Conglomerates and the Media

by Erik Barnouw et al

New Press, 1997


... in 1920 ... when the Commerce Department began to offer broadcasting licenses, it set off a stampede. By July 1922, over four hundred stations were on the air, with more on the way. Many were prewar amateur rigs upgraded for the new era transformed into broadcasting stations. Many diverse interests were brought into play. More than seventy of the stations, the largest group, were launched by universities or colleges, inspired by visions of a new era in adult education. Others were started by newspapers, hotels, manufacturers, department stores, religious groups, and others. All saw in broadcasting an extension of whatever they were already doing; in other words, all had some promotional aspect. But none, at this point, sold time for advertising. In fact, the mere suggestion of doing so could bring rebuke. Commerce Secretary Herbert Hoover, presiding proudly over this extraordinary eruption, said it was "inconceivable that we should allow so great an opportunity for service to be drowned in advertising chatter." It was indeed an idealistic moment. Hoover, by the way, credited the eruption to "the genius of the American boy."

During 1922, the fever generated an orgy of prophecy, not unlike other such orgies. The Doubleday company launched a new magazine, Radio Broadcast, to chronicle the coming age. Broadcasting, said the magazine in its first issue

- will elicit a new national loyalty and produce a more contented citizenry... the government will be a living thing to its citizens instead of an abstract and unseen force...

- elected representatives will not be able to evade their responsibilities to those who put them in office... at last we may have covenants literally openly arrived at...

- the people's university of the air will have a greater student body than all our universities put together.

Also in 1922, a former secretary of the navy, Josephus Daniels, dedicating a station in North Carolina, said: "Nobody now fears that a Japanese fleet could deal an unexpected blow on our Pacific possessions.... Radio makes surprises impossible."

... The exhilaration of 1922 brought more and more stations to the air, and Hoover began to worry-for good reason. The licenses had all been issued under a radio law of 1912, a very ambiguous document. Hoover, studying it, was sure he had the right to issue licenses, but probably not to refuse them-not to U.S. citizens, anyway. And the law did not explicitly define regulatory powers. Hoover kept urging Congress to pass a new law to clarify all this, but the uncertainties of the future made this difficult and led to endless congressional debate, while still more stations came on the air. Hoover invited radio leaders, including those from Westinghouse, AT&T, and General Electric - the titans of the era-to Washington to advise him about the chaos. They urged him strongly to ignore his doubts about the law, to issue firm regulations, and establish order. They promised to support him. Hoover thought it might be the first time an American industry had begged to be regulated.

Broadcasting had been described in 1922 as a unique opportunity for service. By 1924, more thought of it as a likely chance for a killing. So the rush to the air intensified, as did the spectrum chaos. By 1924, Hoover, still waiting for Congress to pass a new law, felt the chaos had become intolerable. He decided to act as the advisers had urged. New requests for licenses began to be handled with a form letter, saying "all available wavelengths" were now in use, so the requests could not be granted. Meanwhile, Hoover began a drastic realignment of existing stations, dividing them into categories. Most, including almost all educational stations, were dubbed "local" stations. They would be on the same wavelength as a host of other local stations, so had to be limited in power-100 watts or less-to avoid interference. Then there were "regional" stations, on a different wavelength, which they shared with other regional stations, all distant enough to permit more power to be used. Finally there were "clear-channel" stations, free of interference over most of the country, and therefore allowed maximum power, eventually, in many cases, 50,000 watts or even more. AT&T'S stations, and those of General Electric and Westinghouse, which all "went commercial," were in this favored group. Nonprofit broadcasters noted that Hoover had created a hierarchy of stations, and that they, themselves, were at the bottom of it. Bitterness developed.

Why had Hoover done this? He had apparently adopted a rationale used by AT&T in promoting its plan. All those other stations, AT&T argued-educational or religious or whatever-were "special-interest stations", whereas an AT&T station was "for everybody." Anyone could buy time on AT&T stations, so they would be the epitome of democracy. They served the "public interest." AT&T also argued that those it called "special interests," such as education, didn't really need stations; they could buy time on AT&T stations, save money, and help clear the chaos. It would not be the first or last time that creative use of language played a part in media struggles. When the Federal Radio Commission later took over the licensing function under the Radio Act of 1927, it used the same rationale, as it, too, began moving stations around the dial. The Harvard Business Review, in a detailed study of the commission, concluded: "While talking in terms of the public interest, convenience, and necessity, the commission actually chose to further the ends of the commercial broadcasters. They form the substantive content of public interest as interpreted by the commission."

I probably need not remind you that all this was during the administration of Calvin Coolidge, who assured us: "The chief business of the American people is business."

With licensing halted, would-be broadcasters felt frustrated but found there was another way to get a channel. You could buy one. A commercial applicant sometimes found a discouraged nonproflt ready to give up, at a price, and then found that the Commerce Department was ready to bless a transfer-channel and all. This seemed at odds with the law, which gave a licensee the use, not the ownership, of a channel. So how could he sell the channel along with his equipment? However, the department took the view, as its spokesman explained to a Senate committee, that "the license ran to the apparatus." With this green light, a traffic in licenses quickly develop A commercial applicant found that it could petition the commission for the right to take over, "in the public interest," a channel in use by someone else, presumably in a less worthy manner. The commission would set a "comparative hearing," and the nonprofit would have to send a lawyer to Washington to defend its channel, perhaps losing in the process. Nonprofits grew increasingly wary. Meanwhile, their presence in the spectrum seemed to be resented. Without profit to anyone, they were sitting on channels that could earn someone a small fortune. Via purchase or pressure, many nonprofits were now to be edged off the dial. Much effort and money went into this.

The Federal Radio Commission was a body drawn largely from businessmen. Taking office in 1927, it found 712 stations on the air and decided that was too many. Ninety of them were operated by educators. The commission began a grand new shuffle, from which most educational stations emerged with part-time licenses, many confined to daytime hours, which were generally considered of lesser value for adult education. In dismay or disgust, eight educational stations left the air in 1927, twenty-three in 1928, thirteen in 1929. A few years later, only about two dozen hung on.

... the traffic in licenses, which made licensing incidental to buying and selling equipment, began during these years, with the result that regulators virtually handed control of the spectrum to private interests. This traffic-with occasional, gallant resistance by individual commissioners-has thrived ever since, bringing a constant escalation in prices, and excluding from the game all but the very well-to-do. This has made our industry's structure increasingly undemocratic, giving us such recent phenomena as the transfer of NBC, along with RCA and all their licenses, to General Electric. Thus, one of our major news sources became the property of a company selling military equipment, collaborating in the planning of Star Wars, and marketing nuclear plants at home and abroad. Every NBC newsman went onto a payroll controlled by GE, and was kept aware of it. From a standpoint of public policy, it is hard to think of a sorrier linkage.

In 1934, Senator Wagner of New York, who had similar feelings, proposed a measure by which all existing licenses would be voided to prepare for a new deal in the spectrum, in which a fourth of all assignments would go to nonprofits, and these would be equal in power to commercial stations. This measure escaped passage by a narrow margin, but the pressure helped to produce a kind of radio renaissance in the late 1930s. Broadcasters applying for license renewals were asked to list hours they had devoted to public services. This period gave us the famous CBS Workshop series, marked "not for sale" in CBS rate cards, and offering such works as MacLeish's Fall of the City. The period also gave us forums like America's Town Meeting of the Air, Edward R. Murrow's World News Roundups, Orson Welles and his Mercury Theater on the Air, and works of Norman Corwin, unofficial poet laureate of the war years-all introduced as nonprofit items. Radio's approval rating soared during these years.

In 1952, as television began its first great boom, the idea of reserved channels for education took hold. Congress legislated the needed channels, but not the necessary funds. So there was delay as educators tackled the fund-raising problem. Meanwhile commercial applicants ceaselessly pressured the FCC to release the channels for commercial use. Broadcasting magazine, backing them, warned: "One day the FCC must take another look at the Communications Act in relation to these socialistic reservations."

When the FCC ignored this advice, the magazine predicted that there would soon be a cleanout at the commission, beginning with a probe by Senator Joseph R. McCarthy of Wisconsin. The magazine considered the members of the FCC "stooges to the communists."

But perhaps the most dangerous triumph of advertising is its gradual takeover of our election procedures, the central process of democracy. Whenever I visit my native land, the Netherlands, my cousins and nephews like to ask me how we can endure such an undemocratic system. Most leading democracies forbid the sale of time for political appeals. In most, free television time is, by law, allotted to opposing parties on some statistical basis such as: the size of a party's membership, or its representation in a legislature, or votes in a previous election. There is no reason why our broadcasting systems, enriched from publicly owned channels, should not yield time for something of such "public" importance ...

TV has no agenda, except to be profitable. Toward that end, TV news is supportive of establishments ...

TV news doesn't serve the public interest. Corporate ownership of the networks and local stations is destroying the integrity of news ... The real crisis in television news today is about corporate control and the emerging corporate culture.

In a TV universe where every rating point represents close to a million dollars in advertising revenue every day, competition is intense. With network viewership declining precipitously-and that includes the evening news-survival depends on hanging onto viewers. That desperate objective produces ratings-driven news, designed to soothe and please more than to inform and challenge.

What is the purpose of news in America today? To enlighten? ... No. The purpose of news is to make money, to generate corporate profits.

In 1987, Laurence Tisch fired hundreds of employees. A lot of good journalists got their walking papers. Over two hundred were executed in one bloodletting alone. The other networks made similar moves, though with fewer casualties and less attention.

News was now to be packaged in London or Tokyo, with footage fed in and edited in those cities, far from many of the stories. Reporters who were not even at the scene now write the scripts. Eyes and ears on the ground, Murrow on the rooftops of London during the blitzkrieg was the great reportorial tradition at CBS. No more. The networks reported Bosnia from London for a long time, when they reported it at all.

Martha Teichner reported Bosnia from London, it seemed, forever. I know Martha. She would have been on a plane to the region in a flash if CBS had been willing to pay for the ticket. Eventually, when the body count got high enough in Bosnia, the networks did go in for firsthand reporting.

When ABC News doesn't bother reporting a story from the story, it's obvious. A viewer just has to listen to the sign off. It will say, "So-and-so, ABC News." Period. There is no dateline offered, no city. That invariably means the reporter is in New York. It's not always obvious. News consumers have to watch carefully and think, if it matters to them at all.

At CBS, some of us in the newsroom began to joke that we had studied at the Columbia Graduate School of Packaging. That is what we were doing. Packaging.

You are citizens and news consumers, and you need that nightly portrait of reality. You are in charge of your lives and have to act in national elections in alternating Novembers, more frequently at the local level.

Here's your problem: television news doesn't like Washington. Doesn't like stories about government. They are presumed boring. Van Sauter hated Washington. He demagogued and railed against it the way his idol, Ronald Reagan, did. In the old days, there probably had been too great a reliance on the nation's capital, too many stories about Congressional hearings. Now we couldn't get anything from D.C. on the air.

And TV really doesn't like presidential or any other form of politics. Management wisdom says they are all a turnoff. Literally. Choosing the president of the United States is arguably the most ~ important story in the world. It matters. Can you imagine news executives pressuring the evening news to go easy on presidential politics? I saw it happen at CBS News. My friends at other networks went through the same thing.

My demise at CBS News came after Dan Rather's celebrated interview with then Vice President George Bush on the facts about the Iran-Contra escapade. What had Bush known? The interview disintegrated into a shouting match between Rather and the vice president, who claimed we had misled him about the subject of the interview.

We hadn't. I set up and choreographed the video battle. Whatever one thought about Bush or what we did, CBS, Inc., was furious with us. Station managers were complaining loudly to the network. They said we had made viewers angry at CBS, and they feared TV watchers would tune CBS out. That would be death by the dial.

The corporation didn't care about the journalism involved. They only cared that station managers and, ostensibly, viewers were not happy. Vice President Bush had been Iying when he claimed to be "out of the loop" on Iran-Contra. But the televised confrontation was simply bad for business. CBS News was kind enough to allow me to leave by the door.

When TV does grudgingly tackle politics and elections, television news usually takes the path of pleasing viewers, or displeasing them least. TV portrays campaigns as horse races, reducing important elections to sporting events. So, it's who's up, who's down. And let's do our own poll, manufacture our own news.

The civic problem with polls as news, of course, is that these public opinion samplings are but a snapshot of the moment, and are likely to change mercurially. Perceptions about specific candidates as winners or losers, however, are set in cement in the public mind too early in the process.

News organizations' polls are frequently self-promotional and have little use as news, especially months, even weeks, before the voting, and they can provide self-fulfilling prophecies. Whose interest does that serve? The real issues are invariably important but stay on some tiny back burner. News executives think issues are boring.

So, if you are wondering why presidential elections are shallow and seem hardly worth following, you should decide who is at fault. Point your finger at the politicians, then step back and point it directly at the television cameras.

Campaigns are run for those cameras. From candidate schedules to soundbites, the whole operation revolves around TV. TV's deadlines and its hunger for pictures are what campaigns are all about. It's too easy to simply blame the candidates for the low common denominator of politics.

It's not just politics that suffers from inadequate coverage. TV doesn't deal with international stories very well. Television news does not have a strong commitment to foreign news. It's a turnoff. Who should pop up with that message last autumn but Andy Rooney. Rooney said on 60 Minutes that network news is not doing its job. Rooney cited the shortage of foreign news as evidence.

So, here we are in this electronic era, with diminished personnel and news gathering capabilities and definite ideas about diluting content. Producers are forced to second-guess what kind of news, what sorts of stories will hold an audience. Our jobs depend on it. We are caught between standing for something and surviving.

CNN holds about five hundred thousand viewers at any given moment on a good day.

News is supposed to tell people what they need to know, not just show them what they want to see... They can spend their money and go to the movies for that.

The press used to frequently lead the political community in raising questions and doubts. We wanted to bask in the glow of patriotism, and we quickly got on board. We had alienated the citizenry with tough reports from Vietnam through Grenada, and then Panama. Now we were not going to make that mistake again. It's bad for business.

Broadcast news cheered our boys on. We ignored suggestions by military analysts that Iraqi soldiers had actually turned their backs to the Saudi border and were digging in defensively. No. This would be like WW2. We got behind it. WCBS all-news radio organized a letter-writing campaign to keep morale high over there. NBC News began showing grinning U.S. soldiers at their stations, waving to the cameras. They'd yell out their names and where they were from. Sometimes they threw in a positive, patriotic comment. These became NBC's news bumpers. Bumpers are the pictures or graphics leading into commercials.

This is not journalism. It's jingoism, market-driven and thoughtless. It's just that pleasing viewers comes first; profits come before citizen responsibility. Don't tell me ownership, with its pressure for those profits, is not the cutting issue with news.

Dissent leading up to the Gulf War was absent and overdue. Democrats on Capitol Hill, already a timid lot, remained silent. By the time the loyal opposition turned off their TVs and wandered outdoors, wondering aloud what the hell we were doing, bombs were falling on Baghdad.

Many argue that little was accomplished in that war. The Clinton administration is fighting the same beast that Bush fought before. We propped up Kuwait, a feudal fiefdom, but Sadam remained in power and continues to work his magic, especially on the Kurds.

I argue the press is partly to blame for the whole mess. Where 1 were we when the tough questions needed to be asked? Busy demonizing the demon Sadam. We, the press, were players. Period.

The question becomes: What, if anything, can be done? I have my doubts that anything will be done to improve television news, but something could be done. Consider two words, which represent two different approaches: Reregulation-recasting the Reagan tide as low tide; and AntiTrust-convincing the Justice Department and Federal Communications Commission to represent people, not industries. That, probably, can be said of most of government. Remember that quaint notion, to serve the public interest?

Broadcasting was deregulated by President Reagan on the assumption that responsible corporate behavior is good for business. Right. For decades, government had told broadcasting, you are the "guardians of the public airwaves." You have a public obligation. The Fairness Doctrine, though somewhat flawed, required broadcast licensees to deal with "controversial issues of public importance."

License renewal procedures were taken seriously by the FCC. News prospered and Americans may have had half an idea what was going on. Then President Reagan said, just kidding, to broadcasting. These are your airwaves. Go where the marketplace takes you.

The federal government could reregulate TV and put a gun to the bastards' heads. Broadcast executives need to relearn the concept of public responsibility. It has been misplaced.

There is the antitrust action that is long overdue, not to mention monopoly and anticompetitive practices prohibitions which are not enforced and have not been enforced for decades. Too few interests own too many VHF licenses. Twenty-five years ago, no single company, and that means no network, could own more than five stations. Now, there is no limit, and according to the August 19, 1996, New York Times, TV stations are hotter properties than ever. According to the Times, those acquiring the most stations now are corporations with the largest stake in television already.

One objective that is written into communications law is "a robust marketplace." That is what the Fairness Doctrine was intended to create. Another way of saying that, as the June 3, 1996 issue of The Nation, devoted to media monopolies points out, is the ideal of pluralism. If pluralism is to be an objective in broadcasting, there can't be five companies owning most of the airwaves.

American news consumers, just another way of saying citizens, are qualitatively under informed. Available political solutions to this problem would involve crossing swords with some of the wealthiest, most powerful corporate forces in America. President Clinton and Republican leaders)receive huge campaign contributions from the PACs of corporate America. There is no political incentive for them to rock the boat by challenging the status quo.

In cynical moments, one could believe the political establishment has a stake in keeping the citizenry uninformed. That allows the political class freedom and keeps the citizenry down on the farm.

So, what are we going to do? Ralph Nader taught all of us the power of consumer movements when he and his disciples forced corporate responsibility on the giant U.S. auto industry. Everyone in America is a news consumer and, remember, everyone's a critic. We can insist on better and vote with the dial on our TVs.

There ought to be a well-organized, nonpartisan, indeed, apolitical movement to force quality back into news. I doubt that's going to happen. Americans seem to have little enough consciousness of corporate control of their entire lives and no concerns about news.

We live in the shadow of that corporate monolith extending ever upward into the sky. Corporations have been called private governments, and they are becoming the state. The financial power of companies explodes around us. The small issue of news quality is probably not even on the corporate radar screen. Conglomerates only grow greedier and fatter for their own purposes.

... the public interest in communication is served by the permitting and encouraging of spaces and behaviors that promote public interaction and expression, autonomous from industry and government.

Corporate Media's Threat to Democracy

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