Committee Of Correspondence

Are Media Conglomerates Bad for Us?

Walter Isaacson
8:24 a.m.  Thursday  10/24/96 

       Let me take issue a bit with Mr. Schwartzman’s elitist charge, and even flip it back. It seems to me elitist to say that smart folks know how to dig for diverse sources of info and are in good shape, but the masses between the Hudson and Silicon Valley are too couch-potato-like or uninterested to do much more than absorb mass-market drivel. Gee, I’m not sure that’s true. All it takes is the ability to channel surf to get from Jennings to Geraldo to Charlie Rose to Oprah to Lehrer to Hard Copy to Moyers to Pat Robertson to Larry King to Rush Limbaugh to wonderfully wacky cable-access shows in order to get a diverse look at the world. We no longer all depend on Walter Cronkite or have to settle for the prime-time dreck of three networks–and we don’t, even west of the Hudson. And certainly talk radio is both popular and populist. The Internet, of course, is even more so, and it ain’t controlled in New York or Hollywood–and there are a lot of Gen X-minus-1 folks and all sorts of other non-elites who are wired. People are not relying MORE on the mass outlets like the networks and monopoly newspapers; they are using and viewing those less as other sources become available. Yes, increased diversity produces niche audiences and microjournalism. Yes, there’s some danger in that. But it is also an antidote to the homogenization of mass media. And it is the inevitable consequence of a digital age. W. Russell Neuman
8:47 a.m.  Thursday  10/24/96 

       There are at least two important threads here.
       The Wednesday comments focused in on the corporate-debt and senior-management issues. Although there are some important structural issues–the fee-driven business, the psychology of the Street–much of the discussion has keyed off of the personalities of the movers and shakers.
       But there is a second thread, also important, which we need not drop. It deals with those elements of the digital revolution that would impact journalism no matter who was CEO and whatever the debt level of the big conglomerates. The question is, how does the technology influence the diversity of voices?
       I wonder if our vocabulary is failing us. Take Herb’s opening comment about the promise of cable and the Internet to greatly increase the number of independent information sources available. I think we all understood and agreed with the gist of that and proceeded with our own remarks. But let’s step back.
       500-channel cable and the Internet aren’t information sources, they are conduits. In the good old days, we would equate source and conduit because it was a convenient shorthand and it made sense. CBS meant Edward R. Murrow, and vice versa. We would intuitively associate cartoonists and columnists with the newspapers in which they could be reliably found. But that’s all changing, and we need a new vocabulary somehow to more accurately capture the new reality.
       We use terms like “electronic newspapers” to try to capture what is evolving, but such a term is akin to “horseless carriage.” We need words for information gatherers, interpreters, packagers, marketers, conduits. We need sexy words. Why is it that “information provider” doesn’t do much for me?
       Another notion that caught my eye was Andy’s reference to microjournalism. Interesting. Again, we associate journalism with generally large institutions like wire services, networks, magazines, newspapers. But what about free-lance journalism? Not a stringer, an independent journalist who sells his or her wares on the open marketplace to readers directly, not through some packager and imprimatur stamper. Why is it that other than I.F. Stone, not a lot of models come to mind? Maybe that will change. Maybe media conglomerates and microjournalism can both thrive on their own terms in the digital age. Kurt Andersen
9:09 a.m.  Thursday  10/24/96 

       1. Herb Stein’s conservative friends may not wish to admit it, but they are the prime ideological beneficiaries of today’s proliferating news and “news” sources: Talk radio from Limbaugh on down, together with Murdoch’s multimedia empire of the right (the Weekly Standard, Fox News, the New York Post), allow conservatives to loll in a happy conservative bubble as never before. And my mention of Viacom’s Beavis and Butthead and Disney’s Trainspotting was meant to extend the conglomerates-aren’t-necessarily-bad argument beyond the realm of news and opinion into pop culture, to make the point that some of the most notable at-the-edge artistic expression is created within the big infotainment corporations. My point is that they are precisely the kinds of left-field, “alternative” works that conglomeration is presumed to jeopardize.
       2. Jack Shafer is, as always, astute and funny. Except I’m not sure it’s so inarguable that movies were better in 1936. The best dozen movies of 1936 may well be better than the best dozen of 1996, but that is not proof of a wholesale decline–and in any event, and more to our point, there is a greater diversity today of cinematic styles and sensibilities and “voices” in general release than there was 60 years ago.
       3. As regards the remarks of Chris Byron (who one of us should reveal, in the interests of full disclosure, was New York magazine’s business columnist when I arrived there as editor, and ceased to be the magazine’s columnist shortly after I took over): I’VE made a “public spectacle” of my firing? Huh? I’m afraid getting the boot was the public part, and if I made it somehow spectacular by telling the truth, as best as I know it, to reporters when they called, so be it. As to his question about whether the debt carried by K-III disqualifies it from owning New York or any other publication–of course not, and I continue to find Byron’s debt-load-determinism curious and unpersuasive. Andrew Schwartzman
9:31 a.m.  Thursday  10/24/96 

       Jack Shafer is nuts if he thinks conglomeration hasn’t contributed to the decline and pasteurization of the American theatrical feature film. Does he think that the best way to make films is to design the breakfast-cereal box before the script is written? I recommend Nancy Griffin and Kim Masters’ Hit and Run for one recent account. (By the way, space precludes a discussion of why the fact that it was published by Simon and Shuster doesn’t prove Walter Isaacson’s point either.)
       One other quick aside: We are not presently addressing adverse economic impacts, but there are many. For example, radio advertisers are discovering that new local “super combos” of six and eight stations per market (60 percent share in Rochester) are (surprise!!!) raising prices.
       I share Walter Isaacson’s optimism about the development of trickle-up media and its impact on ever larger subsets of the public, but he may be overlooking the homogenization there, too. Much talk radio is very unlocal, and with Infinity, Evergreen, and Chancellor each approaching 100 stations, the trend is the other way. Rush, Howard Stern, and Imus are in every major market.
       Let’s not confuse functions. The Internet’s greatest contribution is in increasing direct, unmediated civic discourse between and among citizens. We still depend upon, and need the shared experience of, a mass media, something the Internet hasn’t yet provided. At 7 percent penetration, I’d say the wired nation is itself an elite audience. And if you see the same Reuters story on dozens of commercial sites, you see the limitation of the Internet as a means of improving quantity and quality of what trickles down; the good stuff, like SLATE, may well be too expensive for the many.
       The primary question of the day is this: Is more better? My answer is yes, but more outlets is not more diversity. While we have greater tolerance for small subcultures, and better serve special interests and needs, the mainstream product is more bland and, if anything, less open to new ideas. It is no accident that the only new political movement since the ‘60s–the Perotistas–was created by a billionaire who spent liberally to create it. Money no longer just talks, it screams. Andrew Schwartzman
11:41 a.m.  Thursday  10/24/96 

       I’m afraid our committee’s allusions to pop culture have led us astray.
       The question is whether the public as a whole is going to be exposed to diverse and challenging points of view. The quality of the conglomerated product is good, but is it more or less likely to bite the hand that feeds it?
       Time magazine is the exception that proves the rule. The print and electronic press does least well at covering itself. How much coverage did the broadcasters give to the broadcast-ownership and spectrum provisions they tucked into a bill mainly addressed to restructuring long-distance and local telephony? $40 billion worth of spectrum should have received more attention.
       Bigger companies have more interests and more on the line. Moreover, these group-owned and managed properties are less likely to be run by people with journalistic backgrounds. Bean counters don’t like to read stories that piss off powerful people, and they probably think Katharine Graham was crazy for not sitting on Woodward and Bernstein. Herb Stein
2:50 p.m.  Thursday  10/24/96 

       Maybe I am a cockeyed optimist, but I feel some conclusions emerging from this discussion. At least, they are conclusions that appeal to me. Since tomorrow is our last day on this stage, I am setting these conclusions down here so that you will all have an opportunity to disagree with them and to put down, concisely, I hope, what you are left thinking.
       1. As to overleveraging, that is not peculiarly a media conglomerate phenomenon, although media conglomerates are among the leading examples. Overleveraging as such is not a drain on the real resources of the economy. It transfers wealth from one group of investors to another. Of course, investment bankers and lawyers extract a considerable toll along the way, but they have mouths to feed also. I suppose that the devotion of so much talent to arranging these deals is a waste, but the point is probably not that there’s so much talent, as that it is paid so much. The other efficiency consequences of overleveraging and conglomerating are less clear. The acclaimed synergies have not appeared, but neither are the inefficiencies obvious. Byron considers reduction of staff a sign of inefficiency or waste. I don’t.
       2. The march of technology is inexorably increasing the number of sources of information available to everyone, and conglomeration is only a trivial obstacle to that. This may not seem so obvious to you younger fellows who do not remember when people had to wait for the newsboys coming down the street selling extras before they learned the outcome of the Dempsey-Tunney fight.
       3. With the possible exception of movies, there is no form of creative expression that will not more readily find an audience today than ever before. If there were another James Joyce, he would have no trouble finding a publisher for Ulysses, and there is no self-designated art that will not find a prominent gallery. Movies may be an exception, partly because production and distribution costs are so high, but this problem would exist if all the studios were owned by washing-machine companies rather than by other media companies.
       4. We have been given some examples of self-dealing–where one division of a conglomerate either concealed or advertised something for the advantage of another division–but these examples seem trivial or ineffective. I agree that it is an advantage not to have to see Ted Turner and Jane Fonda at the World Series, but now we have to see the so-called “stars” of Fox sitcoms.
       5. The media are, after all, media. They are a transmission mechanism, and they are a pretty efficient and open mechanism. What controls the outcomes is the quality of what is put in at the beginning and the quality and capacity of the receptors at the end. I think that what is being put in–and I confine myself here to the reporting and explanation of news–is better that it has ever been before. In the field that I know something about–economics–coverage in newspapers, magazines, and even TV, is enormously better than in the past. Before World War II there was no economics reporting, but only business or financial reporting. The whole field has developed greatly. I think the same is true of science news. I am not happy with economics reporting. For example, this whole campaign has been filled with misleading statements about economics that the press should have exposed but did not. But still, it’s much better than it was.
       6. I think there is a real problem with the receptors, us. I didn’t mean my quip about the limitation of brain channels to be elitist. I just don’t know who can absorb and make anything of the information the ordinary citizen is supposed to deal with. I take three daily newspapers, and I have reached the point where I only look for the names of my friends–in the obituaries or on the op-ed page–do the crossword puzzle, and read a further analysis of the ball game I watched the night before. Everything else is too baffling. When I see the words “Bosnia” or “campaign finance reform” or “affirmative action,” my eyes glaze over. It’s all too difficult. The media may be trying to pump too much information into too small a bottle. I don’t know what to do about that. But I’m only the moderator; I don’t have to know. Jack Shafer
3:01 p.m.  Thursday  10/24/96 

       Having already been called “nuts” and “ignorant” by Andrew Schwartzman, may I request a Trifecta? The insult that really gets me hot is “chowderhead.”
       None of the committee members have contested my pronouncement that the media is better today than it has ever been–this despite the ongoing consolidation, despite vertical integration, despite monstrous debt loads, despite network ownership by defense contractors, despite the fact that Christopher Byron stopped working at New York after Kurt Andersen started working there, despite the conspicuous Canadian (!) ownership of American publications, despite the successes of Rush Limbaugh and Oprah Winfrey, despite Disney’s banishing of Jim Hightower and Bob Grant, despite Joe Klein’s million-dollar lies, and despite the existence of Fairness and Accuracy in Reporting, the media does an OK job of, as our moderator put it, protecting the public interest. Not great, but OK.
       But if I’m wrong, if the conglomerated media barks like a dog and needs reform, then I’d love to hear what sort of remedies my epistolary partners have in mind. Antitrust divestitures? Content controls? Reallocation of currently used spectrum? A return to the 5-5-5 ownership rules for AM, FM, and TV license holders? A government-financed press? Compulsory ombudsmen? A Ministry of Information? Must-carry rules for populists who don’t have a billion dollars in the bank?