. . . says Libby Jacobson of CEI, writing in the Washington Examiner.
Media Regulation 
Wall Street Journal columnist Holman Jenkins has a new column up this morning about the ongoing battle over broadcast television spectrum reallocation. [“The Rabbit-Ear Wars.”] It discusses the plan being floated by FCC “broadband czar” Blair Levin, who serves as the Executive Director of the Omnibus Broadband Initiative at the Federal Communications Commission. Levin has raised the possibility of reallocating a portion of broadcast television spectrum for alternative purposes, namely, mobile broadband. Such a “cash-for-spectrum” swap would give mobile broadband providers to spectrum they need to roll out next generation wireless broadband networks while making sure broadcaster receive compensation for any spectrum they hand over. The FCC just recently released a public notice on “Data Sought on Users of Spectrum,” (NBP Public Notice # 26) that looks into the matter. “This inquiry,” the agency says,” takes into account the value that the United States puts on free, over-the-air television, while also exploring market-based mechanisms for television broadcasters to contribute to the broadband effort any spectrum in excess of that which they need to meet their public interest obligations and remain financially viable.”
Holman Jenkins argues that the issue is incredibly contentious and likely to engender a great deal of political wrangling. “The spectrum puzzle won’t be solved by the clean and simple deal the agency envisioned,” he says. That’s true, but I think the FCC still deserve some credit for at least starting the discussion. As my PFF colleague Barbara Esbin and I noted in our recent paper, “An Offer They Can’t Refuse: Spectrum Reallocation That Can Benefit Consumers, Broadcasters & the Mobile Broadband Sector,” [PDF], it’s hard to see what is wrong with letting broadcasters hear offers of cash for their spectrum! That being said, they should have their hands forced (to give up the spectrum, that is). I think Jenkins generally gets it right when he says: Continue reading →
The Comcast-NBC deal has the traditional media world all atwitter—well, better call it aflutter. “Atwitter” is losing its old media connotations.
So the New York Times rounded up a foursome of advocates to air their views, among them Adam Thierer and yours truly.
Huzzahs and rotten fruit in the comments, please.
(And you can see from comparing our posts which of us believes in economy in the use of words.)
Today, Jim Harper and I took on Andy Schwartzman of Media Access Projects and Gigi Sohn of Public Knowledge in this New York Times online debate about, “Should Consumers Fear the Comcast Deal?” Like other media critics, Schwartzman and Sohn adopt the gloom and doom tone that many worrywarts use when discussing the deal. Andy Schwartzman says “Comcast’s proposed acquisition of NBC Universal poses a genuine threat to free expression and diversity of speech in our democratic society.” And Gigi Sohn predicts that “With all that programming under its control, Comcast will have every incentive to take its shows off of the Internet and force consumers to buy a cable subscription to get online access to that programming.”
But as Jim Harper and I point out, we’ve heard such Chicken Little horror stories before. Whether it was AOL-Time Warner, News Corp-DirecTV, Sirius-XM, or whatever else, the story is always that a veritable media apocalypse awaits if the deals aren’t blocked. But it just ain’t so. As I note in my response:
Back in the real world, the sky never fell — except on the merging companies! Just two years after the deal was announced, AOL-Time Warner had lost over $100 billion and Time Warner has now spun off AOL entirely. The News Corp.-DirecTV marriage ended in divorce after just three years. And Sirius-XM flirted with bankruptcy earlier this year as listeners continue to flock to other audio options. The moral of the story: markets worked. Shareholders abandoned bad deals, new niche markets developed, and innovative digital technologies continue to revolutionize media.
And as Harper notes in response to silly claims about restricting access to content or communications, “Comcast-NBC can no more impinge on communications among Internet users than AOL-Time Warner did.” Which is to say, not at all. They would be doomed if they tried to play such games. You can’t make money or retain viewers or customers by cutting off access to content or conduit. Finally, “the genuine threat to free expression and diversity of speech” is not Comcast-NBC, as Schwartman suggests, but a government big enough to crush media companies and control media platforms as if they were their playthings.
For more details about the actual historical record, check out my recent PFF white paper: “A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC.”
As I noted in my recent paper, “A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC,” every time a media merger is proposed we hear all sorts of silly Chicken Little predictions of impending doom. Among the more entertaining claims we hear are conspiracy theories about supposed nefarious schemes to take over the media universe and control our minds, predictions of the death of journalism or democracy, or just good ol’ fashion screw-the-consumer price hikes. But, as I showed in my paper, those predictions have always proven to be bunk once the historical record is in–which usually only takes a few years. While most media mergers do end in misery–it’s for the merging firms and their shareholders, not the public. Unforeseen technological innovations and expanding media marketplace options typically doom most media mergers, while the viewing and listening public enjoys the fruits of continued marketplace evolution.
But the critics never acknowledge any of this. And, sadly, history repeats. The media worrywarts just keep mouthing the same lines and conveniently avoid any reference to their past predictions. No one bothers looking back and trying to match up those past predictions with present day facts. I’m out to change that. I am going to attempt to keep a running inventory all the Chicken Little predictions about the Comcast-NBC Universal deal so that, a few years from now, we can look back and see how well those predictions match up with reality. I suspect that, as was true of those earlier case studies, reality will look quite different than the rhetoric we are hearing today.
To kick things off, here are some rather outlandish comments from someone who should know better — Dan Gillmor, author of the excellent 2006 book, We the Media: Grassroots Journalism by the People, for the People, which I have cited quite favorably in much of my own work through the years. But when it comes to the Comcast-NBCU deal, Gillmor has gone off the deep end in an essay entitled, “Comcast-NBC: The Road Toward Control Over What We Create.” He argues:
A Comcast-NBC combination is brazenly anti-competitve and anti-democratic. It would give one company far too much ownership over not just professionally produced media but also the ways media consumers can receive it.
Worse, if approved, it could mark the tipping point in Big Media’s push to take control over the Internet itself. That’s where we need to focus our attention.
But wait, there’s more… Continue reading →
I’ve just released a new PFF white paper looking at the hysteria that has often accompanied major media mergers and then taking a look at the marketplace reality years after the fact. Here‘s the PDF, but I have also pasted the entire thing down below.
_____________________________
A Brief History of Media Merger Hysteria:
From AOL-Time Warner to Comcast-NBC
by Adam Thierer
Although the pending union of Comcast and NBC Universal has not yet made it to the altar, Chicken Little-esque wails about the marriage have already begun in earnest. For example, the pro-regulatory media organization Free Press has already set up a website to complain about the deal.[1] And Jeff Chester, executive director of the Center for Digital Democracy, has called it “an unholy marriage.”[2] The fever only promises to spread once the deal is formally announced, and a lengthy fight over the deal is expected at the Federal Communications Commission (FCC) and whichever antitrust agency reviews the deal.[3]
But reality tends to play out somewhat less dramatically than the script penned by the media worrywarts. It’s worth looking back at some of the more prominent examples of media merger hysteria in recent years to understand why such panic is unwarranted, and why a deal between Comcast and NBC Universal is unlikely to lead to the sort of problems that the pessimists suggest.[4] Continue reading →
by Adam Thierer & Berin Szoka
Move over, health care reform, climate change, and the economy. Judging by White House visits by various government agency heads, the Obama administration instead appears preoccupied with the re-regulation of communications, media, and the Internet. The Administration has just released logs of all visitors to the White House and Executive Office Buildings from Obama’s inauguration through August—including a staggering 47 visits by Federal Communications Commission (FCC) Chairman Julius Genachowski. By contrast, no other major agency head logged more than five visits. Chairman Genachowski obviously has an audience with those at the highest levels of power, including the President himself, but this raises questions about just how “independent” this particular regulator and his agency really are.
Unprecedented Transparency by White House
The Administration deserves credit for releasing these visitor logs, which offer unprecedented transparency into the White House’s workings. Unfortunately, the logs lack visitors’ affiliation and title, making it difficult to discern subtle patterns. Furthermore, each entry indicates only one “visitee” and the total number of people involved. Full disclosure requires identifying all meeting participants. Nonetheless, President Obama’s gesture is a great first step toward improved government accountability.
This openness allows us to ask questions we couldn’t pose for previous administrations—such as why the FCC head seems to have unparalleled access to the White House. Lacking data from previous administrations, it’s difficult to make direct comparisons with previous FCC Chairmen, but the sheer number of visits by Chairman Genachowski leaves no doubt about his uniquely close involvement with the White House. Continue reading →
Perfect media equality is impossible. There has never been anything close to “equal outcomes” when it comes to the distribution or relative success of old media: books, magazines, music, movies, book, theater tickets, etc. A small handful of titles have always dominated, usually according to a classic “power law” or “80-20? distribution, with roughly 20% of the titles getting 80% of the traffic / revenue.
But here’s the really interesting thing: This trend is increasing, not decreasing, for newer and more “democratic” online media. As I pointed out in two previous essays [“YouTube, Power Laws & the Persistence of Media Inequality” & “Cuban on Fragmentation & Attention in the Blogosphere (or Why Power Laws Really Do Govern All Media)”], there is solid evidence that blogs, YouTube, Twitter, and other digital media outlets and platforms not only follow a classic power law distribution but that the distribution is even more heavily skewed toward the “fat head” of the distribution curve, not “the long tail” of it.
The latest evidence of the persistence of power laws across media comes from Facebook. Erick Schonfeld has a new essay up at TechCrunch (“It’s Not Easy Being Popular. 77 Percent Of Facebook Fan Pages Have Under 1,000 Fans“) highlighting some new findings from an upcoming report by Sysomos, a social media monitoring and analytics firm. Here’s the summary from Schonfeld: Continue reading →
Free Press, the radical pro-regulatory media activist group, recently filed comments with the Federal Trade Commission (FTC) for the agency’s upcoming workshop on “How Will Journalism Survive the Internet Age?” The Free Press comments provide an enlightening glimpse into the mind of how many on the Left now think about media policy in America. Their approach can be summarized as follows:
- Nothing the private sector can do will save journalism (unless it is entirely non-profit / non-commercial in nature);
- Even if there was something that private players could do to save journalism, Free Press would likely have federal authorities forbid it anyway (especially if it involved new business ownership patterns or combinations); and,
- The only thing that can really save journalism is a “public option” for the press in the form of massive state subsidization of media in this country.
To elaborate on the last point, here’s how Free Press summarizes what they are looking for:
For U.S. public media to become a truly world-class system will require a substantial increase in funding. This could be accomplished by an increase in direct congressional appropriations to the Corporation for Public Broadcasting. With increased funding — to as little as $5 per person, increasing annual appropriations to some $1.5 billion — the American public media system could dramatically increase its capacity, reach, diversity and relevance.
But they stress that a simple expansion of the PBS/NPR/CPB non-commercial model will not be enough since that system is “vulnerable to repeated threats of funding cuts” and too “reliant on corporate backing, via the underwriting process.” They want to go well beyond non-commercial media, therefore, and have the state start building a massive public media infrastructure. Here’s where their pitch for a public option for the press comes in: Continue reading →
I was just digging through some old files and came across a quote that I found entertaining. Back in 2003, when he was still president and chief operating officer of Viacom, Mel Karmazin said with reference to Microsoft, AOL-Time Warner, and Comcast: “I can’t imagine being a competitor with any of these guys.” At the time, some media worrywarts made great hay of Mel’s quip and claimed, as Gene Kimmelman of Consumers Union argued at the time, that it proved how “Media moguls themselves admit their desire to avoid real competition within their industry.”
Utter rubbish. In fact, just six years after Karmazin spoke those words, Microsoft finds itself in a heated war with Google on all fronts, AOL-Time Warner has crumbled (even Time Warner Cable and Time Warner Entertainment got divorced!), and Comcast is now squaring off against telco and online video competitors that were unfathomable at the time (not to mention traditional satellite TV competitors.) In the meanwhile, Karmazin abandoned Viacom and today, as CEO of Sirius XM, is struggling to find a way to make the satellite radio universe survive the ongoing digital music bloodbath thanks to unforeseen competition from online music services and a little thing called the iPod!
It’s proof positive that media markets and digital technologies always evolve faster than most people — even smart industry titans like Karmazin — anticipate.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.