Posted by: danfusco | July 20, 2009

Midterm – Should the FCC Regulate Media? – Daniel Fusco

The Telecommunications Act of 1996 set off the modern and significant trend of media consolidation within the United States. Media deregulation has accelerated at an alarming rate since Congress passed this act. The Federal Communications Commission’s main goal is to “serve the public interest, convenience, and necessity,” while creating a fair playing field for media outlets to compete. Since the 1950s this was implemented through various restrictions on ownership and broadcasting. A single company was not permitted to own more than seven stations until 1984 when the cap was raised to 12 stations. One year later the FCC added an additional cap of 25 percent regarding national-audience reach. The Telecommunications Act of 1996 opened the market to expansion by getting rid of the 12 station cap altogether and raising the national-audience cap to 35 percent. It was during this era of consolidation that media mergers became commonplace. As Ted Turner said, “In a climate of consolidation, there would be only one sure way to win: bring a broadcast network, production studios, and cable and satellite systems under one roof. If you didn’t have it inside, you’d have to get it outside–and that meant, increasingly, from a large corporation that was competing with you. It’s difficult to survive when your suppliers are owned by your competitors.” Instead of competition, the FCC oversaw unprecedented media consolidation and the creation of enormous corporations. Public disapproval came to fruition when the FCC once again authorized media deregulation by raising the cap a second time to 45 percent and significantly loosening restrictions on newspaper and TV ownership in the same market. These decisions were eventually scaled back slightly, due to protest, but the atmosphere of consolidation and corporate dominance had been set.

Everything in the media is now vertically integrated. A single company can own a stake in an abundance of industries, including, but not limited to, television, movies, magazines, cable, telecommunications, and even sports teams. The Big Six, which includes, Time Warner, General Electric, Disney, News Corp., Viacom, and CBS exemplify the dominance of media corporations from top to bottom and own a significant portion of the media today.

Unfortunately, the massive success of these enterprises has led to a debate over media regulation. There is a fierce argument from both sides on whether or not the FCC should increase regulation. Deregulation has already killed future competition, as new media outlets either instantly die or are bought out by one of the large conglomerates. The arguers for regulation of the media contest that when six conglomerates own almost everything, diversity will suffer. The chance for a new interesting idea decreases, and the same opinion and stories will supposedly drown society. In 1990, Fox, ABC, CBS, and NBC owned just 12.5 percent of the new series they aired on television. By 2000 however this number had reached 56.3 percent and by 2002 the four companies owned 77.5 percent of the new series they aired. This leads to the poor quality and market censorship arguments. If the 77.5 percent of the new series aired on the four biggest broadcasting stations come from a studio owned by the same parent company, it seems likely that information, opinions, and ideologies, will be recycled. Television is fiscally driven and dependent on ratings so risky new ideas are often cast to the side for more common attitudes concerning society and politics. CNN became the number rated cable news show because of their extensive Michael Jackson coverage. All while Iran is under a dictatorship, Darfur is suffering through genocide, and the American economy is still failing. The outcome is repetitive television and poor quality shows, as well as the market censorship of extreme or under the radar opinions.

These arguments seem unrealistic in a society controlled by the free market though. Is the sensationalism present in today’s media the cause of large corporations’ unwillingness to take chances on hard news, or the direct effect of America’s appetite for soft news over knowledge? It is fairly easy to argue for the latter even with a small number of companies controlling what America watches and reads. The constant struggle that occurs between each company of the Big Six and other corporations like Bertelsmann to top the ratings charts induces enough competition to force diversity. In regards to criticality of Barack Obama, each of the main news programs differs. Survey participants considered Fox News too critical 29 percent of the time, while MSNBC was described as too critical only 8 percent of the time. This difference alone offers viewers a significantly dissimilar opinion by switching the channel for even a short period of time during their regular news watching. This competition between conglomerates has caused Fox to find a niche in the conservative market, while other news networks, such as CNN and MSNBC shift left to find their most efficient identity. While the stories may differ marginally, the opinions expressed are completely opposite and most of the major events in America and the World are discussed for at least a small segment. These opposing views offer a similar attribute of watchdog journalism in that they seem to attack the other party every chance they get.

Another major argument for the deregulation of media is the advancement of technology and the subsequent boom of amateur journalism. The slow death of newspaper will continue and the problem of having a radio station, television station and newspaper in the same market is no longer as significant. With the increase in satellite radio, podcasts, and online newspapers, the “different voices from the same ventriloquist” argument is slowly going the way of the buffalo. The consolidation of media has also led to the convenience of cable companies offering television, telecom, and the Internet at a low bundled price. According to recent statistics, 72.5 percent of Americans have access to the Internet, creating an increasingly abundant landscape of knowledge and the perfect foundation for expressing opinions. Unbiased facts are always available through the World Wide Web and there is a blog for everyone from Neo-Nazis to gay marriage supporters. Going back to the year 2000, only 44 percent of Americans had Internet access, and media consolidation was seen as a major concern because of uniform ideas throughout major media outlets. The emergence of Youtube, blogs, and even Twitter has created a developed sphere of political discourse for the common man or woman. The problem is no longer a lack of sufficient knowledge but really a problem of responsibility. Every American should strive to grasp a better understanding of the political landscape, major world events, and United States’ policies. This is why the free market system makes a lot more sense than one dominated by government regulations.

The free market is a model of efficiency, because if people do not like or accept an idea, it will fail. Without an audience, a company cannot possibly produce a television show. This leads to the conclusion that everything an individual sees on TV is there because a large group of people want to see it. Everyone in a democracy cannot be satisfied, but the basic ideal of democracy is to rule by majority. Hard news may be significantly more important to the lives of Americans, but the government cannot expect an independent business to follow a strict set of guidelines in a free market. If people wanted to watch hard news, then ratings would drop off and corporations would adjust, but unfortunately there is no place in the market for a lackluster informative television show. There is a reason Fox News has so many top rated shows on cable and it is not because of their “fair and balanced” watchdog journalism. Americans are not that invested in politics and it would be a setback to the free market for the government to step in and decrease profits while in all likelihood, not increasing the amount of hard news watched.

Even if regulations were brought back and large corporations were broken up, is there any chance a station like Fox News would die. This would only allow more companies to participate in the ever expanding and ridiculously profitable world of the media, but the same horribly uninformative soft news shows would dominate television sets because of ratings. Rupert Murdoch is probably not an extreme conservative hell-bent on making Bush an icon and Obama a terrorist. He is simply a free marketer who saw a business opportunity in the conservative news market. If a liberal hard news program was a moneymaker, then Rupert Murdoch would have probably gotten on board, but the American public has spoken time and time again through ratings. Competition might increase by limiting the power of corporations and offering smaller companies a chance to enter the market. These multi-faceted corporations had to achieve success from the bottom just like everyone else by appealing to the masses and regulating their success is the opposite of the free market and American ideals.

The solution to the problem seems to be a station similar to the British Broadcasting Corporation. The BBC is publicly funded and a media watchdog for the people. PBS is considered quite boring and not always news centric. With a slight increase in federal taxes, it seems likely that interesting personalities from both sides of the political compass could be attained for an American version of the BBC. The station could strictly focus on hard news and political policies, and Americans interested in the subject could tune in. To be even more informative the station could explain common biases in other forms of media, such as the Groseclose study. The information to develop a deep knowledge of politics is abundantly available. It is the responsibility of citizens to find and analyze this information accordingly in order to be a productive part of American democracy.

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