The future of media corporations?

Imagine if WCCO also ran the Pioneer Press, or you could watch C.J. on KSMP as you read her column on the Star-Tribune’s website.

That might be pretty neat – if you like WCCO or the Star Tribune. It could also be terrible and frightening, according to media reform advocates like Derek Turner at FreePress, a non-partisan activist group and think-tank that promotes a diverse and independent media. When he looks at that scenario, he sees an ever more tightly controlled news media that would focus more on high school sports than the state house, and be able to ignore a scandal that threatened other business interests of its owners.

Twin Cities media ownership Gannett Co. inc. KARE-11 The St. Cloud Times Avista Capital Partners Minneapolis Star-Tribune CBS Corporation WCCO 4 Television KZJK 104.1 Classic Hits, St. Louis Park WCCO 830 AM News/Talk WLTE 102.9 Adult Contemporary Village Voice Media, inc. City Pages Clear Channel Communications, Inc. KDWB 101.3 FM KEEY 102.1 FM (K102) KFAN 1130 AM KFXN 60 AM (Score 690) KQQL 107.9 FM (Kool 108) KTCZ 97.1 FM (Cities97) KTLK 100.3 FM News Corp. KMSP TV 9 WFTC TV 29 MediaNews Group The Saint Paul Pioneer Press (Information courtesy of Prof. Michael Griffin, Visiting Associate Professor of Cinema and Media Studies, Carleton College)

At hearings before the Federal Communications Commission last year, representatives of local and national news media corporations loudly declared their industry would collapse if they were not able to buy a diverse array of media outlets in each city where they had invested. If they fell, the systems by which most Americans still consume news would fall with them.

Before the recent rule change, FCC regulations stated one owner could not hold both a newspaper and a television or radio station in the same “media market” without special permission from the FCC. The United States is broken up into 210 media markets by the private Nielsen Media Research company. The FCC uses Nielsen’s trademarked Designated Market Area (DMA®) as its method of defining markets.

After the rule changes, issued in December 2007, an owner could own both a newspaper and a television or radio station in the same media market, provided the station was not among the four most listened or watched stations in the market. If an owner wanted to buy a station in the top four, they would need a waiver from the FCC. However, the Commission has granted every single waiver request brought before it, effectively deregulating media ownership, according to Turner.

Senator Brian Dorgan (D-South Dakota), who sits on the Senate Communications Committee, has introduced legislation in the Senate that would explicitly revoke the rule-change. The legislation passed May 15 on a voice vote described by FreePress as “nearly unanimous,” and is now awaiting House action. President Bush is expected to veto the legislation.

The National Conference on Media Reform is coming to Minneapolis June 6-8, with more than two thousand participants expected. The conference, sponsored by Free Press, focuses on diversity and democracy in media. Key issues include net neutrality, media consolidation, the future of the internet and the quality of journalism.

The argument that consolidation is necessary for survival is suspect. The Tribune Company, owner of the Chicago Tribune, the LA Times, and numerous local newspapers and television stations across the country has been trying the model for more than ten years, says Professor Michael Griffin, a professor of media studies at Carleton College, but is still “hemorrhaging money.”

Media companies and executives like Rupert Murdoch have lobbied heavily for the rule change for several years, because they are looking to enrich themselves by improving their companies’ stock prices, says Griffin. Stock prices depend on a company’s expansion over time to maintain their value, but most news outlets are growing their revenues either slowly or not at all. Buying more news outlets allows a company to sell more advertising space, and thus increase its revenues; it will also increase its net worth through controlling more assets.

Media ownership consolidation also continues and amplifies the exclusion of minorities from media wonership. (Data from Out of the Picture 2007: Minority & Female TV Station Ownership in the United States, October 2007 report by S. Derek Cooper and Mark Turner, McGannon Communications Research Center, Free Press, www.freepress.net. (Graphic by Joni Berg)

Most media outlets’ revenues are in fact based on ad sales. However, newspapers nationwide have lost substantial ad traffic to websites like Craigslist.org and Monster.com, and television and radio stations have limited space in which to run advertising. Traditional options for raising revenue are thus extremely limited.

Newspapers have been hit particularly hard, but in an interview, Turner quoted statistics that for every print reader lost by newspapers, they gain five online readers.

Newspapers “just haven’t figured out how to monetize those eyeballs online,” he said.

Local businesses also are frequently hurt by concentrated ownership, says Turner, as advertising rates increase out of the reach of all but large national or international companies such as Toyota and Wal-Mart.

According to both Turner and Griffin, concentrated ownership does not produce good local news.

“We’ve actually done studies,” says Turner, “that show news output drops 25%” in media cross-ownership markets, where one company owns both a newspaper and television or radio stations. Almost all cross-ownership occurs between local television stations and local newspapers, according to Turner.

James Sanna (james.sanna@gmail.com) is an intern and writer at the Twin Cities Daily Planet