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From AJR,   December 1999  issue

How Bad Is Big?   

Hold back the tears: Megamergers such as the CBS/Viacom deal may well be good news for journalism, a veteran media writer suggests.

Related reading:   The Company That Would Be King

By Paul Farhi
Senior contributing writer Paul Farhi (farhip@washpost.com) is a reporter for the Washington Post.     


MARK CRISPIN MILLER is a man on a mission. From his perch at New York University, the professor of media studies sees a world of diminishing media diversity, a tainted political dialogue, an increasingly corrupt culture. The cause, he believes, is clear:
"We're living in a time of unprecedented media concentration," he says with characteristic passion. "Magazines, the movie industry, newspapers, books--many of these are already monopolized or are moving toward monopoly. As long as a limited number of transnational entities control these culture industries, the effect on journalism and society is going to be profoundly negative."
Hence, Miller's mission: spreading the word about the full breadth and reach of the Disneys, News Corps., Viacoms and Time Warners of the world. His Project on Media Ownership is building a database and a Web site (www.mediaownership.org) detailing the local, national and international holdings of the giants. Working with the American Federation of Television and Radio Artists, Miller has been proselytizing about the multinationals' growing influence over what he calls the "culture industries."
Miller is by no means alone in sounding alarms. Political scientist Dean Alger has identified the "Dominant Dozen," 12 corporations--Disney at the top, AT&T-TCI at the bottom--that control most of the major book publishers, all of the major film studios and broadcast networks, and a sizable chunk of the TV and radio stations, cable channels, magazines and newspapers in America. Alger's outlook is bluntly summarized in the subtitle of "Megamedia," his 1998 book: "How Giant Corporations Dominate Mass Media, Distort Competition, and Endanger Democracy."
No less a figure than the Rev. Jesse Jackson is worried, too. Speaking at the annual convention of the Radio-Television News Directors Association in September, Jackson ominously warned, "Too few people are calling too many shots."
While it hasn't picked up a popular tailwind yet, the bigger-is-badder movement surely has a solid populist pedigree. Journalists, and perhaps Americans generally, have reflexive suspicions about rich and powerful institutions, including the ones they work for. They needn't be reminded that they are part of one of the biggest business stories of the decade, the wave of mergers that has created media-entertainment conglomerates of unprecedented size: Viacom and CBS, Time and Warner and Turner Broadcasting, Disney and Capital Cities/ABC, AT&T and TCI, and Rupert Murdoch and just about everything else. Megamergers in the media business have become so numerous that the media seem to have become jaded. The joining of two radio companies, Clear Channel Communications and AMFM Inc., in October rated no more than perfunctory stories in many newspapers and barely a mention in the newsmagazines, even though the deal creates a colossus controlling 830 stations from coast to coast.
But for every intimation of Big Brother, alarmists like Jackson, Miller, et al. have yet to assemble a convincing case that bigness is inherently bad. In fact, the counter-argument is more compelling--that more bigness might be beneficial, at least in upholding and defending traditional standards of journalism. Rather than a conspiracy to dominate the channels of communications, consolidation and mergers reflect just the opposite--a corporate class struggling to keep up with a media and cultural landscape that grows more disheveled, more competitive and more anarchic by the month. Let's turn the argument on its head: It's because they can't control their fragmenting markets that the Dominant Dozen are frantically trying to acquire and merge.
Let's compare the current information landscape with that of 25 years ago. In 1974, three television networks dominated the TV screen, commanding more than 90 percent of the prime-time audience night after night. Cable TV was little more than a way to retransmit the networks' programs to isolated communities. A tiny fraction of homes had remote controls, and fewer still had the means to record or play taped programs. Though many big cities still had competing daily newspapers, the one-newspaper community was becoming firmly established. Satellite TV didn't exist (unless you had a massive receiving dish), and there was no Internet (unless you were a research scientist with advanced computer programming skills).
We know what has happened since. The original Big Three of broadcasting became four with the advent of Fox, and since then have become seven with the addition of WB, UPN and PaxNet, a two-year-old UHF network. More than 70 percent of households subscribe to cable TV, which pipes an average of 57 channels to two or three TV sets stationed around the house. About 10 percent of the nation gets satellite TV service. If they don't like what's on, nine in 10 families can become their own programmers and pop a tape into their VCRs, and 73 percent of cable users can turn to pay-per-view. Competing daily newspapers are all but finished, but stronger suburban dailies have emerged, and dozens of radio stations, hundreds of weekly papers and thousands of new magazines have sprung up. Millions can now access the Internet, which has become, in the colorful description of one anonymous wit, "a vanity press for the deranged."
Can any company dominate the media anymore? In this kind of environment, audience fragmentation is becoming more than a concern to advertisers; it's becoming a social problem. We may someday look back in awe, and perhaps some horror, at a time when just three companies exerted a grip on the consciousness of more than 90 percent of the populace. Now, as the mass media slowly disappear, social consensus may be fading with it.
"What TV used to do was to provide a theater upon which all of our debates played out," says Robert Thompson, a professor of film and television at Syracuse University. "It may have done that badly at times, but we may find that kind of consensus of national culture was more important than we realize."
When your collective audience slips from 90 percent of the nation to around 43 percent (on a good night), standing still is hardly an option. To keep up with their wandering customers, big media have had to merge, acquire and diversify. The problem is, they can't do it fast enough.
Despite combining ABC, ESPN, the Disney Channel and several lesser cable networks under one corporate banner in 1996, Disney's television properties now reach a lower total number of viewers than ABC alone reached three years ago. The advent of multichannel digital broadcast TV, the rise of "streaming" video over the Internet and other new technologies virtually guarantee that Disney's and every other broadcaster's market share will be lower still in the next several years.
Nevertheless, both Alger and Miller ask whether reporters can truly be free to report when their bosses are part of giant companies beholden to the return-on-investment demands of Wall Street. They worry about conflicts of interest ("Can a reporter who works for NBC go after a nuclear power story when General Electric owns NBC?" asks Miller). Most pointedly, they ask whether "alternative" voices and viewpoints stand a chance of making it onto the air or into print when the big keep getting bigger.
For an illuminating--if not definitive--answer, take a look at the radio business, where a buying and selling orgy has been under way since 1994. That year, the Federal Communications Commission increased the federal limit on station ownership. Congress followed this in 1996 by passing the Telecommunications Act, which removed all limits on station ownership on a national basis (it kept some restrictions on local markets). Since enactment of the Telecom Act, Robert McChesney, author of "Corporate Media and the Threat to Democracy," estimates that half of the 11,000 commercial stations in the United States have changed hands. The result, according to McChesney, has been a move toward sameness: "When a company owns rock stations in 50 markets...it hardly needs music directors in 50 markets making extensive contacts with the local community," he writes in the preface to a pamphlet advocating the licensing of more low-power stations.
Despite McChesney's claims, diversity has actually increased on the radio dial since 1994. That year, according to Broadcasting & Cable magazine's yearbook, the two most popular radio formats were adult-contemporary and country music, carried by 4,861 stations nationwide. By this year, the number of AC and country stations had fallen to 4,529. What happened to these stations? They changed formats. They diversified. They found niches.
Today, there are 528 Spanish-language stations--an increase of 42 percent since 1994. The number of jazz and classical stations has also grown, despite the demise of some big-city jazz and classical-music stations. In fact, all kinds of nonmainstream programming has increased: gospel, children's, blues, ethnic formats such as Chinese and Japanese. The news about news radio is also good--the number of stations with news and news-talk programming has grown from 1,456 to 1,940, an increase of one-third.
Clearly, bigger group ownership hasn't hurt format diversity, and it may even have done some good. Markets do have a way of sorting themselves out.
As for the claim that media consolidation poses greater potential for journalistic compromise and conflicts of interest, I'd argue that the jury is still out. There's plenty of evidence to suggest standards have slipped--there's more sensationalism, superficiality and sloppiness--but it's not entirely clear that this is the fault of Big Media. The notion that big media companies inevitably trim and pull punches--would an NBC reporter go after a nuclear power story?--is based on a conspiratorial negative: What stories didn't get written or reported, what pieces didn't make it on the air because journalism was sacrificed for some other corporate interest?
I daresay the same pressures exist--and may even be greater--at smaller news outlets, such as the community newspaper. The few instances of conflict cited by the alarmists are likely to be the least of the problem. Take, for example, Rupert Murdoch's decision last year to kill a book manuscript that criticized the mainland Chinese government while he was trolling for business deals with the Chinese. A shameful and cowardly act by Murdoch? Obviously, yes. A threat to the free flow of ideas and information? In the abstract, yes. But bear in mind that Murdoch--because of his company's massive size--is closely watched. In fact, the incident was widely reported, and the manuscript was eventually published by another company. The lesson: It's tough to get away with hanky-panky when so many people are paying attention.
The trouble with concepts such as the Dominant Dozen is that the companies mentioned are neither dominant nor are there just 12 of them. The idea that 12 companies could dominate the flow of news, information and cultural expression seems preposterous in a world drowning in information sources. Alger's dozen includes the usual suspects--Disney, Bertelsmann, CBS, Microsoft, Gannett--but leaves out significant others. There's no New York Times Co., no Washington Post Co., no Tribune Co., Sony, Seagram, Knight Ridder, Dow Jones, McGraw-Hill, Associated Press, or Clear Channel-AMFM. What about Cox, Belo, Hearst, Scripps, Thomson, Hollinger, McClatchy, Comcast, NPR, PBS or even General Motors (owner of the dominant satellite TV company, DirecTV)? It misses new-media companies, such as Yahoo!, Amazon and America Online. And what, in any case, is the unifying editorial conspiracy among all these entities that could possibly "endanger democracy"?
The plain fact is that no modern media baron has done as much to harm the media as competition within the media itself. However greedy we may believe the Eisners and Murdochs to be, however large their baronies become, they are no match for the larger competitive forces that are eroding such cherished concepts as balance, fairness and accuracy.
In his 1993 book, "Out of Order," political scientist Thomas Patterson notes that every president from Kennedy onward has received increasingly critical treatment in the media. This was the case even after controlling for objective measures of job performance, such as the rate of success in passing contested bills. During the Clinton administration, this was evident to anyone who tuned in to a cable or broadcast talk show, and long before Bill Clinton gave his enemies ammunition with the Lewinsky scandal.
How did it get like this? In their book, "Warp Speed: America in the Age of Mixed Media," Bill Kovach and Tom Rosenstiel attribute the development to the sheer demand of filling all the channels that sprouted during the past decade. "Commentary, chat, speculation, opinion, argument, controversy, and punditry cost far less than assembling a team of reporters, producers, fact checkers, and editors," they write.
It is, alas, a genie that may never be rebottled. As the media grow in number, and as readership and viewing shares erode for virtually everyone, the incentives to keep pushing previously respected norms and limits grow apace.
Economist Robert H. Frank and Philip J. Cook, a professor of public policy, neatly summarized the underlying forces in "The Winner-Take-All-Society," a 1995 book. "Both the larger [financial rewards] and the more competitive environment have worked in tandem to fuel the growing trend toward sensationalism," they write. "In the past a relatively small number of competitors interacted repeatedly with one another. With only three TV networks, a small number of movie studios, and a handful of major publishers, it was possible for the news and entertainment industries to implement implicit social norms about the kind of material that could be shown or written about. The fact that the [rewards] were relatively small, moreover, kept the temptation to violate these norms within reasonable limits.... In today's competitive climate, such restraints have proved virtually impossible to sustain."
"It may be tempting," they add, "to think that the network anchormen of earlier decades--men like Chet Huntley, David Brinkley, Walter Cronkite, and John Chancellor--simply had too much dignity to have spent several prime-time hours narrating live coverage of the flight of a former football star suspected of murdering his ex-wife. But to assume that would be to ignore the fact that those men labored under different market conditions. Perhaps any or all of them would have refused to do what is expected of today's news anchors. But if so, they would have been quickly replaced."
Remember that next time you read about a media merger. If journalistic standards and gentlemanly norms of discussion are what you want, root for more consolidation. The morals of the marketplace being what they are, bigger doesn't have to mean badder. But it could mean more respectable, and if we're lucky, more responsible.