The Los Angeles Times, New York Times, and USA Today each lead with Viacom's acquisition of CBS, a $36 billion transaction, resulting, if approved by shareholders and the federal government, in a huge new multimedia entity. The Washington Post top-fronts the deal, but leads instead with a story breaking in the Russian press that none of the other American big dailies has: A Swiss investigation's fresh evidence that a company receiving major Kremlin contracts paid tens of thousands of dollars in bills on credit cards belonging to Boris Yeltsin and his two daughters, and $1 million to a Hungarian bank account associated with Yeltsin.
For those scoring at home, the WP says Viacom/CBS is the third-largest media deal ever, with the new company becoming the third-largest media enterprise, while both the NYT and LAT say it's the biggest media deal ever resulting in the No. 2 media outfit, behind only Time Warner. The papers explain that the deal exemplifies the virtues of vertical integration, nicely defined by the WP as "the ability to produce entertainment and simultaneously distribute it." The LAT notes that this feature of the deal, tying up as it does many production and distribution entities, could stimulate other similar mergers among companies now needing more than ever to tie up their own.
The coverage notes the two largest speed bumps for the get-together: Viacom owns half of UPN, and current federal rules prevent a company from owning two broadcast networks. Also, there is a rule limiting a media company's TV reach to 35 percent of all households, and the new company will reach 41 percent. The papers note that Sumner Redstone, Viacom's No. 1, and his counterpart at CBS, Mel Karmazin, will be visiting the FCC in Washington today to appeal for special dispensation on these matters.
The deal coverage is shot through with the usual attempts at dramatizing the essentially undramatic activity of guys in suits writing themselves checks. The LAT, for instance, bathetically refers to "a series of secret meetings at Karmazin's penthouse apartment," during which Redstone "grew to see the magic of the marriage Karmazin was proposing." Perhaps the day's definitive merger porn is this line from Redstone about Karmazin, quoted in one of the NYT's seven (!) inside stories about the deal: "This began as a deal involving some television stations. Then he started talking about cable networks. Then I could see it coming. He is a master salesman, and he began to turn me on." Just about the only relief from all this breathlessness comes from the WP, which quotes an academic as saying, "It seems to me that this is, by any definition, an undemocratic development. The media system in a democracy should not be inordinately dominated by a few very powerful interests."
Everybody reports that just ahead of a looming Friday deadline, a group of Puerto Rican nationalists has accepted the politically explosive clemency recently offered by President Clinton. This means they will have to foreswear violence or its advocacy. Two prisoners offered the deal declined it.
The NYT and Wall Street Journal run stories reporting that Treasury, State, and White House officials learned last spring of massive Russian money-laundering involving the Bank of New York but didn't pass the information along to Al Gore or President Clinton. The WP buries this information near the bottom of its lead.
The LAT, the NYT, and WP front reports that on the eve of former HUD Secretary Henry Cisneros' trial on various charges stemming from his payment of hush money to a paramour, Cisneros pleaded guilty to a single count of lying to the FBI when asked about the cash, netting a fine but no jail. The case had been developed by an independent counsel under the now-lapsed statute. The NYT and WP headlines emphasize the incommensurability of the case's cost ($9 million) and its result.
Yesterday's NYT ran a sprawling front-page "special report" raising the question of whether the now-confirmed ability in recent years of China to miniaturize nuclear weapons was a result of spying on the United States or just hard, independent work. The effort, conducted by one of the paper's most able science writers, William J. Broad, says high up that the congressional report issued late last year asserting that espionage was the main explanation "went beyond the evidence," and that his thorough review shows that perhaps "thousands" of individuals had access to the information that the report and the federal investigation suggest came from one dismissed scientist, Wen Ho Lee. Now, given that the Times ran hard and often with the congressional report and the line it took, does this piece represent some sort of about-face? Or worse, some sort of illegitimate attempt by the paper to revise its history of coverage on the subject? Today's Papers doesn't think so. The paper's coverage has generally been clear in attributing the Wen Ho Lee-probably-did-it line to particular (named and unnamed) government sources. And anyway, a paper should be encouraged to revisit a topic as more information becomes available and better understood. Today's Papers' only complaint about Broad's re-look is that it somewhat unfairly chips away at the impression the paper had originally created: The three-page piece waits until the second-to-last column to state that the consensus of the American intelligence agencies is that espionage played a role in China's catch-up even if there is no smoking-gun evidence for this.