MOVEMENT FOR MEDIA DEMOCRACY WINS
MAJOR VICTORY IN COURTS AND CONGRESS

Dr. Jerold M. Starr, Executive Director,
Citizens for Independent Public Broadcasting

In late June, the media reform movement won a major victory in the federal appeals court in Philadelphia. In a 2-1 ruling, judges rejected the rationale for almost all of the FCC's rollbacks of media ownership rules, including newspaper-broadcast station cross-ownership and more duopolies and triopolies (i.e. two and three station combinations) in local markets.

The only change still standing is the increased cap for network ownership of stations nationally from 35 percent to 39 percent, negotiated in secret session between President Bush and the Republican Congressional leadership to accommodate Fox and CBS Viacom. According to observers, with more stations networks are better able to eliminate local programming to make room for network shows. In the recent past, this has included such things as preempting a gubernatorial debate for the network's regular commercial programming. Also, networks can buy syndicated programs on better terms; and networks are free to increase cross-promotion. Many stations have profit margins over 50 percent. The more stations a network owns, the bigger its profits.

In rejecting the other rule changes, the Court said: "Although we affirm the Commission's Order, we have identified several provisions in which the Commission falls short of its obligation to justify its decisions…with reasoned analysis." For example, the Court said, the FCC's diversity index "generates absurd results," by treating every radio station the same, even those that don't carry any news.

At the same time, by a voice vote, the Senate approved a provision to repeal the FCC's relaxation of the rules and restore former restrictions. The provision was amended to a major Pentagon funding bill where it has continued to be subject to more maneuvering by the Republican leadership.

Significantly, the Senate Commerce Committee just launched a drive to overhaul the 1996 Telecommunications Act. While the focus will be on easier access of local phone companies to dial into long-distance business, Broadcasting and Cable's Bill McConnell observes: "Expect the bill to set tighter limits on the number of broadcast stations one company can own, as well as new public-interest obligations regarding local-election coverage and kids programs."

The downside is that these victories only stopped even greater consolidation of a media system that already is inaccessible and unresponsive to the general public. The upside is that we have shown the media moguls to be vulnerable to grassroots opposition. Some 13,000 groups and individuals had filed legal briefs opposing the rule changes.

The coalition opposed included religious groups, labor groups, public interest groups, consumer groups, and political groups ranging from Common Cause, the Communication Workers of America and the Rainbow-Push Coalition to the National Rifle Association, U.S. Catholic Conference and Parents Television Council. By the date of the decision, some 2.3 million people had written to the FCC, almost all opposed to the rule changes.

Corporate Media Concentration

No matter what your issue, this is the fight that concerns us all. Mass communications are the lifeblood of modern democracies. If citizens cannot communicate with each other, they can't organize. If they can't organize, they can't defend themselves from those who would threaten the public interest.

In the U.S. today there are approximately 1,800 newspapers, 3,000 book publishers, 11,000 magazines, 11,000 radio stations, and 1,700 television stations. Behind this illusion of great choice, however, lies a collusion of interest that serves the giant media corporations at the expense of American democracy and cultural diversity.

In 1994, a mere 50 companies owned a controlling interest in all of these media. By 2002, this was down to six companies. Between 1975 and 2000, the number of TV stations increased by 75 percent, but the number of TV station owners actually declined by 33 percent. In recorded music, five companies control more than 80 percent of the U.S. market. More than 60 percent of daily newspapers are part of chains and only a handful of cities have a competing daily.

Comcast and Time Warner (TW) dominate the cable market where the average system makes a 30 percent profit. The FCC is actively considering lifting the cap on one company's share of the market from 30 percent to 45 percent of all households. Comcast recently made a hostile takeover bid against Disney, vying to be the first cable company to own its own major network. While Direct Broadcast Satellite (DBS) offers an alternative to cable for 18 million subscribers, only two companies, DirecTV (majority owned by Rupert Murdoch's News Corp.) and Echo Star (The Dish), control the DBS market.

Every single one of the top 20 Internet web sites is controlled by a media giant. Time Warner properties account for nearly 30 percent of all user time spent online. Add Microsoft and Yahoo! And it's 50 percent. Time Warner, General Electric (GE) and News Corp, own all of the cable news networks.

Almost all of these cable news programs offer a conservative slant. In October 2003, the University of Maryland surveyed 3,000 people, measuring their knowledge of three simple facts about the War in Iraq. They asked whether Iraq was involved in the 9/11 terrorist attacks or proven to be supporting
al-Quaeda; whether weapons of mass destruction had been found in Iraq; and whether international opinion favored the U.S. in the war against Iraq.

They found that 60 percent of the public had one or more misperceptions and eight percent had all three. Misperceptions correlated strongly with support for the war. Those who got their news primarily from Fox News had more misperceptions than anyone; 80 percent had at least one and 45 percent had all three.

The damage done by ill-considered deregulation is evident. The 1996 Telecommunications Act lifted all caps on national radio station group ownership and increased the number of stations one company can own in a single market up to four in the smaller markets and eight in the largest. This triggered a tidal wave of mergers and acquisitions. Industry concentration increased by
34 percent. The number of radio station owners with 20 or more stations doubled to a total of 50. The largest two firms in each market average 74 percent of the market's radio advertising revenue.

Democratic FCC Commissioner Walter Copps has commented: "Diversity of programming suffered. Homogenized music and standardized programming crowded out local and regional talent. Creative artists found it evermore difficult to obtain playtime. Editorial opinion polarized. Competition in many towns became non-existent as a few companies bought up virtually every station in the market."

The leading radio group, San Antonio-based Clear Channel Communications grew from 43 stations to 1,250, accounting for more than 10 percent of all commercial radio stations in the U.S. Clear Channel CEO Lowry Mays is a close friend of President Bush. After 9/11, Clear Channel instituted a ban on about 150 songs that it felt mighty undermine public support for President Bush's declared "war on terrorism." After Dixie Chick lead singer Natalie Maynes told a British audience she was "ashamed to be from the same state" as the President, Clear Channel banned the group's songs on all their stations. After the invasion of Iraq, Clear Channel used its resources to organize and promote pro-war rallies. Other radio groups followed suit.

To extend its influence, Clear Channel began buying music venues. It now has 135 amphitheaters, arenas, theaters and clubs and sells 27 million concert tickets a year, accounting for 70 percent of the entire industry. A letter to the FCC from 700 popular musicians accused Clear Channel of refusing to play the songs of artists who don't use its concert promotion services and of accepting payola from music company promoters.

Local music directors and disc jockeys no longer have discretion over their playlists. Rather, it's all done by consultants and committees and put on computer files to be distributed nationally from headquarters.

Five Media groups-CBS/Viacom, NBC, Disney, Time Warner and Fox control 85 percent of prime time TV viewing.

The New Model for Monopoly Media

According to Amy Harmon of the New York Times: "…media analysts and executives are convinced that the most efficient business plan is to own as many outlets as possible to deliver the movies, television, music and books that they themselves produce."

Controlling both content and distribution eliminates the potential threat that your own productions will not see the best positioning on a competitor's distribution system. It also is a method to avoid huge licensing fees for popular programs, like Friends, ER or West Wing.

Unfortunately for the public, internally produced programs typically lack originality and are diluted by bureaucratic compromise. Networks cut corners in the production. If the show is a flop, it's cheap enough that they can afford to leave it on longer than they otherwise would. No matter how bad, the show can still be "repurposed" into syndication on cable networks owned by the same company. This, of course, makes it harder for new shows to break in. To make matters worse, suppliers use their existing hit shows to pressure broadcasters into buying more of their programming.

On May 12, 2004, NBC announced its acquisition of Universal Studios. Now, all four of the major networks have their own production studios. Commenting on the deal, Jeff Chester of the Center for Digital Democracy said: "Now writers will work for NBC and will have to do what the network tells them to do. And that will be based on the aggressive model they have set up with their advertisers."

Anticipating that the networks will shut out any studio with which they are not affiliated, Sony is turning away from TV program production and toward films. Recently, it bid to acquire MGM. This would create a behemoth with 7,500 movie titles, 40 percent of all major English-language movies ever made. Does network ownership of shows stifle creativity? In a recent poll of television critics by Television Week, 18 said yes, seven maybe, and only five no.

There are other specific advantages to greater vertical integration for the media corporations. It permits extensive cross-production, for example, joining film releases with CDs, music videos, toys, games, books and other merchandising.
It permits cross-promotion, that is advertising through other media controlled by the company, even advertising TV programs to movie-goers who have paid for their ticket. Greater vertical integration also leads to being able to offer multi-media packages to advertisers that undercut the competition.

Cheapening the Product

It also leads to a strategy of emphasizing blockbuster hits in the global marketplace that can cover losses on other projects. Because they play easier across language differences, such productions typically feature sex, violence and special effects at the expense of plot, dialogue and character development.
Since 1990, Time Warner and Disney have more than doubled their share of revenue from overseas sales, from 15 percent to 35 percent. Both firms expect to do a majority of their business abroad sometime this decade.

In music this means that companies do not want, say, ten CDs that may gross $12 million each, but one monster album that will gross ten times as much. They have spent tons on older stars, through "megadeals" that have yielded many duds; money not spent on several artists just as good, but still unknown. Artists who buy into this end up dedicating all their energies to videos, touring and label promotion at the expense of writing new music.

There are many other consequences of increasing media concentration that impact negatively on the public interest. New mergers and acquisitions are premised on meeting enhanced profit projections by raising revenue and cutting costs. This means more commercial sales adding up to more program clutter for viewers, that is more ads and promos. Clutter now accounts for about nine minutes in the average half hour TV show, a three-fold increase since the 1950s.

Investigative Journalism Sacrificed

It also means more staff layoffs. One consequence is that print and broadcast newsrooms lack the staff to do investigative reporting and cover breaking stories. In the past 20 years in radio, the number of full-time station news staff has fallen almost 40 percent, from 19,600 to 12,000. PR-generated material now accounts for between 40 and 70 percent of what is called news.

A 2002 survey of 103 television news directors by the Columbia Graduate School of Journalism found almost half citing "not enough staff" as the "most serious obstacle to producing quality news." No other reason attracted more than
11 percent. Seventy five percent said they try to do investigative reporting, but only 25 percent have full-time investigative units.

According to Walter Cronkite, television's corporate chieftains expect news departments to generate the same sort of profits that entertainment programs do. He calls that an impossible task and observes: "Instead of offering tough documentaries and background on the issues that so deeply affect all of us, they're turning those programs into television copies of Photoplay magazine. News executives are helpless when top management demands an increase in ratings to protect profits."

A Pew Research Center survey of 287 journalists found up to 41 percent acknowledging reshaping and softening their stories due to perceived pressures from corporate owners or the market. Tom Brokaw states: "What people truly want is the serious news of war, race, immigration, business, health, education and environment, but, in too many newsrooms, those stories are regarded as too boring…too risky."

Political Election Campaigns Ignored

Even coverage of elections has practically disappeared. During the 2000 presidential campaign, news programs devoted an average of 45 seconds per show to the race. A 2002 study of the top fifty markets found that under half contained any local election coverage. Of these, only 20 percent contained any sound bites from the candidates. Ninety-two percent of the coverage focused on campaign strategy and only three percent on policy. Another 2002 study again found more than half (56 percent) of 122 stations ignoring the campaigns altogether. Campaign stories, on average, were 89 seconds long. Only 27 percent focused on issues or analysis of campaign ads. In 2004, the major networks devoted only one hour each night to live major party presidential convention coverage.

As a consequence, candidates must rely on political advertising to communicate with the voters. In the 2004 presidential election, station political ad revenue has been up 60 percent over 2000 with a projected gross of $1.6 billion. As the game is played, the media corporations contribute millions to the campaigns of the big party candidates who, in turn, use the money to buy ad time on the media.

Worse, research has found that the candidates are charged premium rates, rather than the discounted rates required by law. Finally, the negative tone of these paid attack ads ultimately serves to depress voter turnout in a nation that already has the lowest level of voter participation in the modern world.

Local Programming and Cultural Diversity Lost

Another significant casualty of media consolidation has been the loss of local programming. Media scholar Susan Douglas notes that satellite transmission and national syndication has led to more radio carriage of shows like Howard Stern and Rush Limbaugh. She predicts: "If this trend in radio continues," that "discussion of local issues will be driven out completely."

Cheryl Lianza of the Media Access Project warns: "Citizens must have some recourse to coverage of local issues from different vantage points" because, in her view, the real questions are "who sits on the school board and who is elected mayor. It's about whether the garbage gets picked up, whether we can rely on our local hospitals and whether our local employees are secure."

Here is what we have come to: Sinclair Broadcasting Group, based in Maryland, distributes to all its 62 affiliates a program called "News Central." A one hour mix of local and national news, News Central leads with a segment produced locally and then follows with national and international news, sports and weather pieced together from other Sinclair affiliates or CNN and anchored in Maryland. News staff at the affiliates have been trimmed by about a third. Half of Sinclair affiliates currently have no news staff at all. Unfortunately, this is the norm for the industry. About half of the Fox affiliates and only a handful of Warner Brothers (WB) and UPN affiliates produce local news. In fact, several top 10 market WB and UPN stations don't air any local news.

Another casualty has been the loss of cultural diversity. Increasing media consolidation has resulted in a 26 percent drop in the already small number of black-owned stations. People of color are now less than four percent of radio and TV owners. Jesse Jackson's Rainbow-Push Coalition, has made this a major focus of its political work in Washington. In fact, the Minority Media and Telecommunications Council appealed to the FCC for help. Unfortunately, it didn't get any.

Even media companies that program for Hispanics may not be run by Hispanics. The CEO's of Univision and HBC are both non-Hispanic Republicans and both organizations are largely controlled by non-Hispanics. As the journalist Allison Gregor says: "The words may be in Spanish, but authentic Hispanic voices may eventually be drowned out altogether by those of non-Hispanic owners."

So who is the beneficiary of all this media merger mania? If you say the shareholders, guess again. According to a report by the consulting firm KPMG, as reported by the London-based Reuters news service in 1999, 83 percent of mergers failed to produce any benefits for the shareholders and, even more alarming, over half actually destroyed value. In the communications industry, think of AOL/Time Warner, Comcast (AT&T) and Vivendi Universal.

If you want to know who the winners, are check out the multi-million dollar salaries of network executives and stars.

FCC Way Too Cozy with Industry

One cannot fault these companies for following the logic of a profit driven system. But the airwaves are owned by the public and only held in trust by the media companies. Where is the government agency to represent the public interest in localism, diversity, and democratic discussion?

Like all regulatory agencies, the FCC has significantly more contact with lobbyists and officials representing corporate America than it does with public interest groups and ordinary citizens. Moreover, FCC commissioners and bureau leaders typically count on such professional contacts in negotiating their post-FCC careers.

Between 1995 and 2003, FCC officials were showered with nearly $2.8 million in travel and entertainment, most of it from the telecommunications and broadcast industries the agency is supposed to regulate. All told, agency officials took more than 2,500 industry-sponsored trips over that period.

FCC Chairman Michael Powell says that the "market is his religion" and that he has no idea of what is meant by the public interest. However, the Chairman's passion for the market does not mean removing all rules and regulations. Republicans at the FCC want to regulate corporate conflicts of interest, picking winners and losers. They just do not want to have to acknowledge, let alone represent, the public interest in such conflicts.

In February 2003 Chairman Powell made it clear there would be plenty of rules when he is finished: "I don't know what anybody is talking about when they say this is deregulation. We are talking about a paradigm of competition, but in a very regulatory way. This is not an Adam Smith market. This is industrial management."

There are two prominent areas where this is most apparent. First, the FCC has dropped its frequently repeated concerns for the first amendment rights of broadcasters to impose significantly larger fines for indecency. Even an obscene word spoken by a guest on a live show can put a station out of business.
Self-censorship similar to that of the 1950s is now being practiced, even on PBS. Second, the Chair has legislated a transition to digital television by 2007, despite the lack of interest of networks, stations and consumers and resistance of equipment manufacturers.

Movements for Media Democracy

At present the movement for media democracy operates on three broad fronts. There are organizations that work on media policy issues through the Congress, the FCC and the courts, like the Media Access Project, Institute for Public Representation of the Georgetown University Law Center, Center for Digital Democracy and Consumer Federation of America. They are invaluable to the struggle.

There are those who produce and distribute media that offer alternative perspectives to that of the corporate controlled media. This includes independent or "indy" media centers that make videos about controversial issues, like global capitalism's impact on the third world, and bear witness to the work of progressive movements. This also includes independent film and video makers who keep alive the documentary form. Their organization is called the Association of Independent Video and Film Makers.

Others produce public affairs programs for distribution to public and public access stations. Joined with them are alternative distribution services, like public access stations, grassroots community radio and direct broadcast satellite channels. Leaders here include the Alliance for Community Media, Grassroots Radio Conference, National Federation of Community Broadcasters, Free Speech Channel of The Dish Satellite Network, and Link TV, available on both The Dish and DirecTV.

And there are those who organize themselves to support and reform public broadcasting in their own communities, including chapters of Citizens for Independent Public Broadcasting.

Recent Victories for the Public Interest

The Free Press tracks progress of these many efforts on its web site www.freepress.net. Because of the attention brought to bear on Clear Channel and the terrible consequences of radio consolidation, new limits on radio station ownership have been imposed. Clear Channel actually will have to divest itself of a few of its stations. Corporate sponsored junkets for FCC commissioners have been stopped.

Low power FM broadcasting, that is small, nonprofit radio broadcasting stations with a reach of just a few miles, recently received a huge boost. Based on new research, the FCC recommended to Congress that it eliminate restrictions that deprive communities of their own locally oriented radio stations. If Congress writes this into law, it will clear the way for hundreds, if not thousands, of communities to begin to broadcast.

I close with the words of distinguished journalist Edward R. Murrow, spoken in 1958 and still valid almost 50 years later: "There is no suggestion here that networks or individual stations should operate as philanthropies. But I can find nothing in the Bill of Rights or the Communications Act that says that they must increase their net profits each year, lest the Republic collapse…This instrument can teach, it can illuminate; yes, it can even inspire. But it can do so only to the extent that humans are determined to use it to those ends. Otherwise it is merely wires and lights in a box…"

These are our media. We need to take them back and we can.