Ben H. Bagdikian started writing The Media Monopoly two decades ago, and like a latter-day Walt Whitman, he can't bring himself to finish his magnum opus. This spring, Bagdikian published the seventh edition of his influential book, titling it with Madison Avenue flair, The New Media Monopoly.
The first edition, published in 1983, assailed the concentration of media ownership, finding that 50 companies dominated the newspaper, broadcast, magazine, book, and movie industries. These firms did the bidding of corporate America because, in Bagdikian's view, they were corporate America, their boards of directors interlocked with those of other major corporations.
Perhaps owing to his print past at the Washington Post and his service as the dean of the University of California-Berkeley Graduate School of Journalism, Bagdikian fretted mostly about the consolidation of the newspaper business in the original The Media Monopoly. But with each successive edition, Bagdikian's primary complaint has ambled away from newspaper consolidation to criticize the film-television-radio-magazine-book-music empires. Today he writes, "In 1983 there were 50 dominant media corporations; now there are five," pointing his finger at Time Warner, Viacom, News Corporation, Disney, and Bertelsmann. Only one of the "Big Five" (his term), News Corp., publishes much in the way of newspapers—and its only U.S. title is the New York Post.
In typical overstatement, Bagdikian writes, "These five corporations decide what most citizens will—or will not—learn." Yes, the Big Five own or control four major movie studios, nearly threescore cable channels, five broadcast TV networks, a satellite TV operation, a thousand or more radio and TV stations, a big chunk of the publishing industry, and enough magazines to start a paper drive. Butthe Big Five determine what the majority learns only in those places where the newsstand sells only the New York Post and Time and where TV receivers have been doctored to accept signals only from CNN, ABC, CBS, and the Fox News Channel—which is to say nowhere.
If anybody decides what most citizens learn, it's the agenda-setting editors at the New York Times, the Washington Post, the Wall Street Journal, and the Los Angeles Times. The TV news would go dark if it couldn't crib from the Big Four Newspapers. NPR's Morning Edition would fall mute. The newsweeklies would have to run more cover stories on ice cream, dreams, and guides to colleges.
For all the Big Five's alleged powers of mind control, consider the list of influential news organizations besides the Big Four Newspapers they don't control. The top newspaper chains: Gannett, Knight Ridder, Cox, Scripps, McClatchy, Landmark, Copley, Newhouse, Freedom, Hearst, MediaNews, and Tribune. The Boston Globe. Newsweek. The various flavors of NBC News. The New Yorker and Conde Nast's other titles. PBS. NPR. Reuters. AFP. AP. Bloomberg. U.S. News & World Report. Pearson. Hachette Filipacchi. The Atlantic. The Economist. And scores of local TV stations.
In his January 2004 Reasoncover story, Ben Compaine calls Bagdikian's media consolidation worries "overblown." The media industry isn't highly concentrated, he explains, running the numbers through one widely accepted economic yardstick (the Herfindahl-Hirschman Index). And the media industry hasn't become substantially more concentrated in the last decade. Compaine notes that Bagdikian obsesses over big media acquisitions but ignores divestures. "Much of the best-known merger activity has been more like rearranging the industry furniture," Compaine writes, citing the sale of Universal Pictures to Matsushita, then to Seagram, then to Vivendi, and then finally to GE.
Bagdikian ignores the financial perils of media gigantism. Big isn't necessarily financially beautiful, as the markets have taught CBS Inc. and other conglomerates. In 1986, CBS was the country's largest media company, Compaine reports. It owned a network, a top record label, a magazine division, and a book operation, among other assets. The combination proved fiscally unstable, and CBS dumped practically every property but the network before being acquired by Viacom in 1999.
The synergies media companies hope to reap from their mergers and acquisitions rarely materialize. Disney's absorption of ABC is a business failure. Time Inc. stockholders came to regret its union with Warner Bros., and Time Warner stockholders lament the AOL deal. For better than a year, Time Warner has been trying to divest itself of its book appendages, Little, Brown and Warner Books—no half-assed offer will be refused.
Flipping through the Big Five portfolio, we come to Viacom, which New York magazine's journalist/investor James J. Cramer calls a slow-moving, easy-to-sink battleship at the mercy of nimbler competitors who have invested more wisely in video games, satellite radio, Internet search engines, and video-on-demand.
"Those are the companies with the better models, the better technology that has, in an incredibly short period of time, stolen massive amounts of the fuel that powered Battleship Viacom: the viewers themselves," Cramer writes.
But which video game company should a Big Five player buy? Don't forget that Warner Bros. lost its shirt buying Atari in the late '70s. What media mogul doesn't wish he'd diversified outside the media orbit as the Washington Post Co. did in 1984 when it purchased the Stanley Kaplan educational testing company? Kaplan now produces more revenue for the Post Co. than its newspaper division does.
Bertelsmann gives monopoly hysterics the heebie-jeebies, too, because it owns an extraordinary share of the U.S. book market. But Bertelsmann owes its Big Five standing, in part, to a pair of fortuitous investments it made in AOL and redeemed before the crash, turning a couple hundred million dollars into $6.7 billion. Who's to say that the competition won't splint and scatter Bertelsmann into many pieces, like the old CBS Inc.? (By the way, do you know what Bertelsmann ended up doing with the guy who made the AOL investment? It fired him for wanting to take the company public with an IPO so it could make additional acquisitions. That's right! The German media monopolists didn't want to buy more media companies.)
The only Big Fiver whose center seems to hold is News Corp. In my view, News Corp. leader Murdoch is a bit of hero, terraforming the media world by creating a fourth TV network when everybody said that was impossible. You don't have to like Fox News Channel to acknowledge that he's added ideological diversity to TV news and talk shows. His risky gambles on satellite broadcasting may make his company even more dominant. But the 73-year-old Murdoch periodically drives his News Corp.'s finances off the cliff, and if he doesn't total the company before he dies, we can confidently predict that his heirs apparent, Princes Lachlan and James, will.
In the long run, competition and the dynamism of markets keep any five media conglomerates from dictating "what most citizens will learn." But corporate ownership of media so rankles Bagdikian that I doubt the variations of who's on top and who's slid into corporate oblivion make much difference to him. I'm sure my testament that for all the news media's faults, its quality and variety have never been greater, sounds Panglossian to Bagdikian. But I challenge him to name a time in America's history when the news media did a better job than it does today. Who longs for the days of William Randolph Hearst? Of three broadcast networks? Of the days before the Internet?
As misguided as Bagdikian is about the perils of media conglomeration, he makes excellent sense when barking about the political games the corporate owners of radio and broadcast TV stations play. If only he'd continued that line of thought in the seventh edition. Nobody needs to apply to the government to buy paper and ink and print a publication or book. Nobody needs government approval to purchase computers and bandwidth to serve the public through the Internet. On the hunch that Bagdikian plans to write an eighth edition of The Media Monopoly, I invite him to read my next column about ending spectrum socialism and freeing the airwaves to true competition.