1. Telecommunications Deregulation: Closing Up America's
"Marketplace of Ideas"
SOURCE: CONSUMER PROJECT ON TECHNOLOGY, 7/14/95, "Federal Telecommunications
Legislation," an Internet newsletter*; Authors: Ralph Nader, James
James Love, and Andrew Saindon.
SYNOPSIS: America's "marketplace of ideas," upon which
our democracy rests, began shutting its doors in the summer of 1995.
The harbinger of the bad news for the public was aptly titled the Telecommunications
Deregulation Bill, which moved through both houses of Congress. As the
name implies, the bill eliminates virtually all regulation of the United
States communication industry.
As tends to be the case with most anti-consumer legislation, the bill
stealthily moved under the guise of "encouraging competition"
-- but will, in reality, have the opposite effect of creating huge new
concentrations of media power.
The most troubling aspect of the bill allows easing-and outright elimination-of
current anti-trust regulations. In what the New York Times described
as "a dazzling display of political influence," the nation's
broadcast networks scored big in the House version of the bill by successfully
getting the limits on ownership eased so that any individual company
can control television stations serving up to 50 percent of the country.
The Senate version of the bill provides for a more modest 35 percent
The legislation also dismantles current regulations which limit the
number of radio stations that can be owned by a single company. Currently
no one single company can own more than 40 stations.
It also would lift the current FCC ban on joint ownership of a broadcast
radio or TV license and a newspaper in the same market -- allowing a
single company to have 100 percent control over the three primary sources
of news in a community.
Consumer advocate Ralph Nader warned, "Congress is moving the
law in the wrong direction, toward greater concentration and fewer choices
for consumers, all under the guise of 'greater competition.' Laws and
rules that limit cross-ownership and concentration not only enhance
competition, a putative goal of the new legislation, but they also serve
important non-economic goals, by promoting a greater diversity of programming,
and enhancing opportunities for local ownership." Nader also said
the predictable result of placing even greater power in the hands of
fewer giant media moguls will be less diversity, more pre-packaged programming,
and fewer checks on political power. "That these provisions are
being included in legislation that is being sold as pro-competitive
is particularly galling."
Also galling was the major media's almost complete and utter avoidance
of the "monopoly ownership" factor in their reporting of the
bill's progress in Congress. The threat to the nation's "marketplace
of ideas" from mega-media monopolies has been a nomination to Project
Censored several times in the past.
SSU Censored Researcher: Justin Twergo
COMMENTS: Speaking for the authors, James Love thought that
"local newspapers did a poor job of explaining the nature of the
concentration and cross-ownership issues, particularly cross-ownership
issues such as the possible ownership of local newspapers, broadcast
licenses and the telephone company." He continued, "Network
television was owned by firms that had much at stake in the legislation,
and aside from 'Nightline's' show with Tom Shales, I did not see the
type of reporting that seemed appropriate, given the issues. However,
the general question of the appropriateness of several mergers, ABC/Disney,
CBS/Westinghouse or Turner/Time-Warner, did seem to get a fair amount
of play, but without much emphasis on the legislative debates. The New
York Times had a couple of very good editorials on the legislative proposals,
but the news reporting on the issue, from the Times or the Washington
Post, did not dwell much on the concentration issue, aside from the
occasional reporting of a Presidential veto on this issue. I must say
that the cross-ownership questions were rarely addressed, even though
they are extremely important, and relevant to the newspaper industry.
For example, no one in the media would even acknowledge that there was
a debate over cross-ownership for wireless spectrum, such as satellite
or PCS licenses."
Love felt if the public were better informed about the issue, it might
bring about some reforms in the opposite direction of the legislation.
"Instead of encouraging greater concentration and more monopoly
power," he suggested, "we might see policies that promote
greater diversity and more competition. That would benefit the public
in a number of ways.
"The interests which benefit the most from the lack of debate
over policies about concentration and cross-ownership are the large
corporations which own telecommunications and media businesses, as well
as some players who want a chance to sell their firms to the larger
players. Newspapers benefit, because they would be allowed to purchase
broadcast licenses. Cable and telephone companies benefit, because both
would have greater freedom to enter into new deals, and both want the
opportunity to acquire the new wireless spectrum that could someday
offer troublesome competition. Broadcast license holders would be easier
to sell and acquire, and they would have more opportunities to develop
greater market power in local markets."
Love concluded it would be helpful if the press could generate greater
interest in the media concentration decisions being made by Congress
and the FCC for the future of telecommunications in the U.S.