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Concentration of media ownership (also known as media consolidation or media convergence) is a commonly used term among media critics, policy makers, and others to characterize ownership structure of mass media industries. These individual media industries are often referred to as a 'Media Institution'.
Media ownership is said to be exemplified usually in one or more of the following ways.
First there is a state of oligopoly or monopoly in a given media industry. For example, movie production is known to be dominated by major studios since the early 20th Century. (Before that, there was a period in which Edison's Trust monopolized the industry). The music recording industry in the United States, similarly, is dominated by the major labels.
Second, there may be some large-scale owners in a industry that are not the causes of monopoly or oligopoly. Clear Channel Communications, especially since the Telecommunications Act of 1996, acquired many radio stations across the United States, and came to own more than 1,200 stations. Radio broadcasting industry in the United States can be regarded oligopolistic regardless of the existence of such a player. Because radio stations are local in reach, each licensed a specific part of airwave by the FCC in a specific local area, any local market is served by a limited number of stations. This system of licensing makes many markets local oligopoly. The similar market structure exists for U.S. television broadcasting, cable systems, and newspaper industries, all of which are characterized by the existence of large-scale owners. Concentration of ownership is often found in these industries.
Third, concentration of media ownership often suggest the presence of media conglomerates. When a company owns many different types of media businesses, it is referred to as a media conglomerate. The six current media conglomerates are Disney, Viacom, Time Warner, News Corp, Bertelsmann, and General Electric. These companies together own more than 90% of the media market.
Debates
Concentration of media ownership is very frequently seen as a problem of contemporary media and society. When media ownership is concentrated in one or more of the ways mentioned above, a number of undesirable consequences follows, including the following:
- For the general public, there are less diverse opinions and voices available from media.
- For minorities and others, smaller opportunities exist to voice their concerns and reach the public.
- Healthy market-based competition is absent, leading to slower innovation and increased prices.
For those critics, the deregulation of media and communication industries are lamentable trends, causing or helping the increase in such concentration. Also criticized together at times is the commercialism in media.
A typical counter-arguments to those criticisms include the following:
- Increased competitiveness due to the larger capital of the owners, especially to compete against some of the global, giant media conglomerates
- Reduced cost of operations as a result of consolidation of some functions
- More segmented or differentiated products and services to respond to a wider variety of demands better.
Media consolidation in particular countries
Canada
Radio and television ownership in Canada is governed by the CRTC. The CRTC does not regulate ownership of newspapers or Internet media, although ownership in those media may be taken into consideration in decisions pertaining to a licensee's broadcasting operations.
Apart from the public Canadian Broadcasting Corporation, commercial media in Canada are primarily owned by a small number of companies, including Bell Globemedia, Canwest Global, CHUM, Rogers, Standard, Shaw, Astral, Newcap and Quebecor. Each of these companies holds a diverse mix of television, cable television, radio, newspaper, magazine and/or internet operations. Some smaller media companies also exist.
Due to Canada's smaller population, some types of media consolidation have always been allowed. In small markets where the population could not adequately support multiple television stations competing for advertising dollars, the CRTC began permitting twinstick operations, in which the same company operated both CBC and CTV affiliates in the same market, in 1967. This model of television ownership was restricted to smaller markets until the mid-1990s, when the CRTC began to allow companies to own multiple television stations in large markets such as Toronto, Montreal and Vancouver.
As of 2005, almost all Canadian television stations are owned by national media conglomerates. These acquisitions have been controversial; stations in smaller markets have frequently had their local news programming cut back or even eliminated. For instance, the four MCTV stations in Northern Ontario and the four ATV stations in Atlantic Canada are each served by a single regional newscast. This, in turn, has contributed to the rise of independent local webmedia such as SooToday.com.
Many (but not all) Canadian newspapers are also owned by the same media conglomerates which own the television networks. Companies which own both television and newspaper assets have strict controls on the extent to which they can merge the operations. The issue of newspaper ownership has been particularly controversial in Canada, especially in the mid-1990s when Conrad Black's Hollinger acquired the Southam chain. Black's 1999 sale of the Hollinger papers resulted in an increase in the diversity of newspaper ownership, with new ownership groups such as Osprey Media entering the business, but was even more controversial because the CRTC, waiving its former rules against broadcasting companies acquiring newspaper assets, permitted Canwest Global to purchase many of the Hollinger papers.
In radio, a company is normally restricted to owning no more than three stations in a single market, of which only two can be on the same broadcast band. (That is, a company may own two FM stations and an AM station, or two AMs and one FM, but may not own three FMs.) Under certain circumstances, local marketing agreements may be implemented, or the ownership rule may be waived entirely. For example, in Windsor, Ontario, CHUM Limited owns all of the city's commercial broadcast outlets, due to the city's unique circumstances -- being in the immediate environs of the Metro Detroit market in the United States, Windsor has historically been a difficult market for commercial broadcasters.
When licensing a new broadcast outlet, the CRTC has a general (but not strict) tendency to favour new and local broadcasters. However, in the modern media context such broadcasters often struggle for financial viability, and are often subsequently acquired by larger companies. The CRTC rarely denies the acquisition applications. Canada also has strict laws around non-Canadian ownership of cultural industries; a media company in Canada may not be more than 20 per cent foreign-owned.
United States
Little mass media regulation existed in the United States prior to the creation of the Federal Radio Commission in 1927. The Telecommunications Act of 1934, which was a fundamental decision on how mass media would function from then on. At the time, radio technology had become widespread among the masses, and the electromagnetic spectrum was regarded as public property. The Act reappropriated the spectrum to itself, and claimed the right to assign spectrum ranges to private parties as long as they broadcasted in the public interest. This act created the Federal Communications Commission to replace the Federal Radio Commission. Lobbyists from the largest radio broadcasters, ABC and NBC, successfully petitioned to attach a cost to the license required to broadcast, and were thusly able to "price out" many amateur broadcasters that had previously existed. Such was the precedent for much of the following regulatory decisions, which have mostly focused on the percentage of a market deemed allowable to a single company.
The largely unpublicized Federal Telecommunications Act of 1996 set the modern tone of "deregulation," a relaxing of percentage constrictions that solidified the previous history of privatizing the utility and commodifying the spectrum. The legislation, touted as a step that would foster competition, actually resulted in the subsequent mergers of several large companies, a trend which still continues.
The FCC held one official forum, February 27, 2003, in Richmond, Virginia in response to public pressures to allow for more input on the issue of elimination of media ownership limits. Some complain that more than one forum was needed. [1] [2] On June 2, 2003, The U.S. Federal Communications Commission (FCC), in a 3-2 vote, approved new media ownership laws that removed many of the restrictions previously imposed to limit ownership of media within a local area.The changes were not, as is customarily done, made available to the public for a comment period. Two commissioners requested this public comment period (the same two who voted against the changes) and their requests were denied without justification.The news coverage of this event in the mainstream press was very low-key.
A few of the points included:
- Single-company ownership of media in a given market is now permitted up to 45% (formerly 35%, up from 25% in 1996) of that market.
- Restrictions on newspaper and TV station ownership in the same market were removed.
- All TV channels, magazines, newspapers, cable, and internet services are now counted, weighted based on people's average tendency to find news on that medium. At the same time, whether a channel actually contains news is no longer considered in counting the percentage of a medium owned by one owner.
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- (Thus it is now possible for two companies to own all of a city's 2 newspapers, 3 local TV stations, 2 national TV networks, and 8 local radio stations, (up to 45% of the media each) so long as there are other companies owning the shopping channel, the discovery channel, and at least 10% of other non-news outlets.)
- Previous requirements for periodic review of license have been changed. Licenses are no longer reviewed for "public-interest" considerations.
More information on the new consolidation rules is available from the FCC website. In particular, there are press releases from the commissioners who voted for the changes, and from those who voted against them.
See also
External links
For changes:
Against:
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