Digital Transformation: Mitigating Risks in a Shifting Media Landscape

The media market is in the midst of a significant transformation with the rise of digitisation. Currently, analogue and digital media are evenly split, but a substantial shift towards digital is imminent. For example, it’s forecast that by 2029, 66% of newspaper and magazine readers in the UK, France and Spain will consume this content digitally¹. This seismic change presents challenges and opportunities for media companies, especially in areas such as data storage and intellectual property.
 

This digital revolution is revolutionising the media industry, offering remarkable advancements. The growth of digital platforms and the increasing number of people accessing the internet globally has transformed how information is disseminated and consumed. However, these advancements also bring new risks, particularly in information security. As media companies increasingly rely on digital infrastructure, the need for robust information security measures becomes crucial.
 

Digitisation also entails a shift in risk focus for media companies. Focus is shifting from traditional risks such as fire and property towards uninterrupted delivery of services. Downtime caused by power cuts, cyber-attacks, or mismanagement can lead to substantial revenue loss. Therefore, reliability and continuous operation are paramount for media companies.
 

The due diligence when choosing a managed services provider, checking on the financial strength, the redundancy, historical uptime performance and the tier of data centres used, can be major factors in reducing potential for disruption to uninterrupted delivery of digital services.
 

It is essential to recognise that many data-related issues for businesses, wherever their data is housed, stem from human error. Building a strong cybersecurity framework and fostering a culture of cyber hygiene can significantly mitigate such risks. Regular cybersecurity training and awareness programmes for employees are vital to ensuring a proactive approach to safeguarding sensitive data.

Rising Risks of Intellectual Property

As well as risks from technology, Intellectual Property (IP) risks also pose significant challenges for media businesses, particularly in the realms of defamation, libel, and copyright infringement. These types of claims can result in substantial financial losses. IP challenges can arise from anywhere globally that has access to the material, not just where the material originated from. Particular attention should be given to cases affecting the United States, Australia, and Ireland, as these countries currently have some of the largest costs associated with IP matters. Understanding and complying with the legal frameworks of these jurisdictions is of utmost importance to mitigate potential legal challenges.

Implementing a comprehensive plan that outlines clear guidelines for staff behaviour can make a significant difference in mitigating these risks. Plans could consider areas such as:
 

• Strict controls on third-party data usage.

• Thorough fact-checking processes.

• Obtaining necessary permissions for using third-party content.

• Establishing clear contractual obligations for compliance.

• Seeking legal counsel for uncertainties regarding third-party material ownership.

• Establishing guidelines and processes to reduce intellectual property risks.

In addition to the risks faced by a media company’s own IP, because they are often handling third-party data, the third-party IP also need to be fully protected. Businesses should also be considering developing data classification policies and robust data leakage protection measures.

Best practice for media companies embracing the use of technology would be to proactively manage risks, focusing on intellectual property concerns, information security, robust data centre infrastructure, cyber security, and training initiatives. Insurance plays an important role in risk transfer and mitigation, and media businesses should be advised to fully assess their insurance needs and seek comprehensive coverage, including protection for data storage and against intellectual property risks. It is important to be working with experienced insurers familiar with the media industry's unique challenges. As threats evolve, so should insurance coverage to support business growth. 

Chubb’s Technology & Media Industry Practice offers a bespoke insurance product for media companies, with modular sections for Media Liability, Cyber, Property and Casualty risks. This is supported by a dedicated team across underwriting, risk engineering and claims who specialise in media risks. Chubb’s global presence enables us to provide global media insurance solutions where required. Contact us today to discuss how your clients could benefit.