Ch. 13: Media Economics And The Global Marketplace Monopoly/Oligopoly Monopoly- occurs when a single firm dominates production and distribution in a particular industry, either nationally or locally Oligopoly-describes an economic situation in which just a few firms dominate an industry Telecommunications Act of 1996 and deregulation Notes from Ctools Deregulation FCC eliminated or reduced restrictions on the number of radio stations a company could own nationally In a major market like Los Angeles or New York, with forty-five or more commercial stations, one company could own up to eight stations In a market with 30-44 stations, a company could own up to seven; in a market with 15-29, one company could own up to six smallest markets with 14 or fewer stations, a company could still own up to six Ownership Rules A company can own stations that reach up to 38% of U.S. households Ownership Rules FCC suspended anti-trafficking rule: required owners to hold onto stations for at least three years Ownership Rules 2007--FCC relaxes cross-ownership rules, Senate votes in 2008 to ?disapprove? allows papers in 20 biggest markets to own a lower-rated TV or radio station Consolidation and Media mergers Lecture notes Major Media Industry Trends Conglomeration-consolidation of media Globalization The global media market is dominated Why care about Media Conglomeration? Commercial interests and values always paramount: main goal is to maximize profits Commercial values move down the age chain to ever younger consumers Entertainment values shape the news Conglomeration Reduced quality of journalism Inadequate diversity of opinions, voices Said had to voice controversial issues on both sides (fairness doctrine) but 1980s no longer had it Decline of local radio, local radio news Americans less informed about current and world affairs Powerful interests may not allow certain topics to be discussed Corporate owners like Disney can censor what?s on the news channel (ABC) Control over info is threat to democracy ?Synergy? typically refers to the promotion and sale of different versions of a media product across the various subsidiaries of a media conglomerate (like when a author goes on a tv show by the same conglomerate) means certain news stories, book, films get greater attention while other ignored or censored Publishing companies and film companies maximize advertizing so they promote across media and leave others out Things already apart of corporate home get more coverage Cultural Imperialism when American media are shaping the cultures and identities of other nations. Like clothes and music Notes from Ctools cultural imperialism--seen as a form of colonialism?the invasion of an indigenous people?s culture by powerful foreign countries through the mass media?sense that alien western ideas being imposed on people As a result of growing influence of global commercial media companies, the political and cultural power of public service media are receding in Europe and many other areas Debates about media mergers and democracy Only a few corporations that control all of the media They have the ability to manipulate audiences From a monetary exchange perspective, the relationship of our mass media system to politics is highly functional From a democratic perspective, the relationship of our mass media system to politics is highly dysfunctional. Politians put $$$ into media Media then cuts spending inorder to maximize profits So really there is less coverage (poor public citizens) There is still diversity though Notes from Ctools What values do the global media promote? Consumerism, the wisdom of ?the market,? individualism, and the inevitability of class inequality?also that politics are unimportant and that there is little hope for organized social change?in other words, a hollowing out of democracy Cross Ownership The one to a market caveat: any person or company that already owned a tv station in a particular market could not buy a AM or FM station in that market (bite the dust under Reagan) In 1992, the FCC ceased restrictions on ownership limits again raisig the # of radio stations that a single company could own to 18 AM and 18 FM station Lecture Notes in Ctools Major Media Industry Trends Conglomeration Globalization The global media market is dominated by a handful of transnational corporations Media Fragmentation Audience Segmentation Distribution of Products across media boundaries 8 Media companies from which Americans get news and info Disney (market value: $72.8 billion) AOL-Time Warner (market value: $90.7 billion) Viacom (market value: $53.9 billion) General Electric (owner of NBC, market value: $390.6 billion) News Corporation (market value: $56.7 billion) Yahoo! (market value: $40.1 billion) Microsoft (market value: $306.8 billion) Google (market value: $154.6 billion) Horizontal Integration consolidating control over the same time of production or distribution facility?e.g, controlling numerous oil wells example of horizontal integration would be controlling movie theaters or bookstores Vertical Integration control over the means of production and distribution control content and various means to distribute it--so one company owns, for example, book publishers, movie studios,TV stations, cable channels, video stores, movie theaters Disney?Robert Iger, CEO Annual revenue, $34 billion (2006) Non US sales in 1984--8.4%; in 1998, 21% of revenue Walt Disney studios, which itself includes Miramax, Touchstone, Buena Vista and Disney Feature Animation Fairchild Publications (magazines), Hyperion books Buena Vista Music Group ABC TV and radio (10 TV and 30 radio stations), ESPN, The History Channel Disneyworld Amusement Parks Viacom CEO-Philippe Dauman Annual Revenue: $11.46 billion (2007) Paramount Pictures, Spelling and Viacom Productions MTV, VH1, Nickelodeon, Showtime, TV Land, Comedy Central, The Movie Channel, TNN and CMT (country music stations) CBS-CEO Leslie Moonves Annual Revenues: $14.4 billion (2007) CBS and UPN Networks, CBS and UPN TV Stations Simon & Schuster; Free Press; Scribner NewsCorp Annual Revenue: $28.66 billion (2008) Biggest English-language newspaper producer in the world, including London Times, The New York Post, TV Guide; The Weekly Standard Fox TV including Fox Kids, Fox News, FX, Golf Channel 26 TV stations including 2 in New York Includes 20th Century Fox and Fox Animation Studios HarperCollins Time Warner Annual Revenue: $50.48 billion (2008) Warner Brothers and New Line Cinema CNN and CNN International reaches 200 nations Turner Broadcasting (Turner Network Television, TBS Superstation) and HBO; The Cartoon Network; the WB Network Time Inc. Includes: Time, People, Fortune, Sports Illustrated, Teen People, Money, InStyle DC Comics, Mad magazine Little Brown & Company Warner Music Group, Atlantic Group; Columbia House and Elektra Entertainment Time/Warner Cable provides cable to 13 million people, #2 cable provider in US Bertelsman Annual revenues, $18.578 billion (2007) Largest US trade book publisher Includes Bantam, Doubleday, Dell, Random House, Knopf, Vintage, various magazines like Parents and YM; publishing companies in Germany, Britain and Argentina; Arista Records and RCA Victor; owns largest television and radio group in Europe Vivendi--Jean-Bernard Levy, CEO Annual revenues for Vivendi Universal--$20.044 billion (2006) Universal Pictures; Poly Gram Films, Gramercy Pictures; USA network, Sci-Fi Channel, Bravo, HSN A&M, Def Jam, Geffen, Island, MCA, Motown, Leading publisher in France of literature Houghton Mifflin books GE--Jeffrey Immelt, CEO Annual revenue, $172.738 billion (2007), but only $12 billion in media revenue (2005-2006) NBC, CNBC, MSNBC (with Microsoft), 13 O&O TV stations, Telemundo the one-to-a-market caveat: any person or company that already owned a television station in a particular market could not buy an AM or FM station in that market. Globalization and New media All communications technologies are scopic technologies: as instruments of viewing, listening and observing, they can slide our perceptions outward or inward. Utopian predictions about technology?it was improve understanding, reduce misunderstandings, equalized power relationships, bring world peace Dystopian predictions about technology?it?s a threat to our privacy, allows strangers easier access to us, will further cement inequality and power relations, can be used to spread propaganda, hate messages, pornography Globalization ? the growing integration of economies and societies around the world Annihilation of distance and time; compressed Increased velocity of human affairs Heightened possibilities for social interconnectedness Increased possibilities for cultural imperialism Importance of local and even national boundaries undermined Increased possibilities for action between people where geographic distance seems immaterial to the social activity at hand What is the Internet--vast central network of high-speed telephone lines designed to link and carry computer information worldwide These networks can carry a very high volume of computer data at very high speeds It is a decentralized model--unlike telephone and telephone switchboards, or TV affiliates and networks--not like a spoke and a hub, but rather like a net ARPAnet?grew out of Advanced Research Projects Agency--ARPA--sponsored defense related research communications network, no central authority, no central technical hub that could be destroyed in the event of a nuclear attack or other similar disaster Distributed, packet-based network--information travels from place to place without having to return to or pass through a central point Messages are broken up into packets What are new media doing? speeding up the pace of life and our expectations of how fast we should get information, how rapidly people should respond to us Language--new terms like flamed, spam, cyberspace, google as a verb News--all kinds of news online, where people can pick and choose what they read; access to news archives; even greater speed--between Internet and cable, now a 24 hour news cycle; greater access to health information Law/Policy--governments are still struggling with what the Internet means for the First Amendment, Intellectual property rights, obscene material and privacy Relationships with those at a distance-- increase one's contacts with people you've never met, and may never meet Commerce--ever increasing globalization of markets; increased access of ordinary citizens to financial information; day trading; greater ease of shopping online
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