When the Story Is About the Owner   

Can news organization maintain ethical reporting in the age of conglomerate journalism.

WITH VAST CONGLOMERATES CONTROLLING many of America's communications outlets, ``not a month goes by where you don't see a story that causes you to at least raise your eyebrows," observes Marc Gunther, who covers media and
October's major eye-opener involved ``20/20,'' the ABC newsmagazine whose executives shelved a piece critical of network parent Walt Disney Co. The news division's top investigative reporter, Brian Ross, and his longtime producer, Rhonda Schwartz, had spent months probing allegations of lax hiring practices and pedophilia at theme parks. ``A draft story was submitted that did not work,'' ABC News spokeswoman Eileen Murphy said in a prepared statement. ``This does not reflect badly on any reporter or producer involved.''
A week later, Murphy told AJR that ``happily, we've moved on. Brian is at work on three or four other assignments at this time.''
The incident resurrected questions about media concentration and its impact on journalistic integrity, questions that arose in the mid-1980s with high-profile acquisitions such as NBC by General Electric. Disney bought ABC and Westinghouse purchased CBS in 1995.
How does conglomerate ownership affect news coverage? ``There is this underlying conflict-of-interest problem when these parent companies are involved in so many aspects of the communication industry,'' says Jeff Chester, executive director of the Washington-based Center for Media Education. The ``20/20'' non-episode, he thinks, ``could clearly be a litmus test about the role that these corporate parents play in shaping the news agenda.''
Ross' and Schwartz's examination of theme park problems came at the suggestion of Peter Schweizer, who with wife Rochelle wrote ``Disney: The Mouse Betrayed.'' The book, a generally unflattering look at the entertainment behemoth, was released in October by Regnery Publishing of Washington, D.C.
With the approval of Richard Wald, ABC News' senior vice president for editorial quality, Ross and Schwartz set out to talk to the authors, reinterview law enforcement officers and other sources, and find additional corroboration, all of which narrowed the focus to Disney. When ABC News President David Westin saw the drafts, he got into shouting matches with Ross and Schwartz, according to published reports, and bagged the story.
No one at ABC but Murphy is talking publicly about the case. ``We feel this is part of our internal editorial review process,'' Murphy says, adding that ``very often, there's a healthy debate that goes on about pieces.''
Disney spokesman Bill Warren says ``ABC makes its own decisions'' regarding news coverage. Murphy, too, maintains that the news division operates without parental pressure, noting, for example, a ``20/20'' segment Ross did in March ``that mentioned Disney as one of several companies taking advantage of a loophole in the labor laws.''
``If news breaks, regardless of the nature of the news, we cover it,'' Murphy says. ``Generally we would not embark on an investigation that only looks at Disney, because any conclusions we would make would be suspect.... But again, that's a general rule.''
Regnery's vice president, Richard Vigilante, says that, ``on reflection, we probably gave ABC a situation that was a little too sticky to handle.'' As part of the publicity strategy for ``The Mouse Betrayed,'' he then approached other TV newsmagazines. Kevin Tedesco, spokesman for CBS' ``60 Minutes,'' says, ``It's something we considered...but it's a back-burner issue. If we did anything, it would be based on our own reporting rather than that of the authors of the book.''
This isn't the first time Disney has been charged with heavy-handedness. Three former employees of Los Angeles Magazine--owned by Disney subsidiary Fairchild Publications--claim Disney Chairman and CEO Michael D. Eisner ordered the firing of Editor in Chief Michael Caruso for running a February 1997 story headlined ``L.A.'s 10 Most Overpaid and Underpaid Executives.'' Eisner placed No. 3 on the undeserving list.
Mark Horowitz, who co-wrote the offending story as a senior editor at the magazine, says Caruso's dismissal was in reprisal for the story.
``It wasn't incompetence, that's for sure,'' says Horowitz, now a features editor at New York Magazine. Under Caruso the L.A. magazine increased its circulation and respectability, he says.
Fairchild had just taken control of the publication and might reasonably have been expected to install a new editor, adds Ellen Payne, who was managing editor of the magazine and now holds that post at Glamour magazine. But ``Michael Eisner wanted Michael [Caruso] fired for that story.... That's what we all believe.''
``Nobody's talking because everybody wants [to keep] their jobs,'' adds Bob Roe, the L.A. magazine's former executive editor. He left in December 1997 to become a senior editor at Sports Illustrated.
Eisner's office did not return phone calls, and Caruso, now editor in chief at Details magazine, declined to comment.
Chester, of the Center for Media Education, sees a trend within TV networks ``to consciously self-censor themselves when it comes to issues affecting their own company or industry. I think the best example was the failure of all the evening newscasts to report on their companies' lobbying efforts for the 1996 Telecommunications Act.'' Its passage, he says, provided broadcasters with ``more than $40 billion worth of free spectrum.''
But corporate ownership doesn't automatically translate into intimidation. ``I think there are sins of omission and commission all the time,'' says Michael Wolff, who writes weekly media columns for New York Magazine and for the Internet business magazine Industry Standard. ``But, on a day-to-day, case-by-case basis, there is very little interference.... All media organizations, from the beginning of time, have each had their sacred cows. Somewhere, there is always an owner.''
This June Simon & Schuster published ``Burn Rate,'' Wolff's book about the wild growth of the Internet industry. The publisher is a subsidiary of Viacom, one of the book's many targets. Yet there was ``not an iota of concern or interference,'' Wolff says.
Media and entertainment critic Gunther also maintains he has felt no intimidation, though he's acutely aware of his publication's parent company: ``Virtually every story I write for Fortune magazine touches on a Time Warner property.''
Avoiding even the semblance of conflict of interest can be tricky. Gunther says early this year he noticed an improvement in programming at upstart network WB, a Time Warner property, but didn't write about it until September ``because I didn't want to be perceived as a cheerleader.''
Ethical reporting and disclosure can indeed flourish in conglomerate journalism. In November, for example, a Time magazine special report on corporate welfare revealed that parent Time Warner was a big beneficiary.
Ultimately, it's up to individual journalists and news operations to hold the line. As Gunther observes, ``Once the companies get this big, you have to trust in the integrity of the company and the integrity of the reporter.''