Concentration of media ownership
Introduction
Concentration of media ownership is a phenomenon described by politicians and critics of the media. It is characterized by the ownership of a large number of media outlets by a small number of corporations or media conglomerates. The six largest media-owning corporations are, sharing 96% of the market. A state of concentrated ownership can be either a monopoly or an oligopoly. A monopoly exists when a single corporation owns the entire market. In oligopoly media owned by two or more extremely large conglomerates who dominate the market together and compete only with each other. The film and music industries are both oligopolistic.
Cable television and satellite radio may create some media variety in concentrated local markets. However, the cable stations are standardized across the nation, and most are still owned by a small number of corporations.
Newspapers and magazines are also generally concentrated in ownership. This is true even of some local independent.
Definitions:
Concentration of media is the relative proportion between two quantities: first, the numbers of people or parties who own, control, or influence a given medium; and second, the numbers of people or parties who are exposed to, affected by, or influenced by, that medium.
Concentration of media ownership/Media Consolidation is also refers to the view that the majority of the major media outlets are owned by a proportionately small number of conglomerates and corporations.
Background
Marxist Political Economy
Marx’s view of the economic organisation of society along capitalist lines was less sanguine then that of classical political economists. While he accepted capitalism created wealth, he also emphasized it generated vast disparities in the distribution of resources and life opportunities within society. For Marx the key characteristic of the growth of capitalism was the ownership and control of the means of production by a small number of people; in other words the levers of economic power rest in the hands of the few. These few constitute a ‘ruling class’ which uses its power to further its interest and protect its position and influence in society. The main interest of this class is to amass more and more profits. This however can only be done at the expense of other classes in society.
Marx underlined the need to see the ‘ownership and control of communication as part of the overall structure of property and power relations’. Marx predicted that capitalist enterprises would grow in size so that in the future a smaller and smaller number of companies would control the market. This has certainly been a feature of the growth of the media industries since 1945.
FCC Adopts Media Ownership Limits
Early communications policy started out strongly in favor of preserving and ensuring diverse sources of information as a cornerstone of a functioning democratic society. In 1941, the Federal Communications Commission (FCC) began adopting strong rules to preserve diversity on the airwaves.
Through a series of actions that spanned from then until the 1970s, the FCC adopted rules that restricted the number of local radio stations one company could own, limited the national audience reach for one broadcaster, restricted companies from owning multiple TV stations in a local market and banned the ownership of both a newspaper and a television station in the same market. Each of the FCC's early efforts to maintain some restrictions on media ownership was based on the widely-held belief that media concentrated in the hands of too few companies could threaten access, diverse viewpoints and local news and information. In 1975, the Federal Communications Commission adopted a rule called the newspaper / broadcast cross-ownership ban which prohibited a newspaper and a broadcast or radio station from being co-owned if located in the same market. One company was prohibited from owning both a newspaper and a TV broadcast station in the same market.
Media Consolidation Begins
By the beginning of the 1980s, the Reagan Administration, the FCC and Congress embarked on a deregulatory approach toward communications policy and began chipping away at the protections in place for ensuring media diversity. In 1981, Deregulation by FCC and Congress took place. This first round of deregulation allowed a company to own up to 12 TV stations (up from seven), as long as those stations did not reach more than 25 percent of the population.
Political economy of media
Political economists like Golding and Murdock (1997) see the relationship between ownership and control as an indirect and mediated one. Control is not always exercised in a direct way, nor does the economic structure of media institutions always have an immediate impact on their output. Mainstream communication researchers criticize the conspiracy theories of the media on theoretical as well as on empirical grounds, arguing that political economists’ views are supported only by anecdotal evidence. Since the 1980s, there have been a lot of corporate mergers and buyouts in the media and entertainment industry. As a result, mainstream media has become more concentrated due to ownership and influence from advertisers.
We are here to serve advertisers. That is our raison d’etre,” said the CEO of CBS.
Media consolidation increases day b day as In 1983, fifty corporations dominated most of every mass. And in 1987, the fifty companies had shrunk to twenty-nine. Further, The Cable Act of 1992 gave broadcasters the power to demand "bundled programming”. So In 1997, the biggest firms numbered only ten. Such concerns increase the importance of study about media ownership. As Strinati (1995: 137) argues, its structure of ownership and control are equally crucial.
Media Moguls
Jeremy Tunstall &Michael Palmer wrote a book titled Media Moguls and discussed the concentration of media ownership by presenting different case studies about European Media. He provided the details of the emergence of a few very powerful individuals in control of large sections of world communications industries during an era of media de-regulation. He discussed media lobbies and found two big countries America and England who are controlling media. He viewed that internationalization is a major reason of media consolidation. He gave concepts of ‘One-off’ Media & ‘cash-flow’ Media. Certain types of media content lend themselves to globalization of ownership and control of production and distribution. This includes feature films, popular music recordings, TV serials and books etc named as One-Off Media. The other concept is of ‘Cash-Flow’ Media, which consists of newspaper and television stations not help in the globalization of media. Later Tunstall discussed about the earlier bigger mergers of media in world in 1989 like Time Warner Merger and Sony Takeover of Columbia Pictures
Media Ownership – Does It Matter?
According to William Melody, the greatest threat to freedom of expression in the United States or elsewhere is the possibility that private entrepreneurs will always tend to monopolise the marketplace of ideas in the name of economic efficiency and private profit (Melody 1978).
The problem of media ownership and concentration is perceived quite differently from a political economy perspective. In this context, the mass media industry is said to play a significant role in legitimating inequalities in wealth, power and privilege. When the control of the flow of information, knowledge, values and images is concentrated in the hands of those who share the power of the dominant class, the ruling class will establish what is circulated through the mass media in order to reproduce the structure of class inequalities from which they benefit. The mass media industry is crucial for the creation of reliable information, knowledge, ideology and propaganda in contemporary capitalist societies.
So the researcher Werner A. Meier raised following questions:
What is the real harm of conglomerates, group ownership and the concentration of financial, political and social power in the hands of only a few firms?
What standard of ownership concentration is economically and politically appropriate and what is socially acceptable?
Importance of understanding the Media Ownership
Denis McQuail raised the question that How the powers of ownership are exercised? This question clearly shows the importance about getting knowledge of the policies of media owners. Althusull (1984) present the second law of journalism:
Second law of journalism: the content of the media always reflect the interests of those who finance them.
According to William Melody, the greatest threat to freedom of expression in the United States or elsewhere is the possibility that private entrepreneurs will always tend to monopolize the marketplace of ideas in the name of economic efficiency and private profit (Melody 1978). Researchers prove that the results of media consolidation are not good and favourable to society. The result is that what most people hear and see in the mass media is remarkably uniform in content and world-view (Neuman, 1991). Gomery (2000) argues that ‘no research in mass communication can ignore questions of mass media ownership and the economic implications of that control’.
Media conglomerate
Global conglomerates can at times have a progressive impact on culture, especially when they enter nations that had been tightly controlled by corrupt crony media systems (as in much of Latin America) or nations that had significant state censorship over media (as in parts of Asia). The global commercial-media system is radical in that it will respect no tradition or custom, on balance, if it stands in the way of profits. But ultimately it is politically conservative, because the media giants are significant beneficiaries of the current social structure around the world, and any upheaval in property or social relations particularly to the extent that it reduces the power of business is not in their interest(Robert W. McChesney, 1999).
A media conglomerate describes companies that own large numbers of companies in various mass media such as Television, radio, publishing, Movies, and the Internet. It is also referred to as media institutions and media groups. Media conglomeration has been an increasing concern for media watchdogs. As recently as August of 2007, alerts were sounded when NewsCorp, the conglomerate of Rupert Murdoch purchased the Dow Jones Company, which publishes the Wall Street Journal. Viacom's purchase of Paramount, CBS and Blockbuster Video enables them to use cable, television, movies, comic books, theme parks, music publishing and book publishing to cross-market their products
Media Conglomeration and the News
With the increase in the trend of media consolidation, it is observed that news are effecting badly. So, Federal communication commission put bans on concentration of ownership, but on the name of diversification, internalization and economic profit owners find their way to rule on the minds through the power of consolidated media. They Promote diversified mass communication for their own interest. In the result, the credibility of news start declining. We are moving in conflicting directions where we have more outlets for news but fewer owners.
International Media Owners
Six Companies Own 96% of the World’s Media
Walt Disney
The largest media conglomerate today is Walt Disney Company, whose chairman and CEO, Michael Eisner, is a Jew. The Disney Empire, headed by a man described by one media analyst as a “control freak”, includes several television production companies (Walt Disney Television, Touchstone Television, and Buena Vista Television), its own cable network with millions subscribers, and much more.
Time Warner
Time Warner, Inc, is the second of the international media leviathans. The chairman of the board and CEO, Gerald Levin, is a Jew. In addition to cable and music, Time Warner is heavily involved in the production of feature films (Warner Brothers Studio) and publishing. Turner made a fortune in advertising and then had built a successful cable-TV news network, CNN. Turner had never taken public positions contrary to Jewish interests; he is a man with a large ego and a strong personality and was regarded by Chairman William Paley a loose cannon that might at some time in the future turn against them.
Rupert Murdoch’s News Corporation
In the media world number three on the list is Rupert Murdoch’s News Corporation, which owns Fox Television and 20th Century Fox Films. News Corporation often abbreviated to News Corp., is the world's third-largest media conglomerate (behind The Walt Disney Company and the Time Warner Company) as of 2008, and the world's third largest in entertainment as of 2009. The company's Chairman & Chief Executive Officer is Rupert Murdoch. At present, News Corporation is headquartered at 1211 Avenue of the Americas (Sixth Ave.), in New York City, in the newer 1960s-1970s corridor of the Rockefeller Center complex.
Viacom, Inc
Viacom, Inc, headed by Sumner Redstone (born Murray Rothstein), a Jew, is the fourth largest mega media corporation. Viacom, short for "Video & Audio Communications", is a United States-based media conglomerate with interests primarily in, but not limited to, cinema and cable television. As of 2010, it is the world's fourth-largest media conglomerate, behind The Walt Disney Company, Time Warner and News Corporation. It also continues to focus on its own in-house productions made for its various networks (MTV, VH1, Nickelodeon, etc.).
Japanese Sony Corporation
Number five is the Japanese Sony Corporation, whose U.S. subsidiary, Sony Corporation of America, is run by Michael Schulhof, a Jew.
New World Entertainment
New World Entertainment, proclaimed by one media analyst as “the premiere independent TV program producer in the United States,” is owned by Ronald Perelman, a Jew.
Media Conglomeration in Pakistan
Media conglomerates also getting strong in Pakistan day by day; five major media groups control the majority of the mainstream media in Pakistan. The Pakistani media grow mostly vertically but horizontal concentration is also present to some extent. Pakistan’s media elites invest hugely in the material development of their networks but no such generosity is evident in providing a comfortable working environment to their employee
Why the media conglomerates?
The reasons of the growth of media conglomerates are following:
Economic profit: Economies of scale Free Marketplace Model Global interlocking of the Media and Cartel
Cartel can be defined as a formal (explicit) agreement among competing firms. It is a formal organization of producers and manufacturers that agree to fix prices, marketing, and production. Cartel encourages the spread of certain values for example, consumerism, shareholder value, individualism, egoism, etc. “Virtual reality'' created by media cartel.
Impacts of media cartel
Strong incentives for the displacement of the public sphere with commercial infotainment, reality shows and trivialized news programmes The competition has reduced itself to attracting viewers through sensationalism etc rather than quality, detailed reporting etc. Corrosive influence on journalism: the news divisions of the media cartel appear to work against the public interest—and they work for their parent companies
Effects of Media Giants/ Oligopolies
It is useful to remind ourselves that free expression is threatened not just blatantly by authoritarian governments and all those in the private sector who fear public exposure, but also more subtly by the handful of global media conglomerates that have reduced meaningful diversity of expression in much of the globe. (Gerald Caplan, 1997)
The most common assumption is that the owners of the media influence the content and form of media content through their decisions to employ certain personnel, by funding special projects, and by providing a media platform for ideological interest groups. The growth of giant multinational media corporations means that unelected business tycoons can hold enormous power (Giddens, 1999).
These media tycoons results in the trivialization and personalization of news and political issues in their own interest. The fewer people have all power to affect society. They form oligopolies and opposed the free health competition in the market.
Concerns are expressed about increasing corporate control of mass mediated information flows and about how democracy can function if the information that citizens rely on is tainted by the influence of mega-media (Bagdikian 2000; McChesney 2000; Herman 1998).
The media conglomerates Dissect and attack news reports for their own benefits, they don’t go for impartiality and objectivity, they just promote those news which favours them and which is more sensational news so that they can earn more profit. All of this result in great deeper social loss. People don’t get true; they get only that news which media want to tell them.
Self-serving censorship of political and social ideas, in news, magazine articles, books, broadcasting, and movies are common under the media ownership policies. Some intervention by owners is direct and blunt. There are strong incentives for the displacement of the public sphere with commercial infotainment, reality shows and trivialised news programmes. This strengthens a conservative ‘common sense’ view of the world, eroding local cultures and communities. Media Power’s Expansion to Political Power is increasing day by day, media owners’ impacts on political decisions by using their power. The economic strength of media conglomerates increases their position in society so that they become powerful institutions with substantial political power.
According to Bagdikian (2000: viii) the largest media giants have achieved alarming success in writing the media laws and regulations to favour the interests of their corporations rather than the interests of the general public.
The media conglomerates are often more cooperative than competitive, with an increasing number of strategic alliances and joint ventures. No criticism about economic, political or other policies that go against the interest of that parent company. They form Global interlocking of the Media and Cartel to reduce the competition. So, it results in low quality of programs. The global interlocking of the media industry and traditional corporate power creates a powerful cartel, which in turn encourages the spread of certain values (for example, consumerism, shareholder value, individualism, egoism, etc.). There are strong incentives for the displacement of the public sphere with commercial infotainment, reality shows and trivialised news programmes. This strengthens a conservative ‘common sense’ view of the world, eroding local cultures and communities. As a consequence of the increasing influence of the media conglomerates on public opinion, there is little substantive coverage of the spectacular media deals in terms of the perceived effects of these deals. In most cases, journalists are directly affected but they do not report their own concerns (probably because of internal pressure). Media owners are keen to advertise the advantages of horizontal, vertical, diagonal and international concentration.
In the end, it is clear that the fewer and fewer players in the media market are playing with the whole society on the name of profit and diversification. Some see the concentration of media ownership as having a negative effect on the market and on society as a whole. Others argue that there are benefits to this concentrated market structure.
Proponents of oligopolistic media market structures say that media conglomerates can run the media more efficiently and cost effectively than a host of small local stations. This is because production costs decrease as certain tasks are merged and standardized across a large number of stations. This should give them the necessary capital to meet the specific needs of local markets while competing with other national and international media conglomerates.
Critics say that competition is nonexistent when there are so few corporations to compete. When there is no competition, consumer costs rise and the quality of service diminishes. This is especially true in the case of a monopoly. There are also concerns about whether the views being expressed by the mass media reflect the diversity of the communities served. When the media is standardized, these critics assert, opinions become standardized as well.
References:
Articleworld.org. (n.d.). Concentration of media ownership. Retrieved December 12, 2010, from http://www.articleworld.org/index.php/Concentration_of_media_ownership
Bagdikian, B. (2006). The New Media Monopoly. Beacon Press: Boston
Golding, P., & Murdock, G. (1997). The political eonomy of media. In books.google.com.pk. Retrieved from http://books.google.com.pk
Gomer, D. (2000). Interpretating Media Ownership. Retrieved, from http://books.google.com.pk
McChesney, R. W. (1999). The New Global Media; It’s a Small World of Big Conglomerates. The Nation MagazineW. Russell Neuman, W. R. (1991). The future of the mass audience. Retrieved from http://books.google.com.pk
Media ownership. (n.d.). In hearusnow.org. retrieved from http://www.hearusnow.org/mediaownership/25/
Strinati, D. (2000). An introduction to studying popular culture. In books.google.com.pk. retrieved from http://books.google.com.pk
Wikipedia.org. ( n.d.). Concentration of media ownership. Retrieved December 12, 2010, from http://en.wikipedia.org/wiki/Concentration_of_media_ownership
Werner A. Meier, W.A, (2002). Media Ownership: Does it matter?. Retrieved, from http://lirne.net/resources/netknowledge/meier.pdf
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