by C. Edwin Baker. New York and Cambridge: Cambridge University Press, 2006. 256pp. Hardback. $65.00/£35.00. ISBN: 9780521868327. Paper. $22.99/£14.99. ISBN: 9780521687881. $22.99. eBook format. $18.00. ISBN: 9780511258398.
Reviewed by Thomas Shevory, Department of Politics, Ithaca College. Email: shevory [at] ithaca.edu.
C. Edwin Baker clearly states the intent of his recent book on its first page: “This book,” he says, “defends the merits of restricting [media] ownership concentration” (p.1). The book is timely given the ownership volatility that now exists in media markets and given the FCC’s position under Michael Powell that ownership concentration does not threaten or impede a diversity of political voices from being heard in the contemporary media marketplace. Baker is determined to challenge “the FCC’s hardening view that media concentration is now not a real problem and that ownership restrictions can thwart the public interest. And the book presents, as clearly as I can, an explanation for why these arguments are wrong – for why media ownership concentration is objectionable” (p.1). The book does indeed present a very cogent, at times densely argued, critique of media ownership concentration. I found the presentation to be provocative and mostly convincing.
Baker is highly critical of approaches to media ownership that focus on purely economic analysis, ignoring the more crucial political implications. Baker contends that, apart from whatever market imperatives there may be, dispersal of ownership is essential for the proper functioning or even existence of a democratic society. Democratic governance implies equality of citizens, personified, but not entirely captured by, the principle of “one person/one vote.” Democratic institutions require that they “embody or at least be consistent with respect of citizens’ equal claim to be recognized as part of the self-determination process” (p.6). The “public sphere” is a domain of equality. Moreover, citizens cannot fulfill their roles as citizens if they do not have access to and information regarding the multiple contexts that constitute political life. As Baker notes, “The mass media, like elections, serve to mediate between the public and the government. For this reason, a country is democratic only to the extent that the media, as well as elections, are structurally egalitarian and politically salient” (p.7). A “democratic distribution principle of communicative power” then undergirds Baker’s contention that a “maximum dispersal of media ownership” is necessitated in a healthy functioning democratic system.
Baker’s political views might fairly be characterized as “republican.” As such, they can be contrasted to a more strictly liberal or neo-classical position that democratic governance is simply a matter of gathering consumer/citizen preferences and working out compromises that maximize their [*373] distribution. Yet, while Baker is influenced by the deeper democratic traditions of Jean Jacques Rousseau and Thomas Jefferson, he expresses some deference to John Locke as well. In his analysis of the relationship between media concentration and the First Amendment, he argues for a concept of “complex democracy,” that attempts to include (if not entirely synthesize) the competing liberal, pluralist views of democracy with more republican oriented understanding which emphasizes common interests and ideological commitments and an expansive vision of the public good.
Given his orientation, it is not surprising that one of Baker’s chief foils is the “Chicago School” approach to media ownership put forward by Benjamin Compaine. In Compaine’s view, media concentration is not an issue until it affects price, that is only when it causes problems from conventional anti-trust perspective. Compaine also contends that the industry is not now “as a whole” experiencing heavy concentration of ownership. Any problems that do exist, or that may appear, can be handled via traditional anti-trust mechanisms. Baker argues that ownership has indeed become more concentrated “as a whole,” but even if that were not the case, significant problems would persist. Concentration can occur in complicated patterns – according to geography, format, delivery system, and so forth. Media markets, in other words, simply do not function “as a whole.” An ownership system that fosters democratic imperatives is one in which diversity of ownership exists within multiple contexts.
Another argument put forward by neo-classical economists regarding media concentration is that it is largely irrelevant. According to this view, firms, no matter who their owners are, will simply cater to consumer preferences. The additive result of meeting all consumer preferences is a version of the common good – i.e., welfare maximization. Baker argues, however, that several forces intervene to prevent welfare maximization in the media economy. As he puts it, “Market determination of content systematically leads to too much production and distribution of content that have negative externalities and too little of content that has positive externalities” (p.89). For one thing, owners of media companies are not perfect, and sometimes wildly inaccurate, in their judgments about what will satisfy consumer demands. Given this disconnect between owners and consumers, the ideological biases of the owners will inevitably enter into determinations of content. If the market does not “dictate,” and discretion exists, then ownership matters. Moreover, if some owners are better than others at predicting success, as some clearly are, they have the potential to reap large profits, profits that can then be used to subsidize programming that matches their ideological interests. Rupert Murdoch and Silvio Berlusconi serve as examples of how this can, and in fact has, occurred.
Another feature of media markets, “high first copy, low subsequent copy” costs, also tends to exacerbate market failures, because it fosters monopolistic practices. Starting up a local newspaper is capital intensive, but costs to run it are low, [*374] especially with labor downsizing. It is thus rare now for US towns or cities to have more than one local paper. This again offers media owners relatively wide discretion in terms of editorial slant and even content bias. And, given the high profit margins in the newspaper business, relative to say manufacturing, owners have wide latitude in making decisions that may further a particular ideological agenda. The main point is that, given slack between content decisions and profitability, the market will not determine what the ideological choices are for media outlets. Thus a media marketplace is not by necessity a “marketplace of ideas.”
The argument is often made, or perhaps presumed, that the multiplicity of media sources now available online will provide enough diversity of content to balance any concentration that exists in ownership for more conventional kinds of media outlets. Bloggers, for example, became highly visible when one was able to show sloppy reporting by Dan Rather on whether President Bush properly undertook his service to the National Guard. Baker puts forward the “tentative” proposition that developments on the internet “have no bearing on any debate about the dangers or objections to media ownership concentration” (p.99). Simply put, the internet should not end fears of concentration in particular sectors, such as newspapers or television, within geographical areas, or within market segments. For one thing, the online world’s contribution tends to be in terms of distribution and not in terms of creation of new content.
Two somewhat contrary effects are, Baker contends, generated by internet distribution. On the one hand, distribution costs fall, making more content sources available to people than before. An array of international newspapers and other content sources are now available to anyone with a modem, something that was not previously the case. Yet a larger potential audience can provide a “concentration effect,” encouraging providers to appeal to a wider and wider audience, perhaps watering down what was once a more distinctive and higher quality product. Also, given the justifiable unwillingness of many to accept internet sources as reliable, consumers are pushed towards online sources with a pedigree, such as THE NEW YORK TIMES or CNN, expanding their reach and power. And while there may be millions of bloggers in the online world, most have only a very small audience, with only a very few, such as DAILY KOS or THE DRUDGE REPORT, having a wide readership and a significant impact. In fact, the online world tends to be more concentrated than the more conventional media world. Most bloggers, Baker posits, “could probably reach larger audiences if they spent a couple of hours in the old-fashioned activity of distributing hand-bills in the town center or, if allowed, at a shopping mall” (p.107). One report that suggests that, of 34 million blogs, “over 99 percent will be lucky to receive one visit” (p.107). While I am not entirely convinced by Baker’s rather pessimistic appraisal of the internet for generating and distributing content diversity, I wholeheartedly agree that its existence [*375] should not undercut demands for dispersed media ownership.
Laudably, Baker examines several possible mechanisms to decrease ownership concentration. Minimally, media mergers should receive some extra level of scrutiny and government approval beyond conventional anti-trust. He suggests a two-pronged approach to limiting concentration. First, media outlets should be “sold only to individuals or entities that, after the sale, will own no more media properties (measured by revenue) than the seller previously owned.” Second, “any for-profit commercial entity that purchases a media entity must, after the purchase, be primarily in the media business, that is, receive the majority of its revenue from its media business” (p.178). The two prongs of the proposal address, to borrow from the language of anti-trust, horizontal and vertical concentration. Baker has several other suggestions: (1) When mergers do occur, mechanisms should be put into place to assure editorial independence. (2) Journalistic and other creative contributors should have a say in ownership changes. (3) Tax policies should be implemented to encourage dispersal of ownership. (4) “Special obligations” should be placed on those large media firms that do exist, such as must-carry obligations imposed on local cable providers. The proposals all seem reasonable and potentially workable, although unlikely to be adopted in the current political climate.
Baker’s book is an excellent analysis of the highly complex world of media ownership policy. The approach interweaves legal and political argumentation in a fashion that is compact and rigorous. The book is a substantial contribution to debates about media ownership and the regulation of markets in general. It would be appropriate for upper level undergraduate courses in media policy and a variety of graduate courses related to law and public policy.
©Copyright 2007 by the author, Thomas Shevory.