FCC Moves To Enrich Media Cartel

Chris Shumway

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

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

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 de-
contextualized, 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
info- tainment 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

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.            Z

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.