Media concentration concern overblown

Rupert Murdoch, whose News Corp. owns the Fox broadcast network and Fox-branded cable channels such as Fox News and Fox Sports, has become the choice bogeyman for media consolidation critics. Media critics have painted him a domineering robber baron whose vast media empire steamrolls competing networks and leaves consumers with shrinking news and entertainment choices. Without government intervention, they warn, Murdoch and a handful of other media moguls will drive out smaller competitors and squelch media diversity.

The media critics’ case might be more compelling if they had not conveniently forgotten recent history. Far from being an exemplar of shrinking consumer choice, Fox was on the cutting edge of an explosion of consumer media choices in the ’80s and ’90s. Prior to the Fox network launch in the 1980s, television was dominated by the “Big Three” – NBC, ABC and CBS. Fox’s success turned the “Big Three” into the “Big Four.” A decade later, that success inspired the UPN and WB networks’ creation, giving viewers more choices.

These broadcast networks are fighting over a shrinking viewership pie as more households tune into cable and satellite television. Fox has been a leader here too, creating upstart networks focusing on news, sports, family programming and other content. But Fox is hardly alone; dozens of cable channels cover every imaginable subject, from the History Channel to Comedy Central to Animal Planet. And today’s media consumers have another option unavailable a decade ago: the Internet. On it, one can access virtually every daily newspaper on the planet and thousands of other sites offering news stories, sports scores, weather reports and entertainment.

Given this reality, the fears of people opposing media concentration seem laughably overblown. Consider the most criticized rule change, which would allow a television network to own stations that reach a combined U.S. audience of 45 percent, up from the current 35 percent. Because nearly every media market has the “Big Four” affiliate stations already, this change merely allows networks to own a few more stations that already broadcast their programming. Notice, too, that the rule only limits the potential audience of a network’s stations to 45 percent. The percentage of the TV-watching population tuned into a particular network’s stations will always be lower than 45 percent because several networks compete for the average viewer’s attention at any time.

Media diversity and localism’s biggest danger is the inability of local broadcast stations to compete with rapidly evolving alternatives such as cable television and the Internet. As alternative media cut into their ratings and reduce advertising revenue, many local stations will feel intense pressure to reduce local programming. Rules that make cost-saving mergers impossible will not improve local programming and might well do the opposite, eventually driving some local stations out of business entirely.

Media consolidation allows sister stations to pool resources to save money and seek financial assistance from their corporate parent during lean years. The greater resources available to a large media conglomerate could also allow more local in-depth reporting during times of crisis just as large media conglomerates that own CNN and Fox News were able to dispatch reporters to Iraq earlier this year. Those concerned with strong and vibrant local coverage should be cheering the Federal Communication Commission’s proposed rule changes.

Timothy B. Lee is a staff writer at the Cato Institute in Washington D.C. He graduated from the University in 2002.Send comments to [email protected]