medium. Even clients now have begun to control the form of
communication and information obtained, stored and how data is utilised
through ICT for further application. Refer Figure 8.3.
Figure 8.3: Concept of accessing information and interacting from anywhere
Malaysia is in line with other developed countries such as Japan and Korea in
migrating to new technology such as Voice Over Internet Protocol (VoIP), use of
Wireless Fidelity (Wi-Fi), Mobile Content Streaming service, broadband service
which supports Third Generation Advanced Cellular Telecommunications
Services (3G), on-demand video services through Internet. Internet Streaming
facilities and 3G service are still being improved, while the success of
telecommunications technology combination, broadcasting and computerisation
indicate the entry of Telco and Celco in Malaysia as competitors to traditional
broadcasters in Multimedia broadcasting service. The result of this Multimedia
technology enables various media products and services to be received at their
respective base as in Figure 8.4. The concept of information and entertainment
distribution to the audience (mass broadcast) has now shifted to the concept of
information and entertainment distribution directly to individual clients (mass
broadcast to personalised broadcast).
Figure 8.4: ClientsÊ TV, computer or mobile telephone screens
The climate and ways in which the clients view TV or communicate using
telephones are quite different now. Clients have begun to demand facilities in
accessing information, communication and entertainment according to their own
comforts. They want information wherever they are and at any time. This
ubiquitous concept means anywhere, anytime, any device. The capability of
traditional television or fixed line telephone is limited and unable to fulfil these
needs. Clients are beginning to switch to interactive TV or mobile telephones
with 3G capabilities. Television stations may start streaming programmes to
Internet clients and mobile telephone clients. Broadcasters have to chase viewers
to give them satisfaction by planning interactive programmes because todayÊs
viewers are capable of processing various kinds of information as in Figure 8.4.
Viewers are able to participate in quiz, games, contribute to forums, blog, browse
advertisements while viewing and listening to radio and TV broadcasts at the
same time.
CHALLENGE FROM OUTSIDE
Giunta (2005) stated the technology combination has stimulated growth in the
field of telecommunications aggressively in the Asia-Pacific region where its
clients enjoy a rising social standard of living. Countries in Asia have among the
highest number of users of mobile telephone services and wireless Internet.
Examples of clientsÊ involvement in SMS/MMS service are increasingly popular
in Malaysia as found in the following report:
Astro - AKADEMI FANTASIA
15 million SMS messages worth an estimated RM 7.5 million sent by fans since
June.
8TV - MALAYSIAN IDOL
On average, there are 1,300 to 1,500 chatters on air per hour on 8TVÊs chat.
220,000 SMS messages per month. At peak, 12 minutes before SMS can be
displayed on TV due waiting time.
ASTRO - Channel @ 15
3.5 million SMS in the last 13 months (since July 2003). In 2003, Malaysian sent a
total of 6.2 billion text messages.
Figure 8.5: Example of client involvement in SMS/MMS service in Malaysia
Source: The Star, 17 August 2004.
During the visit by representatives of the World Trade Organisation (WTO) to
MCMC on 21 June 2005, they referred to MalaysiaÊs agreement to a commitment
of opening 30% of telecommunications sector market to foreign investors while
in the pioneer status 100% equity maybe held by a foreign company if it operates
from the Multimedia Super Corridor or MSC. Opening of opportunities to more
advanced and more capable entrepreneurs from overseas through WTO and
pioneer status at MSC, also places a serious challenge to local
telecommunications industry (Pillai et. al. 2005).
The local Telco and Celco sectors- i.e. Telekom Malaysia Berhad (TM) and three
cellular companies (Celco), i.e. Maxis, DiGi and Celcom (a subsidiary of Telekom
Malaysia Berhad)- control almost all of the mobile telephone market. But that is
only 50% of the 26 million Malaysian population who have become users of
mobile telephones, and less than 1% become the clients for broadband facilities
which are prepared to develop their organisationsÊ operation value. So the Telco,
Celco companies and suppliers of various broadcasting platforms and services
take cautious steps in terms of capital expenses to face the challenges and
opportunities waiting for the telecommunications industry in Malaysia.
The hottest heat of competition will be felt especially by Celco companies and
small companies supplying services such as interactive SMS/MMS, software
program broadcasting and website builders. In the efforts to uplift business,
Telco and Celco companies highlight their brands of products and services with
various methods of promotion and positioning among the clientsÊ audience (See
Table 8.3). Companies attempt to capture part of the Celco business sector
through a war of slogans.
Table 8.3: Examples of Slogan Used among Celco Competitor
Company Celco Promotion/Slogan
Maxis Access Fee „0‰
One Country One Rate
Cost SMS 1 Sen
Celcom „This is Celcom Territory‰
„Everything is in your hands‰
DiGi „Use of the longest prepaid‰
„Lowest Prepaid‰
Beside challenges from overseas, management of local Telcos and Celcos face
their own specific problems to progress further in the industry. The problems are
as follows:
(a) Opportunities to develop business between Telcos and Celcos should be
balanced because sudden growth in telecommunications causes congestion
in the use of the frequency. MCMC may redistribute frequencies so that the
sector can give a more general service. Unbalanced distribution of
opportunities may create uneasiness of big/small companies and
monopolistic situation.
(b) Telcos and Celcos are less capable and slow in performing various services
which are available in the environment of telecommunications industry.
While waiting for them to fulfil clientsÊ demands, suppliers (vendors) who
are often weak in terms of resources are used. This opens the possibilities
for competitors from outside to enter the market.
(c) In using suppliersÊ service, there are various issues causing difficulties to
the industry and clients. Profit distribution ratios which benefit the Telcos
and Celcos become an issue to service suppliers. Problems of variations in
billing and delays in payment weaken service suppliers with small capital.
(d) Shortage of a skilled workforce and competencies in Multimedia
Technology often gives rise to problems such as server-down, which causes
dissatisfaction among clients.
How can the local community handle the effects of globalisation? What
are the positive and developmental effects of globalisation?
FUTURE CHALLENGES OF THE BROADCASTING INDUSTRY
Growth of TV households in the Asia Pacific Region was forecasted to reach 30
percent, i.e. 600 million before 2010 (ABU, 18th March 2005). The growth
represents fertile market for broadcasting media to expand their activities in the
region. Broadcasting industry in Asia Pacific began to feel the impact of
globalisation when giant companies such as Time Warner, Sony Corporation
began to supply more attractive programme content to broadcasting industry
participants in this region. These challenges became more serious to broadcasting
management operating with analogue and terrestrial when pay satellite TV
(ASTRO, Malaysia, LIPPO Group, Indonesia) and cable TV (Singapore;
Philippines and Thailand Pool TV) and direct to homes TV (DTH/DBS) began to
offer programmes at much higher levels of quality.
Planning of terrestrial radio began to show reformation in short term scheduling
and programme production (2000-2005) in the efforts to improve opportunities
and ratings in the market. Management began to focus attention to positioning of
their own brands among viewers and media planners. Scheduling method of
slots and belting became niche programming. From here, it changes to popular
programming which in general are viewersÊ selected popular programmes.
Media planners present prime time, other primes and fringe time as additional
attractive air space to advertisers.
Now, a new phenomenon in scheduling has begun to be used among the
broadcasters who are competing to attract listenersÊ/viewersÊ attention.
Broadcasting stations have begun to promote their new/main programmes in a
big way in the media and billboards by exhibiting times and dates of
broadcasting on the radio or TV. They invite listeners/viewers to make
appointments to view the stations concerned. For example, The Contender -
ASTRO, Majalah 3 - TV3, Mahligai Gading - RTM and Edisi Siasat - ntv7.
In your opinion, what are the challenges that may face the broadcasters
in future? Is competition the main challenge?
SELF-CHECK 8.2
8.7.1 Competition in Broadcasting Media
Environment
With the existence of a fertile environment for investment, media companies and
global telecommunications (TNC) may continue to find opportunities to expand
their operations in Malaysia. Syndicated programme distributors from western
countries, East Asia, India and Singapore strengthen their positions in the local
broadcasting schedule.
In the meantime, representatives of global media such as Fox and Time-Warner
have begun to creep in as suppliers of broadcasting schedules following popular
programming. They make strategic partnership agreements with local stations to
bring in their international service such as news of CNN, BBC, Deutsche Wella,
Al-Jazeera which become permanent programmes in daily broadcasting.
For broadcasters and listeners/viewers, radio and television broadcasting media
are the main channels for effective information distribution. This media has been
most sought after in the last decade (1995 -2005) as it is considered the most
lucrative and strategic to consolidate business transactions of other related
media. Until 2005, five free to air broadcasting organisations (FTA-TV) with
seven broadcasting channels had been in operations.
Two of them have ceased broadcasting for not being able to withstand
competition from the industry (See Table 8.4).
Table 8.4: Free Broadcasting Stations (FTA) in Malaysia
The first radio and television satellite broadcasting stations in Malaysia (ASTRO),
which offers more than 40 TV broadcasting channels and 12 radio channels, is in
operation successfully, while the second pay TV (MiTV was launched in
September 2005. In the meantime, Telekom Malaysia Berhad (TM) began to
participate in the field of broadcasting through broadband streaming services
FTA-TV Number of Channels in Operation
RTM
TV3
NTV7
8TV
2
1
1
1
FTA-TV Number of Channels which Ceased
Operation
METRO VISION
Ch9
1 (1999)
1 (2005)
which offers a package of TV and radio broadcasting, data to mobile telephone
and website.
The existence of the second pay TV stations (MiTV), the capture of three private
FTA stations by Media Prima and broadcasting of radio/TV programmes
through Internet toughened the competition to get viewer share and adverting
expenses (Adex) (refer Figure 8.6). AC Nielsen is of the opinion that with a small
size of viewers, i.e. as many as 16.7 million and a less encouraging increase in
advertising expenditure, compared to other media, the broadcasting industry in
Malaysia may not be able to support any more additional broadcasting channels.
Lim Ai Leen (2005) reports in The Edge that television industry only obtained
29% of Media Adex compared to the 60% controlled by newspapers. TV Adex
growth in 2004 was 30% but declined to 15% in 2005 and it is expected to fall
further to 10% in 2006.
Reports in the newspaper of The Star, 9 Mac 2005 and The Business Times on 13
March 2005 believe that there is still space to expand viewers share.
Figure 8.6: Adex TV 1996 ă 2004. Data for 2005 - 2007 are forecast
Source: The Edge Malaysia, 20th June 2005
"MiTV targets 100,00 subscribers in the first year" said Datuk Rosman Riduan,
the chairman of the 2nd Pay TV station in Malaysia. Subsequent media report
says,"ASTRO net profit surges 12-fold to RM155.4 million". There appears to
be profitable expansion opportunities despite the restrictive market place.
While the confidence raised by Rosman, and in his subsequent reports,
illustrates the resilient character of the television industry in Malaysia.
The newspaper report above gives a picture that the broadcasting industry in
MalaysiaÊs vibrant industry and can be profitable. Meanwhile, the management
of Media Prima attempts to combine all private TV FTA stations to avoid
competition, ASTRO feels viewers share in Malaysia is reaching saturation. The
satellite station has announced its broadcasting expansion to Indonesia with
confidence to capture 30%, 1.5 million of pay TV clients in the country. In
planning various strategies to capture a part of viewers share and advertising
expenses, competition between broadcasting stations in the country is getting
stiffer. This has caused many workers to lose jobs in both TV stations which
ceased their operations.
In the meantime, the Celco sector rushed to promote their services, Telco sector
offers Voluntary Separation Scheme (VSS) to 10% of its workers because of
automating part of their service and operations. These effects of globalisation
have revealed pressures on telecommunications management to expand their
services horizontally and vertically.
8.7.2 National Broadcasting Digitalisation Project
The building of Digital Broadcasting Hub (DBH), a national broadcasting vision,
will benefit the whole telecommunications industry. This pioneer digitalisation
project comes from careful planning since 2002. This project will provide
terrestrial digital radio and TV broadcasting service to clients in the Klang Valley
in phase 1 (2006), metropolitan area and subsequently the whole country by 2012.
Table 8.5 is a proposed road map of the digitalisation project implementation.
Table 8.5: Mapping of Broadcasting Digitalisation Implementation
IMPLEMENTATION SCHEDULE
Project Evaluation February 2005-April 2005
Project Offer May 2005-August 2005
Delivery August 2005-December 2005
Installation November 2005-May 2006
Training February 2006-June 2006
Testing May 2006-September 2006
Launching September 2006-November 2006
Source: Briefing to Telecommunication Industry of Malaysia, 2005
With the introduction of Radio and TV digital broadcasting, it could be extended
to telecommunications media and computerisation, i.e. Digital Multimedia
Broadcast (DMB). This digitalisation project is the building of new infrastructure
at a high cost. In this case, the broadcasting department of Malaysia, Radio
Televisyen Malaysia (RTM) is given the responsibility to introduce digital
broadcasting technology and culture to the audience.
Broadcasting stations such as Ch-9 and ASTRO were already equipped with
digital broadcasting infrastructure. TV3 and RTM stations have obviously shown
their preparedness towards full digital broadcasting by 2012. Their respective
managements have set up a special division of New Media and trained staff to
face digital broadcasting challenges. Their production format now contains
interactive elements such as SMS which is a starting point for the culture of
sending and receiving in radio/television broadcasting. The main part of the
programme format will contain interactive TV (iTV) characteristics, with viewers
as product and service clients, besides radio/TV programme through
Multimedia base.
The combination of Multimedia and Multimedia broadcasting becomes a reality
in an experiment in BBC when the station made its television news report from a
location through a mobile telephone with 3G facilities. A broadcasting company
TV station in Norway, NRK, also directly broadcasted a skiing competition from
Sweden using a mobile telephone camera (ABU, 18 March 2005).
8.7.3 Digital Broadcasting Advantages
Digital broadcasting introduces to the clients quality programmes which are as
good as quality digital video disc (DVD) in terms of picture and quality compact
disc (CD) from its video. Digital broadcasting systems enable broadcasting in
wide screen format with high resolution with Standard Definition TV (SDTV or
High Definition TV (HDTV). For radio broadcasting, it enables digital audio
broadcast (DAB). Both broadcasting formats are capable of producing audio and
video of more attractive quality compared to analogue broadcasting. Digital
broadcasting is capable of broadcasting simulcasting/multiplatform broadcast.
Clients can benefit from various value-added services with digital broadcasting
technology. Refer Table 8.6.
Table 8.6: Difference between Analogue and Digital Broadcasting
Analogue Broadcasting Digital Broadcasting
Two-way broadcasting
communication.
Two-way broadcasting communication through
set-top-box.
Information support material
according to broadcasting
programming.
Information support material is more like
Multimedia service controlled by viewers.
Horizontal programme Programmes having interactive elements
controlled by viewers.
Interactivity application which is passive and limited to call-
back and SMS/MMS.
Having additional facilities through interactivity
application involving computer network system,
back channel and remote-control.
Inactive commercial
broadcasting.
Enabling viewers to shop in real-time through e-
shopping.
Receiving broadcasting direct to
TV through UHF/VHF
technology.
Receiving broadcasting through technology UHF
and set-top-box (STB), satellite dish. In future
broadcasting reception does not require STB.
Current TV broadcasting form
Terrestrial Free-To-Air (FTA).
Futuristic TV Broadcasting Terrestrial Free-To-Air
(FTA),Partial Pay-TV, Satellite Pay-TV, Cable Pay-
TV.
Information service on
programmes through
programme summary and print
media.
Providing electronic programme guide (EPG)
accessible with a remote control.
Source: ABU ICT Forum, Kuala Lumpur, 2004 and ABU Study Tour, Seoul, 2005
CHALLENGES TO THE BROADCASTING
MANAGER
8.8.1 Implication of Digitalisation Project
Service and analogue devices as in the era of black-white TV will soon be
discarded because analogue system cannot fulfil the demand and expectation of
viewers. Developed countries have begun planning towards terrestrial digital
broadcasting service. The most popular broadcasting system is Video Broadcast-
Terrestrial (DVB-T) (See Table 8.7). Developing conventional FM/MW radio
broadcasting and analogue TV broadcasting no longer brings any benefit (ROI)
to management because it involves a high cost.
Figure 8.7: Development of TV broadcasting analogue TV broadcasting
Besides the government who has to bear a high cost from the stage of project
evaluation to implementation stage, the broadcasting management will have to
pay for the cost of setting up a creative Multimedia division, skills training for
staff and expenditure for preparing interactive programme content. The
broadcasting industry in Malaysia cannot be left behind in implementing this
project.
(a) Acceptance of Technology by Audience
Digital broadcasting technology can be used as a mechanism to collect,
analyse and distribute information interactively with viewers. Management
supplies information to raise understanding and involvement of the
community in activities sponsored by the broadcasting stations.
Reception of signals or digital radio and TV broadcasting at home, involves
changing the radio/TV set to those that can receive programmes in digital
form. As an alternative, clients may use Set-Top-Box (STB) or decoders for
changing signals to digital content. This is something that may raise
problems for the broadcasting management.
Broadcasting managers in Europe, Japan and South Korea also experience
the same problem. Digital format broadcasting in Australia only got 10%
response from existing TV viewers (ABU, 18 Mac 2005).
AC NielsenÊs study (2005) on viewersÊ interest in digital TV broadcasting
found that more than 2.4 million viewers stated that they are willing to pay
extra premium to get value added services. Service here means selection of
subtitle language, electronic programme guide (EPG), Internet browsing,
private video recorder, paying at each viewing, e-commerce and data
casting. In selecting this service, viewers involve themselves personally and
interactively.
Interactive TV (iTV) is an important feature of digital TV broadcasting. It is
a TV and programming system which is specifically provided to allow
viewers two-way interaction in real time (real time navigation) during
programme broadcasting. This means viewers can control a part of the
programme broadcasted and be able to communicate with the broadcaster.
For the time being, viewers need the Set-Top-Box facilities with EPG
application that can be controlled by using a remote control to enjoy
facilities provided in the programme.
(b) Management Burden
Coordinating decoder or Set-Top Box facilities and nurturing the culture of
viewing digital broadcasting with EPG application becomes the
responsibility of broadcasting management. Management examines digital
broadcasting planning from each angle to ensure that devices such as set
top box and receiving antenna may be made in Malaysia by the original
manufacturer (original equipment manufacturer). By this measure, not only
the cost to the clients may be reduced, but the set-top-box can be adjusted
to receive broadcasting from all stations.
By the time Multimedia broadcasting arrives, many clients are expected to
use a base or receiver devices such as a laptop and a mobile telephone in an
area that is hard to receive broadcasting signals. Management should also
cooperate with the suppliers of telecommunications networks to provide
service „outside the area‰ or areas which are regarded as gap fillers.
(c) Implementation
The task force of this national project proposed that RTM begin digital TV
broadcasting at the end of 2006, followed by other broadcasting stations in
the country. Various cost implications, technology applications, social and
clientsÊ acceptance, skilled workforce and private broadcasting capabilities
demanded the implementation of digitalisation project be carried out in
phases and cautiously.
Multi-channel Standard Digital TV (SDTV) broadcasting would be transmitted
to the Klang Valley area first. Various value added facilities for TV viewing
through digital broadcasting may be enjoyed through phase-by-phase planning
(please See Table 8.7).
Table 8.7: Implementation of Digitalisation Project through Phase-by-phase Planning
8.8.2 Roles of Manager in Facing Future Challenges
in Broadcasting Industry
Future broadcasting managers must be trained in broadcasting organisational
management which is changing constantly. They must have leadership qualities
and wide knowledge in modernising broadcasting industry, telecommunications
and ICT.
(a) Organisational Management
Ć To manage the negative influence of globalisation, broadcasting
industry managers of the country must strengthen their position in
dealing with the new environment. Broadcasting industry managers
should explore opportunities to expand business and strengthen
services and their respective organisational functions according to
Legend
DVB-S Digital Video Broadcasting ă Satellite
SDTV Standard Definition TV
DRM Digital Radio Mondiale
HDTV High Definition TV
DAB Digital Audio Broadcast
DVB-T Digital Video Broadcast - Terresterial
Why is Malaysia's broadcasting industry not active in the efforts
regarding broadcasting technology research?
ACTIVITY 8.4
Implementation of Technological Facilities in Digital Broadcast
Year 2005 2006 2007 2008 2009 2010
DVB-S SDTV HDTV DRM (HF)
DVB_T DRM (pilot) (pilot) DAB
vertical integration and horizontal integration concepts (Sherman,
1995). Managers should also be sensitive for dimensions of globalisation
as proposed by Abdul Rahman Embong (2000) and examine the ways of
handling these dimensions in the context of technological change,
policy change and market global forces from time to time.
Ć To raise broadcasting industry performance to a competitive level in the
international arena, managers should always use their position among
local broadcasting entrepreneurs with an open mind. Managers should
examine the differentiated approach being practised in world class
broadcasting industry such as BBC, NHK and KBS and be willing to
make changes in the local context.
Ć Among strategic actions of broadcasting managers, a platform for
discussion and cooperation between entrepreneurs of local
broadcasting industry should be created. The platform should be used
to build relationship network and subsequently for expanding
broadcasting and telecommunications activities regionally and at global
levels. While attempting to coordinate activities globally, managers
must be responsive to local needs.
Ć Create the philosophy of organisational human resource, i.e. appointing
the most suitable manager to a post in which he/she is able to plan a
strategy and implement it. For this purpose, there should be a strategic
management team and a management team which implements
planning at the operational platform. They together have and create a
strategy which is implemented responsibly. The performance of this
manager should be evaluated continuously.
Ć Understanding the socio-political needs of viewers/listeners in terms of
the reception methods of digital radio and interactive TV technology.
The broadcasted service and programmes should be those that can be
afforded by the audience and not a burden to them; for example, the
cost of buying an antenna and set-top-box.
(b) Management of Broadcasting Operations
Ć Carrying out modernisation of local broadcasting industry by taking
into account studies and the experience of successful global
broadcasting organisations, applied in local context, especially the
nooks and corners of broadcasting sector privatisation, in developing a
business planning which includes terrestrial analogue and interactive
digital broadcasting strategy in future.
Ć Continue to strengthen broadcasting sector excellence in the era of a
combination of telecommunications, computerisation and broadcasting
technology or multimedia. Expand the functions of broadcasting
stations with the setting up of new units according to the needs of
broadcasting multimedia. Based on current development and trend of
broadcasting, a new media unit should be created.
Ć Provide trained human resources and expertise. Match the multimedia
training needs with continuous training proposals to assure a quality
appointed and existing workforce in order to produce various contents
planned in the future.
Ć Organisation rebranding, either in telecommunications sector or in
broadcasting sector is a change from the external point of view and an
operation with the purpose of improving image performance of the
stations. Besides the change of the organisationÊs face, managers should
ensure that programming and interactive TV channel which were
previously planned to support the desired type of rebranding.
Ć Establish a network of interactive programme content suppliers and
ensure work process flow for fulfilling channels conforms to
programme evaluation guidelines supplied.
Ć Increase information flows to all levels of organisation. Marketing and
sales team should know about the role of advertisements which will be
different, i.e. future advertisements will be interactive and an additional
income source.
Ć Ensure Budget and Internal Audit Unit always monitors and performs
audits on management expenditure process.
Ć Identify smart partners who can cooperate with entrepreneurs of
broadcasting industry in strategy implementation as in Figure 8.8.
Figure 8.8: Smart Partnership between telecommunication entrepreneurs and
broadcasting managers
• The beginning of digital broadcasting and multimedia means radio and TV
management will have to face cross media broadcasting. This development
requires readjustment of technical operational standards and a system which
has wide implications. Preparation of programme content to fill up 24-hour
broadcasting and the elements of airtime marketing are new complexities for
future broadcasting management.
• In the effort to bring about progress to the telecommunications industry in
Malaysia, telecommunications management utilises the opportunity from
rapid developments and changes taking place in telecommunications field
environment. They should attempt to improve the telecommunications
technology facilities accessible by the audience. This effort will place
Malaysia in the category of an advanced country in the field of
telecommunications.
• Telecommunications management introduces various innovations especially
in the new media sector which enables consumers to access information from
any location with multimedia facilities. The existence of streaming
broadcasting through Internet and mobile telephone with broadband
facilities has brought the consumers closer to world knowledge and the
creation of K-community.
• ICT facilities, such as Internet broadband and teleconferencing, are a must in
order to progress further in business either in the country or overseas. Use of
these facilities is still low among businesses and trade communities.
• While there are many viewers and listeners who want interactivity and
involvement in programmes, marketing patterns are increasingly changing
where broadcasting network becomes a virtual marketing centre. In fact, if
the opportunity of the new revenue stream is not properly handled, a
competing media will control the broadcasting field.
• Symptoms of this phenomenon were clearly seen during the exhibition of
Broadcast Asia 2004 and 2005 where Mobile Phone-TV and Internet-TV
broadcasting already existed. It is possible that this broadcasting service
maybe extended to viewers and listeners onboard aeroplanes or ships
through Satellite Aided Internet Usage facilities. Now, it is the broadcasters
who go after viewers to deliver products and services wherever they are.
With the proper facilities, viewers can access broadcasting service in various
ways, and the roles of a broadcasting manager become more challenging.
• The last topic has outlined how the globalisation phenomenon can bring an
impact on, particularly, the telecommunications industry in Malaysia.
Digitalisation has a big implication on the telecommunications industry
(either new media or old media). This involves new planning for the human
resources development, hardware and national development, in general.
Many challenges must be faced proactively by media managers of each
organisation. These future challenges can be turned into opportunities to
bring about positive changes to the organisation, community and the
country.
Digital Audio Broadcast
Digital Video Broadcast
Globalisation
High Definition TV (HDTV)
Simulcasting/Multiplatform
Streaming Broadband
Technological Combination
Technological Leap
Television Digital
Abdul Rahman Embong. (2000).Wacana Globalisation. In Noraini Othman &
Mandal, S.K., Malaysia Menangani Globalisation: Peserta atau Mangsa.
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Communities Through ICTs. Kuala Lumpur. 26-29 July 2004.
ABU Study Tour (2005). KBS Multimedia Overviews. Presentation by KBS, Seoul,
Korea. 25-26 April 2005.
ABU. (18 Mac, 2005). ABU weekly News Digest.e-newsletter@abu.org.my
AC Nielsen (2005). Audience Needs in Digital Content. Presentation by AC
Nielsen, Petaling Jaya. 11 April 2005.
ABU. (2005). Broadcasters Must Defend Frequency Spectrum Turf. In ABU News,
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Broadcast Asia (2004). Mobile Phone TV Trials for Singapore? Broadcast Asia 2004.
Giunta, T.K. (2005). Introduction. In The Preston Gates Guide to
Telecomunications in Asia. Hong Kong: Preston Gates and Ellis.
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