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Communication, Society and Politics
Media Concentration and Democracy: Why Ownership Matters
Firmly rooting its argument in democratic and economic theory, the book argues that a more democratic distribution of communicative power within the public sphere and a structure that provides safeguards against abuse of media power provide two of three primary arguments for ownership dispersal. It also shows that dispersal is likely to result in more owners who will reasonably pursue socially valuable journalistic or creative objectives rather than a socially dysfunctional focus on the 'bottom line'. The middle chapters answer those agents, including the Federal Communication Commission, who favor 'deregulation' and who argue that existing or foreseeable ownership concentration is not a problem. The final chapter evaluates the constitutionality and desirability of various policy responses to concentration, including strict limits on media mergers.
272 pages, Paperback
First published November 29, 2002
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November 8, 2015
This was much more about the US system than I probably needed it to be, but after finishing it I realised that this was pretty well inevitable. The problem is that it is very hard to talk about democracy in the abstract – well, that is without saying lots of motherhood statements that end up saying hardly anything at all. This book is, if anything, seeking to be quite practical, and so presenting a string of motherhood statements is near enough to the exact opposite of what it is trying to achieve. Practical isn’t really the right word. This book is trying to explain why the media has an important role to play in a democracy – and not just that, but also the whys and hows of that role.
It is also trying to clear away some of the ideas people have, both on the left and right, about what is dangerous about media concentration that probably isn’t all that dangerous if you think about it.
Often the ways we go about trying to increase media diversity is to limit the reach of certain media outlets. This is something the author sees as completely misinformed. That is, if democracy is the ability for a voice to win against other voices in the marketplace of ideas, then the fact that certain voices attract more listeners isn’t immediately proof that the system isn’t working – in fact, it might well prove exactly the opposite. The real problem is that certain voices do not have a valid way of being heard at all. And that is what a democracy needs to ensure: not the outcome, but the starting conditions.
As is said a few times here, press freedom can’t be left only to those who are free to own the press. A democracy needs a many voices as possible, voices that are in loud disagreement, able to make their case in a public forum. The problem is that increasingly we have two phenomena occurring that are undermining our democracy. The first is that media ownership is becoming much more concentrated in so few hands that some voices are much less likely to be heard at all. This in itself is a problem, but perhaps a bigger problem is that the types of people buying media are also much more likely to be in the game for the money they can make, rather than for an interest in the media per se. This means that media outlets are increasingly interested in ‘efficiencies’. And the things that make for good journalism, in particular, are rarely compatible with economic efficiencies.
A lot of this book is focused on a discussion of the idea of the ‘first copy’. You see, it costs an awful lot of money to produce the first copy of any piece of media. If you want to publish a book, before you can have the very first copy you need to buy the printing press, buy the factory to house the printing press, get the ink and paper, employ people able to do stuff with this printing press and so on. Then you need to research and write and edit and rewrite a book, preferably one that people want to read. Then you need to print the book and to market it and distribute it and god knows what else. All of this is expensive. And all of this expense is realised in the very first copy of whatever you are producing. Every other copy of that book costs virtually nothing in comparison. Once you have the first copy the other copies are as cheap as chips – part of the reason why Hollywood complain about peer-to-peer file sharing sites. But it is in every other copy, that is, the ones that are cheap to produce, where you will have to make your money back. The more you spend on your first copy, the more likely it is that the subsequent copies will be worth having. Thus is the perverse contradictions inherent in the media industry.
This first copy idea is part of the reason why companies associated with newspapers often try to move into television news too. They already have done a lot of the leg work in producing their content – whereas, someone without a newspaper behind them is going to have to get their content for themselves somehow and possibly from scratch, and that is obviously going to be more expensive.
So, some forms of media concentration are virtually inevitable, and it is hard to argue they are necessarily bad. The problem is in trying to make sure that with all of this concentration you are going to be left with something more than a megaphone for some bastard like Murdoch. Which is something discussed here in relation to both Britain and the US and at some length – though, not at all excessively (I’d have preferred a bit more of this).
It is for this reason that a lot of the policy proposals this book ends with contain ways to stop purely economic considerations being the main (if not only) driving force of the matter of concerns with media concentration. He points out that there are anti-trust laws in the US and that these ought to be used against the media too. But also that the media isn’t just an economic market, but one that is concerned with providing us with the sorts of information we need so as to properly function within a society. That is, the media is normative, not merely economically efficient. The public sphere is hindered by sucking money out of good journalism (particularly expensive journalism associated with high quality investigative journalism) and sucked out of the media for the sake of ‘shareholder value’. Again this is the first copy problem – where the more that is spent on the first copy (particularly around journalism for news) the better quality all subsequent copies are likely to be and the more likely it is that they will meet their democratic purpose. And since this is in all of our interests, we, as a society, need to find systemic ways to ensure that this kind of journalism is funded and pursued. He makes the point that the Savings and Loans affair in the US may have been due to financial journalism not pursuing the issues associated with it until it was all too late – so that, rather than journalists being the canary in the mine, they were helpless spectators like the rest of us (page 120).
For these reasons he proposes that we need rules to limit the ability of companies to take over of media outlets, particularly if these are non-media buyers. That editors need to be in control and at arms length from the owners of media and that journalists that work in a newspaper ought to have a say over corporate takeovers. (In which context, I wonder if National Geographic would have been sold to Murdoch if the journalists there had had a say…) He also proposes a tax system that would make it more expensive for you if you control more than a certain proportion of the market, and that you would receive subsidies if you control less than a certain proportion of the market. That is, the tax system would be designed to increase and sustain media diversity. And that all this needs to recognise that the biggest guys in the media field are substantially different from the smaller guys and that if we want to go on living in a democracy we will need to find ways to bend the big guy’s wills to that of the people, or they will use their power to simply drowned out, either with screaming or through silence, all opposition.
There is an argument that with the coming of the age of the internet all of these problems have now disappeared. This is because the cost of the first copy is now such that anyone can, in theory, write up or film something and just about everyone else in the world (okay, I’m exaggerating) can access that if they so choose to do so.
The problem here is, again, related to the price of the first copy. You are much more likely to trust established news outlets than other less known and random people, because they have invested in all of the things likely to make what they have to say appear to have credibility. Whereas, some blog by what could well be a fifteen-year-old crypto-fascist with a love of cats might prove somewhat less trustworthy, even if they are breaking the story of the decade. Yes, everyone has a voice on the internet, but not all voices can be equally trusted, nor deserve to be. And this, as the author points out, has lead to the internet proving to be even more concentrated than even the old-fashioned media is. And because people sitting in their bedrooms simply don’t have access to the sorts of resources it takes to really go out and find and report on the news day after day – too often the ones that do ‘make it’ as bloggers turn out to be part of a kind of echo chamber – using, rather than replacing, the resources of the major outlets to, at best, put another spin on the news – if even this... Rather than the internet being an assured boon for freedom and diversity of the press, it might just (ironically enough) prove to be the exact opposite.
I really liked this book – but again, a lot of it was concerned with US case law, particularly concerning the nature of the first amendment – which, I can absolutely see is a very important discussion. It is just that it isn’t quite as relevant to Australia as it is to America. All the same, this is important stuff and has given me a lot to think about.
It is also trying to clear away some of the ideas people have, both on the left and right, about what is dangerous about media concentration that probably isn’t all that dangerous if you think about it.
Often the ways we go about trying to increase media diversity is to limit the reach of certain media outlets. This is something the author sees as completely misinformed. That is, if democracy is the ability for a voice to win against other voices in the marketplace of ideas, then the fact that certain voices attract more listeners isn’t immediately proof that the system isn’t working – in fact, it might well prove exactly the opposite. The real problem is that certain voices do not have a valid way of being heard at all. And that is what a democracy needs to ensure: not the outcome, but the starting conditions.
As is said a few times here, press freedom can’t be left only to those who are free to own the press. A democracy needs a many voices as possible, voices that are in loud disagreement, able to make their case in a public forum. The problem is that increasingly we have two phenomena occurring that are undermining our democracy. The first is that media ownership is becoming much more concentrated in so few hands that some voices are much less likely to be heard at all. This in itself is a problem, but perhaps a bigger problem is that the types of people buying media are also much more likely to be in the game for the money they can make, rather than for an interest in the media per se. This means that media outlets are increasingly interested in ‘efficiencies’. And the things that make for good journalism, in particular, are rarely compatible with economic efficiencies.
A lot of this book is focused on a discussion of the idea of the ‘first copy’. You see, it costs an awful lot of money to produce the first copy of any piece of media. If you want to publish a book, before you can have the very first copy you need to buy the printing press, buy the factory to house the printing press, get the ink and paper, employ people able to do stuff with this printing press and so on. Then you need to research and write and edit and rewrite a book, preferably one that people want to read. Then you need to print the book and to market it and distribute it and god knows what else. All of this is expensive. And all of this expense is realised in the very first copy of whatever you are producing. Every other copy of that book costs virtually nothing in comparison. Once you have the first copy the other copies are as cheap as chips – part of the reason why Hollywood complain about peer-to-peer file sharing sites. But it is in every other copy, that is, the ones that are cheap to produce, where you will have to make your money back. The more you spend on your first copy, the more likely it is that the subsequent copies will be worth having. Thus is the perverse contradictions inherent in the media industry.
This first copy idea is part of the reason why companies associated with newspapers often try to move into television news too. They already have done a lot of the leg work in producing their content – whereas, someone without a newspaper behind them is going to have to get their content for themselves somehow and possibly from scratch, and that is obviously going to be more expensive.
So, some forms of media concentration are virtually inevitable, and it is hard to argue they are necessarily bad. The problem is in trying to make sure that with all of this concentration you are going to be left with something more than a megaphone for some bastard like Murdoch. Which is something discussed here in relation to both Britain and the US and at some length – though, not at all excessively (I’d have preferred a bit more of this).
It is for this reason that a lot of the policy proposals this book ends with contain ways to stop purely economic considerations being the main (if not only) driving force of the matter of concerns with media concentration. He points out that there are anti-trust laws in the US and that these ought to be used against the media too. But also that the media isn’t just an economic market, but one that is concerned with providing us with the sorts of information we need so as to properly function within a society. That is, the media is normative, not merely economically efficient. The public sphere is hindered by sucking money out of good journalism (particularly expensive journalism associated with high quality investigative journalism) and sucked out of the media for the sake of ‘shareholder value’. Again this is the first copy problem – where the more that is spent on the first copy (particularly around journalism for news) the better quality all subsequent copies are likely to be and the more likely it is that they will meet their democratic purpose. And since this is in all of our interests, we, as a society, need to find systemic ways to ensure that this kind of journalism is funded and pursued. He makes the point that the Savings and Loans affair in the US may have been due to financial journalism not pursuing the issues associated with it until it was all too late – so that, rather than journalists being the canary in the mine, they were helpless spectators like the rest of us (page 120).
For these reasons he proposes that we need rules to limit the ability of companies to take over of media outlets, particularly if these are non-media buyers. That editors need to be in control and at arms length from the owners of media and that journalists that work in a newspaper ought to have a say over corporate takeovers. (In which context, I wonder if National Geographic would have been sold to Murdoch if the journalists there had had a say…) He also proposes a tax system that would make it more expensive for you if you control more than a certain proportion of the market, and that you would receive subsidies if you control less than a certain proportion of the market. That is, the tax system would be designed to increase and sustain media diversity. And that all this needs to recognise that the biggest guys in the media field are substantially different from the smaller guys and that if we want to go on living in a democracy we will need to find ways to bend the big guy’s wills to that of the people, or they will use their power to simply drowned out, either with screaming or through silence, all opposition.
There is an argument that with the coming of the age of the internet all of these problems have now disappeared. This is because the cost of the first copy is now such that anyone can, in theory, write up or film something and just about everyone else in the world (okay, I’m exaggerating) can access that if they so choose to do so.
The problem here is, again, related to the price of the first copy. You are much more likely to trust established news outlets than other less known and random people, because they have invested in all of the things likely to make what they have to say appear to have credibility. Whereas, some blog by what could well be a fifteen-year-old crypto-fascist with a love of cats might prove somewhat less trustworthy, even if they are breaking the story of the decade. Yes, everyone has a voice on the internet, but not all voices can be equally trusted, nor deserve to be. And this, as the author points out, has lead to the internet proving to be even more concentrated than even the old-fashioned media is. And because people sitting in their bedrooms simply don’t have access to the sorts of resources it takes to really go out and find and report on the news day after day – too often the ones that do ‘make it’ as bloggers turn out to be part of a kind of echo chamber – using, rather than replacing, the resources of the major outlets to, at best, put another spin on the news – if even this... Rather than the internet being an assured boon for freedom and diversity of the press, it might just (ironically enough) prove to be the exact opposite.
I really liked this book – but again, a lot of it was concerned with US case law, particularly concerning the nature of the first amendment – which, I can absolutely see is a very important discussion. It is just that it isn’t quite as relevant to Australia as it is to America. All the same, this is important stuff and has given me a lot to think about.
April 23, 2021
The book’s argument:
Media Concentration and Democracy by C. Edwin Baker is divided into five sections. Section 1 talks about the importance of diversifying media for democracy. It argues that the current state of media, mainly US examples, is that it is too concentrated, preventing a full functionally democracy from appearing. In regards to the importance of a diversified media ownership, Baker argues that for the state to be self-governing – to be ruled by the people(democracy) – people require the capacity to form public opinion and then to have the public opinion influence… government laws and policies. Baker argues that this necessitates a dispersal of ownership as when the power to control the flow of information is in the hands of the few with large amounts of funding, media will be biased and people don’t have the capacity to form public opinion. Rather only those with control over the information can do so.
He argues that each group needs its fair share of the media so that no one feels that they are not included in creating the public discourse; they should feel that their voices can be expressed. My only hesitation on that claim is that there is an infinite number of ways to categorize society. There are gender, ethnic, class, religious, political views and more all of which intersect one another; therefore, it seems impractical to allow every one of those groups to have a share in the media.
An important point that Baker makes – that I agree on – is that a diverse media ownership is the end, not the means. The idea that the reason we should aim for diversified media ownership is not because of what its results are in terms of content or any other purpose in a democracy. But rather there are reasons for a diversified media ownership intrinsically linked to the concept – such as a democratic dispersal, equality of importance, rights to express their views. This concept is akin to the argument for democracy itself; that we want democracy not because it is better for the economy, or is more politically stable, but rather as it is fair and just.
He also makes very clear that ownership diversity does not necessitate content diversity, and thus should not be forced when society does not have its demand. But rather other components of the media, such as source, also play a role. Despite his claim that it is an end and not a means, he does delve into the positive effects of diversified ownership. He points to evidence and states that dispersed media power allows an independent and potentially engaged media to scrutinize the wealthy candidate who vastly outspends her opponent. Thus the argument goes that a robust media industry reduces the phenomena of a dollar a vote or that money buys power and influence in politics. Why? As dispersal increases the number of ultimate decision-makers who have the power to commit journalistic resources.
Additionally, Baker continues to assert that a diversified media makes the industry as a whole less controlled by money, that a large number of influential media are less likely to be bribed or purchased as a potential stakeholder would have convinced/threaten and pay more people to have an outcome that could have been done by convincing a couple of owners if ownership was concentrated.
Section 2,3,4 first explains certain counter-argument as to why ownership matters. He then goes to break each of them down. Most of the counter-arguments made by other writers I never agreed with them, so I generally agreed with Baker on his response to them. The only part where I had to stop to think about was his claim that the spread of the internet and the increased access to media, as a result, has at the very least did not change media concentration and perhaps in fact lead to further concentration. Perhaps that might be true, I am not old enough to have witnessed this occur nor have I read the research on it. Yet, when I imagine myself living in a world without the internet I think democracy would be in a worse situation. Me living in the UAE, without the internet, I would only have access to the local newspaper and thus people would be confined to their geography. However, now with the internet, I read the local newspapers as well as foreign news from Pakistan as well as the dominant Western media. While in many cases the views and perspectives are similar, the source of content varies between the media, a goal of dispersal of media ownership. Thus, I find it hard to believe that the internship has reduced our ability as citizens to form our own opinions.
In section 5 and the Postscript, he goes overresponse that won’t work, explaining why, and ends with the government response that he believes will be the most effective. He states that policy should provide support, often varying kinds of financial support, for sectors not adequately nourished by the market. This he proposes that can be through subsidies and taxes encouraging dispersal, conditioning these subsidies on journalists having complete editorial independence and a media policy that have the following two elements: (1) Media entities can be sold only to individuals or entities that, after the sale, will own no more media properties (measured by revenue) than the seller previously owned, and (2) any for-profit commercial entity that purchases a media entity must, after the purchase, be primarily in the media business – that is, receive the majority of its revenue from its media business.
Nevertheless, he ends by saying that there is no one size fits all and policy requires variation depending on context. Strength lies in structural diversity.
My fundamental concerns:
My main concern with government intervention in dispersing ownership is that it does provide the right incentives. When a firm knows that it won’t be allowed to expand, will be prevented from gaining market share and making more profit, what incentive will the firm have first to enter the market and then invest in quality journalism. When competition is reduced by the government preventing the best from rising and pushing the bottom upwards, what incentive would firms have in becoming more efficient and improving their quality and other components that attract consumers to a certain news outlet?
While Baker doesn’t address this concern directly, he does acknowledge that when individuals know they won’t be allowed to expand after a certain point many will not want to be part of the market. However, he argues this to be a good thing as it means that those who leave will be the owners whose motive is a pursuit for profits and thus a focus on the bottom line. While the ones that remain, are the owners determined and aims to provide quality content – the type of content that provides positive externalities and is vital for democracy. Baker states that the goal should be to have media controlled by people most interested in using media entities’ income to produce high-quality content.
Another fundamental concern of mine is that if there are too many firms, while they might have the incentive to innovate, the situation might be opposite to oligopoly where they cannot do so. This point was not addressed by this book.
Media Concentration and Democracy by C. Edwin Baker is divided into five sections. Section 1 talks about the importance of diversifying media for democracy. It argues that the current state of media, mainly US examples, is that it is too concentrated, preventing a full functionally democracy from appearing. In regards to the importance of a diversified media ownership, Baker argues that for the state to be self-governing – to be ruled by the people(democracy) – people require the capacity to form public opinion and then to have the public opinion influence… government laws and policies. Baker argues that this necessitates a dispersal of ownership as when the power to control the flow of information is in the hands of the few with large amounts of funding, media will be biased and people don’t have the capacity to form public opinion. Rather only those with control over the information can do so.
He argues that each group needs its fair share of the media so that no one feels that they are not included in creating the public discourse; they should feel that their voices can be expressed. My only hesitation on that claim is that there is an infinite number of ways to categorize society. There are gender, ethnic, class, religious, political views and more all of which intersect one another; therefore, it seems impractical to allow every one of those groups to have a share in the media.
An important point that Baker makes – that I agree on – is that a diverse media ownership is the end, not the means. The idea that the reason we should aim for diversified media ownership is not because of what its results are in terms of content or any other purpose in a democracy. But rather there are reasons for a diversified media ownership intrinsically linked to the concept – such as a democratic dispersal, equality of importance, rights to express their views. This concept is akin to the argument for democracy itself; that we want democracy not because it is better for the economy, or is more politically stable, but rather as it is fair and just.
He also makes very clear that ownership diversity does not necessitate content diversity, and thus should not be forced when society does not have its demand. But rather other components of the media, such as source, also play a role. Despite his claim that it is an end and not a means, he does delve into the positive effects of diversified ownership. He points to evidence and states that dispersed media power allows an independent and potentially engaged media to scrutinize the wealthy candidate who vastly outspends her opponent. Thus the argument goes that a robust media industry reduces the phenomena of a dollar a vote or that money buys power and influence in politics. Why? As dispersal increases the number of ultimate decision-makers who have the power to commit journalistic resources.
Additionally, Baker continues to assert that a diversified media makes the industry as a whole less controlled by money, that a large number of influential media are less likely to be bribed or purchased as a potential stakeholder would have convinced/threaten and pay more people to have an outcome that could have been done by convincing a couple of owners if ownership was concentrated.
Section 2,3,4 first explains certain counter-argument as to why ownership matters. He then goes to break each of them down. Most of the counter-arguments made by other writers I never agreed with them, so I generally agreed with Baker on his response to them. The only part where I had to stop to think about was his claim that the spread of the internet and the increased access to media, as a result, has at the very least did not change media concentration and perhaps in fact lead to further concentration. Perhaps that might be true, I am not old enough to have witnessed this occur nor have I read the research on it. Yet, when I imagine myself living in a world without the internet I think democracy would be in a worse situation. Me living in the UAE, without the internet, I would only have access to the local newspaper and thus people would be confined to their geography. However, now with the internet, I read the local newspapers as well as foreign news from Pakistan as well as the dominant Western media. While in many cases the views and perspectives are similar, the source of content varies between the media, a goal of dispersal of media ownership. Thus, I find it hard to believe that the internship has reduced our ability as citizens to form our own opinions.
In section 5 and the Postscript, he goes overresponse that won’t work, explaining why, and ends with the government response that he believes will be the most effective. He states that policy should provide support, often varying kinds of financial support, for sectors not adequately nourished by the market. This he proposes that can be through subsidies and taxes encouraging dispersal, conditioning these subsidies on journalists having complete editorial independence and a media policy that have the following two elements: (1) Media entities can be sold only to individuals or entities that, after the sale, will own no more media properties (measured by revenue) than the seller previously owned, and (2) any for-profit commercial entity that purchases a media entity must, after the purchase, be primarily in the media business – that is, receive the majority of its revenue from its media business.
Nevertheless, he ends by saying that there is no one size fits all and policy requires variation depending on context. Strength lies in structural diversity.
My fundamental concerns:
My main concern with government intervention in dispersing ownership is that it does provide the right incentives. When a firm knows that it won’t be allowed to expand, will be prevented from gaining market share and making more profit, what incentive will the firm have first to enter the market and then invest in quality journalism. When competition is reduced by the government preventing the best from rising and pushing the bottom upwards, what incentive would firms have in becoming more efficient and improving their quality and other components that attract consumers to a certain news outlet?
While Baker doesn’t address this concern directly, he does acknowledge that when individuals know they won’t be allowed to expand after a certain point many will not want to be part of the market. However, he argues this to be a good thing as it means that those who leave will be the owners whose motive is a pursuit for profits and thus a focus on the bottom line. While the ones that remain, are the owners determined and aims to provide quality content – the type of content that provides positive externalities and is vital for democracy. Baker states that the goal should be to have media controlled by people most interested in using media entities’ income to produce high-quality content.
Another fundamental concern of mine is that if there are too many firms, while they might have the incentive to innovate, the situation might be opposite to oligopoly where they cannot do so. This point was not addressed by this book.
This entire review has been hidden because of spoilers.
March 12, 2007
Very Poorly organized. I wanted the book to be better, because its arguments were generally on point, but it was unnecessarily dense and obfuscating.
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