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The Big 6 and Media Consolidation

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Joseph Ebert

on 12 February 2014

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Transcript of The Big 6 and Media Consolidation

The Big Six
design by Dóri Sirály for Prezi
Audience Analysis
Interviewee Introduction
Pros/Cons of Media Consolidation
Laws and Challenges
How it Affects Us
Media Consolidation - the process of fewer organizations or companies gaining control of more of the mass media.
Media Conglomerate - a company that owns a large number of smaller companies in various mass media such as television, radio, publishing, movies, and the Internet
In 1983, 90% of U.S. media was owned by 50 companies. Now, six companies own that 90% of the media.
These six companies are all media conglomerates.
FCC Regulation History
Dow Jones & Company, Inc.
The Times
National Geographic Channel
20th Century Fox
Wall Street Journal
Fox Sports
Times-Herald Record
Disney Channel
Pixar Animation
Marvel Studios
Touchstone Pictures
Hollywood Records
Miramax Films

Paramount Pictures
Comedy Central
TV Land
Spike TV

Universal Studios
USA Network
Syfy Channel
NHL Network
Weather Channel
Home Box Office (HBO)
Sports Illustrated
People Magazine
TIME Magazine
CNN News Group
CW Network
DC Comics
Warner Bros. Entertainment
Cartoon Network
CBS News
CBS Sports
CBS Television Network
Simon & Schuster
TV Guide Network
CBS Radio Inc. (130 stations)
Infinity Broadcasting
CW Network

Television Station Ownership Cap
Companies are able to own up to 12 stations rather than 7 stations
The Telecommunications Act of 1996

Amended the Communications Act of 1934.

Relaxed restrictions on media cross-ownership

Eliminated the national 40 station ownership cap for radio

Extended radio and TV license terms to 8 years and loosened rules on license renewal
Effects are Seen
Minot, North Dakota Spill - Clear Channel Communications

FCC Review of Media Ownership Announcement
Continued Deregulation
Viacom, GE (NBC), and News Corp request that all media ownership rules be eliminated

The FCC revises its ownership limits

Senate makes a last minute deal to help out Viacom and News Corp
Dual Television Network Rule
prohibits a major television network from buying another major network (ABC, CBS, Fox, and NBC)
Radio/TV Cross-Ownership Restriction
Prohibits a company from owning a newspaper and a television station in the same market
Local Radio Ownership Rule
prohibits radio stations from owning a large number of companies in the same market
National TV Ownership Rule
allows television stations to reach a maximum of 35% of the nation's homes
Who are the Big Six?
Newspaper/Broadcast Cross-Ownership Restriction
Prohibits a company from owning a radio station and a television station in the same market
Television License Extension
Television Licenses now last 5 years rather than 3 years
Audience Analysis
Overall, the Big Six affect everyone, because everyone is exposed to the media.

Each individual company may have different audiences
The Walt Disney Company
News Corporation
- The Wall Street Journal
- Several newspapers and magazines, each one targeting a different audience

Robert J. Dreps

Godfrey & Kahn s.c. - Madison, WI
Business and Litigation Attorney
Practice emphasizes media law
UW - Madison Law School
30 Years Experience
Deals with litigation in news media

Middleman between different types of media
The Anti-Trust Laws
The Sherman Antitrust Act

The Clayton Act

The Federal Trade Commission Act

The Sherman Antitrust Act
The Clayton Act
The Federal Trade Commission Act
Contracts, combinations and conspiracies

Crime to monopolize any part of interstate commerce

Civil Statute

Prohibits the lessening of competition

Want to merge?
Antitrust Division of the Department of Justice
Federal Trade Commission

Preventing harmful business practices

Prohibits unfair methods of competition

Carries no criminal penalties

Also created the FTC

Enforcement: What’s the penalty?
Preventing Fix Prices, Rig Bids and Market Allocation Schemes

Corporations: $100 Million
Individuals: $1 Million or up to 10 yrs in prison
Established after June 22, 2004
Restitution may be sentenced as well

The First Amendment
Free and open competition
The Internet
Bad for Corporations Good for Consumers (Robert J. Dreps)
Promotion of competition
Never will be a monopoly

Evidence Based Conclusions
Our Conclusions
Positive effects of Media Consolidation
Negative effects of Media Consolidation
Pros of Media Consolidation
Cons of Media Consolidation
No monopolies
The Internet prevents it

Consolidation will continue because businesses benefit from it

Broadcasting companies make more money with more options.
Cable companies allow people to have many options.
Internet facilitates too many voices for a monopoly to occur.

The media is becoming more and more concentrated
In 1983, 90% of American media was owned by 50 companies. In 2011, it was down to six.

U.S. Department of Justice
Antitrust laws protect competition, benefiting consumers by ensuring lower prices and new and better products.
Room for growth
Many consumers have never heard of these laws
When effectively enforced, they can save them millions of dollars a year in illegal overcharges.

Thank You for Your Time

Any Questions?
At this stage, the majority of people don’t notice too many of the effects because of the vast selection of media, even if they are controlled by the same company.

It is alarming that so few people know about the media

Negative Connotation - few professionals are experts/are willing to talk about it

FCC shouldn’t be relaxed about it; punishments may need get more harsh to keep businesses in line and slow consolidating.

"The country is really standing on a cliff when it comes to media concentration. When you go over that cliff you are going to be fundamentally changing what this country is about, and not for the better."
- Senator Ron Wyden
Few companies own the majority of the media

Allows them to drive up prices
The creation of what the public thinks is important

Can have a huge impact on the news brought to the public’s attention

Wade Henderson- President of the Leadership Conference on Civil and Human Rights

Controversial topics often left out
Agenda Setting
“The way the public looks at issues, indeed whether the public is even aware of issues like voter discrimination, immigration reforms, or fair housing is directly related to the ways these issues are covered by the media.”
Radio stations recording broadcasts for different states

TV stations devote less than .05% of total programming to local issues

Less Local News
Less need for local workers when job can be done from different markets

Tribune Company
- Cut 900 jobs in 2005

- Since June 2000, 70,000 media workers have been laid off

Fewer Jobs for Media Workers
Cumulus Radio and Clear Channel
banned the Dixie Chicks from being played on the radio

refused to play ad for United Church of Christ

Increased Censorship
In 2006, political discussion accounted for 10% of stories on local newscasts
50% of stories on local newscasts were dedicated to traffic and crime

Media companies also known to support candidates and political parties
influences types of political content shown

Less Political Discussion
Bundles become popular
Lack of Government Control
Media Diversity
Digital TV, high speed internet, and phone service can all be purchased from one company
One monthly bill instead of three=less expensive for consumers
Superior to a system where content is controlled by the government
There is still some form of media diversity
Different mediums allow for many voices to be heard

“The internet facilitates too many voices for there to be a monopoly.”
-Robert Dreps
Media for consumers
Minimal government control
Advantage of converging technologies
Improved Quality
Larger Audiences
More money and a bigger impact

Biased political views

Less local news

Focused on advertiser

Money vs. public interest

Under representation of minorities and women

Lack of competing views and perspectives

Net Worth : $29.42 Billion

CW Television Network (50% share)

TV Guide Network (50% share)

Net Worth: $31.25 Billion
Paramount Pictures

Dreamworks SKG


MTV and Showtime

Net Worth: $52.96 Billion



CW Television Network (50% share)

20th Century Fox

Dow Jones

New York Post
Net Worth: $70.6 Billion
Net Worth: $103.96 Billion

Marvel Studios


Pixar Animation

ABC/Capital Cities

Miramax Films
Net Worth: $106.27 Billion
NBC Universal
(GE's Remaining 49%)

MLB Network (5.44%)

E! Network
(Disney’s Remaining 39.5%)

NHL Network (Owns 15.6%)

The Golf Channel (54.7%)
"Government regulators reportedly are likely to allow the country's media giants to get even bigger"
- Liz Cho, ABC News
Full transcript