Introduction

In the past two decades, the foundations of doing business in the media industry have been changing rapidly. Many of the media industry's most long-standing practices and business models have been losing ground, and media companies have needed to develop new organizational practices and procedures, new business concepts, and new strategies (Malmelin & Villi, 2017a). Business models explain the business logic of specific enterprises and the products, services, and relationships upon which the business and activities are based. They identify the consumer needs to be met, provide insight into where and how value is created, reveal how its value constellations will operate, identify dependencies and interdependences, and explain how the company and its offerings differ from competitors. In doing so, business models show how enterprises will overcome the most common reasons for failure: lack of market need, poor products and services, lack of attention to customers, inability to organize business relationships effectively, and losing out to more effective competitors.

The contemporary business model perspective for all media enterprises involves creating new processes, products, and ways of presenting content, and changing the relationships between consumers and the enterprise. Thus, the focus is not only on the revenue streams. It is crucial to embrace this larger perspective. However, for many legacy media organizations such transformation is not always easy, as most legacy media have grown up in a ‘steady state’ environment, where change has been rather gradual and well signposted (Küng, 2017). Now, their business models need to be adapted to the digital media environment that is influenced by rapid advances in media technology and the emergence of new platforms and new media consumption habits.

This chapter focuses on how transformations in the media environment and among media consumers have created the need for new business models and the reconceptualization of media businesses. The goal of the chapter is to provide an understanding of media business models and especially the challenges in innovating and creating new business models that can ‘make it work’.