For instance, the companies could commit to increasing the number of local reporters at either the TV station or newspaper—or provide significant financial assistance to an independent local nonprofit news outlet. And if a TV station makes concrete promises and then reneges, it could have its license renewed for a shorter duration, or the parent company could be penalized during future waiver requests.
Or, better yet, here’s my modest proposal: Congress could consider something bolder and cleaner. It could loosen the rules on media mergers—but require a substantial transaction fee for each merger, with the proceeds going to fund local journalism in that community.
Each time there is a consolidation, the participating companies would donate money to a local endowment supporting successful nonprofit or independent news providers. Throughout the country—from MinnPost in Minneapolis to The Lens in New Orleans—citizens and entrepreneurs have created digital news organizations to make up for the losses in civically important but financially dubious reporting. Local minority-owned media startups have faced the same difficulties in generating revenue and could benefit from such an idea as well. Here’s a way for the lumbering media giants to help them—even as they help themselves.
Under this scenario, companies would not have to make a case that their merger would help the community. If the economics dictate that they invest more in news, great. But if they don’t, the community will still end up better off for the merger because of the journalism being underwritten by the transaction fee.
Yes, it would add to the cost of the acquisition. But the parties would know exactly what that amount is on the front end, build it into the cost-benefit calculus (and the offer price), and decide whether it still makes sense. This is a far more market-oriented approach than past media policies. If the transaction fee deters the merger, fine. It might have the side effect of preventing mergers with weak economic rationales. But if the parties proceed, they would be helping to subsidize the local media market.
There are many practical details to work out. How could you make sure that this money is spent well? One thought: the merging companies would present a plan proving that there’s a non-partisan mechanism in place in that community that could manage a fund. My guess is that local journalism schools could often play a key role (and, no, Columbia isn’t paying me to say that). Often skilled at creating competitions for journalism awards, some locally based schools could manage the process for distributing funds, perhaps through competitive grants or through a matching system that would reward nonprofit media that has successfully raised funds from other sources.
Crucially, once the check is deposited in the fund—ideally creating an endowment that would continue subsidizing community journalism indefinitely—neither the government nor the media companies should have any say in how that money is distributed.
There’s a limit to how much consolidation should be allowed even with this tollbooth approach. And there are no doubt flaws to this community-investment idea as well. The most important thing right now is that rather than reverting to an antiquated debate about consolidation, we have an honest discussion about what would truly benefit communities.
Responsible media policy isn't about protecting the status quo for the stodgy interests of Columbia University, FCC alumni, and newspapers that, for years, have done quite well. It is about serving the public interest. And for the same number of years newspapers owned by Rupert Murdoch and the Sulzbergers have been fat and happy, advocates for media ownership have fought for better policies to reduce discrimination against minorities and women who have sought to own stations. Other advocates have fought for newsroom diversity and newspapers like The New York Times (a Columbia Journalism Review backer) have and continue to routinely discriminate against minorities and women. Policymakers have sat on their hands when it comes to new entrants. But when it comes to deregulation, now there's something that has to be done RIGHT AWAY!
Deregulating the media industry is just another strategy do protect the interests at the very top of the food chain, while everyone else can wait. That is why the Leadership Conference for Civil Rights, whose membership is comprised of 200+ real civil rights organizations and unions, including the Newspaper Guild/Communications Workers of America, NAACP, and the American Civil Liberties Union, have opposed the FCC's proposed relaxation of the media ownership rules: http://bit.ly/ZVQIqh. And they did not need the blessing of the ivy league, FCC alumni, or even Free Press, to do so.
#1 Posted by Joseph Miller, CJR on Thu 20 Dec 2012 at 05:38 PM
Steve Waldman's idea seems practical. As traditional media shrink -- and let's be clear, in nearly all of America's communities, they are shrinking, fast -- it's in the public interest to help the traditionals glide to the ground as the new systems that will provide the news of tomorrow take off.
Even thought it's a good idea, I'm afraid this politically polarized country is becoming incapable of doing anything down the middle. One side or the other always has to crusade and win and insult the other side while doing it. My view: it's a shame that practical ideas are thrown in the dustbin because of this zero-sum mentality.
Traditional media still provide the bulk of America's useful community news, yet in the digital era's new economic reality they are fading. "Let them die as fast as possible" is a bad idea, just as "let them do whatever they want" is a bad idea. Slightly relaxing the rules and protecting the public interest with Waldman's "merger fee" is obviously neither what conservatives want, nor what liberals want.
I would call it a creative and reasonable compromise -- suggested, unfortunately, on a national stage where compromise is becoming a dirty word.
#2 Posted by Eric Newton, CJR on Fri 21 Dec 2012 at 09:42 AM
It's always amusing to observe disputes among extreme left wing Luddites. Google has 80% of ad revenue nationally, but these geniuses are still worried about one entity owning two TV stations or a newspaper and a radio station in the same local market. Newspapers are closing down and laying off reporters, but self-styled "progressives" are wringing their hands about whether allowing newsroom assets to be owned by a local broadcaster would be acceptable. Pretty darn laughable! It's none of the government's business, folks. We would never have the freedom, benefits, creativity, and diversity present on the Internet if the government regulated it with the stranglehold it places on other electronic media.
#3 Posted by Mark J. Prak, CJR on Fri 21 Dec 2012 at 05:16 PM
It's always amusing to observe disputes among extreme left wing Luddites. Google has 80% of ad revenue nationally, but these geniuses are still worried about one entity owning two TV stations or a newspaper and a radio station in the same local market. Newspapers are closing down and laying off reporters, but self-styled "progressives" are wringing their hands about whether allowing newsroom assets to be owned by a local broadcaster would be acceptable. Pretty darn laughable! It's none of the government's business, folks. We would never have the freedom, benefits, creativity, and diversity present on the Internet if the government regulated it with the stranglehold it places on other electronic media.
#4 Posted by Mark J. Prak, CJR on Fri 21 Dec 2012 at 05:18 PM
I guess one way to look at it is: "how can we make the ongoing trend of media consolidation less horrific than it has been" and Waldman has some reasonable ideas on that front. But it begs the larger question of why facilitate the continuation of something that has provably worsened local news coverage and diminished public debate in the first place. The economic decisions of media moguls have done nothing to enable better journalism, the much discussed economies of scale have provided no demonstrable benefits and there isn't much indication that anything has improved at all, except perhaps some short-term benefits to the stock portfolios of a few one percenters. It's like trying to figure out how to increase the social benefits of off-shoring jobs. Why bother? Media mergers have no track record of saving distressed outlets or preserving local journalism and no one with an interest in those things benefits from the proposed relaxation of the rules. I'm waiting for one good answer for "why do this?" from anyone but Rupert Murdoch .... and I still haven't heard it.
#5 Posted by Tracy Rosenberg, CJR on Sat 22 Dec 2012 at 08:40 PM
First off, we have a reexamining of modern antitrust in the passing of Robert Bork worth looking at to give this context:
http://www.motherjones.com/kevin-drum/2012/12/it-or-not-today-we-live-robert-borks-world
In 1960, he was concerned the socialists would take over the country through antitrust. Antitrust then was about protecting small businesses. He built a full framework about how antitrust should be more about economic efficiency than about helping small businesses. He expanded upon this in articles and the book, The Antitrust Paradox , in 1978. He wrote a sentence: Congress enacted the Sherman Act as a "consumer welfare prescription." The Supreme Court adopted that sentence in 1979. That is the stated goal in antitrust today. It is a big deal. A huge deal. In antitrust, it's operational. Robert Bork defined it.
Second, the less local and more consolidated media ownership becomes, the more it becomes generalized and remote from its local audience.
http://www.democracynow.org/2007/1/25/exclusive_911_calls_in_north_dakota
Something to think about.
#6 Posted by Thimbles, CJR on Tue 25 Dec 2012 at 03:53 AM
I couldn't resist responding to this one at length over at The Huffington Post: http://www.huffingtonpost.com/craig-aaron/hey-cjr-lets-do-the-time_b_2365754.html
In shorter form here minus all my jokes about the '80s, I don't know how you can call what the FCC is doing "hardly radical."
What else would you call eliminating the only rules that would prevent Rupert Murdoch from adding the Los Angles Times and Chicago Tribune to his media empire?
Terrible? Apocalyptic? Insane? How about just plain wrong?
Waldman also leaves out the issue of ownership diversity, which is at the core of the current debate. While noting the support of one radio station sales broker, he fails to mention that 60 members of Congress, The Newspaper Guild and every major civil rights group, including the NAACP, Rainbow PUSH Coalition and The Leadership Conference on Civil and Human Rights, oppose the FCC's current proposal.
But even if you were to set aside the FCC's blatant failure to address diversity, neither Waldman nor the FCC backs up claims that changing ownership rules will actually help struggling newspapers, the journalists who work there or the public. In fact, the crisis in journalism is a direct result of the type of pro-consolidation policies the FCC continues to push.
While he offers some interesting ideas, the FCC isn't actually studying any of Waldman's proposals. His former employer isn't actually introducing any new ideas or analysis. It certainly isn't listening to the public or participating in an "honest discussion about what would truly benefit communities."
The only thing the FCC is doing is the one thing we know won't help the crisis in journalism: pushing more and more media consolidation. And that's what needs to be stopped.
#7 Posted by Craig Aaron, CJR on Wed 26 Dec 2012 at 01:40 PM
Communications Daily reported today that the FCC is considering granting waivers for some Joint Sales Agreements, again without considering the effect this will have on broadcast ownership by women and people of color.
It must take a tremendous amount of energy to purposefully ignore the potential effects rule changes will have on diversity. Perhaps part of the reason is a lack of diversity among staffers at the Commission itself.
#8 Posted by Joseph Miller, CJR on Wed 26 Dec 2012 at 10:47 PM
The money quote: "This rule defies common sense and ignores recent history . . ."
I am always loathe the ignore what I already know to be true. That's my starting (and ending) point. Particularly at the upper corporate levels of media, just like any other business, once concentration reaches a tipping point, product diversity drops through the floor and the implications regarding news organizations are well known. I do not see anything which leads me to believe that the pitfalls have magically disappeared, internet or not.
If the business model is no longer valid, either it must adapt or die. I propose we think extremely seriously about allowing greater concentration of media ownership. We already know that there are certain organizations out there exploiting state and local media to further a narrow agenda to the cost of the greater good. Why make that easier?
The author presupposes a benign influence in society and I for one, see the media landscape otherwise. If the author feels I'm wrong, I want to see the proof. Exhaustive proof. The last thing in the world we need is another LA Times of the 50's and 60's, and we all know, with metaphysical certainty, that if enabled, media concentration will be abused. The rules are good. If anything, more diversity is needed, not less.
#9 Posted by papicek, CJR on Thu 27 Dec 2012 at 12:00 PM
I'd like to respond to Craig Aaron of Free Press by making sure we're all working from the same facts. In his Huffington Post piece, he attacks the FCC's "consolidate-at-all-costs model." Reading his history of the evils of media consolidation, one would think the FCC was proposing eliminating all the rules blocking media mergers. And who could be in favor of such wanton de-regulation?
So it might surprise you that this is what the FCC has actually proposed:
The FCC currently restricts the number of TV stations that one company can own in a particular community. The FCC's new proposal: keep those restrictions.
The FCC currently restricts the number of radio stations that one company can own in a particular community. The FCC's new proposal: keep those restrictions.
The FCC currently restricts the number of TV stations one company can own throughout the nation. The FCC's new proposal: keep those restrictions.
The FCC currently restricts mergers between two of the top four Networks (ABC, NBC, CBS, Fox). The FCC’s new proposal: keep those restrictions.
There are two areas where the FCC has indeed proposed removing the bars to consolidation. There has in the past been a ban on newspapers merging with radio stations. The FCC has proposed lifting that ban -- and I'm inclined to think it's right. The number of commercial all news stations has dropped, as has the provision of local news in commercial radio in general. Companies like Clear Channel and Citadel have shown little interest in local news as a formula for success. Allowing news media companies -- i.e. companies that are often in the business of local news -- to enter the world of radio could be a step in the positive direction.
The FCC also proposes lifting the ban of TV companies owning radio stations. I don't want to oversell this: the most likely affect of this is nothing. But if CBS -- which does actually care about news on radio -- wants to buy some radio stations to compete with Clear Channel, that might well be progress.
The most controversial step the FCC has proposed in making a limited change in the newspaper-television cross-ownership rule. Newspapers currently cannot merge with a TV station in the same town. The FCC has proposed keeping that rule in 90 percent of the markets. But in 10% of the markets -- the top 20 markets -- they have said that a newspaper can probably merge with a TV station if that station's is one of the smaller stations in town -- specifically if it
ranks fifth or lowest. Even then, the merger would be blocked if it the result were fewer than eight independent voices in the community.
This limited extra flexibility, of course, comes at a time when newspapers are hardly the behemoths of old – indeed, at a moment when they need whatever help they can get.
So there you have it: the FCC's "apocalyptic," "consolidate at all costs" initiative consists mostly of keeping the merger rules exactly the way they are and in a few cases offering limited -- and, in my view, completely reasonable -- changes.
You wouldn't know that from reading the Free Press article, would you?
Craig's piece prefers to operate at the general level – “Consolidation..Bad!” -- because its much harder to generate outrage with the bumper sticker, "THE FCC HAS KEPT MOST MERGER RESTRICTIONS IN PLACE BUT MADE SOME MINOR CHANGES THAT MIGHT ALLOW FOR AN OCCASIONAL MERGER BETWEEN A NEWSPAPER AND A TV OR RADIO STATIONS.”
Lacks a certain zing, doesn’t it?
Responses on some of Craig’s other points after I go to the store to return some Christmas/Hanukah presents….
#10 Posted by Steven Waldman, CJR on Thu 27 Dec 2012 at 08:16 PM
Mr. Waldman's article fails to acknowledge both minority and women's interests, as did his Future of Media report. Those who stand the most to lose from further deregulation aren't even on his radar. The argument that "The Internet will Set us Free" fails to recognize that most in the US still get their information from broadcast media, not the Internet. Even if it is delivered through cable, news and other programming come from broadcast stations. And for those without cable, it comes the old-fashioned way, through the airwaves. It's easy to forget that these airwaves are by law a public resource, and they must be protected from those who would see them as a private resource to be reallocated for other purposes so they can profit from them. Communication policy in this nation falls along the fault lines of race, gender and social class. In our discussions about policy, we have a responsibility to remember this.
#11 Posted by Carolyn Byerly, CJR on Fri 28 Dec 2012 at 09:48 AM
Mr. Waldman's subsequent comment did not even address ownership by women and people of color. That is because any deregulation of the media ownership rules, however slight, is premature without robust diversity studies going well beyond the FCC's current cram session to rectify decades of neglect. This effort will prove futile when any relaxed rules end up back in court and wasting even more taxpayer dollars.
#12 Posted by Joseph Miller, CJR on Fri 28 Dec 2012 at 04:45 PM
I appreciate Steven Waldman making the effort to respond my critique in the comments here and over at The Huffington Post. I hope to return to this thread in the new year to discuss some of the interesting ideas he puts forward on how we might support local news.
But first I need to explain why he's so wrong to minimize what his former bosses at the FCC are proposing.
Waldman's suggested bumper-sticker headline is indeed long and boring. The obviously better headline is: FCC CLEARS THE WAY FOR RUPERT MURDOCH TO OWN LA TIMES AND CHICAGO TRIBUNE.
It's true, too. That's exactly the kind of "limited change" the FCC's proposal would make possible. If you think giving Rupert Murdoch that much media power is a bad idea, then you should be very worried about what the FCC is doing.
(And to those reading the fine print, yes, Murdoch's Fox TV stations regularly finish outside the top-four behind Univision in L.A. and WGN in Chicago.)
Another headline might be: OBAMA ADMIN. FLIP-FLOPS ON COMMITMENT TO MEDIA DIVERSITY.
As Professor Carolyn Byerly emphasizes in her comments above, the FCC has continually failed to address the scandalously low levels of media ownership by women and people of color. And as Joe Miller rightfully points out, their "current cram session to rectify decades of neglect" won't cut it for the courts, the civil rights community or the public. That the president eloquently spoke out against these exact kinds of changes as a senator and presidential candidate in 2007 and 2008 makes what his FCC appointees are doing all the more perplexing.
But what I really take issue with in Waldman's reply is the idea that the FCC's latest attack on media ownership limits should somehow be acceptable because the FCC is keeping so many existing restrictions in place. The examples he cites are almost all cases in which previous administrations already had gutted the rules.
So, yes, the FCC generally restricts the number of TV stations that one company owns in a particular community; unfortunately, the FCC has looked the other way when it comes to local-marketing and shared-services agreements and other forms of "covert consolidation" that allow one company to run the newsrooms at two or three stations in the same market while pretending to have separate owners.
And while there is no national cap on radio station ownership (hello, Clear Channel), the FCC currently limits local radio-station ownership in the biggest markets to eight stations — a high level of concentration that has been disastrous for independent stations and the local news radio Waldman wants to save. The FCC hardly deserves credit for not smashing something it already broke.
Likewise, the national cap on TV ownership is currently 39 percent — a level set by Congress in 2003 to ensure that neither News Corp. or Viacom would have to sell any of their stations. (The Republican-controlled FCC had proposed raising the cap to 45 percent.) Keeping this rule in place doesn't show much restraint on the part of the current FCC leadership, either.
#13 Posted by Craig Aaron, CJR on Sun 30 Dec 2012 at 08:36 PM
All of Waldman's arguments seem to rest on the idea that more consolidation might help struggling newsrooms somewhere. But all of the supposed benefits are hypothetical. Where's the evidence?
Every independent study I've seen shows that consolidation harms local news, as well as local diversity of ownership and viewpoint.
If newspapers need all the help they can get, how do more debt, more layoffs and fewer reporters on the beat constitute "help"?
And why exactly — as instructed by the U.S. Court of Appeals for the 3rd Circuit -- can't the FCC actually study the impact on ownership by women and people of color before pushing through a new round of major changes?
I don’t think it's because they are in such a rush to save journalism.
The FCC and its defenders accuse groups like mine of sloganeering, but we've put hundreds and hundreds of pages of serious and detailed analysis in the record — not to mention the repeated court rulings we've won against the FCC based on the facts. And it's worth repeating that 99 percent of the public comments received by the agency since 2003 opposed these changes.
The relentless push for more and more consolidation has left the media landscape bleak and scarred. I say we need to protect what's left while planting the seeds for a healthier media ecosystem in the future.
Steven Waldman looks out at the clearcut forest and asks, what's a few more Redwoods?
#14 Posted by Craig Aaron, CJR on Sun 30 Dec 2012 at 08:40 PM
In my 2008 study of radio listeners, I proposed loosening broadcast/print cross-ownership restrictions for some of the same reasons cited in this column. However, instead of implementing various fees and waivers, as Waldman suggests, my less-complicated proposal ties looser cross-ownership rules to tighter radio ownership caps, both locally and nationally.
Read more on study results here:
http://www.rit.edu/news/release.php?id=46578
Hear audio podcast discussing study findings and proposals here:
https://soundcloud.com/mike-saffran/studio-86-the-state-of-radio
Michael Saffran
SUNY Geneseo
#15 Posted by Michael Saffran, CJR on Mon 7 Jan 2013 at 10:54 PM