The News Corporation disaster was waiting to happen – and, ironically, Edelman, the PR firm tasked with advising NewsCorp on handling the current crisis, was the firm that saw the writing on the wall.
Edelman, which measures ‘trust’ in institutions (NGOs, government, business and media) annually, underlined the fall in trust in media in both the USA and UK.
The malaise goes beyond NewsCorp news products, as the ‘trust barometer’ measures the overall trust in all media.
Currently, the focus is on NewsCorp, and UK politicians, cutting across party lines, have called for a review of laws relating to news media ownership.
“When you give one individual or a small number of people a huge amount of power without proper accountability things go wrong, and that’s what’s happened here,” (deputy prime minister Nick) Clegg told the BBC’s Andrew Marr Show. “We have to look at the plurality rules to make sure there’s proper plurality in the British press.”
The Bloomberg story quotes leader of the Labour party, Ed Miliband asking for a similar overhaul of media ownership.
The current voice-mail hacking scandal has crossed the Atlantic, “The contagion affecting News Corp has spread rapidly in the US. The FBI is investigating potential criminal hacking of the voicemails of victims of the 9/11 attacks,” says The Guardian.
If Rupert Murdoch had studied the Edelman Trust Barometer report, he could have seen how little consumers in his two largest markets trust NewsCorp – even if they consume the products and generate advertising dollars.
In the Edelman report, when respondents (globally) were asked, “How much do you trust the institution to do what is right?”, media scored 49% in 2011, up from 45% in 2010.
However, while the global findings for trust in media are encouraging, the figures for the US and UK paint a dismal figure. In the UK, trust in media has dropped from 31 percent in 2010 to 22 percent in 2010; in the US, the corresponding show a slide from 38 percent to 27 percent.
It’s the lack of trust that consumers have in media in the UK and US that will make this recovery, for Newscorp, a long haul.
The Edelman study finds that the impact of trust on reputation is, not surprisingly, significant. When a company is distrusted, the study says, 57 percent will believe negative information after hearing it 1-2 times – while only 15 percent will believe positive information after hearing it 1-2 times.
So even the famous apology, repeated ad nauseam, will be a hard sell.
Even an Edelman will find it a Herculean task to keep disseminating positive stories about Newscorp and Rupert Murdoch to turn the tide. Murdoch, Newscorp and Edelman are in for a long, hard and tiring battle to win back, first, trust, and then confidence of their most influential stakeholders – advertisers and the stock markets.
Moving away from Murdoch, Indian media owners, too, would gain from studying the report: trust in media in India has fallen alarmingly as well, from 58 percent in 2010 to 50 percent in 2011.
The Murdoch episode might still have some positives — media owners worldwide could learn what not to do.
Updated Date: Jul 18, 2011 12:32 PM