Big Media and the Economy

Shane Schiff

Media consolidation is a term used to describe the process of fewer media corporations owning more and more of the media. Freepress.net, and other independent media sources oppose the ever-growing media monopoly. They feel that mass media is responsible for our media’s stagnation and for eliminating the voice the smaller companies. These large companies are more inclined to seek money than truth. Even news companies are selling out to product placement and advertising.

Six individual companies currently own the bulk of the media. News Corp, Comcast, Walt Disney, Viacom, CBS, and Time/Warner. Comcast, which previously was a property of GE, has now merged with NBC. The largest radio station owner is Clear Channel. They’re so large that some regions can listen only to clear channel stations, because there aren’t any other competitors around. There is a massive amount of media being distributed from an extremely small amount of companies.

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Falsified or biased news by large news corporations is one of the major issues many have with media consolidation. News producers can advertise products distributed by companies they own shares in (and profit from). They can also use news to promote their own political agenda. Fox news is criticized by liberal thinkers, especially within the documentary “Outfoxed,” for being biased and guilty of consumer fraud. Fox is closely tied to News Corp by Murdoch, who has a known right-wing bias.
There wasn’t always a 1% of media. In fact, it assembled in over 20 years of mergers and fierce competition. In 1983, 90% of the media (the same percentage as the big six today) was controlled by 50 companies. After any company merger, there are job cuts. People from one company usually get laid off because there are people doing those same jobs within the other company.

Having a monopoly over the media allows those companies to effectively decide the bulk of what we see on TV and in the media. This is dangerous, because it allows for an extremely biased media. Anything that could have potential consequences for those companies can obviously be censored. Something like… a news report on big media companies evading taxes! News Corp wouldn’t want you to know if Fox was evading taxes, so they wouldn’t have any of their news companies (including fox news) distribute anything mentioning it.
News Corp, which distributes the dow jones index, can ultimately alter our perception of the economy in their favor. This perpetuates their success, wealth, and overall power. If the economy shows Fox is doing substantially better than NBCU, then people will be more inclined to invest in Fox rather than NBCU. And because these large companies are so intertwined, they can use the stock market against us on a large scale.

Much of the media that is produced is unsuccessful, perhaps because it isn’t liked, or because it simply didn’t reach enough of the market to continue. Whatever the case, an estimated %80-90 of media is too low in profit to be considered a success. Numbers like these are too high of a price for smaller companies to pay. As a large wealthy corporation Disney or Universal can release more low-profit movies, than smaller industries. Each movie they have in a theater is another the “little guys” can’t have. By flooding the market, the competition is unable keep up. It doesn’t hurt that their loss makes it easier for them to get bought out, either. This is a major flaw with capitalism, and many liberals feel it threatens the wellbeing and wealth of the majority.

Mergers are not particularly good for the economy. Jobs are a fundamental part of a stable economy. A heavy increase in media consolidation is a decrease in employment rates, because of the jobs lost in the majority of mergers. The Telecommunications Act of 1996 allowed for merging of large media companies, along with allowing broadcasters to have an unrestricted amount of channels nationally. The FCC previously outlawed excessive broadcasting.

Another huge flaw many see in media consolidation is the cycle of money. Instead of trickling down to the general public, large media companies are working together, keeping the money within a closed circle. Hulu is a shared entity shared equally by Disney and NBCUniversal, and slightly more by Fox. It is the epitome of circulating currency, and it makes it difficult for a local tv station to get anywhere. Should products like Hulu continue to be developed, we could see an even more consolidated market.

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Some of the related graphics from our presentation on this material are below.

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2 Comments Add yours

  1. Junming says:

    The relationship between economy and media is something that I have never through about. Also I like how you use different kinds of graphs.

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