International regulation, economic control, and operating principles of media services in an international comparison in the Eu 2013-2017

Abstract

In my case study I focus on the financial and economic situations of public service media service providers in the EU-29 member states for the period of 2013 and 2017, partly in terms of their revenues and, to a lesser extent, their general economic background. I analyse broadly possible necessary general statistical data using a number of economic characteristics, by other words economic variables, that best know the situation and internal characteristics of public service media providers concerning economic conditions. These financial and economic considerations affect the purchase of certain public media revenue. Where appropriate, increasing financial resources are considered to be a decreasing purchasing power, calculated at a higher rate of inflation. It is advisable for public media to expect more income than inflation. However, in many countries and EU Member States, subscriptions are more significant than foundation grants, so the population, as a public media service, can reduce their willingness to pay subscriptions. I note that in the period between 2008 and 2013, the revenues of the public service media increased to a greater extent than in the period between 2013 and 2017. This was mainly due to the fact that in the later period, one of the important items of public finance revenues, the size of subscriptions, decreased significantly in the EU member states where it was introduced earlier.

Introduction

My research topic examines the development trends of media service in the European Union, which is based on an international comparison of the effectiveness and efficiency of PSM (Public Service Media) in the EU-28 member states. In my research, I take into account the GDP growth of the given country, the government budget, the development of inflation, and in this context the operational situation of the Public Service Media Service Providers by country.

The three economic factors – GDP growth, government budget, and inflation – are important in terms of how sustainable the revenues of Public Service Media Providers, whether from state support or advertising revenues, can be for Public Service Media Providers. It is also important to what extent both GDP growth and the government budget balance affect government support for the Media, as slowing economic growth or a possible downturn, as well as a concomitant increase in the budget deficit, will reduce the level of support provided to the Media. This, in turn, may adversely affect the services available to the public. In my research, I focus in part on the evolution of the operating revenues of Public Service Media Providers by country and also on the forms of revenue sources such as government grants, License (as copyright) and advertising revenues between 2013 and 2017. I would like to make a comparison between the conditions that developed in 2013 and 2017 in terms of revenue sources.

Material and Methods

In my research, I assess the economic situation of public service media service providers in the EU-29 member states, partly in terms of their revenues and, to a lesser extent, their general economic background. In order to make this analysis as broad as possible, it was necessary to provide a general statistical analysis method for the dissertation, using a number of economic characteristics, in other words economic variables, that best know the situation and internal characteristics of public service media providers. economic characteristics and their context.

It is worth mentioning that this EBU (European Broadcasting Union) is much wider than the number of countries I have included in my research, as it covers three continents, namely: in addition to Europe, Asia and Africa as well. In addition, the EBU includes a number of European countries that are not members of the European Union but also members of this EBU international organization, such as Switzerland, Norway, Iceland and some countries in the Western Balkans, including Macedonia and Serbia. In addition to Europe, Turkey, Morocco and Israel, which are also members of the EBU, should be highlighted.

My statistical analyses used in my research are based on the SPSS (Statistical Program for Social Sciences) system, extending the international comparison of the effectiveness and efficiency of the EU-29 Public Service Media (PSM) system. The thirteen economic variables used, as an economic characteristic, can be summarized as follows:
Names of economic variables in Table 1:
1. PSM2008131 = PSM operating revenues, Operating revenues of public service media providers, by country, in millions of euros and as a percentage, 2008-2013
2. PSM2013172 = PSM operating revenues, Operating revenues of public service media providers, by country, in millions of euros and as a percentage, 2013-2017
3. PSM1FŐ3 = PSM operating revenues, Operating revenues of public service media providers, per capita, by country, in euros, 2013-2017
4. (Minus) PSMGDP174 = PSM operating revenues, Public Service Media Service Providers as a percentage of GDP, 2017
5. (Minus) PSMInc175 = PSM public income, Percentage of public money revenues from the operating revenues of Public Service Media Service Providers in 2017 by country,
6. PSMMarket176 = PSM commercial income, Percentage of commercial revenues from the operating revenues of Public Service Media Service Providers in 2017 in countries,
7. PSMMark377 = commercial income, Public Service Media Providers in commercial income, by country, as a percentage, between 2013 and 2017, 2013 = 100,
8. PSMReven378 = PSM public income (public fund and license fee), Public service income of Public Service Media Service Providers, by country, in millions of euros, as a percentage, between 2013 and 2017, 2013 = 100
9. PSMCap379 = PSM operating revenues, Contribution to Revenues of Public Service Media Providers, changes in per capita public revenue per month, by country, in euros, as a percentage between 2013 and 2017, 2013 = 100
10. (Minus) License3710 = PSM license fee, (a part of public income) Annual subscription fee paid to Public Service Media Providers in EUR, as a percentage, between 2013 and 2017, 2013 = 100
11. Fund1711 = PSM public fund (a part of public income), percentage change in the rate of support provided to public service media providers, between 2013-2017, 2013 = 100
12. Infl3712 = Inflation development by country, as a percentage, between 2013 and 2017,
13. GDP131713 = GDP growth as a percentage, between 2013 and 2017,
As not all EU Member States have subscription fees, this item could only be reported at 0.1% in countries where there were no subscription fees. A value of zero could not be entered in the SPSS statistical database because then this system would not have been able to interpret the other data in the comparison either. The 0.1% value, on the other hand, is an insignificant negligible value, so it can be disregarded in further analyses.
Subscription fees had to be included as a separate economic variable in my research, as this is an important feature when assessing the public service revenues of an EU member state. It is also important for comparison which EU member states have subscription fees and which countries do not.
Results and discussion
Institutions involved in the research, media forums: international and domestic TV companies, where the topic is: – usually the institutional-organizational structure and legal bases of TV companies; – their activity, operation, job description for the individual institutional units, management levels; – financial bases and sources of their activity, possibilities of use. The topicality, importance, timeliness of the topic, the fact that there has not been such an international comparison of electronic media in general nowadays. In my research I included the following countries, the EU-28 member states: Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, United Kingdom, Estonia, Finland, France, Greece, Netherlands, Croatia, Ireland, Poland, Latvia, Lithuania, Luxembourg, Hungary, Malta, Germany, Italy, Portugal, Romania, Spain, Sweden, Slovakia, Slovenia. Belgium in this study consists of two parts based on the collected statistical data: Belgium-Flanders and Belgium-France due to the local population.
Of the 13 economic variables listed, the first four variables include PSM2008131, in PSM operating revenues, also known as operating revenues of public service media providers, by country from 2008 to 2013; PSM2013172, ie PSM operating revenues, operating revenues of public service media service providers, by country between 2013-2017; PSM1FŐ3 = PSM operating revenues, operating revenues of public service media providers, by country, per capita, 2013-2017 and PSMGDP174, ie PSM operating revenues, operating revenues of public service media providers as a percentage of GDP in 2017.
The other seven economic variables belong to the composition of PSM (public service media) revenues, such as PSMInc175, ie PSM public income, public service revenues of public service media providers (public foundation support and subscriptions), by country, in 2017; PSMMarket176, i.e. PSM commercial income, commercial revenues of public service media providers, by country, as a percentage, 2017; PSMMark377, i.e. PSM commercial income, the commercial income of public service media providers, by country, between 2013 and 2017 compared to 2013 levels; PSMReven378, ie PSM public income (public fund and license fee), public revenue of public service media providers: public foundation support and subscriptions, by country, between 2013 and 2017, compared to 2013; PSMCap379, ie PSM operating revenues, contribution to revenues of public service media providers, per capita public revenues, per month per country between 2013 and 2017, compared to 2013; License3710, ie the PSM license fee, (part of public income) is the annual subscription fee paid to public service media providers in euros, as a percentage, between 2013 and 2017, compared to the 2013 level; Fund1711, ie the PSM public fund (a part of public income), the percentage change in the share of support from public foundations in the total revenue of public service media providers between 2013-2017.
The other existing economic variables are related to the general economic situation, namely Infl3712, in the development of inflation by country, as a percentage, between 2013 and 2017, and GDP131713, as the development of GDP growth as a percentage, between 2013 and 2017. The last two digits of the abbreviations for economic variables in each case give the order I have defined for the variables. The numbers preceding this number give the abbreviated form of the year numbers, or 37 or 1317 for the period 2013-2017, in some cases 2008-2013, in shorter 200813, in other cases 2013-2018, as 201317 (see Table 1 and interpretation of variables). The public money revenues of public service media providers consist of two main parts: support for 1-public foundations and 2-month subscriptions. The related commercial revenues and insignificant other revenues provide the total operating revenue of the public service media service providers.
In the period 2013-2017, the topic of the research is directly related to the changes in the operating revenues of the Public Service Media (PSM), taking into account the specific countries in which each national media institution operates. The statistics used for the research are linked to each national source, which is also published in the EBU’s annual regular publications. The statistics compiled, which can be used as reliable sources, cover the evolution of government subsidies, subscriptions (License) and advertising revenues, the analysis of their combined interactions and the comparison of these correlations with some of the major economic situations in the countries surveyed. In the course of the research, it was important to take into account the connections between these economic changes and the growth of GDP and the percentage change in inflation.
The SPSS statistical system usually classifies each country into a maximum of 5 clusters according to the similarities or differences in the economic characteristics of public service media providers in each EU Member State, which are always defined at the discretion of the author or authors. It is advisable to classify the countries into 5 clusters, as more or less would not be expedient enough considering the economic characteristics of the public service media institutions of the given EU member states. I used the statistical analysis methods explained above in my research and I also followed these aspects when writing my dissertation.
For the five clusters, the starting countries of each cluster are denoted by a serial number near the country: austria-1; estonia-2; ireland-3; lithuania-4; romania-5 the last two countries are lithuania and romania each represent a separate cluster.
During the research, I reviewed the situation of public service media service providers in the EU 28 Member States, primarily its economic situation, analysing the composition of the public media income in each country, in the context of the distribution of the foundation, public foundation and subscription and other income. The material-income situation of the public media also depends largely on the general economic situation of the countries – EU Member States – which is well characterized by general economic growth based on GDP development and inflation.
These economic considerations affect the purchase of certain public media revenue. Where appropriate, increasing financial resources are considered to be a decreasing purchasing power, calculated at a higher rate of inflation. It is advisable for public media to expect more income than inflation. However, in many countries and EU Member States, subscriptions are more significant than foundation grants, so the population, as a public media service, can reduce their willingness to pay subscriptions. This circumstance can also have a negative impact on the general income situation of the public media, even on the reduction of individual or newer television devices. From this point of view, consumer will and willingness to pay in media devices, TVs and radio are definitely important. My research was based on the publications of the EBU, the European Broadcasting Union, was able to rely on data from the organization’s most significant states in my research, so that all EU Member States within the organization take into account the data of all EU member states between 2013 and 2017. During the research period, I also included the data of the UK (UK, United Kingdom) during my research. Belgium as an EU Member State was divided into two parts by the EBU international organization, one Belgium -Flamand and the other Belgium-French. (Table-1; EBU, 2013 and EBU, 2018).
The Table-2 provides the correlation matrix, that is, the degree of context between each economic variable, which is necessary to be understood as the result of the revenue and expenditure of public service media service providers during the period under review. In addition, which economic variables played an important or more important role in determining the profitability of public service media service providers.
The relationships between economic variables are different, with the approximate context of the two variables sensing or indicator numbers to 1.000, as 100%, or 0.500, which corresponds to 50%. The value of the relationships among variables can accordingly be determined. If the value among economic variables is above 0.800 (80%), the relationship between them is very strong, if it is between 0.800 and 0.600, but if the value is between 0.600 and 0.500, the relationship is moderately strong. The value is 0.500-oz (50%) up to 0.400 (40%) below (40%), in this case the value of relationships among economic variables is weak. For analyses, if the value between the relationships is below 0.400 (40%), there is no valuable relationship among economic variables. The diagonal shown in this table -diagonal -indicated by 1,000 values, as each economic variable alone gives 1.000 values (100%) and proportionate to this value that the other data in the table are proportional to other economic variables to the given variable. The diagonal divides the table into two parts diagonally so that the data in the upper right part is the same as the data in the bottom left – in triangles. Therefore, I consider only one, that is, the upper right part of the table.
From this point of view, analysing the table-2 data, it can be concluded that PSMInc175, namely the 2017 public service media service providers (public foundation support and subscriptions) between the economic variable and PSMmarket176, as the 2017 public service media service providers’ commercial incomes, by country, as this value is minus 0.960 (96%), approaching the value of 1.000. Of course, the value of the relationship between economic variables can also be minus, which means that there is a reverse relationship between economic variables. So, for example, while one economic variable is increasing, the other variable is decreasing. In this case, the minus sign indicates not the value of the number, but the opposite economic change against another variable. It is only about development trends in economic variables and not a mathematical model in this case. As the public service media service providers (public foundation support and subscriptions) increase by country, the commercial income of public service media service providers is reduced by a percentage. The reverse is also true. In the percentage system, if one of the economic variables decreases-within 100%-the proportion of other variables will increase.
The relationship between additional economic variables is strong in the operating income of PSM1FŐ3, as public service media service providers, per capita, between 2013 and 2017 and PSMReven378, as public service media service income: public funds and subscriptions, During the period as it was 0.773. This means that during the same period between 2013 and 2017, when public service media services increased, public service media service revenue increased in parallel, per capita. The increase in some of the total revenue, namely public money income, has generally increased operating income per capita for public media. This also means that between 2013 and 2017, the total income of other income has not changed very much with the same number of subscribers in the EU-28 Member States under review. In essence, commercial income has not changed significantly than the other most significant source of income. As there is a direct proportionality between the two economic variables, the decrease of public money returns of public service providers is combined with a reduction in operating income per capita.
The relationship was also strong with 0.670 PSMReven378, as public service media service income: public foundation support and subscriptions by country, between 2013 and 2017 and contribution to PSMcap379, ie public service media, between 2013 and 2017, compared to 2013. This close connection is similar to the relationship between the previous two economic variables, different from the former in that it is a per capita subscriber, while in this case this is a public service media revenue for a single citizen. In this case, too, there is a straightforward proportionality, namely the public finance-incomes of public service media service providers: support of public funds and subscriptions increase the revenue of public service media service providers with a population of roughly the same population and the amount of commercial income.
Based on 0.655, the relationship is strong on PSM2013172, ie the operating income of public service media service providers, between 2013 and 2017 and the operating income of PSM1FŐ3, as public service media service providers, per capita. In this case, it is clear that as the operating revenue of the public service media, the size of the operating income of public service media service providers is also increased per capita, as a subscriber. In the event of a decrease in revenue, the revenue of public service media service providers per person per subscriber will be reduced.
The relationship between economic variables between 2013 and 2017 was moderately strong, as this value is 0.561, PSM1FŐ3, that is, the operating income of public service media services, per capita and PSMcap379, as public service media providers’ revenue, unity monthly public money income per citizen, in the same period. In this case, too, the media revenue per capita increases, and then the monthly unit of public money per citizen also increases. When it comes to a decreasing trend, then the media revenue and public money income decrease in both categories, per capita. The moderately strong minus 0.505 was between two economic variables, namely PSM1FŐ3, as public service media service providers operating revenue per country, between 2013 and 2017, and PSMGDP174, as public service media services operational revenue at the end of 2017. In this case, for this 29 EU Member States, the percentage of media revenue between 2013 and 2017 will decrease by the end of 2017 as a percentage of media revenue throughout the year. In this case, GDP growth or decrease greatly affects the rate of media revenue as a percentage of GDP.
If media revenue is at stagnating levels or minimally, they are not significantly changing, then the increase in media revenue is decreasing as GDP increases, while GDP decreases will increase as a percentage of GDP. In essence, if media revenue increases compared to an unchanged or minimal decreasing GDP, the proportion of media revenue will increase. Even if a minimum growing GDP is increased by media revenue, the proportion of media revenue will increase as a percentage of GDP. It can be seen that the two economic variables are moving in the opposite direction, so the relationship between the two one is inversely proportional, so the PSMGDP174 can be negatively signed.
Among the following economic variables, economic contexts were weak during the period under review, as it was 0.439 between the two economic variables, namely PSM2008131, as public service media service revenue, between 2008 and 2013 and PSMMark377, as public service media commercials income by country, compared to the later period, between 2013 and 2017. The poor relationship between the two economic variables is compared by two different periods based on 2008-2013 and 2013-2017. The essence of this is that if media revenue increased between 2008 and 2013, this is a direct proportion to the media’s commercial income between 2013 and 2018. Media revenue growth in the period 2008 and 2013 was largely dependent on the increase in trade incomes during this period, which may also be supported by the fact that commercial income also increased in 2013 and 2017. This raises the possibility that in some EU Member States, media trade income has grown uninterrupted in both periods. Commercial incomes, such as advertising income, increase total media revenue. However, since this relationship is not necessarily legal for all EU Member States for the two economic variables, this relationship remains weak between two economic variables.
There is also a weak relationship, but in reverse (minus) -0,422 for two economic variables, namely PSMGDP174, public service media service revenues in 2017 and PSMReven378, as public service media in public funds: among the subscriptions by country, compared to 2013 to 2017. These situations also occur only occasionally in each EU Member States, so there may be a weak correlation between the two economic variables. In essence, it is not a causal relationship, but there is a context or only a relationship for a given period. Here, in this case, the increase in public finance income and the decrease in media revenue in proportion to GDP or the reverse: the decline in public finance income and the increase in media revenues in proportion to GDP. In this case, the increase in commercial income may also promote the growth of media revenues in proportion to GDP. It can be stated that the evolution of public finance in itself is not crucial to media revenue increases or decreased in proportion to GDP percentage. Here, changes in GDP are also influenced by media revenue in proportion to GDP.
There was also a weak relationship for two more economic variables for PSMMarket176, commercial income for public service media service providers, by country, percentage, 2017 and License3710, as the annual subscription fee paid to public service media service providers in euro, in 2013 and 2017 compared to the annual level. In this case, there is no reason to have a causal relationship between the magnitude of the annual subscription fee for one of the important elements of commercial income and one of the important elements of public finance. There are EU Member States where both variables can sometimes increase, but at the same time they can decrease. On the other hand, many EU Member States do not have an annual subscription fee, as a result of which commercial income increases, while where there is an annual subscription fee, commercial fees can still increase. Therefore, the statistical system considers both variables to be increasing at the same time, thus expressing straight proportionality between the two variables. Where there is no annual subscription fee, commercial income increases, and where there is an annual subscription fee, commercial income can still increase. Therefore, the relationship between two economic variables is not decisive, that is, weak.
Furthermore, there is also a weak economic context between two economic variables, which is primarily PSM2013172, as the operating income of public service media service providers, by 2013-20 by citizen, between 2013 and 2017, compared to 2013. Here, too, there is a weak relationship because the growth of the population also influences the contribution to the revenue of a national media, based on the unity of public finance income. At the same time, contribution to the media’s revenue, the size of the unity of public finance income per month does not depend on the number of citizens, but rather on the number of subscribers and the support of public foundations. The former may rather depend on the development of the population, but mainly on the purchasing power and willingness of subscribers, while not subscription fees, while many EU Member States are not subscription fees.
Conclusions and observation
The international role of public service media providers has recently grown significantly, also due to expanding international economic and cultural relations. As a result, the flow of information has accelerated strongly recently. Public service media, in particular the television media service, which provides not only verbal information but also visual representation of information, provides very important and increasingly essential assistance to the accelerated pace of information and to meet the ever-expanding needs of up-to-date information.
In addition to daily information and news, as well as its visual representation, the public service media also provide more and more scientific and tourist knowledge to the wider public. Public service media also carry out serious advertising activities, partly to increase consumption-boosting purchases and partly to raise awareness of the characteristics of products. An aspect not to be underestimated is the increase in advertising revenue, which partially offsets the coverage of the ever-increasing costs of maintaining public service media.
In the course of my research, I have placed the main emphasis on the extent of the correlations between economic variables and their different magnitudes, in order to shed light on which economic variable has an impact on shaping the profitability of public service media providers. Based on the different economic and social conditions of the individual EU member states, the different profitability conditions of the public service media have also developed. There are EU member states where the public service media do not count on the revenues of monthly subscription fees, there are some where the media does not receive adequate revenues through the support of public foundations. I consider it important that the proper harmonization of the three main sources of revenue – support for public foundations, monthly subscription fees and commercial revenues – is necessary for the effective operation of public service media providers. I summarize my new scientific findings accordingly below.
In the course of the research, I reviewed the situation of public service media in the 29 EU member states, primarily the economic situation, with a special analysis of the composition of public media revenues in the context of foundation, public foundation and subscription, and commercial and other income distribution. The material and income situation of the public media also largely depends on the general economic situation of the given countries – EU member states – which are well characterized by the general economic growth based on the development of GDP, as well as the development of inflation. As my research was based on the publications of the EBU, ie the European Broadcasting Union, it was possible to rely on the data of the most important states of the organization in my research, thus taking into account the data of all EU member states for the period 2013-2017. In the course of my research, I examined the activity of public service media in the EU-29 member states using a number of economic variables based on SPSS statistical methods.
I note that in the period between 2008 and 2013, the revenues of the public service media increased to a greater extent than in the period between 2013 and 2017. This was mainly due to the fact that in the period between 2013 and 2017, one of the important items of public money revenues, the size of subscriptions, decreased significantly in the EU member states where it was introduced earlier. In Hungary, the operating revenues of the public service media have increased modestly by 6.8% for the period 2013-2017, which is still significantly below the EU-29 average. At the same time, public service media operating revenues per capita increased by 0.1%, well below the EU-29 average.
I note that, compared to the EU-29, there are few countries where only subscriptions and no public foundation support have been paid for in the total revenue of the public service media within the framework of public funds. For these six countries – the Czech Republic, Denmark, Greece, Italy, Sweden, Portugal – I note that public revenues consist only of subscription fees, which accounted for an average of 87% of total public service media revenues per country. The amounts in excess were now only commercial income. It can also be seen that media revenues do not come very significantly from commercial revenues.

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Balázs Medveczky PhD Student
Doctoral School of Economic and Regional Sciences
Hungarian Agricultural and Life Science University
HUNGARY