Media giants in the information marketplace

IF PRESENT trends are allowed to continue, 10 large corporations will own nearly every daily paper in the U.S. before the turn of the century. Fewer than 10 corporate giants will dominate the production and airing of ihe television programs on which the public relies for news and entertainment. These giants will not generally compete with each other for the consumer's favor. Rather, under most circumstances, they will enjoy local market monopolies. Frightening? You bet! And just as frightening is the massive opposition which the insatiable media giants can muster against reform.

What is at stake here is the quality of political life in the U. S. Diversity of knowledge and opinion is essential in a vigorous democracy. When news is excessively homogeneous because it comes from a limited number of sources, free discussion withers. When citizens have access to only a few general "truths" selected by a few corporate managers, we lose the strength that can come from vigorous public debate. When a few major networks control the news, consensus which should be reached only after weighing a wide variety of options approached from diverse perspectives, is already near completion at the start and rests on a constricted information base. Moreover, when news treatment is uniform, biases and errors which are endemic to news production may cause major disasters because they are disseminated to millions of people, often simultaneously.

Early Vietnam War coverage provides a tragic example. Most American media, relying on a limited number of sources, presented a similar scenario. They depicted the war as a struggle between the non-communist world and expanding communist powers which threatened American security. They prophesied a domino effect if Vietnam should fall into communist hands. Unchallenged support for this definition of the situation (which was also proffered by leaders in the executive branch and Congress) made American intervention to prevent communist domination of all of Southeast Asia an unassailable policy. The underlying assumptions were not questioned by most of the media until the course of events in Vietnam demonstrated serious errors. Had dissenting voices received media attention earlier, countless lives might have been saved.

How can the risks inherent in news uniformity be lessened? How should the news business be structured to best serve the goals of a democratic society? Two conditions are essential. First, information must come from a large number of sources which fully sample the richness of happenings throughout the country and the world. Secondly, it must be collected and processed by contributors who represent the diversity of the country, in all those dimensions which are likely to produce differences of concerns and opinions. This diversity includes racial, ethnic, and religious origins, past and current lifestyles, regional variations and differences related to education and exposure to diverse information sources.

Reasons for concentration

The way the media business has developed in the U. S., we have never had such a marketplace of diverse ideas. We do not have one now. In fact, all signs point away from the ideal pattern. There has been an unrelenting tide of concentration in the media with ownership and control of the bulk of American media passing into the hands of large businesses.

The major reason for concentration of media enterprises is the desire for maximum profits. Such profits flow more readily from economies of scale when news gathering and news processing are performed by a few big organizations for a large clientele. There are also economies of scale when the production and distribution of newspapers, news magazines, and radio and television broadcasts can be handled centrally and the resulting product used at many different locations with only minor adaptations.

Other economic considerations point in the direction of bigness as well. Operating a media business requires

This is the last of six essays made possible in part by a grant from the Illinois Humanities Council, in cooperation with the National Endowment for the Humanities. In alternate months in 1981, concluding this month, Illinois Issues has published four-page supplements containing original essays by Illinois humanists. No restriction in regard to style, form or perspective were placed on the authors. They were encouraged to use any of a number of approaches including exposition, analysis, satire and parody. Reprints of these essays are available at no cost from the Illinois Humanities Council, 201 W. Springfield, Champaign, Illinois 61820.

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large financial resources. The production of prime-time television programs routinely runs into six and seven figures. Wiring a major city for cable television costs $50-$100 million.

A good share of the income of media enterprises in the U. S. comes from advertisers who pay for the right to display advertisements to media audiences. To be attractive to most advertisers and to be able to charge them high rates, media enterprises must have large audiences. Chains and mergers are the answer.

Take, for example, nationwide press coverage of a sickening string of child murders in Atlanta, Georgia. The press focused on the sensationalism, the gruesome details, the grieving parents and the comments of assorted bystanders. The deeper, more significant issues were neglected. As pointed out by Hodding Carter, former press spokesman for the U.S. State Department and currently host of "Inside Story," a "60 Minutes"-style public television show, "The national press treated the murders as an isolated Atlanta story instead of a reflection of a problem familiar to virtually every American city"(Chicago Tribune, May 8, 1981).

This trend towards consolidation and uniformity, which is quite defensible from a business standpoint, endangers the vigor of American democracy. I am going to suggest feasible policies which could halt this trend and even reverse it. My case is based on the assumption that mass communication in a democracy is an extraordinary kind of business, not an ordinary one, and warrants special care to assure that it serves the public well. As the founders of our country recognized long ago, when they singled out the news business for explicit mention in the Constitution, an ample untrammeled flow of information is the lifeblood of a working democracy. The news media must therefore be kept free from domination by any major concentrations of power, whether that power emanates from government, political parties, labor unions, or giant private businesses.

But first, let's look at the major manifestations of concentration as they exist today, beginning with the newspaper business. There are roughly 1,750 daily newspapers throughout the U.S., 97½ percent of which lack even nominal local competition. That compares with a figure of 40 percent 50 years ago. With very few exceptions, and those nearly all in our largest cities, local newspaper competition is a thing of the past. Even the nation's capital has become a one-newspaper town with the recent death of the Washington Star, the conservative counterbalance to the Washington Post's liberalism. Competing newspapers remain alive, although not always well, in only 55 cities. When one of the competitors gains even a slight edge in circulation, advertisers flock to it, leaving the less successful paper. That generally seals its doom.

But monopoly control at the local level is not as tight a tourniquet on the flow of information as it may appear to be. While it is true that most towns have only one newspaper, there is competition from other media, such as television, radio, news magazines and cable television. In smaller towns, competition from nearby metropolitan papers is common, and the 1,700 suburban weeklies are thriving with over 32 million readers nationwide.

Decline in competition

More serious than the dearth of local newspaper competition is the decline in newspaper competition across the nation. The 1,750 daily newspapers published in the U.S. no longer represent 1,750 independent voices. Instead, nearly two-thirds of the daily newspapers (62 percent), representing 73 percent of the total circulation nationwide, are now controlled by a series of chains. This compares with less than half (47 percent) of the dailies in 1970 and a mere 20 percent in 1950, representing 61 and 45 percent of the total circulation, respectively. The largest of these chains, Gannett, controls 73 newspapers with a combined circulation of 3 million copies a day. But the largest giant in terms of information control is the Knight-Ridder chain. The 34 papers in its organization reach nearly 4 million homes.

The case against newspaper chains has often been argued in terms of journalistic excellence. That approach is self-defeating because it is based on misconceptions. Compared to individual owner control, chain control has not meant journalistically inferior newspapers. It has not meant more emphasis on sensational stories to titillate mass audiences. It has not meant less emphasis on public service features. Neither has it meant excessive orientation towards a business point of view nor neglect of local concerns.

Thanks to their better financial resources, chain owners have often been able to produce more polished products, richer in both national and local news and in public service programs, than is possible for financially weaker single owners. Chain-controlled papers have carried more programs appealing to special audiences, including cultural high-brows. Confirming the groundlessness of charges that "Big Media" stands for "Bad Media," a 1974 study led to the conclusion that "The results of assessing the state of current knowledge about the effects of media ownership concentration can be expressed in the well-known Scotch verdict: 'Not proved' . . . The form of media ownership generally seems to have a small impact on economic or content performance" (Walter S. Baer et al., Concentration of Mass Media Ownership: Assessing the State of Current Knowledge, Santa Monica: Rand Corporation, 1974, p. 79).

But the breadth and polish of chain-owned papers does not compensate for the real danger of such concentration. The danger is that chains expand the size of the audience reached by a limited number of media entrepreneurs while, at the same time, reducing the number of sources and viewpoints used to formulate public policy and stimulate public discussion. In other words, chains may cover a great many issues, but they rarely present a total range of values. With fewer gatekeepers deciding what news to present

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to the public forum and what news to omit, newspaper offerings have become increasingly uniform. The trend towards combining print and electronic news businesses under one corporate roof has further homogenized news and diminished the number of people with access to the information marketplace.

Two facts of life that are rarely mentioned compound the danger of producing assembly-line standardized news: wire service concentration and pack journalism. The bulk of news in the U.S. for both print and electronic media is gathered and distributed by just two wire service organizations, the Associated Press (AP) and United States International (UPI). The two provide news for 99 percent of all American media. Among the two giants, UPI is currently in financial straits. This raises the possibility that AP will soon be the lone giant in the field.

Disease of pack journalism

Pack journalism is a disease afflicting most media. Its symptoms consist of slavishly following news choices and interpretations provided by prominent news sources like the New York Times, the Washington Post, or television commentators like Walter Cronkite or John Chancellor. Pack journalism helps to explain why news media throughout the country cover essentially the same stories and ignore many others that are available and eminently suitable for publication. In fact, the average newspaper uses only 10 percent of the stories supplied by the wire services. Many important stories are left in the discard heap, untouched by all news outlets.

A good example occurred in March 1977 when media nationwide riveted their attention on a Washington story — the terrorist activities of a small Moslem sect which was holding several people as hostages. While the hostage situation was reported in minute detail, a presidential news conference was largely uncovered. In this conference, President Carter proposed a $1.5 billion youth employment bill, a Youth Conservation Corps, new approaches to peace settlements in the Middle East, new procedures for withdrawal of American troops from South Korea and a new atomic weapons agreement with the Soviet Union. As James Reston commented in the New York Times, "It is hard to remember any time since the last World War when an American President made so much news in a press conference or anywhere else . . . but nobody could hear him for the noise and the headlines about the terrorists" (May 11, 1977).

Concentration is also the hallmark of the news magazine business, which is dominated by three magazines. Each has a huge audience of people with above average interest in politics and, as a group, above average influence on public policy. Time magazine reaches 4 million households, Newsweek 3 million, and U.S. News and World Report goes to 2 million. The business interests who control Time and Newsweek have been especially well-situated for leaving their marks on the minds of the influential because they have dominated the information market in the nation's capital. Time was linked with the Washington Star until the paper's demise in 1981 and Newsweek is owned by the Washington Post. Major Washington dailies, of course, are widely read by congressmen and members of the executive branch.

How does the concentration picture look with respect to the electronic media? Control over radio broadcasting, despite many combinations, has remained comparatively dispersed. However, radio takes a distant third place as a source of news for most of the public. Television comes first, followed by newspapers.

The story is far different for television. The three major networks, all of them subsidiaries of large business conglomerates, provide the bulk of programs for 550 stations throughout the country which are affiliated with them. Altogether, network programs have access to 85 percent of the potential television audience in the U.S. Only 90 stations are totally unaffiliated. Besides providing programs for affiliates, each network also owns five stations. This number is deceptively small because the reach of these stations, which are located in the most populous areas of the country, is enormous. The 15 stations owned by the three major networks have a combined audience reach of 100 million people.

The hope that cable television would diversify the number of sources controlling the flow of televised information is rapidly disappearing. Much cable programming comes from the existing networks or from a few highly concentrated new networks that have emerged recently. More significantly, established media businesses are gobbling up cable outlets even though the major television and telephone giants have been barred from acquiring cable companies. Currently, 55 percent of all cable outlets are owned by either broadcasting enterprises (30 percent), newspapers (12 percent) or publishing houses (13 percent). When cable outlets owned by television program distributors (20 percent) and television manufacturers (11 percent) are added, 86 percent of cable television is owned by the same people who already dominate the media.

As is true in the newspaper field, concentration in the television business has not meant that programs of individual stations have been poorer, that big business viewpoints have prevailed or that public service programs have been neglected. All these charges have been made frequently. On the contrary, bigger has been equivalent to better, when affiliated and unaffiliated stations are compared in terms of the number of programs winning media critics' approval.

But once again, as in the case of newspapers, professional excellence does not counterbalance the deleterious consequences of a limited number of viewpoints and perspectives. Concentration has meant enlargement of the audiences subject to the influence of particular news entrepreneurs and a narrowing of the spectrum of diverse voices heard in the marketplace of ideas. Those who desire access to that marketplace find that they have few

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options if the limited number of corporate media gate-keepers decides to exclude them.

There are several ways to halt excessive media concentration. First of all, the notion that the media business should be treated like ordinary businesses must be abandoned. The media business is essential to the conduct of democratic government. It therefore cannot be judged by the usual antitrust regulations. Under these regulations, which challenge concentrations only where the eight largest firms in an industry control over 50 percent of the market and the 20 largest firms control 75 percent or more of the market, media concentrations have remained at legally acceptable levels. A change of the rules is needed for media businesses so that far stricter limitations can be established for media concentrations than for other types of trusts.

Changing the trend

In setting limits, the size of audiences should be considered, along with the number of news outlets under the same control. For instance, current FCC rules restrict a single owner to owning five VHP television stations. But that small number still has enabled individual networks to create markets encompassing up to 35 million people. The ability of any one entity to control the daily news for such a large audience is a menace to free government.

Several structural reforms are needed to cope with the problem of concentration. In addition to existing limitations on ownership concentration of broadcast outlets, media audience size should be limited to a maximum of 3-4 million people, except in large metropolitan areas where this is not technically feasible. No single corporation should be allowed to expand its holdings of media enterprises to the point where it controls media fare for a substantial portion of the American public. A market of 3-4 million people is large enough to be attractive to media entrepreneurs and advertisers, yet small enough to allow many competitors to participate in major opinion shaping activities.

To avoid saturating huge audiences with programs prepared by the same supplier, major blocs of time now occupied by network programming would have to be relinquished. A variety of new organizations would undoubtedly spring up to fill this gap because the opportunities for selling programs produced outside the established network structure would finally become attractive. Their products would probably be less lavish and star-studded than those currently available. But access to a wider array of ideas and talents should be a worthy substitute.

It would also be advisable to encourage the growth of competition in the wire service field so that initial gathering of news would be performed by organizations with a wide range of perspectives.

Structural reforms must be supplemented by behavioral reforms. To solve the problem of pack journalism, newspeople must scan the presentations of their most highly respected competitors to avoid repetition, rather than seeking it out. They must strive for greater accuracy and completeness in stories, shunning the empty triumphs of scoops that increase sales at the risk of grave inaccuracies and omission of crucial background information and details.

They must also make greater efforts to serve major specialized audiences, like the elderly or children, who have been neglected in the past because they are too small or economically powerless to be attractive targets for most advertisers. If all media audiences are limited in size, it will become more appealing to create programs for special populations.

All of the changes that I have proposed are possible within the basic American system of media operation in which media are large, profitable enterprises beyond the reach of government control over content. Splitting up large media concentrations or divesting giant enterprises of control over a huge share of the American audience does not mean that media enterprises must be small or weak or incapable of producing excellent programs. In fact, increased competition is likely to improve the quality of the media product.

The limits suggested here would permit the economies of scale while protecting our society against mass-produced opinions. If needed, combinations of physical production facilities might be permitted, as is now done in 24 cities under the Newspapers Preservation Act of 1970, as long as news gathering and production do remain decentralized. On the whole, however, the media business has been so profitable that curtailing the size of combinations and audiences is unlikely to do it much harm.

By no means should government become involved in legislating its own conceptions of journalistic excellence. First Amendment protections of the free flow of information must be rigidly enforced. In fact, as I have argued, these protections need to be expanded to encompass private as well as public concentrations of power. All the media giants must be curbed. Pluralism of control and pluralism in the information supply must become the distinguishing characteristics of the American information marketplace.

Doris A. Graber is a professor of political science at the University of Illinois at Chicago Circle.
She has written several books, including Mass Media and American Politics, 1980 (Congressional Quarterly Press),
and Media Agenda Setting in a Presidential Election, 1981 (Praeger), which she co-authored.

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