FCC Moves To Enrich Media Cartel

by Chris Shumway

Z magazine, March 2002

Last Fall, the FCC quietly moved forward with plans to overhaul or possibly abolish the last few remaining restrictions on media ownership. These include: prohibitions against one company owning TV stations and cable systems in the same market; restrictions on the number of TV stations one firm can own; restrictions on the percentage of the nation's homes one cable TV operator can reach; and prohibitions against owning newspapers and TV stations in the same market (a few TV/newspaper duopolies already exist due to "grandfather" clauses in the current rules).

In more recent days, the FCC has also taken steps to significantly alter regulations dealing with Internet access. Some business analysts and media critics believe that unless there is significant political resistance to the FCC's moves, ownership restrictions and Internet protections could be dismantled by mid-year.

The FCC's actions appear to be the result of both a market -friendly drift in the agency's philosophy and an expensive lobbying campaign by media companies. One of the great under-reported stories in the debate over campaign finance reform is the increasing amount of soft money and perks media executives give to politicians and government staffers and the enormous amount of money they collect selling commercial time to candidates and political parties.

In late 2000, the money cycle was thoroughly documented in a report by the Center for Public Integrity appropriately titled "Off the Record." Another report on the 2000 election, issued by the Alliance for Better Campaigns, showed that local TV stations across the country "systematically gouged candidates" by overcharging them for commercial time. Candidates, however, don't typically challenge the election year rate hikes because they need the airtime and, besides, they know that pampered broadcasters are likely to make return contributions to candidates who tow the line.

If ownership limits are cast aside, the possible outcomes are fairly easy to predict based on previous de-regulation and the publicly reported-via the business press-intentions of media executives. For starters, lifting the cable ownership restrictions will allow companies such as AOL-Time Warner and the newly merged AT&T-Comcast to expand their vast cable TV empires, thereby diminishing what little competition now exists in the industry. As a result, cable rates will continue to rise and the newly enriched companies will be more likely to layoff workers.

It's important to note that these same companies also have a substantial Internet presence through their control of high-speed, broadband cable connections, and digital content conveniently produced by their entertainment subsidiaries. In addition to dropping the ownership rules, the Center for Digital Democracy reports that the FCC might formally classify broadband networks as an "information service" rather than as a cable or a telecommunications service. This, according to the CDD, will undo current "open access" guidelines that apply to Internet services offered by telephone companies, thereby releasing cable operators from "requirements that they operate their networks on a nondiscriminatory basis." In effect, the cable monopolies will have the power to significantly change the open architecture of the Internet, turning it into a tightly controlled system in which corporate priorities determine how customers and citizens are served."

Other companies in the U. S. media cartel such as GE, Viacom, Disney, and Fox will be able to expand their empires by purchasing more local TV stations. Uniformity and standardization will follow, with newly acquired stations being managed just like every other affiliate or subsidiary. News departments will be less likely to encourage well-researched, critical reporting and more likely to produce decontextualized, depoliticized journalism and other content designed solely to promote the company's wide array of entertainment offerings (books, magazines, music cds, movies, theme parks, sports franchises etc.).

Smaller, but still influential, media companies will also reap the benefits of de-regulation. For example, Virginia-based Gannett Corporation, owner of 22 TV stations, 100 websites, and 97 daily newspapers including USA Today, is itching to acquire more broadcast and print outlets in markets where it already has operations. If Gannett's track record is any indication, newly purchased outlets will be organized with existing company papers into regional "clusters." Diverse, local news coverage will gradually be reduced in favor of standardized infotainment and syndicated columns carried by other company papers, all with the goal of helping Gannett attract more regional and national advertisers.

Like Gannett, Sinclair Broadcasting, which owns or has operating and advertising agreements with a staggering 63 TV stations nationwide, is hungry for more media. With regards to public affairs programming and the commitment to journalism, Sinclair's record is far worse than Gannett's. The company has recently shut down news operations at several of its stations including its St. Louis affiliate and, according to an article in Broadcasting and Cable online (January 7), company executives are discussing the idea of saving more money by centralizing all weather operations. If the plan were carried out, meteorologists based in Baltimore (the company's headquarters), or some other city, would present forecasts and severe weather bulletins for all company stations.

Removal of cross-ownership rules is also likely to open up the door for more "convergence" journalism. This entails the merging of equipment and personnel from various media platforms (print, TV, radio, and the Internet) into a centralized news combine. An example of convergence can be found in Tampa, Florida where the journalists from a major daily newspaper, a TV station, and an affiliated website all work in the same newsroom. As with the clustering of newspapers, convergence is meant to increase revenue while keeping expenses down. It all works if: (1) workers in the combine produce a steady stream of entertaining, multimedia content that consistently attracts target audiences; (2) wealthy sponsors are convinced to buy access to those audiences through expensive, multimedia advertising packages.

Many executives and media consultants promise that well-managed convergence will not only boost profit margins but improve journalism as well. It seems pretty clear that a tightly run, multimedia news factory can do the former, but what about the latter? For the most part, the answer is no. Convergence journalism values speed, quantity, and content adaptability above all else. Reporters accustomed to working in only one medium are likely to find themselves under constant pressure to churn out stories for two, three, maybe even four media formats each day. Reporters working under these conditions will spend less time doing critical research and conducting interviews with diverse sources. This increases the likelihood of factual errors and all but guarantees that stories will be dominated by official sources, press releases, or corporate public relations material-which already accounts for about 60 percent of today's news. In the end, rather than generating a wealth of diverse, well-researched content for three distinct media, convergence is likely to produce more of the same sensational "cops and robbers" stories and hyper- commercial fluff that currently dominates TV, newspapers, and the Internet.

All this cross-ownership, consolidation, and convergence will have another drawback less visible to the public: the reduction of serious, structural media criticism. Newspaper reporters, columnists, and critics associated with a convergence combine or newspaper company that owns dozens of TV stations will undoubtedly be discouraged from criticizing media partners or investigating institutional corruption. Likewise, reporters and other workers will catch more flak (demotions, less airtime, or transfers to other, less visible company projects) or be fired if they expose ethical conflicts or openly criticize the antidemocratic concentration of media power. In effect, the ability of the media to police itself through internal criticism-which is already tenuous-will deteriorate further.

As bad as all this sounds, there's still a chance that the FCC's new de-regulation scheme could be blocked, but only if a substantial resistance starts now. Media scholar Robert W. McChesney argues that the time has come for a bold, new media reform movement to begin. This movement must not only confront FCC policy in the short term, it must also look at the structure of our media system and fight for genuine democratic change in the long term. McChesney suggests that a good place to start is within the various progressive, grassroots organizations already working on environmental, political, and economic justice issues-talent and resources in alternative media should be tapped too. If these groups can put media reform on their agenda, or move it up a notch, and mobilize supporters to reach out to others in their communities, progress is possible. It certainly won't be an easy struggle but when you consider that the agenda of the powerful media owners and the FCC does not include the public interest, there's really no other choice.


Chris Shumway is currently working on a Master's Degree in Media Studies from the New School and assisting with research for a book on Media Ethics.

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