Disasters have long shaped U.S. media policies, because crises throw into stark relief the status quo that, absent dramatic benchmarks, is otherwise so hard to apprehend. In April 1912—exactly ninety years before the chemical spill in North Dakota—another radio alert system failed, and the death toll of that more famous disaster led directly to the nation’s first broadcast media policy. When the luxury ocean liner the Titanic hit an iceberg en route from England to New York City, radio operators aboard the ship used its wireless radio system to broadcast a distress signal. The message, which included information about the craft’s nautical position, immediately reached two boats that were a half-day’s distance by sea, as well as the Carpathia, whose one radio operator heard the distress call “by a lucky fluke,” leading him to direct the captain to travel the fifty-eight miles separating them from the doomed ship. “When it arrived at the scene three and a half hours after hearing the distress call,” reported the radio historian Susan Douglas, “it could only rescue those who had managed to get into the lifeboats.” More than fifteen hundred others drowned with the ship. There were at least two boats traveling closer to the Titanic that evening. The California could have reached the Titanic in about an hour, but its wireless operator slept through the distress calls. Lena was some ninety minutes away, yet the freight steamer did not have a wireless on board.1
Wireless communications among those following the disaster ashore also failed. Friends and relatives of passengers who used radios to get news about the Titanic and make inquiries about who survived were stymied in their efforts due to the extraordinary traffic on the system, the speed of which had another downside: vast circulation of misinformation, which generated widespread complaints about “ceaseless interference, cruel rumors, and misleading messages that filled the air from unknown sources during the disaster.” Douglas explained that “out of this early congestion of inquiries emerged the message reporting that the Titanic was moving safely towards Halifax. When the American and British press learned that this news was completely false and that the Titanic had, in fact, sunk, its editors were appalled. The amateurs were accused of manufacturing the deception and were universally condemned.”2
Problems with wireless communication during the Titanic disaster generated new congressional proposals for radio policies to protect public health and safety on the seas, including ensuring that ships maintained a wireless system that was manned at all times, an auxiliary power source in case the engine malfunctioned, and a formal procedure for reporting emergencies. But the most significant policy initiatives involved federal regulation of the airwaves on which the wireless operated, an unprecedented move in the United States that made the government responsible “to insure to the people of the United States an uninterrupted wireless service twenty-four hours a day for every day of the year,” because the private sector had proved incapable of policing itself.3Political officials demanded that amateur operators, who were stigmatized as “wireless meddlers” and became scapegoats for the communications breakdown, be forced off prime spots on the broadcast spectrum, constrained from using powerful signals, and converted from active, talking participants to passive listeners. The most influential newspapers and magazines would eventually join the Progressive Era chorus for government control, too; at the same time, upstart entrepreneurs advocated measures that would rein in the space for amateurs while opening up the airwaves for new commercial projects.
A mere four months after the Titanic disaster, the broad coalition of media companies and civic reformers got its wish. On August 13 Congress passed the Radio Act of 1912, which, as Douglas explained, “required that all operators be licensed, that stations adhere to certain wave allocations, that distress calls take priority over all other calls, and that the secretary of commerce and labor be empowered to issue licenses and make other regulations necessary to sort out the wireless chaos.” For the first time, the government would control property rights and manage the airwaves, allocating certain wavelengths (or portions of the spectrum) to the military, the private sector, and to individual amateurs depending on their needs, investments, and potential contributions to the “people’s interests.”
The 1912 legislation paved the way for the Radio Act of 1927 and the Communications Act of 1934, which created the Federal Communications Commission (FCC), an independent regulatory agency made up of seven commissioners who are appointed by the president and confirmed by the Senate. (The number of commissioners was reduced to five in 1983.) The FCC’s responsibilities extended far beyond managing communications during disasters. Congress charged the new agency with setting media policies of all kinds, and particularly with generating rules to ensure that local media markets would be competitive and diverse. The commission, whose rulings are often narrowly decided because the president can only give his party a one-seat majority, played a key role in establishing the notion that promoting the public interest should be the guiding principle of media policy. During the twentieth century, however, media policies that advanced the interests of corporate broadcasters often trumped proposals that would have better served citizens. The FCC’s political will to live up to its stated ideals has varied depending on the values of its commissioners and the goals of the political party in charge.4
The FCC did establish some important precedents for the nation’s approach to media regulation. Under the FCC’s oversight, the government would formally treat the airwaves as natural resources that, like the air itself or national parks, belong to the people. Over time, the FCC defined the core goal of federal media policies as the promotion of “diversity,” “localism,” and “competition” in American towns and cities, and it set strict ownership limits to maintain a robust flow of ideas into the public sphere. Although the commission allocated great control of the spectrum to national networks and commercial broadcasters, corporations could only secure official licenses as “trustees” of the airwaves by promising to meet certain “public-interest” standards and to provide “public-service” programs, including news and other shows with no commercial sponsors.5 During the last seventy years, the FCC has regularly reexamined whether its policies help advance its core objectives, even as it has maintained many of its original principles, and its mission to promote strong local coverage, diverse content, and open competition remains sacrosanct.
SCHOLARS OF AMERICAN POLITICAL CULTURE, FROM ALEXIS DE Tocqueville and John Dewey to Richard Hofstadter and Cass Sunstein, have emphasized the crucial role that local media play in creating as well as informing communities and citizens. Before the advent of radio, that task largely fell to newspapers. As Tocqueville famously said, “Without newspapers there would be hardly any common action at all.” Robert Park, a newsman who became the founding figure of American urban sociology, claimed that in cities the local press replaces gossip as the social institution that binds residents to one another. Joseph Medill, the editor and co-owner of the Chicago Tribune and onetime mayor of Chicago, wanted his paper to provide another public service, helping migrants and immigrants acculturate to the city and nation that would become their new home. Hofstadter described Medill’s project eloquently: “[The newspapers] found themselves undertaking the … ambitious task of creating a mental world for the uprooted farmers and villagers who were coming to live in the city. The rural migrants found themselves in a new urban world, strange, anonymous, impersonal, cruel, often corrupt and vicious, but also full of variety and fascination … The newspaper became not only the interpreter of this environment but a means of surmounting in some measure its vast human distances.” Even established city dwellers benefited from the metropolitan press, wrote the historian Gunther Barth. Because it “reduced anxiety and solitude” among those “yearning for contacts with each other and their world.”6
There was no shortage of sensationalism and partisan politics in nineteenth-century newspapers. The “penny papers” of the 1830s targeted working-class readers with human-interest stories about ordinary people, criminals, and local politicians, while the “yellow papers” of the 1890s were notorious for their inflammatory coverage of controversial topics. But the distinctive feature of American city papers has always been their use of local news reporters to hit the streets and gather primary facts about urban life. Urban newspapers developed a beat system for producing regular coverage of key institutions, such as city hall and the urban political machine, the local economy and labor market, sports franchises, factories, the stock market, the neighborhoods, and entertainment venues. They also cultivated relationships with local advertisers, whose contributions not only helped to make publishing profitable but also gave each city’s printed pages a decidedly local look and feel. Local subjects became progressively more prevalent in city papers during the nineteenth century. As new publications targeting the fast-growing urban population made newspaper markets more competitive, publishers lured readers by increasing both the number of stories concerning local events and the proportion of original articles written by local reporters rather than clipped from national sources.7
The great diversity and intensely local focus of modern American newspapers helped them earn the reputation as watchdogs over the powerful political and corporate interests that shaped American cities. Just as, according to the late urban scholar and activist Jane Jacobs, ordinary civilians safeguard neighborhoods by acting as “eyes on the streets,” modern American urban news organizations promised to protect entire metropolitan communities by serving as “eyes on the city,” attuned to the dangerous consequences of corrupt officials, greedy developers, failed public projects, or mismanaged disasters.8
Not all newspapers lived up to this mission, and most American cities have had their share of media organizations that used their printing presses or broadcast licenses to promote their own interests, even at the expense of the people they served. Yet local news companies that proved their commitment to the public interest through serious journalism and civic contributions established a public trust with the communities they served. Historically, this ethic of responsibility to the collective good evolved organically, out of deeply rooted local ties. Walter Lippmann, whom some consider the dean of American journalism, attributed the durability of America’s free press to these abiding local attachments: “There is,” Lippmann argued, “a fundamental reason why the American press is strong enough to remain free. That reason is that the American newspapers, large and small, and without exception, belong to a town, a city, at most to a region.”9
Lippmann and other proponents of local news were hardly parochial; they understood that, no matter how globally connected the world is, most people live locally; that local institutions—schools, hospitals, police departments, tax boards, and the like—exert tremendous influence on our lives; that local media producers are uniquely capable of reporting on and opining about the issues that directly impinge upon us and our communities, and of explaining how and why regional, national, and international events hit home.
In addition, the local media can also exert tremendous power. According to Phyllis Kaniss, the University of Pennsylvania communications scholar who authored the most recent comprehensive academic study of city newspapers and television stations, messages from local media “are as capable of killing a multimillion dollar development project as helping it sail through a lengthy public approval process, as potent in winning a politician votes as in ousting an entire agency’s management from their appointed positions. Local news plays a crucial role in the policy decisions of local officials to implement new initiatives or to eliminate and modify existing programs … Local news can affect private decisions as well. It can send people packing to move out of homes in the city or suburbs and determine whether they send their children to public or private schools or let them play in the nearby park.”10
In 2001 the Seattle Times, where local management was embroiled in a bitter struggle to preserve its autonomy, reported that patients had died prematurely in clinical trials run by the Fred Hutchinson Cancer Research Center, and that doctors and administrators had financial interests in the drugs under review. In lawsuits, the families of five of the patients alleged that they had never been told about the institution’s stake in the experiments; nor had they been adequately informed about the risks of participating. Although one family won its initial suit, all parties are still appealing. Until the Times investigation, neither Seattle residents nor other potential patients in the region could have known that some of the center’s experiments were dangerous. In 2005 the Sacramento Bee (which is owned by the McClatchy Company, one of the few newspaper chains to maintain its large investments in local reporting staffs), published a three-part series on the Pineros, migrant foreign workers who were injured or killed on U.S. Forest Service projects. In its nine-month investigation, the Bee discovered that the Forest Service had not merely failed to adequately train the ten thousand Pineros or provide proper safety equipment, but repeatedly “abused” the laborers by forcing them “to live in squalor” and ridiculing them on the job. The series not only won honors and awards but also led the government to promise immediate reforms.11
Local news stories are consequential even when they don’t address matters of life and death. The East Hampton Star, a family-owned weekly since 1885, has been a steady voice for historic and environmental preservation in a region where real estate development, especially for ultrawealthy New Yorkers shopping for second homes, has long threatened to transform the landscape. In a 2003 issue, the paper featured one story on “regenerative designs” such as underground parking garages and multifamily apartment complexes (rather than single family homes) that could reverse growth and “retain East Hampton’s most environmentally sensitive marshes and woodlands, while returning to a pristine state some land already built upon”; and another explaining a confusing public plan to protect local wildlands and groundwater sources. The Star, which is one of the few newspapers in the United States to publish every letter to the editor it receives (at considerable cost to the owners), keeps residents informed and engaged, helping to create a collective, if contested, sense of place. In this way, the Star makes self-governance and social participation available to its readers, revealing how the business of business becomes the people’s business when it affects public life.
When they stake a claim in the communities where they operate, the media contribute to the vitality of local democratic politics by shedding light on important issues that private citizens do not have the time, inclination, or expertise to uncover or understand on their own. In the process, local media can provide a forum from which dissenting voices reach the public, and also help to mediate disputes between self-interested groups. Local news organizations like the Star have been especially important players in debates about urban and suburban growth; although in many American towns and cities the local media have aggressively advocated development to serve their own interests, in others the local media have helped hold back projects that threatened to overrun the area.
In a classic article on urban growth machines written in 1976, the sociologist Harvey Molotch argued that “the newspaper tends to achieve a statesman-like attitude in the community and is deferred to as something other than a special interest by the special interests. Competing interests often regard the publisher or editor as a general community leader, as an ombudsman and arbiter of internal bickering and, at times, as an enlightened third party who can restrain the short-term profiteers in the interest of more stable, long-term, and properly planned growth. The paper becomes the reformist influence, the ‘voice of the community,’ restraining the competing subunits, especially the small-scale, arriviste ‘fast-buck artists’ among them.”12
The impact of local news does not end at home. Today we can look back on the history of local journalism and recognize its role in identifying emerging social problems, political projects, and cultural trends that—once documented and publicly reported—grow from city stories into national or international issues. Whether it was the Memphis Commercial Appeal, the Columbus (Georgia) Enquirer-Sun, or the New York World documenting the rise of the Ku Klux Klan in the late 1910s and 1920s, reporters like Ted Poston and Carl Rowan covering the growing civil rights movement at the grass roots, Randy Shilts and the San Francisco Chronicle documenting the rise of the HIV/AIDS epidemic in San Francisco, or the Boston Globe staff uncovering sexual abuse by Catholic priests, locally engaged reporters and news organizations have served the public interest and helped effect social change.
No matter if the object of investigation is development and sprawl, corrupt city governments, organized violence, racial discrimination, self-interested medical researchers, or public health crises, penetrating local journalism contributes to the collective welfare of communities and residents—even those who don’t pay attention to the coverage. The reason, as the legal scholar C. Edwin Baker argued before a U.S. Senate hearing on media ownership in 2004, is that the presence of large, diverse, aggressive, and independent local journalistic staffs, and the constant threat of critical attention that they impose, provide a strong disincentive for powerful institutions and individuals to engage in harmful, unethical, or illegal conduct. Without “eyes on the city,” Baker explained, political officials and corporations feel emboldened to promote their own interests, even at the public’s expense.13
ONE SET OF “EYES ON THE CITY,” THOUGH, IS NOT SUFFICIENT TO GUAR antee critical attention. The effectiveness of media depends on the vitality and diversity of available news sources. From Thomas Jefferson and James Madison onward political theorists have argued that the local media are most effective, and the public sphere is most dynamic, when it includes competing perspectives. Of course, an open market for news and information means some unsavory organizations are always part of the mix, and the history of local journalism is full of ugly episodes. Many small, independently owned news companies have produced parochial, discriminatory, and incendiary content, and even the most stalwart advocates of locally controlled journalism have warned about the damage done by bigoted or profiteering publishers.
As Upton Sinclair put it in 1919 in his self-published study of American journalism, The Brass Check: “The average country or small-town editor is an entirely ignorant man; the world of culture is a sealed book to him. If you go to the small town in Pennsylvania or Arkansas or Colorado … you find [the editor] getting a regular monthly income from the copper-interests, whatever happens to be dominant in that locality. You find him heavily subsidized at election-time by the two political machines of these great interests.”14 Sinclair’s concerns about local publishers hardly softened his contempt for the day’s newspaper moguls. Yet they did convince him that there are no simple solutions to the problems generated by America’s for-profit media.
We can only imagine what Sinclair would have written about the Newark Weekly News, a locally owned and operated paper published by Howard Scott and launched in 2005 with a $100,000 no-bid contract from the city council and then-mayor Sharpe James, who wanted an organ for promoting “good news” about the beleaguered city. Among the paper’s regular features are glowing accounts of city council members, full-page ads promoting city programs, and reports based on leads from local officials. “Do we have critical reporters on staff? No. Do we have investigative reporters? No,” Scott told the New Jersey Star-Ledger. “Our niche is the good stuff.”15 The city of Newark is hardly the only government to offer citizens propaganda disguised as legitimate news, but it is certainly the most unabashed.
Just as there are some corrupt local publishers, so too is there an ever-dwindling set of national chains that have maintained their commitment to local journalism that promotes the public interest. Today most Americans recognize that there are differences between Wal-Mart, which faces lawsuits from a class of potentially more than one million current and former employees who charge it with sex discrimination, off-the-clock labor, and contracting with sweatshops, and Costco, which is widely praised for its good pay (its average hourly wage was seventeen dollars in 2005) and benefits; or between McDonald’s and In-N-Out Burger, the chain praised by Eric Schlosser in Fast Food Nation for its fresh ingredients, friendly customer service, and low prices.16 Media chains always had a similar variety of managerial styles. But in recent years intense pressure from financial analysts and large shareholders who demand profit margins several times the 5 or 6 percent now typical of Fortune 500 firms has made it practically impossible for publicly traded companies to sustain their investments in the sizable local staffs required to watch over a city. Those that do have either a two-tiered stock system that allows family owners to maintain managerial control (as is true for the New York Times Company and the Washington Post Company), or a special strategy that concentrates on growth markets with special opportunities and leaves out any other places (as is the case for the McClatchy Company).17
FOR NO MATTER WHO CONTROLS THEM, CONSOLIDATED MEDIA companies—be they made up of newspapers, television and radio stations, or a combination of them all—compromise the quality of democratic politics and cultural life when they grow out of touch with the communities in which they operate. In the last decade, though, Congress and the FCC have relaxed ownership restrictions in all media. The government did not so much “deregulate” the market, because broadcasters depend on tight state supervision to protect their exclusive domains in the airwaves. Instead, the federal government “re-regulated” the industry so that Big Media companies could expand and consolidate ownership across outlets, even though such arrangements threatened the localism, diversity, and competition that are supposed to drive U.S. media policy, and resulted in massive downsizing of the local reporters, editors, and DJs who produce original content for cities and towns.
These re-regulatory projects affected every major and minor media market, but their impact was particularly severe in the radio industry. Prior to 1996, the FCC exercised caps on the number of radio stations that a media company could own at the national level. It set the limit at seven AM and seven FM stations in 1953, and, in 1984, under pressure from broadcasters who insisted that loosening radio regulations would increase their efficiency and profitability, the commission modified the caps to allow for twelve and twelve. In 1992 the limits were expanded to eighteen and eighteen, and then to twenty and twenty in 1994.
With the Telecommunications Act of 1996, Congress and the FCC eliminated the national station ownership limit altogether and raised local limits from four to as high as eight stations, allowing Big Media groups to merge operations on an unprecedented scale. Following the 1996 rule change, ambitious radio companies such as Cumulus Media, Viacom/Infinity, and Citadel Broadcasting Corporation joined Clear Channel in the race to take over hundreds of stations and establish dominance in particular markets. Despite the eight stations local limit in the largest cities, the FCC’s idiosyncratic counting method still made it possible for single corporations to own nine or more stations in some thirty-four specific metropolitan areas around the country. By the early years of the twenty-first century there were markets in Kansas, Wyoming, Florida, Oregon, and Ohio where one company, Clear Channel or Cumulus, owned more than half the local stations; and others in New York, Texas, Maine, Iowa, and Georgia where two companies owned more than 60 percent between them.
As the Citadel Broadcasting Corporation openly acknowledges, small and midsize markets are the best to take over because they are “less competitive, have fewer signals, derive a significant portion of their revenue from local advertisers and offer substantial opportunities for further consolidation.”18 Not that Big Media companies avoid big cities. Clear Channel owns fifteen stations that reach Washington, D.C., fourteen in Pittsburgh, thirteen in Detroit, twelve in Cleveland and Newark, and eleven in Los Angeles, Boston, and Cincinnati.19
Whether buying into large markets or small, Big Media spent billions of dollars to acquire stations immediately after the Telecommunications Act became law. There were more than 10,400 commercial radio stations in the United States when the Telecom Act went into effect in 1996. During the two-year industry-wide shopping spree that followed the relaxed regulations, media companies bought and sold more than 4,400 of them, over 40 percent of the field, reducing the number of individual owners by 700 (or about 14 percent). Less than twelve months after the new rules became law, Neil Hickey, a contributing editor at the Columbia journalism Review, reported that in the radio industry alone, “Westinghouse/CBS purchased Infinity Broadcasting for $4.9 billion, creating a radio colossus of 77 stations and achieving dominant power in the nation’s top ten radio markets, with multiple stations in each,” while “Chancellor Broadcasting Co. bought twelve radio stations from Colfax Communications for $365 million, giving it 53 stations in 15 markets.”20 USA Today, whose parent company, Gannett, had led the consolidation movement in the newspaper industry, warned about the “unprecedented wave of consolidation” that took radio “from a kitchen-table culture of mom-and-pop business to one at home in the boardrooms of the nation’s largest companies.”
Small, independently owned and operated radio stations were hit especially hard by the wave of acquisitions, as were minority station owners, whose numbers dropped 8 percent (from 350 to 322)—the largest decrease since the FCC began tracking them in 1990—when they were forced to compete against or sell out to Big Media groups. By 2005, the FCC reported that only 3.6 percent of all broadcast radio and television stations were minority-owned, while a mere 3.4 percent were owned by women. “I don’t think anybody anticipated that the pace would be so fast and so dramatic,” said FCC chairman William Kennard, defending himself against critics who charged him with allowing the industry to dictate the terms of its own regulation. “The fundamental economic structure of the radio industry is changing from one of independently owned operators to something akin to a chain store.”21
In Texas, to take one example, radio consolidators were rounding up as many stations as they could handle. Lowry Mays, then the president and CEO of Clear Channel Communications, purchased his first local station, KEEZ-FM (now KAJA-FM) in San Antonio, in 1972. During the early 1990s he expanded his national holdings to the legal limit of forty, and in the months following the 1996 act he turned his relatively unknown company into one of the nation’s largest radio operators, acquiring outright or obtaining interest in sixty-six new stations to top one hundred overall. Mays was downright cautious compared to his old Austin associates, R. Steve Hicks, the radio entrepreneur and cofounder of SFX Broadcasting, and his billionaire brother, Thomas Hicks. Backed by what analysts estimated as a $700 million equity commitment from Hicks, Muse, Tate & Furst, the investment firm where Tom was cofounder, chair, and CEO, Steve created a new company, Capstar Broadcasting Corporation, to take advantage of the deregulated marketplace. Capstar purchased 350 radio stations, including all the SFX stations that the Department of Justice allowed it to take, between 1996 and 1998.22 As Lisa Dollinger, Capstar’s former vice president of corporate communications and now the chief communications officer at Clear Channel, told me, “The Hickses saw what had happened in the 1996 Telecom Act, and they went out and bought as many small and midsized stations as they could. Capstar became the largest radio group in the country overnight.”23
Standardization of broadcast content made such rapid consolidation possible. Randy Michaels, the former CEO of Clear Channel’s radio division, compared its programming format with the menus at national burger franchises, telling the Wall Street Journal that “a McDonald’s manager may get his arms around the local community, but there are certain elements of the product that are constant. You may in some parts of the country get pizza and in some parts of the country get chicken, but the Big Mac is the Big Mac. How we apply those principles to radio we’re still figuring out.”24
National media chains have in fact shown little interest in letting customers have it their way. Rather than offering homemade broadcasts done specially for the people and places they serve, companies like Clear Channel produce standardized national and regional shows that have the artificial flavor of local broadcasts. Announcers prerecord voice bits and music selections into four-hour segments that take them less than twenty minutes to produce, and pretend familiarity with places they’ve never been and local traditions they’ve never experienced. On one Clear Channel show, for example, the San Diego-based personality “Cabana Boy Geoff” Alan raved about a “wild and crazy party” in a local club where, he said, “I personally saw a number of you hook up with people you had never hooked up with before.” He then conducted an interview with the pop star duo Evan and Jaron Lowenstein, during which Evan announced that a town was “actually far more beautiful than I expected it to be”: “It’s actually really nice, so happy to be here.” “We’ve got some good people here,” Alan agreed, then asked listeners to call the station with questions for the musicians. Yet the show had been taped weeks earlier, in Southern California. The DJ had not attended the party, nor ever visited the town, and the Lowensteins could not answer the calls. Listeners were hearing a doctored script, produced in a studio far away, and—until they began turning off their radios in favor of satellite service, the Internet, and MP3 players—no one at Clear Channel cared what the audience had to say.25
ALTHOUGH CITIZENS MAY BE DISSATISFIED, BIG MEDIA COMPANIES across the board have taken Clear Channel’s business strategy as a model for how they can profitably expand. In today’s media market, established conglomerates such as Viacom, Disney, News Corporation, and General Electric, as well as emerging giants such as Gannett Company and the Tribune Company, are centralizing operations and cutting costs while customizing content just enough to offer local variation—chicken in some places, pizza in others, and everywhere the Big Mac
Take Sinclair Broadcast Group, the upstart television chain known for airing partisan nightly news coverage and scheduling “news specials” such as Stolen Honor, in which Vietnam veterans spewed unfounded accusations at Democratic presidential candidate John Kerry just weeks before the 2004 presidential election. In the media industry, Sinclair is best known for pioneering NewsCentral, an innovative if short-lived system for producing local television news coverage for affiliates in its fleet of just under sixty stations with a central cast working in a suburban Baltimore studio. Or Village Voice Media, the alternative weekly publisher that recently merged with New Times, the Phoenix-based chain whose irreverent managers developed a standard format for blending local investigative features with cookie-cutter cultural coverage and copious sex ads in cities throughout the country. After the merger, which left the Southwestern executives in charge of the Village Voice brand, the company owned seventeen alternative weeklies in major markets such as New York, Los Angeles, Miami, Houston, Seattle, Denver, and San Francisco, giving it control of about 25 percent of the Association of Alternative Newsweeklies market.
In the Midwest, the Tribune Company has grown from its roots in Chicago to become the nation’s leader in “convergence” news production, in which staff from newspapers, broadcast television and radio stations, cable channels, magazines, Web sites, and entertainment subsidiaries work “across platforms,” creating “content” (not simply journalism) that is customized for different markets and media. Tribune’s bold growth strategy captured the attention of media conglomerates around the globe, while raising concerns from industry watchdogs and consumer groups. For the Tribune model of “cross-ownership” of broadcast and print outlets in the same market is possible only if a corporation can get around standard federal media policies that prohibit such arrangements unless—as is the case for Tribune’s properties in Chicago, New York, and Los Angeles—a company is given a special waiver or grandfathered in by law.
Media policies do little to prevent ambitious companies such as Tribune, Sinclair, Viacom, and News Corporation from acquiring properties beyond the standard limits. During the past two decades it has become common practice for Big Media companies to challenge the federal government’s ownership restrictions by conditionally buying outlets in places where they are over the limit, and then requesting waivers, pressing legal cases, or mounting political campaigns so that the law comes into compliance with them.
Major media companies spend lavishly on marketing and lobbying projects that put spotlights on their leading roles as creative cultural entrepreneurs whose mission is to inform, entertain, and serve the public. What they leave unsaid, however, is their other identity as political entrepreneurs and powerful interest groups, whose fundamental purpose is not to promote the interests of citizens but, like all publicly traded companies, to generate high revenues and increase stock values for their shareholders. There is, of course, a strong American tradition of doing well in the media business by doing good journalism and entertainment. But in recent decades most media chains have used a different strategy, increasing profits by cutting their costs, eliminating reporters, DJs, and producers in cities where they control enough of the market that consumers have few other places to turn for local news and culture.
The rise of national media conglomerates and the fall of locally owned and operated newspapers, television channels, and radio stations have helped to facilitate the industry’s divestment from the places where they operate. In 1945, for example, roughly 80 percent of American newspapers were privately owned, often by families that were willing to sacrifice potential profits to maintain their journalistic principles and preserve their readers’ trust. Today, however, more than 80 percent of American newspapers are owned and operated by publicly traded corporations, many of which are merely subsidiaries of larger conglomerates whose executives are unwilling to compromise income for the good of cities they rarely visit or towns they’ve never seen.
Not that the FCC is unaware of the industry’s influence. In addition to the revolving door through which regulators routinely exit to take high-paying jobs in the companies they once regulated, Big Media companies get influence the old-fashioned way: they pay for it. According to a report on the legislative process behind media re-regulation published by the CPI in 2003, “FCC officials have been showered with nearly $2.8 million in travel and entertainment over the past eight years, most of it from the telecommunications and broadcast industries the agency regulates … The $2.8 million paid for FCC commissioners and agency staffers to attend hundreds of conventions, conferences and other events in locations all over the world, including Paris, Hong Kong and Rio de Janeiro.” The National Association of Broadcasters was the leading industry sponsor, doling out $191,472 to FCC officials traveling to its events. The FCC chairman, who was most responsible for setting the commission’s agenda, “chalked up the most industry sponsored travel and entertainment among active commissioners during the period covered by the study—44 trips costing $84,921.”26
Lobbying by the media industry is especially intense when Congress and the FCC are actively debating regulatory changes. In the early 1990s, for example, the networks and aspiring radio giants helped to lead a high-powered, low-profile campaign on the Capitol, urging political officials to roll back the ownership caps that restrained consolidation among radio and television companies. The effort intensified after the Republican Party took control of Congress in the 1994 elections, and in the next two years the media industry’s lobbying expenses skyrocketed while political contributions from the communications and electronics sector soared from $30,727,095 to $60,914,552. By comparison, 1996 contributions were $51,593,530 from agribusiness, $46,578,676 from energy and natural resources, $13,089,979 from defense.27 In the view of CPI founder Charles Lewis, such conduct from major media interests leaves little question that “the FCC is in the grips of the industry,” captured by the very companies it is supposed to regulate.
The money was well spent: the expensive lobbying campaign of the mid-1990s, for example, culminated in the 1996 Telecom Act. Arguing that the economic downturn of the early 1990s had imperiled the media business, with stations and channels across the country suffering operating losses, aspiring consolidators claimed that more mergers would allow them to reduce costs and increase profits. Whether and how concentration would protect competition, diversity, and localism was left unsaid.
Andrew Jay Schwartzman, president and CEO of the Media Access Project, a nonprofit law firm that works on media policy in Washington, D.C, acknowledged that Big Media’s lobbying narrative had some truth to it, up to a point. Many broadcasters did indeed lose advertising revenue during the recession of the early 1990s. “The media business is always cyclical that way,” he told me. But the real source of their trouble at the time was that some companies “bulked up quickly and took on a lot of debt after the FCC raised ownership caps in the 1980s and again in 1992. They paid high prices for radio properties, expecting them to keep generating the same levels of income. And when the market slowed they were exposed.” The broadcast industry had been pushing for relaxed ownership laws since the 1980s, and in the mid-1990s it simply used the brief economic downturn as an excuse to call for gutting the caps. “Many of the stations that were in the red during the early 1990s were there because of their debt, and others were family-owned stations that put people in their families on the payroll in no-show jobs so they could take money out. The industry was doing just fine. The ‘crisis’ they talked about to get a policy change was a fake crisis.”
The tremendous political clout of the media and telecommunications industries derives not only from their big budgets for lobbying and well-connected trade associations, but from the belief of elected officials (who spend much of their time raising money to buy advertising from broadcast companies) that the industry’s influence determines the fate of policy proposals, political campaigns, and, in turn, their own careers. Indiscreet members of Congress say that FCC officials, senators, and representatives are “reluctant regulators,” because they fear being singled out and targeted with a backlash of negative coverage from the Big Media companies they are supposed to check.28 Officials sometimes benefit from their relations with Big Media in more concrete ways, too.
The Hicks brothers of Capstar Broadcasting Corporation are illustrative of such mutually profitable relationships. No mere bystanders to the 1996 act, the Hickses, according to their own press materials, played a key role in persuading Congress to raise the local ownership caps and abandon the national limits outright. Hicks, Muse, Tate & Furst was already the the nation’s largest active investor in the broadcast industry, and it stood to profit handsomely from aggressive deregulation. Steve, who purchased his first radio station at age twenty-nine and took over stations in several southern states soon thereafter, was the Hicks family leader on media policy. Capstar’s Web site boasts that Steve devised the Local Marketing Agreement (LMA), the legal loophole that allows one media company to effectively lease and operate stations it does not technically own, thereby evading ownership limits in a local market.
For the Hicks brothers, as for other media executives, political entrepreneurialism is the fundamental source of financial success. As a regent of the University of Texas under Governor George W. Bush, Tom Hicks lobbied to create and then chair the UT Investment Management Company (UTIMCO), which would manage the system’s multi-billion-dollar budget. Soon after taking it over, Tom was at the center of a statewide scandal when journalists discovered that UTIMCO awarded $450 million in contracts to companies whose executives were close friends of Hicks, major donors to the Bush family, or business partners with Hicks’s companies. In 1998 Hicks made a direct contribution to the governor’s wealth by leading a group that purchased the Texas Rangers for $250 million in what the Texas Observer called a “sweetheart deal.” The future president had spent $605,000 on his 1.8 percent share of the team, and he personally earned between $10 million and $14 million on the sale.
IF LOBBYING HAS BEEN ONE SECRET TO BIG MEDIA’S POLITICAL SUCCESS, storytelling, which news and entertainment companies are uniquely equipped to do effectively, has been another. In the past decade major media companies have told two, mutually exclusive stories, depending on whether the audience is made up of political officials and regulators or citizens and shareholders. Each story has a different moral and a different implication, so it’s not surprising that media executives don’t tell them both at once.
Before Congress and the FCC, Big Media managers always insist that the industry is in crisis—as in the early 1990s—besieged by competition from the Internet, satellite services, bloggers, citizen journalists, and personal listening devices. As their hard-luck story goes, only the elimination or drastic reduction of ownership limits can save major media conglomerates and, by extension, the public goods they offer. Testifying in a U.S. Senate hearing on media consolidation in July 2001, Mel Karmazin, the former president and chief operating officer of Viacom, used such a story to challenge the very premise of the debate. “Thank you for this opportunity to testify before you today on the topic of media consolidation and broadcast ownership,” he opened. But “instead of ‘media consolidation,’ I prefer to call it media competition, because that’s what consumers are enjoying today.” After complaining about dwindling audiences and revenues for Viacom’s then-subsidiaries such as CBS and Infinity (one of the nation’s leading radio companies), Karmazin reported that “it is bewildering and astounding that there is a debate raging anew here in Washington over the limits on national broadcast television station ownership.”29
What Karmazin left out is the happier story that Viacom’s own Web site provided to potential investors at the time. “Viacom is a leading global media company, with preeminent positions in broadcast and cable television, radio, outdoor advertising, and online. With programming that appeals to audiences in every demographic category across virtually all media, the company is a leader in the creation, promotion, and distribution of entertainment, news, sports, music, and comedy. Viacom’s well-known brands include CBS, MTV, Nickelodeon, Nick at Nite, VH1, BET, Paramount Pictures, Infinity Broadcasting, Viacom Outdoor, UPN, TV Land, Comedy Central, CMT: Country Music Television, King World, Spike TV, Showtime, and Simon &c Schuster.”
Karmazin was in good company at the hearing. Jack Fuller, then-president of Tribune Publishing, the newspaper subsidiary of the Tribune Company, offered in his testimony a variation on Viacom’s theme. “In an environment where people’s choices for obtaining information have radically multiplied, there is no risk of one voice dominating the marketplace of ideas,” Fuller assured the committee. “Today in clamorous cities such as Los Angeles, Chicago, and New York, it is frankly a challenge for any voice—no matter how booming—to get itself heard … Let firms own newspapers and broadcast television stations and people who get all their news from broadcasting today will hear new voices.”30
Tribune Company president, chairman, and CEO Dennis FitzSimons shared a different version of market conditions with the corporation’s shareholders just a few years later. “Here’s a quick look at how this [cross-ownership strategy] has worked for us in Chicago, where we offer consumers varied media choices like the Chicago Tribune, RedEye, and WGN television and radio. We also own Chicago magazine, Hoy/Chicago, CLTV, our 24-hour cable news channel, and Tribune Direct, our direct mail operation. And we have a strong Internet presence with our newspaper sites Chicagosports.com and Metromix.com, our very successful entertainment site. Together, the weekly reach of these properties is 6.4 million people or more than 90% of the market.”31
Americans and their elected officials may not know which of Big Media’s own stories they should believe, but they are beginning to realize that entrusting media conglomerates with even more control of the public airwaves is a losing proposition.
THE TIMING OF AMERICA’S LOCAL MEDIA DEVASTATION COULD NOT BE worse. We live in an era of extraordinary upheaval and conflict. The United States is now engaged in a war that has no foreseeable end-point, a war made possible because the government misled the majority of its citizens into believing that Iraq had given substantial support to Al Qaeda in planning 9/11, and a substantial minority into thinking that inspectors had discovered weapons of mass destruction in Iraq or that world public opinion supported the war.32 Strange outbursts of extreme weather are punishing the planet, with catastrophic storms hitting cities everywhere, and policy makers are searching for ways to handle emerging natural and manmade catastrophes. Millions of good jobs, and some entire industries, are disappearing as multinational firms relocate facilities to countries with low prevailing wages. Public programs, such as health care, education, and possibly social security, are being transferred into the hands of private sector companies with no proven performance records. As metropolitan regions are sprawling outward, city centers are gasping for new life. Scientists warn of a coming energy crisis and insist that our modern habits are unsustainable. Record numbers of citizens are incarcerated. And we can only speculate about unreported issues and trends—especially at the local level—that are shaping the ways we live and die. Our need for media that serves the public interest by helping citizens and communities make informed decisions has never been greater.