Think Media Consolidation Is Good for Journalism? Think Again
Think Media Consolidation Is Good for Journalism? Think Again
By Free Press / freepress.net

The Federal Communications Commission is pushing a plan to gut its 30-year-old newspaper/broadcast cross-ownership ban. This proposal would allow one company to own a local paper, two TV stations and up to eight radio stations in a single market. Advocates of more media consolidation argue that allowing TV stations and newspapers to merge is critical to cutting costs and saving local journalism.

This is the same argument the Bush FCC used to try to push through the same bad rules in 2007. Back then, the Senate voted the rules down and the courts later threw them out. It’s time to put this argument to bed for good: More media consolidation won’t save journalism.

Banks have toxic assets. Journalism has media consolidation.

When we think about the state of journalism today, let’s not forget that media consolidation is largely what got us into this mess in the first place. Newspapers and TV stations have long been hugely profitable enterprises — and many still are.

Rick Edmonds at Poynter recently highlighted the fact that 2012 was a good year for newspaper stocks. Indeed, the top publicly traded newspaper companies remain quite profitable. In 2011, the McClatchy Company enjoyed 27 percent profit margins, Lee Enterprises had 24 percent profit margins and the Gannett Company’s profits were at 22 percent.

This sounds good, but not that long ago many media companies reported 30 or 40 percent profits. But instead of investing in their product during those flush times — hiring more journalists, diving head-first into the Web — most companies went on a buying spree. The biggest news organizations in the country got over-leveraged with debt as they gobbled up competitors.

Ad revenue eroded as a result of the economic downturn and the media companies’ failure to invest resources online. These companies could have weathered all of this if they weren’t also drowning in debt.

As media companies are bought and sold, as they go bankrupt and get traded by private equity firms, the people who get hurt are journalists and communities. Journalists lose their contracts or their jobs and communities are left with newspapers whose revenues are used only to pay off debt.

More media consolidation will only make the situation worse.

Letting one company own both a newspaper and broadcast stations in the same market isn’t just bad for the community; it’s also bad business. Cross-ownership doesn’t save anything; it simply drags down the performance of both broadcasting and print operations.

Media General was once one of the biggest advocates for gutting the newspaper/broadcast cross-ownership ban, but the company is silent on the issue now. In fact, over the course of 2012 Media General broke up its four cross-owned properties. Similarly, Belo Corp. spun off its broadcasting and newspaper operations. Margins at both then improved, with the newspaper’s profit margin doubling.

The Tribune Company has cross-owned print/broadcast holdings in five cities around the U.S. The company just emerged from the largest bankruptcy in media history and plans to unbundle its cross-owned properties.

The only company actively lobbying the FCC to weaken the cross-ownership rules is Rupert Murdoch’s News Corp., which sent representatives to meetings with the FCC chairman’s office just last month. That may be why the FCC proposal looks like such a plum handout to Murdoch, who wants to buy the L.A. Times and the Chicago Tribune — but can’t unless the agency changes its cross-ownership rules.

Media consolidation leads to less local news.

Here at Free Press, we’re concerned as anyone about the future of journalism. We need a system where communities have access to a full range of news and information, where diverse perspectives are part of the national debate, where journalists make a living wage and are protected enough to hold power to account.

However, relaxing the newspaper/broadcast cross-ownership ban will move us in exactly the wrong direction. While the FCC’s 2007 studies indicated that cross-ownership leads to increased news production at the cross-owned station, that finding was later debunked in peer reviews. It turns out the FCC was counting sports and weather segments in its calculations. Those categories aside, cross-owned stations actually aired less hard news than non-cross-owned stations.

In addition, if you look beyond the one station and take into account the entire region being served by local TV and newspapers, both FCC data and outside studies indicate that cross-ownership leads to less total news produced locally. Cross-ownership crowds out the competition. The presence of a cross-owned station leads other stations in a market to collectively curtail their news output by about 25 percent.

The FCC’s plan to relax the newspaper/broadcast cross-ownership ban will lead to more absentee landlords controlling our nation’s public airwaves, and it will hurt media diversity. The same old media consolidation policies are not a solution for the new challenges (or opportunities) facing journalism today.

Original photo by Flickr user Inju


If you care about fighting media consolidation, please consider a donation to the Free Press Action Fund.

0.0 ·
0
What's Next
Trending Today
A Perfect Symbol of Media Capture: DWS Booed, MSNBC Caption Says “Cheered”
Liam Miller · 63,189 views today · Monday morning saw Debbie Wasserman Schultz, former DNC chair, booed offstage at the Florida Democratic Delegation Breakfast; while it was transpiring, MSNBC's caption read...
History Tells Us What May Happen Next With Brexit and Trump
Tobias Stone · 26,599 views today · It seems we’re entering another of those stupid seasons humans impose on themselves at fairly regular intervals. I am sketching out here opinions based on information, they may...
The 6 Grand Illusions That Keep Us Enslaved
Sigmund Fraud · 17,361 views today · For a magician to fool his audience his deceit must go unseen, and to this end he crafts an illusion to avert attention from reality. While the audience is entranced, the...
The White Man in That Photo
Riccardo Gazzaniga · 12,724 views today · Sometimes photographs deceive. Take this one, for example. It represents John Carlos and Tommie Smith’s rebellious gesture the day they won medals for the 200 meters at the...
Law Professor's Epic Response to Black Lives Matter Shirt Complaint
Social Design Notes · 10,513 views today · A first year law school student wrote a complaint about her professor having worn a Black Lives Matter T-shirt during class. The professor’s response is priceless. Scans of...
How Prison Labor Is the New American Slavery and Most of Us Unknowingly Support It
Sara Burrows · 9,153 views today · If you buy products or services from any of the 50 companies listed below (and you likely do), you are supporting modern American slavery
John Lennon's "Imagine," Made Into A Comic Strip
John Lennon. Art by Pablo Stanley · 8,834 views today · This is easily the best comic strip ever made.  Pabl
25 Mind-Twisting Optical Illusion Paintings by Rob Gonsalves
Dovas · 8,552 views today · The beautiful and mind-bending illusions in Canadian artist Robert Gonsalves’ paintings have a fun way of twisting your perception and causing you to question what in his...
Watch What It Really Means to Hold Space for Someone
2 min · 5,288 views today · How to Be There for the People who Need you Most. Read the article here.
On the Phenomenon of Bullshit Jobs
David Graeber · 5,187 views today · Ever had the feeling that your job might be made up? That the world would keep on turning if you weren’t doing that thing you do 9-5? David Graeber explored the phenomenon of...
Eckhart Tolle: Your Facebook Ego, That's Not Who You Are
2 min · 4,562 views today · “Identification with thoughts and the emotions that go with those thoughts creates a false mind-made sense of self, conditioned by the past: the "little me" and its story. This...
Who Are You? This Breathtaking Video Might Change Your Life
2 min · 3,409 views today · "Normal is getting dressed in clothes that you buy for work, driving through traffic in a car that you are still paying for, in order to get to a job that you need so you can...
Your Anger Is Misdirected: Don't Let Bernie Endorsing Hillary Distract You From What Matters
Tim Hjersted · 3,287 views today · All this attention on Bernie endorsing Clinton is a big distraction from the fact that the work was always going to be up to us. The movement isn't about Sanders and what he...
The U.S. Has an Incarceration Problem
3 min · 3,132 views today · When you shrink the United States' population down to 100 people this is what you get. The United States has over 2,000,000 prisoners. Who are they? What are they in for?
A World War Has Begun - Break The Silence
John Pilger · 3,034 views today · I have been filming in the Marshall Islands, which lie north of Australia, in the middle of the Pacific Ocean. Whenever I tell people where I have been, they ask, "Where is...
Donald and Hobbes Is Genius
Various · 2,921 views today · Some clever folk have been replacing precocious 6-year-old Calvin, from the Calvin and Hobbes comic strips, with Donald Trump and the results are, well, take a look...
Why Hope Has Power in This Gut-Wrenching Election Year
Frances Moore Lappé and Adam Eichen · 2,186 views today · Cynicism and despair are among democracy’s worst enemies.
We've Been Protesting for Decades. What's It Going to Take to End Police Brutality?
Tai Amri Spann-Wilson · 2,047 views today · On #BlackLivesMatter, moral injury and activism
Wetiko - The Cannibalistic Disease Consuming Our Planet and Society
4 min · 2,042 views today · Wetiko is an Algonquin word for a cannibalistic spirit or thought-form driven by greed, excess and selfish consumption. It deludes it host into believing that consuming the...
I Stopped Eating Animals Because of Human Rights
Andy West · 1,805 views today · What does the meat industry do to people’s mental health?
Load More
Like us on Facebook?
Think Media Consolidation Is Good for Journalism? Think Again