Money
Wins at the FCC
What
media consolidation means for Hawai‘i
Beverly Keever
July 23 , 2003
“I was stunned to learn that a single person
or entity could potentially own two television stations, eight radio stations,
a daily newspaper and a cable system in Honolulu,” said U.S. Senator
Dan Inouye. “This level of concentration is certainly not in the
public interest.”
Inouye, a member of the Senate Commerce Committee
that oversees the Federal Communications Commission (FCC), scrutinized
its preliminary rule changes announced on June 2 and made a studied calculation
of what the media landscape in Hawai‘i might look like after the
changes in broadcast ownership rules announced by the FCC.
He didn’t like what he saw.
The new rules could affect Hawai‘i more
profoundly than other states because of its unique, geographic isolation
and its smaller market. Hawai‘i is the only state designated as one
media market by the FCC.
Half-jokingly, Wayne Cahill, administrative officer
of the Hawai‘i Newspaper Guild, predicted that The Honolulu Advertiser’s
parent company of Gannett will own two-thirds of the television stations
in the state and the Honolulu Star-Bulletin will own the rest.
(Before the rule changes, a newspaper generally could not own a broadcast
station in the same market but the trade association representing the
nation’s top newspapers lobbied hard to get that ban lifted.)
The Advertiser isn’t considering
any expansion, said general manager Dennis Francis. [Editors’ note:
Perhaps not in broadcasting, as the Weekly pointed out last week,
Gannett has already acquired 22 publications in Hawai‘i.] The
Advertiser is owned by Gannett, the nation’s largest chain of
daily newspapers. Gannett also operates 22 U.S. television stations in
different markets, owns more than 400 nondaily publications in the U.S.
and is an Internet leader. Gannett wanted the FCC’s cross-ownership
ban lifted.
Besides erasing the cross-media ownership ban,
the new FCC rules permit companies to own more television stations in
major markets. The 257-page FCC order says that the changes serve its
public interest goals and take account of and protect “the vibrant
media marketplace.”
Ironically, a newspaper’s moving into broadcasting
here would roll back the clock to the 1920s when Honolulu dailies raced
to radio broadcasting, and in the 1950s when they helped to bring in television.
40-Years of ‘Media Omnipresence’
The FCC’s rule changes mark a major turning
point in an industry that has increasingly shaped U.S. culture and society.
In 1963 the three major networks increased their 15-minute nightly newscasts
to 30-minutes and inaugurated what sociologist Michael Schudson describes
as a “media omnipresence” that reaches from the White House
to your house, and that has led to the “newsification of popular
culture.”
This media omnipresence has brought a fragmentation
of content, and an economic concentration of media ownership that controls
that content. In the early 1990s, legendary media scholar Ben Bagdikian
observed, “a small number of the country’s largest industrial
corporations have acquired more public communication — including
ownership of the news, than any private businesses have ever possessed
in world history.” Paralleling this unprecedented media power, he
said, “confidence in the news dropped from a high of 55 percent in
1988 to 20 percent in 1993.” This media power also paralleled a dumbing-down
of the news, with less coverage of government and the corporate power
structure.
Case: ‘A Grassroots Uprising’
In the eight months Ed Case has served in the
U.S. House of Representatives, he fielded such tough issues as the war
on Iraq, tax cuts and drilling in the Arctic National Wildlife Preserve.
But, referring to the FCC changes, the congressman said, “This one
is at the top of the list.”
The issue is complex, “yet people get it
on a gut level.” Thumping his desk overlooking Honolulu Harbor, he
elaborated: “They are scared of the loss of information and they
should be scared. And they are scared about the loss of public discourse
and their ability to sit in their homes or in their cars and reach their
own conclusions.”
Estimating he has received hundreds of letters
on this issue in the two months prior to the ruling, he thinks these numbers
typify the rest of the country: “That’s a grassroots uprising.
And grassroots uprisings can, in fact, reverse congressional intent.”
Case’s description is consonant with news
reports that said more than a million letters, phone calls and e-mails
were received in Washington from groups as diverse as the National Rifle
Association and the feisty MoveOn.org: Ninety-nine percent of the feedback
opposed the FCC proposed rule changes.
This million-strong uprising included input from
the Hawai‘i chapter of the Society of Professional Journalists, the
Honolulu Community-Media Council (HCMC) and Akakü, Maui’s community
television. HCMC president Moya Davenport Gray explained, “We made
the point that consolidation of media ownership eliminates diversity of
information, thought and opinion, all of which are critical to Hawai‘i’s
democratic community.”
Curbing Quality News and Discourse
“Democracy thrives on information and discourse,”
Case said. This information and discourse occurs in the modern media and
is facilitated by a strong media. But, he warned, “I have no doubt
that some people in our country would like to control the media in order
to control the information and in order to control the discourse.”
The FCC rule changes “will accelerate a very negative development
in our democracy,” and the “overall effect is just the diminution
in overall information available and in discourse on the information.”
Locally, Case foresees fewer financial resources
and personnel devoted to local news reporting and analysis. “That’s
dangerous when you go in that direction,” he said. “That’s
already happened over the last five, 10 years.”
Others agree. “Larger newspaper chains,
because of corporate pressures, have cut costs in a number of newsrooms;
jobs are being trimmed and sometimes axed,” said Linda Foley, president
of the National Newspaper Guild-Communication Workers of America.
The quality of news content is also reduced by
other factors. University of Hawai‘i journalism professor Ann Auman,
who has researched the transformed role of copy editors in newsrooms nationally,
explains that editors have less time for editing. Technology has made
it possible for newspapers to eliminate “back shop” jobs such
as paste-up and proofreading and add these to copy editors’ increasing
number of duties. Auman noted, “Copy editor is a strange job title
for someone who has so little time to edit stories and write headlines.”
Shutting out Public Input
As explosive as the potential outcomes of the
rule changes, is the process through which they were decided. The FCC
had announced general topics on which it invited public comments, but
the U.S. Small Business administration complained the notice was too vague
to comply with administrative procedures.
Inouye said, “I was very disappointed that
the public was not given an opportunity to review and comment on specific
rule changes prior to their adoption.”
Case joined other legislators in complaining
to the FCC that it had cut short public input.
HCMC’s Gray echoed this criticism. She argued
that permitting a major agency that has a significant impact on American
society, and that is run by only five politically appointed commissioners,
to adopt a rule without its first being presented to the public for comment
is “democracy gone amok.” Without the public’s full participation,
the FCC is making “secret law,” she said.
Emerging Partisan Battleground
The media landscape far and near is being carved
out by partisan combatants in Washington, D.C. The rule changes were approved
by the three Republican FCC commissioners over strong dissents from the
two Democrats. Partisanship is carrying over to Congress, Case said, with
most Democrats opposing the FCC’s changes.
“This is a partisan issue because the Republican
Party is particularly obligated to the large business sector primarily,
including large media companies, and because they are just in general
focused on a free market, less regulatory environment, including in the
media.”
Legislation to rollback some or all of the rule
changes is pending in both houses, including S1046, HR2052, HR2212, HR2462.
(See sidebar.) Case foresees “a very hard, uphill battle” in
the House where FCC matters are assigned to the Energy and Commerce Committee.
Its chair, Louisiana Rep. Billy Tauzin, has publicly stated support for
the FCC’s changes and opposes any rollback.
Some moderate Republicans oppose the changes,
Case observed, but on critical votes they usually lockstep with their
leadership. House Republicans outnumber the Democrats 229 to 205, with
one independent. But on July 16, the House Appropriations Committee voted
to pass the money bill blocking FCC funding. Eleven of the 36 Republican
committee members broke ranks with their party and joined 29 Democrats
to approve the measure by a 40-25 margin.
To accelerate the grassroots uprising and to
compete with the “large-money interests” that lobby Congress,
Case advises coordinated action and centralized sharing of resources of
like-minded organizations and individuals to bombard selected House Republicans
and the president with their views (see box). An example of such big-money
interests, he explained, is the pharmaceutical companies and Medicare
specialists with about 600 paid, registered lobbyists, all targeting their
coordinated efforts on about 20 pivotal members of Congress. Then, referring
to the lobbying to gain and retain the FCC rule changes, he said, “That
scope of effort” is basically “what’s going on here too.”
He urged Democratic presidential candidates to
make a campaign issue of the rule-change controversy “because people
care about this.”
Hawai‘i’s Dual Duopolies
How will the FCC’s rule changes impact Hawai‘i’s
duopolies? Hawai‘i has two. (Duopoly is FCC jargon for one company
owning two television stations in the same market.) One duopoly is KHNL
and KFVE, owned by Raycom Media based in Alabama. The second and perhaps
more significant is the Indiana-based Emmis Communications Corp., which
owns and operates top-ranked KHON-TV Fox 2 and CBS affiliate KGMB-TV 9,
Hawai‘i’s oldest stations.
The rule changes left untouched the existing
ban on one company’s owning two of the top four-ranked stations in
certain markets but they re-categorized how market size will be determined
and they expanded the conditions under which waivers could be granted.
An early casualty of the Emmis duopoly is Jerry
Drelling, KGMB’s former 14-year anchor-cum-investigative reporter.
In a telephone interview from San Francisco, he said he was told his contract
was not renewed in March 2001 because Emmis had paid too much for KGMB
and needed to cut expenses. With the rule changes, Drelling sees more
veteran reporters being let go, replaced by less experienced ones and
more sharing of station resources so that the community will suffer because
the result will be “look-alike news.”
Unknowingly, Emmis is a microcosm of media ownership
concentration that is propelling the grassroots uprising. Since 1980,
Emmis — the Hebrew word for “truth” — has become the
nation’s sixth-largest radio group, owning and operating 18 FM and
three AM radio stations and two Indiana-based radio networks. Internationally,
it owns controlling interests in the No. 1 radio network in Hungary and
in two stations in Buenos Aires, according to its latest annual report
filed with the Securities and Exchange Commission (SEC). Emmis also owns
16 television stations and six magazine publishing operations. In 1994,
it went public, and trades on the Nasdaq as EMMS. Next year it expects
to finalize its purchase of controlling interests in six Austin radio
stations.
Emmis acquired KGMB and its two satellite stations
in Wailuku and Hilo when it bought a string of eight stations from Lee
Enterprises in October 2000. The FCC granted a temporary waiver of the
duopoly rule but ordered the divestiture of one station before April 1,
2001. That deadline was extended a year. In May 2002, Emmis asked the
SEC that the divestiture requirement be held up pending the outcome of
the FCC’s 2003 rules review. That request was opposed by an unidentified
Honolulu broadcaster and two local public-interest groups. The FCC took
no action.
Rick Blangiardi, who manages both KHON and KGMB,
is very interested in what the FCC will decide about Hawai‘i’s
top duopoly in light of its new rules. As senior vice president locally,
he concedes he is probably unique in being the nation’s only manager
of two flagship affiliates for CBS and Fox in one market. Like Emmis,
he unknowingly perches at the center of the grassroots uprising: one executive
making strategic decisions that determine the news and local programming
of two of the top-ranked, supposed-to-be competing stations in the same
market.
“This is going to be a very complicated
legal issue,” Blangiardi explained. He awaits the FCC’s decision
on Emmis’ petition to delay divestiture, which “could take weeks
or even months.”
Hopeful his duopoly is permitted to continue,
Blangiardi foresees KHON and KGMB as two distinctly separate stations,
linked by high-speed fiber optics and both continuing their network affiliations.
No Fat Cats Here
Despite Drelling’s being an early victim
of cost-cutting by Emmis, Blangiardi said that since he began a year ago,
he has resisted cutting employees for economic, as distinct from merit,
reasons, and is now taking steps to beef up the news operations at both
stations. He has hired a new news director, recruited reporters, acquired
top-level producers and is “in process of hiring a strong male anchor,
actually a couple of them, for KGMB.” He is planning to do more local
specials such as ones with Governor Lingle and about Kapi‘olani Park.
It is “very challenging” to run “a
first-class news operation,” he said, because the market here has
for the last 20 years “really teeter-tottered at or about the same
revenue numbers for all that time and by any definition that’s really
a train wreck. That’s flat growth.”
Noticing a visitor’s eyeing KHON’s
posh offices flaunting cathedral-like atriums and dark-paneled walls,
he hastily interjected, “It’s very deceptive to look at this
building and this facility and think we’re a bunch of fat cats, because
that’s not the case.”
Beyond newspapers and television, the greatest
concentration of media ownership nationally and in Hawai‘i is occurring
in radio. Pending now before the FCC is the approval needed for the Pacific
Media Group, which owns six radio stations on Maui, to finalize its April
purchase of four additional stations (KLEO in Kona and KKBG, KHLO and
KKOA in Hilo), according to group president and CEO Chuck Bergson.
S.O.S: From Honolulu to Seattle
More than just reacting to national developments,
Hawai‘i has also served as a guide for other localities resisting
media ownership concentration. A group called Save-Our-Star-Bulletin (SOS)
joined the state in 1999 in a lawsuit that blocked the closing of the
Honolulu Star-Bulletin after it had profited for decades from a
Joint Operating Agreement, an exemption from U.S. anti-trust laws. That
resistance has “absolutely” shown the way for others in Seattle
to prevent closure of the Post-Intelligencer, Foley explained,
adding, “The people of Honolulu really rallied around the concept
of two newspapers.”
In Seattle a SOS-styled group has blossomed,
calling itself the Committee for a Two-Newspaper Town. Echoing sentiments
similar to those expressed earlier in Honolulu, the group argues on its
Web site: “One less newspaper means one less public watchdog keeping
an eye on government.”
The FCC’s rule changes came at a time when
criticism of the news media is at an all-time high, from both ends of
the political spectrum and from within the profession itself. These are
fueled nationally by the Jayson Blair scandal at by The New York Times,
by misgivings about coverage of the war on Iraq and locally by KITV’s
ethical breach of accepting freebie trips to Japan with Lingle for a reporter
and a cameraman.
Even so, despite static wages, more demands and,
often greater dangers, journalists produce some excellent articles that
provide, for most U.S. citizens, their only window on an increasingly
filtered world.
Beverly Keever is a journalism professor at UH Mänoa, a member
of the Society of Professional Journalists and of the Honolulu Community-Media
Council.
Congress
is listening. Stay tuned and stay involved
Contact information
President George W. Bush
The White House
1600 Pennsylvania Ave., NW
Washington, D.C. 20500
Phone: (202) 456-1111
Fax: (202) 456-2461
president@whitehouse.gov
House Speaker
Representative J. Dennis Hastert
speaker@mail.house.gov
Read Pending Legislation
thomas.loc.govHouse Energy and Commerce
Committee Chair
Representative Billy Tauzin
2183 Rayburn Office Building
Washington, D.C. 20515
Phone: (202) 225-4031
www.house.gov/writerep
1. Scroll in the location window
to Louisiana
2. Enter zip code and four-digit zip (only Louisiana
zips are accepted so enter 70560-1007)
3. Enter your name, address,
city, phone, e-mail; your
Louisiana zip will also appear
4. Click “contact your
representative” button
5. Type your comments
6. Click “send your message”
Hawai‘i Delegation, District Offices
Prince Kühiö Federal Building
300 Ala Moana Blvd.
Honolulu, HI 96850
Senator Daniel Akaka
Phone: 522-8970
Fax: 545-4683
senator@akaka.senate.gov
Senator Daniel Inouye
Phone: 541-2542
Fax: 541-2549
senator@inouye.senate.gov
Representative Neil Abercrombie
Phone: 541-2570
Fax: 533-0133
neil.abercrombie@mail.house.gov
Representative Ed Case
Phone: 541-1986
Fax: 538-0233
ed.case@mail.house.gov
