Galloping Global Multi-Media Merger Mania:
A Former FCC Commissioner’s Perspective
Nicholas Johnson
Peoples Unitarian-Universalist Church
Cedar Rapids, Iowa
February 18, 2001
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Jefferson and Free Speech |
Corporate Interlocks
Where Have All the Journalists Gone? |
“Why don’t you find out for yourself,” they said. And so I set out to visit all the churches in Iowa City. In doing so I found they had different approaches to their members’ visiting other churches.
Some rewarded such curiosity with excommunication. The Unitarians gave extra points. I decided to go with the Unitarians, and have been there ever since.
My mother-in-law for life, Evie Chapman, was a member of this church. My wife, Mary Vasey, who is here today on her birthday, also was a member for many years. I have visited on occasion in the past. As have my daughter, Julie, and son, Gregory, who are also here today.
So when Joyce Nielsen invited me to speak today I was, of course, honored to be asked and pleased to accept.
The diversity of America’s religious choice has only expanded over the years since I first signed the Unitarians’ membership book in Iowa City in the late ‘40s. “Unity in diversity” is a UU’s way of expressing, not our “toleration,” but our celebration, of that diversity.
But if diversity is desirable for religious choice it is essential for political choice, for democratic choice. Not just a choice among political parties and candidates, but diversity in the sources of information that feed the minds of active citizens engaged in the radical experiment called self-governing.
Thomas Jefferson saw the modules of a democratic society as of a piece.
As a school board member, I am as aware as anyone of the challenges confronting public education today. But I am also proud of our accomplishments. We get better than we deserve.
You have a great public library in Cedar Rapids. We’ve recently passed a bond issue to expand our award-winning public library in Iowa City. And both are responding to the challenge of a global Internet that can today bring into our homes intellectual and informational resources even beyond those of the Library of Congress.
It is the third module, the available diversity in the democratic dialogue, which most concerns me.
It is the subject about which you have asked me to speak.
Needless to say, those shortcomings are multiplied many times in our political campaigns, elections, and democratic governance.
Indeed, when fewer than 10 percent of us bother to vote for school board or city council members – and less than half for president -- one can reasonably feel concern that we are no longer engaged in informed self-governing in this country.
As a law professor, I am used to speaking for entire semesters at a time. So as a concession to the shortness of life, if nothing else, my remarks this morning are going to be for you thankfully, and for me painfully, truncated.
However, there are at least 11 points that need to be summarily touched upon. It is not a single phenomenon with which we are dealing. It is much worse, much more complicated, than that. Numerous undesirable trends are each re-enforcing each other.
The first major change to note is where the information, the dialogue, are coming from.
I don’t mean to disparage the importance of what we call “word-of-mouth.”
There is what we are doing right now and conversation after church, meetings over coffee in the cafes of rural Iowa, community meetings, posters on kiosks, machine-copied handouts, community video channels on cable, and individuals’ Web sites. These are the remnants of Thomas Jefferson’s notion of free speech.
But compare this flow with the influence and quantity of that from, for example, the New York Times, Wall Street Journal and Washington Post on the one hand, and ABC, CBS, NBC, Fox and CNN on the other. It is like comparing the flow from a garden hose to that of the Cedar River.
It is these multi-billion-dollar multiple-media conglomerates, with their global reach, that have the greatest influence in young girls’ acceptance of their own bodies. Young boys attraction to violence as a technique of dispute resolution. The willingness of blue-collar workers to accept an ever shrinking wage rather than join a labor union. Even the news junkies’ view that O.J. Simpson’s road rage, and missing “Ws” from White House keyboards, are more significant stories than global poverty and corporate corruption of the political process.
Nor is the forum, the place where the dialogue occurs, the only thing that has changed over time. So have the rules.
What the Supreme Court did recently in choosing Bush over Gore by a five-to-four vote is as nothing compared to what they’ve done with the First Amendment.
It is one thing to say that I should be able to censor the content of this speech, or my newspaper column, or book. That I should not be compelled to include arguments with which I disagree, or the views of individuals I find disagreeable. It is quite another to say that if I own the dominant newspaper, television station, or only cable system, I should also have that right to censor every page and every channel.
And yet that’s exactly what the Supreme Court has said with regard to newspapers, radio, television, cable, satellites, public utilities’ billing envelopes, and St. Patrick’s Day parades. No one contests that the owner of a mass medium should have a right of free speech through his or her media. But I most certainly do find abhorrent the notion that they should also have the right to censor the free speech of everyone else.
Nor am I just talking about our right to personal expression in the dominant mass media for free. The law provides that we cannot buy our way in either. The newspaper and TV station may have a rate card, and we may be willing to pay their quarter-page, or per-minute, rates. But if they don‘t like what we have to say, for whatever reason, they have the legal power to keep us from being heard.
In short, our legally enforceable right to speak is conditioned on our finding the $100 million in spare pocket change that might enable us to buy our own newspaper or TV station.
Couple this with the ability of corporate employers to silence their workers, and we’re left not with 280 million Americans, but something more like 10,000, who are still free meaningfully to exercise their First Amendment rights in a mass media society.
It is as if the Supreme Court decided to repeal the First Amendment and then not tell anyone about it.
Not only have we changed the forum, and given the gatekeepers of our media conduits the right to censor their content, there are some other unfortunate trends as well.
Media firms are getting larger and fewer. When Time and Warner merged, long before AOL was a relevant player, we asked them why. “Because some day,” we were told, “there are going to be five firms controlling all the media on planet Earth and we intend to be one of them.”
There are not yet five firms controlling all the world’s media. But that’s clearly the trend. In music we’re already there. Of all the music you hear on the radio, the CDs you buy, the soundtracks of the movies you see, well over 95 percent of it is owned by five global firms.
The FCC, required by Congress to regulate media “in the public interest,” used to have strict standards regarding ownership. Limits on how large a geographic area a station could reach. Limits on how many stations a single licensee could operate. Concerns about national media power. Regional media power. Joint ownership within a single market. Multiple media ownership.
No longer. “Deregulation” is the mantra of the day. Nor are the FTC or Antitrust Division of the Justice Department particularly concerned.
The media grab has been underway now for some time. So there are newspaper chains that own so-called “local” newspapers in dozens of cities. There are individual corporate licensees that operate over 100 radio stations.
But that’s the least of it.
The other thing that has been going on simultaneously is the creation of multiple media conglomerates. What I mean by that is a single company with not only a dominant position in one medium, such as newspapers or radio stations, but in multiple media – movie studios, magazines, videotape rentals, Internet service providers, and cable television.
Want an example? Let’s use Time Warner – or, as it now is, AOL Time Warner. Go to its Web site, http://www.aoltimewarner.com. Look at the pages called “Corporate Overview” and “Our Companies.” They list six categories of companies. Each category seems to have within it what might be thought of as multiple corporate divisions. And those, in turn, contain companies.
AOL, for instance, is in fact 13 companies.The others are similar – News Corporation, Viacom, Disney, AT&T.There are four network groups: Turner Entertainment, CNN, HBO and the WB TV Network. Turner Entertainment is 15 companies plus 3 joint ventures. CNN is 10 companies, 15 Web sites, and 3 joint ventures. HBO is 12 companies and 14 joint ventures. WB is 2 companies.
Publishing is Time Inc. and Time Warner Trade. Time Inc. has 56 publications and what appear to be 11 additional companies plus 2 joint ventures. Time Warner has 5 companies.
Filmed Entertainment includes Warner Bros. and New Line Cinema. Warner has 15 companies, New Line has 6.
Warner Music Group includes 15 companies and 10 joint ventures.
Time Warner Cable doesn’t even bother to list all of the cable companies it owns, just the ones with more than 100,000 subscribers each. There are 35 of those. The Tampa Bay and New York City systems, for example, each have about 1 million subscribers. Time Warner Cable also owns 5 local news channels and has 2 additional joint ventures.
As if this weren’t bad enough, they are also buying into each other, going into joint ventures, and partnership agreements. As difficult as it is to know what any given company owns on any given day, it is even more difficult to know what other companies may own a piece of it.
From time to time a publication called Multichannel News puts together a chart of these interlocking relationships. I got out the 1999 version the other day. I didn’t count all the boxes on the chart, but I would estimate there are at least 500. Initially I assumed that surely this chart must cover all of the various media companies involved.
But, as I examined it more closely I realized that there were no book publishing subsidiaries listed. No magazines or newspapers. No movie studios. No broadcast stations. What this enormous, and enormously complex, chart reflects is only the interlocking relationships between the cable programming suppliers – a narrow slice of the multi-media conglomerates we’re examining.
And while this has been happening the digital transformation has enabled a technological convergence.
What do I mean by “convergence”? Want some practical illustrations?
You can get streaming audio and video on your computer screen from radio stations and TV program providers, and get access to the World Wide Web on your television set.
It is becoming increasingly difficult to tell one electronic pocket device from another. You can send e-mail from a pager, use your cell phone to surf the Internet, and your pocket computer to take digital photographs.
Convergence is well illustrated in the single desktop device that can perform as a telephone, fax machine, copier, scanner and printer – all in one box.
So what used to be a telephone company now brings me my cable television service. And that cable company wants to be my Internet service provider. And my present Internet service provider gives me access from my computer to a free long distance telephone company -- as well as a free “voicemail” service when I’m getting access to the Internet over a conventional phone line.
In other words, there’s a kind of technological imperative driving at least some of this multiple media merging.
So what?
So the consequence is a radical alteration in the content, and the marketing, of media. The owners call it “synergy.” In generating profits the whole becomes a multiple of the parts.
Consider this scenario:
These ownership patterns have a corrupting influence throughout all media.
How can a book reviewer, or late night talk show producer or interviewer, maintain the independence and integrity we, the audience, assume and rely upon? There is enormous pressure for what we used to think of as independent evaluation and criticism to become little more than a contribution to a marketing effort, or hype. This takes the form of both what products are chosen for any comment at all, as well as what is said about them.
Because so much money is riding on an individual book or movie there is much less room for risk. Gone are the days when a dedicated book or newspaper publisher might decide to publish a worthy first novel, or pursue an important bit of investigative journalism, knowing the projects would inevitably produce a financial loss.
And re-enforcing those pressures is the drive to create the superstar.
Global superstar status is why a Michael Jordan could earn more from Nike for endorsing their product than Nike pays to all their southeast Asian workers combined for manufacturing it. Corporations manufacture celebrities in music, drama and sports because it’s an easier and a more profitable form of marketing than focusing on talent and content.
As a result, however, the gross disparities in pay between the superstar and those who are merely extraordinarily gifted is so vast that the owners need to radically reduce the number of people at the bottom of the ladder in order to pay the one person at the top.
Thus, what we lose from this marketing, as an audience and a society, is the richness and variety of entertainment, information and culture now denied us. The more that we, too, want to see and hear the superstars of sports, TV, music and movies, the less we see of the equally, or more, talented in our midst. The less is the incentive for a young person to become a starving actor, and join that 80 percent of the Screen Actors Guild membership that earns less than $3000 a year from their craft.
Who among us is anxious to tell the world about the things we have done of which we are most ashamed?
It’s only natural that corporations also want to put their best foot forward.
Why would a TV network want its news division to do a series about how network executives order writers to insert more violence into episodic television scripts than the writers think appropriate?They wouldn’t.Why would the Wall Street Journal want to do a piece revealing the percentage of their daily content that comes directly from the public relations releases of major corporations?
We might hope for more. But so long as owners and journalists are human asking them to be self-critical is really expecting too much.
But if newspapers are willing to be critical of television, and broadcasters are willing to lobby against the interests of cable systems, and telephone companies take no interest in content at all, we can live with the consequences.
The problem arises when, for example, a major nuclear power plant manufacturer, such as GE, acquires NBC News. Or when Disney acquires ABC. The result is to substantially reduce, if not silence entirely, NBC’s candid appraisal of the risks of nuclear power plants, and ABC’s willingness to report on Disney’s hiring pedophiles.
When I was an FCC Commissioner, and ITT wanted to acquire ABC, ITT’s CEO, Harold Geneen, told me that he had over 400 boards of directors reporting to him. When conglomerates reach that size, and diversity, corporate censorship begins to cover a dangerously wide range of subjects.
We are living in an age when, as the former CBS News President Fred Friendly was fond of putting it, “what you don’t know can kill you.” Not only is that true in the literal sense, it is also true in the figurative death of the democratic dialogue essential to self-government.
What sometimes appears from an historic distance to be a golden age, often turns out, upon closer examination, to be little more than yellow journalism.
It is certainly true that the media business has always been a business. Early 20th Century newspaper publishers were as interested in increasing circulation and advertising revenues as their counterparts are today.
Although, in fairness to them, it should be noted in passing that Joseph Pulitzer put his one principal on the masthead: “to make it harder for the rich to grow richer and easier for the poor to keep from growing poorer.” William Randolph Hearst wrote, “This newspaper hopes for a labor union victory and means to help it along because the public welfare demands it.” When was the last time you heard sentiments like that from one of today’s media moguls?
One could argue that the Internet provides more free access to journalism – albeit larded with advertising – than was ever available in the past.
But A. J. Liebling’s observation is still accurate as well. He pointed out that the first thing to go, following the loss of competition among taverns, was the free lunch. Similarly, he said, news is the first thing to go following the loss of competition among newspapers.
Just as we have substituted junk food for the blue plate special, so have we substituted junk news for traditional journalism. It’s what Walter Lippmann once characterized, in the book Public Opinion as “side shows and three-legged calves.”
What Paddy Cheyefsky predicted in the 1976 movie, “Network,” has not only come to our TV screens but has actually become worse. A TV critic once observed of entertainment television, “It is impossible to write anything of social consequence for a show like ‘Gomer Pyle.’” Sadly, it is becoming increasingly difficult to present anything of social consequence on television’s talk and panel programs as well – let alone to do so with civility.
Nor is local TV news much better. All too often fender-bender accidents, fires, high school sports, commercials and weather – do we really need to know the precise temperature in every Iowa town? – drive out the local stories we really do need to know.
But it is not just pandering and ratings. It’s also costs and profits.
The “Extreme Football League” (XFL) – “extreme” as in “extremely bad taste” – costs NBC a lot less to produce than the NFL games. The fantasy called “reality television” – such as “Temptation Island” – costs a lot less than paying skilled writers and professional actors.
And so it is with journalism. A lot of television news is created by folks who read the New York Times in the morning, take pictures of those stories in the afternoon, and put them on the air in the evening. News bureaus, especially those outside the U.S., cost a lot of money to create and maintain. Abolish a bureau and the cost savings fall all the way to the bottom line where they are immediately transformed into profits.
The problem with this kind of “downsizing,” of course, is that you end up with someone in a Paris news bureau who suddenly discovers she is now responsible for covering the whole of Africa as well.
You may have heard something about the election in Israel and the earthquake in India.
But ask yourself, how much do you know of the relevance of the recent snowfall in Afghanistan – or what’s now going on along its border with Pakistan? The big story out of Myanmar? The Congo? Indonesia? Sri Lanka?
This is supposed to be the age of the global village, international economic competition, Friedman’s The Lexus and the Olive Tree. We fear terrorists we’ve never heard of, and have a constantly eroding balance of payments.
And yet, if it weren’t for WSUI’s carriage of the BBC’s World Service I’d have a tough time finding out what is going on outside the limited, jingoistic focus of America’s media.
I would like to end on a more optimistic note, but I don’t have the tonal range I once did.
So I will close by merely repeating the themes we’ve briefly touched upon: