Oct
01
2011

Media Monopoly Revisited

The 20 corporations that dominate our information and ideas

The introduction of the original 1983 edition of The Media Monopoly, Ben Bagdikian’s classic investigation of media consolidation, concluded: “When 50 men and women, chiefs of their corporations, control more than half the information and ideas that reach 220 million Americans, it is time for Americans to examine the institutions from which they receive their daily picture of the world.” When the second edition was released in 1987, the number of people controlling half the media was down to 26. By 1993, as the last edition went to print, the number had fallen to 20.

To arrive at these alarming numbers, Bagdikian—who has been a Washington Post editor and the Dean of the Graduate School of Journalism at Berkeley—charted revenue numbers for each media category. The biggest companies whose combined market share exceeded 50 percent of their sector were counted by Bagdikian as the dominant media corporations.

Since these figures have not been updated since 1993, Extra! used the same methods to calculate a new Media Monopoly number. Based on 2009 revenue figures, the most recent that are available (from Advertising Age, 12/20/10), the number of corporations dominating the media sectors analyzed in Bagdikian’s most recent edition—newspapers, magazines, motion pictures, television and book publishing—has fallen to 15. Expanding the analysis to include emergent technologies like cable television, satellite radio and the Internet, the number of corporations dominating the American media remained at 20.

However, to suggest that as many as 20 corporations dominate U.S. media is somewhat misleading. The five corporations highlighted in Bagdikian’s 2004 The New Media MonopolyNews Corp, Viacom, Bertelsmann, GE and Disney—are far more powerful than many of their counterparts. Take Hearst, for example, one of the companies in the controlling half of the magazine industry. The owner of magazines like Harper’s Bazaar and Cosmopolitan as well as TV and newspaper properties, Hearst’s 2009 net revenue was over $3 billion. Yet compared to Disney’s $18 billion in net media revenue for 2009, it’s clear that even the dominant can be dominated.

And the dwindling number of corporate owners is only one side of the story Bagdikian began telling in 1983. The other component is a media environment increasingly dependent on a commercial model. As the number of owners goes down, overall advertising revenue continues to soar; even in the recession year of 2009, $309 billion was spent on ads (Advertising Age, 12/20/10).

In some industries, like network TV and the motion picture industry, ownership dominance has remained fairly static, while other sectors, like book publishing and radio, have seen their numbers shrink, whether through loosening FCC regulations or traditional takeovers and mergers. As ownership and cross-ownership limitations continue to be either weakened or repealed outright, powerful telecommunications corporations like Comcast and AT&T are now legally free to begin eyeing not only infrastructure, but the content flowing through their pipes. These efforts, if successful, would position these companies above even the currently most powerful media corporations.

Movies

Movies Chart

Throughout its history, the motion picture industry has been dominated by a handful of studios. With the movies consolidated from their beginnings in the early 1900s via the Hollywood cartel system, the studios receiving the majority of revenues continue to be familiar, with some combination of the major six firms raking in the lion’s share—the particular few on top depending on the vagaries of box office receipts.

In 2009, Time Warner’s Warner Brothers, Viacom’s Paramount, Sony/Columbia and News Corp’s 20th Century Fox together accounted for more than 60 percent of the $10.6 billion box office take, according to the website Box Office Mojo. Back in 1988, the same companies were mostly on top, with Disney’s Buena Vista Films instead of Columbia in the top four. Going back a few more years, to 1975-79, Universal was in the top four rather than Disney, with the rest of the list unchanged. These six studios together took 80 percent of the box office in 2009.

Newspapers

Newspapers Chart

In 1989, the total circulation of daily newspapers in the United States was 63 million, (journalism.org) and 14 chains distributed over half of these papers. Unlike with other media sectors, Bagdikian chose to use circulation rather than revenue to determine the dominant newspaper groups, since individual revenue figures were seldom available. He suggested, though, that revenue figures would have revealed the industry to be dominated by even fewer corporations.

With revenue data now made available by Advertising Age, it’s clear that Bagdikian’s prediction was correct. In 2009, five corporations received over half the newspaper industry’s $19.7 billion revenues: Gannett Co. (publisher of such papers as USA Today and the Arizona Republic), Tribune Co. (L.A. Times, Chicago Tribune), New York Times Co. (New York Times, Boston Globe), Advance Publications (Oregonian, Plain Dealer) and MediaNews Group (San Jose Mercury News, Denver Post).

Magazines

Magazines Chart

Once a diverse medium, magazines have seen a consolidation rivaled only by radio. In 1981, there were 20 corporations dominating magazine publishing. By 1988, Time Inc. had merged with Warner, and News Corp had purchased Triangle Publications, joining Hearst to take over half the revenue of the entire industry. For 2009, the number of corporations receiving half of the $12.6 billion of magazine advertising revenue remains at three, with one change: News Corp, through the sale of nine magazines, including Seventeen and New York, has been replaced by Advance Publications, owner of Conde Nast. Time Warner still receives the lion’s share, with 40 percent of the market.

With Hearst’s recent $914 million purchase of Hachette’s magazine properties (including 102 titles in 15 countries, such as Elle and Popular MechanicsCrain’s New York Business, 1/31/11), which came too late to be reflected in this survey, the number of magazine publishers that control half the market has probably been reduced to two.

Radio

Radio Chart

The radio industry in 1982 was dominated by 10 corporations. At the time, the “7/7/7” rule meant one corporation could own up to seven AM stations, seven FM stations and seven TV stations—a limit that was expanded to 15/15/15 in 1985.

With the passage of the 1996 Telecommunications Act, all radio ownership caps were removed, save for regional caps preventing ownership of more than eight stations in any market. Within a week of the Act’s passage, around $700 million was spent on newly available media properties (Common Cause, 5/9/05).

Fifteen years later, the radio industry stands as the most consolidated industry in the media, with two companies, Clear Channel Communications and Sirius XM, controlling over half the revenue for 2009. Since 1995, Clear Channel has increased its ownership from 43 radio stations to 850 in 150 U.S. cities.

Like Clear Channel, SiriusXM benefited directly from government policy. Satellite broadcasting was established in 1990, and the FCC issued two licenses, stipulating that the recipients, Sirius Satellite Radio and XM Satellite Radio, would not be permitted to merge. In 2008, the FCC changed its mind, allowing the merged satellite radio company to overtake the traditional radio powerhouses, CBS and Cumulus Media, in advertising revenue (FCC ruling, 10/19/10).

Network Television

Network TV Chart

According to the Pew Research Center (12/20/10), TV is the primary news source for 66 percent of Americans. Three companies took in over half the broadcast TV advertising revenue for 2009: CBS, News Corp (Fox) and Walt Disney (ABC). With the addition of NBC, the top four companies receive 70 percent of all broadcast TV ad revenue.

Since the emergence of News Corp’s Fox in 1986, the number of companies controlling the airwaves has remained static, though the owners of those companies continue to change. In 1985, ABC was bought by Capital Cities, which in 1996 sold ABC to Disney. CBS, acquired by Westinghouse in 1995, was taken over by Viacom in 2000. In 2005, Viacom and CBS split, creating its modern incarnation, CBS Corp. GE bought NBC in 1986; in 2009, after this study’s time frame, it sold 51 percent of its stake to Comcast, the nation’s largest cable provider.

Cable Television

Cable TV Chart

While Bagdikian did not survey the emerging cable systems when editions of The Media Monopoly were still being published, he certainly would have remarked on the quickness with which the cable industry has consolidated. As with the Internet, cable television was initially celebrated as a technological breakthrough that would challenge the dominant networks while giving voice to new individuals and ideas. Such hopes were dampened as cable rapidly became as concentrated as broadcast TV.

For 2009, three cable networks received over half the $49 billion in advertising revenue: Disney, Time Warner and Viacom.

If broadcast and cable TV were treated as a single sector, four companies would have dominated its $74 billion market in 2009: Disney, News Corp, Time Warner and NBC.

Book Publishing

Books Chart

In 1980, 11 corporations received over half the revenue from book sales. By 2009, the number of corporations controlling half the $23.9 billion market had fallen to five: Bertelsmann (owner of RandomHouse), Pearson, Hachette, News Corp (Harper Collins) and CBS (Simon & Schuster). Of the five, four have significant holdings in other media industries. Pearson, while not vertically integrated, takes solace in being the largest education company in the world.

Internet

Internet Chart

Since Bagdikian’s 1993 analysis, the Internet has exploded onto the media scene, lauded as a egalitarian medium, flush with potential for democratic enrichment.

Idealistic visions have a long history of attaching themselves to new communication technologies. Old-time radio hobbyists certainly felt their early broadcast experiments were the beginning of a better future. Yet with the 1927 Radio Act, the hobbyists were replaced by a government-sanctioned monopoly based on a commercial model. As television began, it too felt the potential for democratic enrichment. Yet instead of opening up the new medium to new players and voices, television likewise went the way of the commercial model.

The Internet’s fate is far from written. However, at this moment, most individuals in the United States may choose from only one or two Internet service providers, and the corporations that currently control the pipes are beginning to make unprecedented gains into the content that flows through them. Provider Comcast, already the highest-revenue media company in 2009, purchased NBC and Universal in 2011.

The revenue from online content is quickly consolidating as well. For 2009, two companies, Google and Yahoo, received over half the $20.9 billion in advertising revenue. As the two leading search engines, these companies use commercially driven algorithms to influence how people explore the Web. Unsurprisingly, then, a majority of users still go to traditional media on- and offline. In measuring media diversity online, political scientist Matthew Hindman of Arizona State (New York Times, 6/2/03; Television Quarterly, Spring-Summer/04) found that the Internet produces levels of audience concentration greater than those of traditional media, while also disadvantaging local content providers.

Monopoly vs. Democracy

In interpreting the First Amendment in 1945, Supreme Court Justice Hugo Black emphasized that “the widest possible dissemination of information from diverse and antagonistic sources is essential to the welfare of the public.” As giant media companies continue to push an interpretation of the First Amendment that focuses only on their freedom to speak, the freedom to hear “diverse and antagonistic voices” has all but disappeared.

While the country is becoming more diverse racially—and remains half female—the heads of all 20 corporations are still white males. Lack of diverse ownership leads to non-diverse newsrooms and viewpoints: According to the American Society of Newspaper Editors (4/16/09), ethnic minorities make up less than 13 percent of newsroom employees, less than 4 percent of television station ownership, and less than 8 percent or radio station ownership. This in a nation revealed by the 2010 census to be 36 percent minority. Women, meanwhile, are 37 percent of full-time newspaper newsroom staff.

Writing for Extra! (6/87), Bagdikian observed, “The American audience, having been exposed to a narrowing range of ideas over the decades, often assumes that what it sees and hears in the major media is all there is.” Since that day, the range of what the American audience hears is controlled by fewer and fewer people. As fast as new technologies are created, they are consolidated in the hands of well-positioned corporations for commercial use.

As the newspaper industry attests, the market is failing to protect the core principles of diversity and localism. Major cities like Houston, Seattle, Denver and Cincinnati are down to one local daily newspaper, a status that is becoming the default condition. While the Internet has sparked optimism, its current news production through blogs and web pages cannot replace well-funded investigations produced by experienced editors and journalists.

As companies collect vertically integrated media properties, market logic inclines them to produce lowest common denominator fare on a national level, neglecting not only their public interest standard obligations, but their crucial responsibility as the fourth estate. Without paradigmatic shifts in the way national media is consumed and regulated, communication technologies, old and new, will continue to serve a corporate minority that is inherently contradictory to the values of democracy.

Patrick Morrison is a freelance journalist and recent FAIR intern.