Monopoly Money

By Dan Kennedy, Boston Phoenix. Posted January 17, 2002.

A.J. LIEBLING WOULD not be pleased. Nearly 40 years ago, the legendary press critic lamented the rise of one-newspaper cities, a phenomenon considerably less common then than today. Where there is no competition, Liebling wrote, "news becomes increasingly nonessential to the newspaper. In the mind of the average publisher, it is a costly and uneconomic frill, like the free lunch that saloons used to furnish to induce customers to buy beer. If the quality of the free lunch fell off, the customers would go next door."

Since then, things have gotten only worse.

When the first edition of Ben Bagdikian's The Media Monopoly (Beacon Press) was published, in 1983, some 50 corporations were identified as controlling most of our newspapers, magazines, books, television networks, radio stations, and movie and music studios. Twenty years later, in the current "Big Media" issue of the Nation, that list is down to 10 international conglomerates, their vast holdings detailed in a fold-out color chart.

But though media consolidation is hardly a new story, there is a disturbing sense that the pace of monopolization is accelerating, and that the end game, or something like it, is at hand. Particularly distressing is the rapid consolidation of the cable industry, which threatens to turn the wide-open, decentralized, but slow Internet of the 1990s into a corporate-owned, profit-oriented, high-speed network with no room for independent voices. The Net is the last, best hope for a truly democratic media. Yet if we don't act, it may soon be too late to save it.

The most significant recent development took place just a month ago, when AT&T Broadband, the country's largest cable-television provider, was acquired by Comcast, the number-three company. AT&T Comcast, as the new company will be known, will control some 22 million subscribers — more than a third of the nation's 60 million cable households. And if that weren't chilling enough, analysts are already predicting that the most humongous media conglomerate of them all, AOL Time Warner, whose 13 million cable subscribers make it the number-two company, will work out some sort of a partnership with AT&T Comcast.

The AT&T Broadband–Comcast deal did not take place in isolation. Earlier last year, the Federal Communications Commission (FCC), whose alleged job is to make sure that media giants do not trample upon the public interest, dumped a half-century-old rule that had prohibited one network from owning another. The result: Viacom, which owns CBS, was allowed to acquire UPN. That's why, in Boston, you can now watch Channel 4's news on Channel 38 (see "Big Media Stalk Hub," sidebar).

At about the same time that the cable giants were consolidating, the French media conglomerate Vivendi Universal announced that it would buy USA Networks for about $10.3 billion. Vivendi owns the Universal movie studios; USA's holdings include a television-production operation and the USA and Sci-Fi cable channels. Earlier in the year, Vivendi acquired Houghton Mifflin, the last of the big, independent, publicly traded book publishers — and the holder of the suddenly lucrative Lord of the Rings franchise.

Moreover, all of this is taking place at a time when a series of pro-industry court rulings and changes at the FCC threaten to sweep away what few restrictions remain in place following passage of the Telecommunications Act of 1996, which greatly relaxed ownership rules. The FCC appears poised to junk such old standbys as the prohibition against a newspaper's owning a television or radio station in the same market, as well as a passel of local and national restrictions on the number of radio stations, television channels, and cable systems any one company is allowed to own.

"The problem is that a lot of this stuff is happening behind the scenes," says Danny Schechter, executive editor of MediaChannel.org, a media-watchdog Web site with an international and progressive orientation. "The FCC may make any concerns about this completely irrelevant when it chooses to lift all remaining regulations, which is certainly possible. I think there really is kind of a tipping point. It's hard to get it back to the way it was, not that the way it was was so great. But what you did have was more of an ethos, at least a lip-service ethos, to public service. And now even that has gone out the window."

At the center of all this is President Bush's handpicked FCC chairman, Michael Powell, who, like his father, Secretary of State Colin Powell, is bright, smooth, and articulate -- but who, unlike his father, espouses the kind of doctrinaire free-market conservatism that Bush favors in his domestic-policy appointees.

Michael Powell has a penchant for saying provocative things, and sometimes the nuances get lost. For instance, when he was asked last year about the "digital divide" — the technology gap that exists between rich and poor -- Powell memorably replied, "I think there's a Mercedes divide. I'd like one, but I can't afford it." The Washington Post later showed that Powell's remarks immediately before and after showed considerably more thoughtfulness than the dismissive sound bite suggested.

Yet there's little question that when it comes to deregulation, Powell intends to outdo even his deregulation-minded, Clinton-appointed predecessors, Reed Hundt and William Kennard. In a little-noticed interview with the Wall Street Journal published last September 10, Powell spoke disdainfully about "what I call the 'Big Fish Problem,' which is this inherent anxiety about bigness in a capitalist economy." He also made it clear that his view of the public interest was not necessarily the same as that of those whose business it is to act as the public's eyes and ears.

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