Media Ownership
Brc 319
Mass Media Law
Media Ownership in the United States
* Two Forms
Non Regulated - Newspapers, Magazines,
Internet
Regulated - Television, Radio and
Cable (to some extent)
* The Federal Communications
Commission Licenses Radio and
Television Stations
* It Regulates Cable Rates if authorized
by Congress
The Airwaves Belong to the People
* Unlike most countries where the
government asserts ownership of the
airwaves, the United States Congress said
that the airwaves belong to the public. This
notion is really an extension of our First
Amendment rights
Why Regulate Radio and TV Stations?
* The Radio Act of 1912 made it necessary
for operators of stations to get a license to use
the ‘ether’(airwaves)
* The ‘ether’ (airwaves) are thought to be a
finite resource
Who should get a license? What level
of service should be provided?
* Licenses should be given to those who
would provide the best service to the
community
* The ‘test of service’ is the “public interest,
convenience and necessity.”
Media Ownership should be localized
* Local stations should program to local
audiences. In the U.S. that means local
programs in addition to national (network)
programs
Media Ownership has always been limited
* The basis of the First Amendment is that
anyone who wishes to speak and publish should
be able to do so
* Early on the FCC decided that too much
concentrated media ownership could limit the
number of voices that could speak
* Each and every station had to be re-licensed
every 3 years - Test of service
Media Ownership has always been limited
* Until 1985, radio and television station
ownership was very limited. Broadcasters could
own:
7 Television stations
7 AM
7 FM stations
Broadcasters could only own one type of
station in each market.
Media Ownership has always been limited
* Cross media ownership with television and
newspapers in most markets was forbidden
For example, in 1975 the FCC said that a
television station could not be owned by the same
company that owned the local newspaper
Media Ownership Rules 1985 - 1996
* FCC Relaxed Rules during this period to
help consolidate the radio industry.
* Television ownership was still limited to
about 12 stations (up to 25% of U.S.
population)
The Telecommunications Act of 1996
* Watershed legislation that ordered the FCC to
loosen restrictions on broadcast ownership
Group Station owners could own as many
stations as they pleased, restricted in numbers by
markets. For example, in radio:
In small markets, owners could own up to 5 stations
In larger markets, owners could own up to 8 stations
Local Radio Changed Dramatically
* In 1995, Clear Channel Communications
owned 54 radio stations
* In 2003, Clear Channel owns 1,240 radio
stations (about 10% of all commercial stations)
Source: Broadcasting, Cable, the Internet and Beyond - Dominick, Messere,
Sherman (2003)
Local Radio Changed Dramatically
* 1995: In Syracuse, no one owner could
own more than 2 radio stations (1 AM & 1
FM)
* 2003, Clear Channel owns 8 radio stations
including the most powerful AM and FM
stations in the market
Some of the stations in the area owned
by Clear Channel Communications
Rochester
WHAM-AM
WHTK-AM
WKGS-FM
WLCL-FM
WMAX-FM
WNVE-FM
WVOR-FM
Syracuse
Utica
WBBS-FM
WADR-AM
WHEN-AM
WOUR-FM
WYYY-FM
WRFM-FM
WSYR-AM
WSKS-FM
WHHT-FM
WUTQ-AM
WSKU
WRBY-FM
WWDG-FM
WPHR- FM (Auburn)
Sources: Columbia Journalism Review and CNYRadio.com
Local Radio Changed Dramatically
* 1995: In Oswego and Fulton there were 2
AM and 3 FM stations, all with different
local programming (Swap Shop, Speedway
program, Local Weather with Bob Sikes, Laker
Hockey)
Local Radio Today
* 2003, except for WAMF 1300 AM,
Fulton, all local stations are gone.
Now all Oswego, Minneto and Fulton
stations simply rebroadcast other
Syracuse stations
Are Television Rules About to Change?
* In 2001, the FCC began evaluating televisionnewspaper cross ownership, dual network, local
and national television ownership rules
Are Television Rules About to Change?
* Early in 2003, FCC Chairman, Michael
Powell signaled a desire to relax restrictions on
television ownership.
•Increasingly the Courts have taken issue with
FCC rulemaking, frequently calling the
decisionmaking ‘arbitrary and capricious.’
(Look at the Sinclair case)
Proposed Changes in Media Ownership
Proposed Changes in Media Ownership
* Proposed changes are concerned more with
television stations and newspaper ownership
rules
Proposed Changes in Media Ownership
* National TV Ownership Caps (for group
owners)
Current Rule: Set for 35% of the 106.7
million TV households
Proposed Rule: Would raise ceiling to 45%
of the TV households - Congress
modified it
to 39%in 2004
Proposed Changes in Media Ownership
* Newspaper Crossownership
Current Rule: Forbidden for newspaper
and television station ownership in the
same market
Proposed Rule: Permit crossownerhip in
the top 150 markets
Proposed Changes in Media Ownership
* TV Duopoly
Current Rule: Permitted only in the largest
50 markets where there are 8 separately owned
TV stations
Proposed Rule: Prohibit duopolies
between any market’s 4 top rated stations but
permitted for larger/smaller station combinations
Proposed Changes in Media Ownership
* TV Triopolies
Current Rule: Completely forbidden
Proposed Rule: Allow triopolies in
markets with 18 TV stations, roughly the top
markets in the country
Who Favors The Proposed Rules?
* Television Networks favor raising the media
ownership caps from 35% to 45%
Most TV Networks lose money
TV Networks make money on the stations
they own. If they can ‘reach’ 45% of the
population with their own stations, they
can offset losses in the network portion of
the business
Who Favors The Proposed Rules?
* Newspapers favor changing the newspaper
crossownership rules
Newspapers argue that as the younger
population gets more news from TV than
from print. In order to stay strong,
crossownership would permit newspapers
and TV stations to share reporters,
equipment, etc
Who Favors The Proposed Rules?
* Television group owners favor changing the
duopoly rules
Television group owners in small markets
have seen audience shrinkage as more
people turn away from TV and watch
cable. Owning more than one station in the
market would allow for economies of scale
Who Favored The Proposed Rules?
* Television networks favor the changes in the
rules allowing triopolies
TV Networks (mostly) own other outlets
and this additional outlets would allow
them to ‘sell’ different audiences to
advertisers. Economies of scale would be a
factor.
Who Opposed the Rules?
* Center for Digital Democracy, Media
Access Project, Common Cause,
Communication Workers of America,
Writer’s Guild, Screen Actors Guild,
National Rifle Association, Parents
Television Council, Catholic Conference,
Association of Christian Schools, Media
Alliance, Directors Guild of America, Code
Pink and many other groups
Why Do The Rules Change Matter?
Why Do The Rules Change Matter?
*Victoria Riskin - President of Writers Guild of
America, west
“ In 1992, only 15% of new TV series
were produced by networks. Today that figure is
77%…. The 6 media companies that own the TV
networks also own or co-own 80% of all the
major cable networks.”
Why Do The Rules Change Matter?
* Ted Turner - Founder of CNN and Superstation
WTBS
“The days of starting up a cable television
network or trying to do it from outside the media
business are over….there’s really five companies
that control 90% of what we read, see and hear.”
Why Do The Rules Change Matter?
*William Safire writing an Op Ed in the New
York Times
“We’ve already seen what happened when
the FCC allowed the monopolization of local
radio: today three companies own half the
stations in America, delivering homogenized
product that neglects local news coverage and
dictates music sales.”
Why Do The Rules Change Matter?
*P.J. Bednarski, Editor of Broadcasting and
Cable Magazine:
“The rules…the FCC propose to change
don’t just let companies get bigger. They
effectively prevent new entrants…”
Why Do The Rules Change Matter?
*Michael Copps, FCC Commissioner, dissenting
the decision
“At issue is whether a few corporations
will be ceded gatekeeper control over the civil
dialogue of our country, content control over our
music, entertainment and information…”
Where do the rules stand?
*June 2, 2003, the FCC passed all the rule
changes in a 3 to 2 vote, along party lines.
3 Republicans voted in favor of the rules
2 Democrats voted against the rule
changes
Public Interest Concerns
* The Commission needs to examine decisions
in light of the ‘public interest’ standard as
required in the laws that govern media
regulation.
Public Interest Concerns
* In this proceeding more than 700,000
comments were filed with the FCC before the
vote. Ninety percent of those comments
opposed changing the rules. Should one ask in
who’s public interest did the FCC vote?
Update on Current Situation
The Rules were voted and passed by the FCC but
a court challenge by Prometheus Radio and the
Media Access Project caused the 3rd Circuit to
revoke the rules