The Net @ Risk: Big, Bigger, Biggest Media
|Backgrounder: Big and Bigger Media|
Media ownership rules are again a topic of debate on Capitol Hill, as the rules come up for a review and Republican Kevin Martin undergoes hearings to reconfirm him as chairman of the Federal Communications Commission. Senator Barbara Boxer grilled Martin about an FCC study on local media ownership, which found local reporting decreased markedly after the Telecommunications Act of 1996. In 1984, the number of companies owning controlling interests in America's media was 50 today that number is six. Critics of media consolidation say it has led to fewer and fewer voices being heard and a marked decrease in local news coverage. Some media watchers are worried that the much touted "free for all" of the Internet will go the same way. Proponents of "net neutrality" worry that the cable and telecom companies providing the bulk of Internet connectivity will use new fee structures, which may favor some content providers over others. Phone and cable companies have a near monopoly over Internet service. More precisely, it's a 'duopoly' - which means that in more than 90 percent of American homes in the U.S… [more]
Class Is in Session...
In 1941, the federal government regulated the ownership of media outlets to ensure a broad spectrum of opinion. The Local Radio Ownership Rule, National TV Ownership Rule stated that a broadcaster cannot own television stations that reach more than 35% of the nation's homes. Many other regulations followed as the American media landscape changed. In the 1980s the climate changed in the U.S. -- fewer federal regulations became the order of the day under President Reagan. (View a timeline of media regulation.)
Then came the Telecommunications Act of 1996, signed into law by President Clinton. It is generally regarded as the most important legislation regulating media ownership in over a decade. The radio industry experienced unprecedented consolidation after the 40-station ownership cap was lifted. Clear Channel Communications now owns 1200 stations, in all 50 states, reaching, according to their Web site, more than 110 million listeners every week. Viacom's Infinity radio network holds more than 180 radio stations in 41 markets. Its holdings are concentrated in the 50 largest radio markets in the United States. In 1999, Infinity owned and operated six of the nation's Top 10 radio stations.
Then in 2003 ownership limits came up for review again -- media companies wanted ownership rules relaxed further. Among the proposed changes: allowing greater cross-ownership in media markets (newspapers and broadcast stations, radio and television stations) and caps on television and radio stations ownership raised in large markets. In addition, the FCC proposed that a single entity could own television stations reaching up to 45 percent of the national viewership, an increase from 35 percent.
In 2003, Barry Diller, the man who created Fox Broadcasting and ran ABC Entertainment, Paramount, Vivendi Universal, spoke out against the rule changes to an industry group - and to Bill Moyers. (Diller is currently chairman and CEO of USA Interactive, itself an empire of informational services from the Home Shopping Network to Ticketmaster.)
What about the fairness doctrine?
Critics of consolidation fear that the fewer the owners the fewer the voices on the airwaves. Several recent cases -- among them Sinclair Broadcasting's decision not black out names and faces in an episode of NIGHTLINE which listed the names of U.S. soldiers killed in Iraq - have media watchers saying conglomerates have too much power over the message heard.
The Communications Act of 1934, as amended, called for stations to offer "equal opportunity" to all legally qualified political candidates running for office. In 1949, the FCC adopted the "fairness doctrine," a policy that viewed station licensees as "public trustees" and, as such, responsible for addressing controversial issues of public importance. The key requirement was that stations allowed opportunity for discussion of contrasting points of view on these issues.
By the 1980s, many stations saw the FCC rules as an unnecessary burden. Some journalists considered the fairness doctrine a violation of the First Amendment rights of free speech and free press; they felt reporters should be able to make their own decisions about balancing stories. In order to avoid the requirement of presenting contrasting viewpoints, some journalists chose not to cover certain controversial issues at all. In addition, the political climate of the Reagan administration favored deregulation. When the fairness doctrine came before the courts in 1987, they decided that since Congress did not mandate the doctrine, it did not have to be enforced.
(You can also see how the major news stations prioritize the news by visiting the Tyndall Report. Andrew Tyndall has watched the major broadcasts for six years.)
What happens to local media?
Another key worry surrounding media consolidation is that as ownership of newspapers, radio and television stations are concentrated in fewer hands - a vital connection to the local community is lost. NOW WITH BILL MOYERS and correspondent Rick Karr told a cautionary tale about the risks of media consolidation to local communities.
The story, broadcast in April 2003, starts in Minot, North Dakota where a train derailment spilled two hundred and ten thousand gallons of ammonia and a toxic cloud. Authorities wanted to get the word out to Minot residents: stay indoors and avoid the area near the derailment. So they tried to get in touch with six local commercial radio stations.
All six of those commercial stations out of a total of seven in Minot were owned by one huge radio and advertising conglomerate: Clear Channel Communications and had replaced live local programs with shows recorded in far-off studios that only sound local.
But what does this mean for the internet?
Lots of lobbying and advertising money is being spent on net neutrality and ownership rules in DC. In 2006, the FCC approved the sale of substantially all of the cable systems and assets of Adelphia Communications Corporation to Time Warner Inc. and Comcast Corporation. And, in July 21, 2006, BellSouth shareholders approved the $67 billion sale of the company to AT&T, which would further expand the latter company's reach in the telecommunications sector and place Cingular under a single owner.
In addition, the Supreme Court ruling on the Brand X case put cable modem service providers in the class of information provides, not telecommunication service providers - which come under fewer regulations - and are not bound by common carriage rules. At the bottom of the ruling? Cable broadband providers don't have to share their lines with competitors. A ruling which some say will further hamper the spread of high-speed service throughout the nation. (See more on the new digital divide.)
- Do you think that media consolidation is a problem?
- Do you feel like you get enough local news coverage?
- Do you know who owns your local media outlets?