TV Consolidation – A Moat Against Extinction

Broadcast television, once the unquestioned center of American life, now stands at the edge of obsolescence. What was once a cultural hearth has been pushed to the margins by streaming, cord-cutting, “cord-nevers,” and the algorithmic dominance of Big Tech. Viewers have migrated, advertisers have followed, and revenue models that once sustained thousands of stations are eroding at an accelerating pace.

The uncomfortable truth is that fragmentation has become fatal. American broadcasters, still bound by ownership rules written for another era, are ill-equipped to compete against digital behemoths that operate without limits. Unless policymakers, regulators, and industry leaders embrace consolidation, the medium that has long been free, universal, and trusted risks being reduced to a relic of a bygone era.

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Local Broadcasters Need Level Playing Field To Compete, Innovate, Serve the Public

America’s broadcasters are beacons of our democracy. Every day, they exercise their First Amendment right to report, inform, and help citizens understand the issues that affect their daily lives.

And let’s face it: This is a challenging time to be a broadcast journalist. As the truth competes with falsehoods on social media and political polarization gets the headlines, exercising our First Amendment right to inform the public and provide the facts has never been more challenging – or essential.

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A New Era at the FCC: What’s Ahead

Media have become more important and invasive in our lives than ever.  Whether online, TV, video, wireless, or wearable devices, Americans can’t seem to survive more than a few minutes without them.

It thus stands to reason that a newly established Federal Communications Commission led by incoming Chairman Brendan Carr will expand the agency’s reach into areas where more and more Americans are engaged.  As such, it could become as important and involved in our lives as the very media it regulates. 

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American TV Is Changing for Better or Worse

The American TV market is changing before our very eyes, presenting viewers, creators, and advertisers an unprecedented degree of choice, convenience, and competition. We are witnessing a platinum age of television, where an alluring array of movies, sports, and specials is accessible on our phones, tablets, and computers, available anytime and anyplace, on demand. Though we now refer to it as “video,” at its essence it remains television, and we just cannot get enough of it.

But, for traditional TV broadcasters, these changes are both a blessing and a bane. A blessing because more people are watching more video than ever before.  A bane because more people are viewing that video through non-traditional media, which represents an evolving societal shift.

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Who Will Keep the Sun Shining?

The news media’s annual celebration of Sunshine Week, which takes place March 10-16, has always called to mind the importance of access to government information, transparency of public records, and the idea that the free flow of information is an essential element of “good government.”

Created by the American Society of News Editors (ASNE) in 2005, the event was timed to coincide with the March 16 birthday of Founding Father James Madison, a strong supporter of the Bill of Rights.  It has always been envisioned as a celebration of the Freedom of Information Act signed into law on July 4, 1966, which outlined mandatory disclosure provisions for federal documents and records.

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Conflict and Compromise Await New Congress in Telecom, Media, Tech

A new era of American history begins when the 116th Congress convenes in January 2019 with one of the most partisan classes in modern history. Depending on which side of the aisle they sit, the members’ mission will be either to balance the ship of state or continue full steam ahead.

Conventional wisdom suggests there will be conflict. Optimists hope there will be compromise. The reality will be somewhere in between as the new Congress will have the opportunity to forge a unified path on things that matter to all Americans. With so many pressing policy issues facing the republic – immigration, healthcare, homeland security, and more – it is a stretch to think telecom, media, and technology (TMT) issues will top the agenda or lead the day.

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The Judge Who Holds Key to Future of Media

Federal Judge Richard Leon is not a household name, but he is one of the most powerful men in Washington. As senior judge of the U.S. District Court for the District of Columbia, Leon’s past decisions have altered the fate of some of America’s biggest companies, and his upcoming decision holds the key to the future of the media industry itself.

Leon made history in 2011 by approving the $38 billion Comcast-NBCU merger, positioning the new company as the largest cable and broadcast entity in the U.S. More importantly, his ruling established a hard-to-overlook legal precedent, which has influenced antitrust law and competition policy ever since.

Today, Judge Leon presides over yet another ground-breaking case with similar themes: United States v. AT&T and Time Warner. A mega merger valued at $108.7 billion, the deal seeks to marry a major content distributor (AT&T) with a leading video content producer (Time Warner). Beyond the litigants, the media and communications sector anxiously await the judge’s ruling, and with good reason.

First, the case marks the first time since the Carter administration (1977) that the U.S. Department of Justice has sued to block a vertical merger (i.e., between two companies that do not compete)…..

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Progressives’ Anti-Merger Mania

The proposed merger between the cable systems of Charter Communications, Time Warner Cable, and Bright House Networks has brought out the usual poseurs in opposition.  I speak, of course, of such as Common Cause, Consumers Union, and Public Knowledge (all of which are wrong in their usual and tiresome way, but not certifiable), and their more extreme kin, Media Alliance and Free Press.

As it happens, there exists a bridge between these armies of progressivism in the person of former FCC commissioner Michael Copps.  Since leaving the FCC, Copps has flocked to the aid of those organizations he favored when he was a commissioner.  So it is that the gentleman is now on the board of Free Press and a “special adviser” to Common Cause.

Which, of course, is why it’s important to know the kinds of things he’s saying about the merger.  Writing in Common Dreams (“Breaking News and Views for the Progressive Community”), Copps relieves himself of opinions like these:

This merger would create a new Comcast – a national cable giant with the ability and the incentive to thwart competition, diversity, and consumer choice….  >> Read More

The opinions expressed above are those of the writer and not of The Media Institute, its Board, contributors, or advisory councils.  The full version of this article appeared in The Hill on Feb. 9, 2016.

Michael Copps’ Excellent Adventure

Even in a town filled to the gunwales with sagacious and selfless public servants (wink, wink), FCC Commissioner Michael Copps, now in his tenth and final year as such, stands out from the crowd.  Evidence of his colorful take on policy issues has been on display right from the beginning.

In 2001, for instance, in just his first months on the job, Copps issued statements condemning allegedly indecent radio comments by Howard Stern (September); the TV broadcast of a Victoria’s Secret program (November); and the airing of liquor advertising (December).

When he wasn’t condemning indecent language, scantily clad women, or Demon Rum, Copps was laying the groundwork for what would become his signature spiel: a four-part jeremiad that excoriates the current state of journalism (not enough “localism” or investigative reporting); blames this state of affairs on media consolidation; recommends more spending on public broadcasting; and decries what he sees as insufficient “public interest” obligations on the licensed media (and perhaps the unlicensed media as well).

Copps is not alone in holding such views, but there’s something about the way he presents them – especially now when the political, legal, and economic winds are blowing in a very different direction – that’s borderline amusing.  Where once his fire and brimstone suggested a kind of Elmer Gantry, it now seems rather like Elmer Fudd. (“I hate wabbits!”)

Who could forget, just five months before the 2008 presidential election, the speech that Copps gave to the so-called National Conference on Media Reform?  Organized annually by those wonderful “progressives” at Free Press, Copps never misses one of these things; they are, he says, his favorite place to be.

Anyhow, in June of 2008, the commissioner was practically giddy at the prospect of working that old time religion on the nation’s communications policies:

On a night like tonight almost anything seems possible, doesn’t it?  To tell you the truth, I feel like that a lot these days.  I know we can get this done.  We can climb into the bright uplands of real democracy.  Because as we change media, we change everything.  We empower 300 million Americans to deal with all those issues that Big Media has dumbed-down or just plain ignored at terrible cost to our democracy.  There is no real democracy without media democracy.

Never mind the risible imagery of the Free Press crowd, backpacks and all, climbing those “bright uplands,” or the pristine gimcrackery in the real democracy/media democracy linkage – what’s notable is the contrast between those remarks and a speech Copps gave just a week ago.

Speaking again to the National Conference on Media Reform (who else?), Copps let it all hang out:

I’m here because I’m more worried than ever about the state of America’s media and what it’s doing to our country….  For the consolidated owners of radio and TV, the license to broadcast became a license to despoil….

What we’re dealing with here is a bad case of Big Media substance abuse – and they just can’t break the habit.  These folks have no intention, even as the economy improves, of reopening shuttered newsrooms or rehiring laid-off reporters.  They might even fire more, just to prove to Wall Street that the bottom line still rules….

You and I knew all along that the realization of our dreams waited on a new era of reform in Washington.  Then the new era came and we all just knew that media reform was right around the corner.  Twenty-seven months later we are still waiting.  Waiting for even a down payment on media reform, like an honest-to-goodness broadcast license renewal process to replace the utterly ridiculous, no-questions-asked regime now in place.  Or some public interest guidelines to encourage broadcast news and diversity and localism.

Really, it’s almost enough to make a grown man cry.  All those uplands unclimbed!  And Big Media moguls, firing people left and right, just to prove something to Wall Street.  Hearing such stuff, you know that Copps earnestly believes he’s put his finger on the problem.  After all, what else could it be?

Still, there’s something a little otherworldly about the gentleman’s lament, as though he’s been just a bystander looking in.  For the past 10 years Michael Copps has been one of five commissioners at the FCC, even chairman for a while, and since 2009 he has been a member of the majority there.

So if now, as he’s on his way out the door, Copps feels that the FCC has foozled its play, perhaps he should consider pointing one of those accusatory fingers at himself.  Maybe the problem all along hasn’t been consolidation or avarice, maybe it’s been that what ails the media, and the way forward, are more complex than to be availing of the kind of nostrums Copps and Free Press have been peddling.

Maybe the problem is that the Internet has upset the business model of almost all of the “old media,” denying them, most importantly, the kind of ad revenue that has been their lifeblood.  Seen from this perspective, exhortations to deny the efficiencies of consolidation, or to require more stringent “public interest” obligations, or to recommend greater funding of public broadcasting are not just irrelevant, they’re appalling.

                                       
The opinions expressed above are those of the writer and not of The Media Institute, its Board, contributors, or advisory councils.

Dueling Philosophies on Minority Ownership

What happens when you invite the FCC’s two veteran commissioners to speak about the media at a Rainbow PUSH Coalition symposium?  When one of the commissioners is Michael Copps, and the other is Robert McDowell, you get two very different views of where things stand and how they could be improved, as we saw on Nov. 20.

Copps, a Democrat, is a long-time foe of large media companies.  So he uses phrases like “excessive media consolidation,” “big media run awry,” “tsunami of consolidation,” and the punchline: “Minorities have suffered greatly because of consolidation.”  

One of his proposals to “put some justice back into our ownership policies” would involve a “public interest licensing system for broadcasters.”  Copps would like the Commission to “go back to having some guidelines to make sure stations are consulting with their audiences on what kinds of programming people would like.”  But wait, I think we already have such a system.  It’s called “ratings.”

Copps also favors something called a “full file review,” which would have the Commission award certain broadcast licenses by considering an applicant’s “experiences in overcoming disadvantages,” including race and gender discrimination.  (This sounds like a lawsuit waiting to be filed, but that’s another story.)  In other words, Copps views the FCC as the referee in a fight between “big media” and the little guy, where the solution is a tight rein on ownership regulations.
    
Robert McDowell sees things differently.  For minorities to get ahead in broadcasting and other media, Republican McDowell is quite clear about what is needed: access to capital.  “An important priority for me in my three-and-a-half years on the Commission has been to help create a competitive environment that allows minority entrepreneurs and other new entrants a real opportunity to build viable communications businesses,” he told the Rainbow PUSH group.
    
McDowell noted that he enthusiastically supported the Commission’s 2007 Diversity Order, which contained nine measures to help small entrepreneurs acquire capital or use their financial resources more efficiently.  He has also called for a tax certificate program to help disadvantaged businesses.  
    
At the same time, McDowell is keenly aware of the unintended and hurtful consequences of regulations (of the sort favored by Copps) aimed at helping small, local media owners  – like a “localism” proposal to reinstate a 20-year-old rule requiring stations to be manned throughout their broadcast day (technology notwithstanding), or onerous “enhanced disclosure” requirements so complex that they could require the hiring of additional employees.   
    
In short: On the question of disadvantaged minorities, Copps sees the culprit as large media companies.  From his perspective, the FCC must be a strict regulator of media ownership.  McDowell sees the culprit as the lack of access to capital.  He would envision the FCC as a facilitator, creating policies to generate financial opportunities for entrepreneurs.
    
Whose view is more accurate and whose solution is more likely to succeed?  On both counts, my money is on McDowell.