Concentration of media ownership

For example, movie production is known to be dominated by major studios since the early 20th Century; before that, there was a period in which Edison's Trust monopolized the industry. The music and television industries recently witnessed cases of media consolidation, with Sony Music Entertainment's parent company merging their music division with Bertelsmann AG's BMG to form Sony BMG and TimeWarner's The WB and CBS Corp.'s UPN merging to form The CW. In the case of Sony BMG, there existed a "Big Five" (now "Big Four") of major record companies, while The CW's creation was an attempt to consolidate ratings and stand up to the "Big Four" of American network (terrestrial) television.

There may also be some large-scale owners in an industry that are not the causes of monopoly or oligopoly. Clear Channel Communications, especially since the Telecommunications Act of 1996, acquired many radio stations across the United States, and came to own more than 1,200 stations. However, the radio broadcasting industry in the United States and elsewhere can be regarded as oligopolistic regardless of the existence of such a player. Because radio stations are local in reach, each licensed a specific part of airwave by the FCC in a specific local area, any local market is served by a limited number of stations. In most countries, this system of licensing makes many markets local oligopolies. The similar market structure exists for television broadcasting, cable systems and newspaper industries, all of which are characterized by the existence of large-scale owners. Concentration of ownership is often found in these industries.

In the United States, data on ownership and market share of media companies is not held in the public domain. Academics, for example at MIT Media Lab and NYU, have struggled to find data that show reliably the concentration of media ownership.

Debates

Concentration of media ownership is very frequently seen as a problem of contemporary media and society. When media ownership is concentrated in one or more of the ways mentioned above, a number of undesirable consequences follow, including the following:

It is important to elaborate upon the issue of media consolidation and its effect upon the diversity of information reaching a particular market. Critics of consolidation raise the issue of whether monopolistic or oligopolistic control of a local media market can be fully accountable and dependable in serving the public interest. If, for example, only one or two media conglomerates dominate in a single market, the question is not only that of whether they will present a diversity of opinions, but also of whether they are willing to present information that may be damaging to either their advertisers or to themselves.

If it is in the best interests of the media conglomerates not to run a story or allow a particular opinion, but in the best interests of the public interest to run it, it arguably makes better business sense to opt for the former over the latter. On the local end, reporters have often seen their stories refused or edited beyond recognition, in instances where they have unearthed potentially damaging information concerning either the media outlet's advertisers or its parent company. For example, in 1997, the Fox Broadcasting Company affiliate in Tampa, Florida fired two reporters and suppressed a story they had produced about one of the Fox network's major advertisers, Monsanto, concerning the health effects of Bovine Growth Hormone (BGH). Monsanto took action after Fox and threatened to sue over the story.

Another example would be the repeated refusal of networks to air "ads" from anti-war advocates to liberal groups like MoveOn.org, or conservative groups like the United Church of Christ, regardless of factual basis. A recent famous case was Super Bowl XXXVIII wherein CBS refused to air an ad criticizing the growing federal budget deficit but aired a spot celebrating the White House National Drug Control Policy.

Consequently, if the companies dominating a media market choose to suppress stories that do not serve their interests, the public suffers, since they are not adequately informed of some crucial issues that may affect them. If the only media outlets in town refuse to air a story, then the question becomes, who will?

Critics of media deregulation and the resulting concentration of ownership fear that such trends will only continue to reduce the diversity of information provided, as well as to reduce the accountability of information providers to the public. The ultimate consequence of consolidation, critics argue, is a poorly-informed public, restricted to a reduced array of media options that offer only information that does not harm the media oligopoly's growing range of interests.

For those critics, media deregulation is a dangerous trend, facilitating an increase in concentration of media ownership, and subsequently reducing the overall quality and diversity of information communicated through major media channels. Increased concentration of media ownership can lead to the censorship of a wide range of critical thought.

Another concern is that consolidated media is not flexible enough to serve local communities in case of emergency. This happened in Minot, North Dakota, in 2002, after a train filled with anhydrous ammonia derailed. None of the leading radio stations in Minot carried information on the derailment or evacuation procedures, largely because they were all owned by Clear Channel Communications and received automated feeds from the corporate headquarters in San Antonio, Texas. 1600 people were injured and one died ^[1].

Europe

United Kingdom

Republic of Ireland

Germany

Axel Springer AG is one of the largest newspaper publishing companies in Europe, claiming to have over 150 newspapers and magazines in over 30 countries in Europe. In the 1960s and 1970s the company's media followed an aggressive conservative policy (see Springerpresse). It publishes Germany's only nationwide tabloid, Bild and one of Germany's most important broadsheets, Die Welt. Axel Springer also ownes a number on regional newspapers, especially in Saxony and in the Hamburg Metropolitan Region, giving the company a de-facto monopole in the latter case. An attempt to buy one of Germany's two major private TV Groups, ProSiebenSat.1 in 2006 was withdrawn due to large concerns by regulation authorities as well as by parts of the public. The company is also active in Hungary, where it is the biggest publisher of regional newspapers, and in Poland, where it ownes the best-selling tabloid Fakt, one of the nation's most important broadsheets, Dziennik, and is one of the biggest shareholder in #2 private TV company, Polsat.

Bertelsmann is one of the world's largest media companies. It ownes RTL Group, which is one of the two mayor private TV companies in both Germany and the Netherlands and also owning assets in Belgium, France, UK, Spain, Czech and Hungary. Bertelsmann also ownes Gruner+Jahr, Germany's biggest popular magazine publisher, including popular news magazine Stern and a 26% share in investigative news magazine Der Spiegel. Bertelsmann also ownes Random House, a book publisher, #1 in the English-speaking world and #2 in Germany.

Italy

Silvio Berlusconi, the Prime Minister of Italy, is the major shareholder of - by far - Italy's biggest private TV company, Mediaset, Italy's biggest magazine publisher, Mondadori, and Italy's biggest advertising company Publitalia. One of Italy's nationwide dailies, Il Giornale, is owned by his brother. Berlusconi has often been criticized for using the media assets he owns to advance his political career.

United States

History

Prior to 1927, public airwaves in the United States were regulated by the United States Department of Commerce and largely litigated in the courts as the growing number of stations fought for space in the burgeoning industry. The Federal Radio Act of 1927 (signed into law February 23, 1927) nationalized the airwaves and formed the Federal Radio Commission (later named the Federal Communications Commission, or FCC) to assume control of the airwaves.

The Communications Act of 1934 refined and expanded on the authority of the FCC to regulate public airwaves in the United States, combining and reorganizing provisions from the Federal Radio Act of 1927 and the Mann-Elkins Act of 1910. It empowered the FCC, among other things, to administer broadcasting licenses, impose penalties and regulate standards and equipment used on the airwaves. The Act also mandated that the FCC would act in the interest of the "public convenience, interest, or necessity."^[2] The Act established a system whereby the FCC grants licenses to the spectrum to broadcasters for commercial use, so long as the broadcasters act in the public interest by providing news programming.

Lobbyists from the largest radio broadcasters, ABC and NBC, successfully petitioned to attach a cost to the license required to broadcast, and were thus able to "price out" many amateur broadcasters that had previously existed. Such was the precedent for much of the following regulatory decisions, which have mostly focused on the percentage of a market deemed allowable to a single company.^{citation needed}

The Telecommunications Act of 1996 set the modern tone of "deregulation," a relaxing of percentage constrictions that solidified the previous history of privatizing the utility and commodifying the spectrum. The legislation, touted as a step that would foster competition, actually resulted in the subsequent mergers of several large companies, a trend which still continues.^[3]

The FCC held one official forum, February 27, 2003, in Richmond, Virginia in response to public pressures to allow for more input on the issue of elimination of media ownership limits. Some complain that more than one forum was needed.^[4]

On June 2, 2003, FCC, in a 3-2 vote under Chairman Michael Powell, approved new media ownership laws that removed many of the restrictions previously imposed to limit ownership of media within a local area. The changes were not, as is customarily done, made available to the public for a comment period.

The decision by the FCC was overturned by the U.S. Third Circuit Court of Appeals in the decision Prometheus Radio Project v. FCC in June, 2004. The Majority ruled 2-1 against the FCC and ordered the Commission to reconfigure how it justified raising ownership limits. The Supreme Court later turned down an appeal, so the ruling stands.^[5]

Cross-Ownership Proceedings

The FCC voted December 18, 2007 to relax media ownership rules, including a statute that forbids a single company to own both a newspaper and a television or radio station in the same city. FCC Chairman Kevin Martin circulated the plan in October 2007.^[6] Martin's justification for the rule change is to ensure the viability of America's newspapers and to address issues raised in the 2003 FCC decision that was later struck down by the courts.^[7] The FCC held six hearings around the country to receive public input from individuals, broadcasters and corporations. Because of the lack of discussion during the 2003 proceedings, increased attention as been paid to ensuring that the FCC engages in proper dialogue with the public regarding its current rules change.

FCC Commissioners Deborah Taylor-Tate and Robert McDowell joined Chairman Martin in voting in favor of the rule change. Commissioners Michael Copps and Jonathan Adelstein, both Democrats, opposed the change.^[8]

By corporation

Contents

Debates

Europe

United Kingdom

Republic of Ireland

Germany

Italy

United States

History

Cross-Ownership Proceedings

By corporation

See also

Film documentaries

References

Contents

An opposite evolution: massive diversification via citizen media

Media consolidation in particular countries

Australia

Canada

External links