Global Media for Global Control

by Robert W. McChesney

EDucate magazine, October - December 2001

A specter now haunts the world: a global commercial media system dominated by a small number of super-powerful, mostly U.S.-based transnational media corporations. It is a system that works to advance the cause of the global market and promote commercial values, while denigrating journalism and culture not conducive to the immediate bottom line or long-run corporate interests. It is a disaster for anything but the most superficial notion of democracy, a democracy where, to paraphrase John Jay's maxim, those who own the world ought to govern it.

The global commercial system is a very recent development. Until the 1980s, media systems were generally national in scope. While there have been imports of books, films, music and TV shows for decades, the basic broadcasting systems and newspaper industries were domestically owned and regulated. Beginning in the 1980s, pressure from the IMI: World Bank and U.S. government to deregulate and privatize media and communication systems coincided with new satellite and digital technologies, resulting in the rise of transnational media giants.

How quickly has the global media system emerged? The two largest media firms in the world, Time Warner and Disney, generated around 15 percent of their income outside of the United States in 1990. By 1997, that figure was in the 3035 percent range. Both firms expect to do a majority of their business abroad at some point in the next decade. The global media system is now dominated by a first tier of nine giant firms. The five largest are Time Warner (1997 sales: $24 billion), Disney ($22 billion), Bertelsmann ($15 billion), Viacom ($13 billion), and Rupert Murdoch's News Corporation ($11 billion). Besides needing global scope to compete, the rules of thumb for global media giants are twofold: First, get bigger so you dominate markets and your competition can't buy you out. Firms like Disney and Time Warner have almost tripled in size this decade.

Second, have interests in numerous media industries, such as film production, book publishing, music, TV channels and networks, retail stores, amusement parks, magazines, newspapers and the like. The profit whole for the global media giant can be vastly greater than the sum of the media parts. A film, for example, should also generate a soundtrack, a book, and merchandise, and possibly spin-off TV shows, CD-ROMs, video games and amusement park rides. Firms that do not have conglomerated media holdings simply cannot compete in this market.

The first tier is rounded out by TCI, the largest U.S. cable company that also has U.S. and global media holdings in scores of ventures too numerous to mention. The other three first-tier global media firms are all part of much larger industrial corporate powerhouses: General Electric (1997 sales: $80 billion), owner of NBC; Sony (1997 sales: $48 billion), owner of Columbia & TriStar Pictures and major recording interests; and Seagram (1997 sales: $14 billion), owner of Universal film and music interests. The media holdings of these last four firms do between $6 billion and $9 billion in business per year. While they are not as diverse as the media holdings of the first five global media giants, these four firms have global distribution and production in the areas where they compete. And firms like Sony and GE have the resources to make deals to get a lot bigger very quickly if they so desire.

Behind these firms is a second tier of some three or four dozen media firms that do between $1 billion and $8 billion per year in media-related business. These firms tend to have national or regional strongholds or to specialize in global niche markets. About one-half of them come from North America, including the likes of Westinghouse (CBS), the New York Times Co., Hearst, Comcast and Gannett. Most of the rest come from Europe, with a handful based in East Asia and Latin America.

In short, the overwhelming majority (in revenue terms) of the world's film production, TV show production, cable channel ownership, cable and satellite system ownership, book publishing, magazine publishing and music production is provided by these 50 or so firms, and the first nine firms thoroughly dominate many of these sectors. By any standard of democracy, such a concentration of media power is troubling, if not unacceptable. But that hardly explains how concentrated and uncompetitive this global media power actually is. In addition, these firms are all actively engaged in equity joint ventures where they share ownership of concerns with their 'competitors" so as to reduce competition and risk. Each of the nine first-tier media giants, for example, has joint ventures with, on average, two-thirds of the other eight first-tier media giants. And the second tier is every bit as aggressive about making joint ventures.

We are the world

In some ways, the emerging global commercial media system is not an entirely negative proposition. It occasionally promotes anti-racist, anti-sexist or anti-authoritarian messages that can be welcome in some of the more repressive corners of the world. But on balance the system has minimal interest in journalism or public affairs except for that which serves the business and upper middle classes, and it privileges just a few lucrative genres that it can do quite well, like sports, light entertainment and action movies, over other fare. Even at its best the entire system is saturated by a hyper-commercialism, a veritable commercial carpetbombing of every aspect of human life. As the C.E.O. of Westinghouse put it (Advertising Age, 2/3/97), "We are here to serve advertisers. That is our raison d'etre"

Some, once posited, that the rise of the Internet would eliminate the monopoly power of the global media giants. Such talk has declined recently as the largest media, telecommunication and computer firms have done everything within their immense powers to colonize the Internet, or at least neutralize its threat. The global media cartel may be evolving into a global communication cartel.

But the entire global media and communication system is still in flux. While we are probably not too far from crystallization, there will likely be considerable merger and joint venture activity in the coming years. Indeed, by the time you read this, there may already be some shifts in who owns what or whom.

What is tragic is that this entire process of global media concentration has taken place with little public debate, especially in the U.S., despite the clear implications for politics and culture. After World War 11, the Allies restricted media concentration in occupied Germany and Japan because they noted that such concentration promoted anti-democratic, even fascist, political cultures. It may be time for the United States and everyone else to take a dose of that medicine. But for that to happen will require a concerted effort to educate and organize people around media issues. That is the task before us.

This article and the corporate profiles are based on The Global Media: The New Missionaries of Corporate Capitalism by Edward Herman & Robert McChesney

Media Control, Propaganda, and Democracy

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