Overcoming Mythology in the Debate over Media Ownership


Good morning, my name is Adam Thierer and I serve as Director ofTelecommunications Studies at the Cato Institute. Thank you, Mr.Chairman, for your invitation to testify here this morning on theimportant issue of media ownership regulation. This hearing isespecially timely for me since I have a new book on this issue dueout early next year entitled, "Media Myths: Making Sense of theDebate over Media Ownership."

I chose that title because I have come to the conclusion thatthe debate over media ownership is being driven more by myth thanreality. That is, while critics of media liberalization have hadgreat success employing heated rhetoric and extremely emotionalrationales for media regulation, claims about a lack of"diversity," the end of "localism," or the supposed "death ofdemocracy" simply do not square with reality.

Objective facts reveal that such rhetoric and claims arebaseless. Indeed, by all impartial measures, citizens are betteroff today than they have ever been before. Regardless of what theunderlying business structures or ownership patterns look like, thereal question in this debate must be this: "Do citizens have morenews, information, and entertainment choices at their disposaltoday than in the past?" The answer to that question isunambiguously "yes."

There are 7 leading myths about modern media. I'll quicklysummarize each one for you.

Debunking the Media Myths

The first, and probably most commonly repeated myth, is thatdiversity will disappear absent extensive government regulation ofthe media. The reality, however, could not be more different.Today's media environment is more diverse than ever before and ischaracterized by information abundance, not scarcity. Citizensenjoy more news and entertainment options than at any other pointin history. To the extent there is a media diversity problem today,it is that citizens suffer from "information overload." The numberof media options has become so overwhelming that most of usstruggle to manage all the information at our disposal. Considerthat in 1979 most households had 6 or fewer local televisionstations to choose from, but today the average U.S. householdreceives 7 broadcast television networks and an average of 102cable or satellite channels per home.1 Also, the number of radio stations in America hasroughly doubled from about 6,700 in 1970 to almost 13,500 today.And there are more magazines and periodicals being produced nowthan at any time in our nation's history. In 2003, there were17,254 magazines produced up from 14,302 in 1993. 2

A second common myth is that "localism" in media isdisappearing. The truth is, while we do not really know exactly howmuch local fare citizens demand, citizens still receive a wealth ofinformation about developments in their communities. That is,although citizens are increasingly opting for more sources ofnational news and entertainment, local information and programmingare still popular and will not disappear in a deregulated mediamarketplace.

The third myth concerns concentration and the mistaken beliefthat only a few companies control the entire media universe.Contrary to this widely circulated myth, the media marketplace isvigorously competitive and not significantly more concentrated thanin past decades. A McKinsey & Company analyst recently notedthat "There are more than 100 media companies worldwide... andentertainment and media are still fragmented compared with otherindustries such as pharmaceuticals and aerospace."3 An FCC survey of various media marketsacross America from 1960 to 2000 also showed that, "Collectively,the number of media outlets and owners increased tremendously overthe 40-year period," with an average of a 200 percent increase inthe number of outlets and a 140 percent increase in the number ofowners.4 Media expert EliNoam of Columbia University has nicely summarized why we mustunderstand that "bigness" is a relative term in media: "[W]hile thefish in the pond have grown in size, the pond did grow too, andthere have been new fish and new ponds."5 But, in any event, competition and concentrationare not mutually exclusive. Citizens can have more choices even asthe ownership grows slightly more concentrated as it has in somesectors in recent years.

The fourth myth involves assertions about the future of ourdemocracy somehow being at risk. These arguments strike me as quitepreposterous since increased media availability and communicationsconnectivity have given Americans the ability to learn and debatemore about our democracy than ever before. More importantly, civildiscourse and a healthy democracy are the product of a free andopen society unconstrained by government restrictions on mediastructures or content. If government can simply ordain anyownership structures or business arrangements it wishes in the nameof serving "democracy," then it raises serious censorshipconcerns.

A fifth myth is that regulation is needed to preserve highquality journalism and entertainment. I find these arguments verytroubling since, at root, media quality is a subjective matter.Government should have no say over, or even attempt to influencethe quality of news or entertainment in America. The good news,however, is that with so many media outlets available today,citizens have a wide range of options from which to choose, meaningthey can decide for themselves what level of "quality" theydesire.

A sixth myth is that the First Amendment justifies extensivemedia ownership controls, or can be used as a regulatory tool tomandate access to media outlets. This is, without doubt, the mostdangerous of all the media myths. In reality, the First Amendmentwas not written as a constraint on private speech or actions, butrather as a direct restraint on government actions as they relateto speech. If the First Amendment is to retain its force as abulwark against government control of the press, it cannot be usedto justify ownership rules or "media access" mandates.

A seventh and final myth is that new technologies or mediaoutlets, including the Internet, have little bearing on this debateor cannot be used as justification for relaxing existing mediaownership rules at all. To the contrary, new technologies andoutlets do have an important relationship to this debate and callinto question the wisdom of existing media ownership restrictions.In particular, the rise of the Internet and the World Wide Web isradically changing the nature of modern media. (Anyone who thinksdifferently might want to ask Dan Rather what he thinks about theimpact of new technologies on traditional media!) With 72% ofAmericans now online and spending an average of nine hours weeklyon the Internet6 surfingthrough the 170 terabytes of information availalble online-which isseventeen times the size of the Library of Congress printcollections7-I do not see howanyone can seriously argue that the Internet is not fundamentallytransforming our media universe.

More generally, my research finds that all media compete in abroad sense and that citizens frequently substitute one type ofmedia for another. What else explains cable stations stealing somuch audience share from traditional broadcasters, or that 88% ofAmericans now subscribe to cable and satellite TV even though"free, over-the-air" television remains at theirdisposal?8 What else explainshow satellite radio, an industry that did not even exist prior toDecember 2001, today boasts over 2 million subscribers and israpidly eating into traditional radio's market share? Or the factthat millions of Americans purchase daily editions of nationalnewspapers such as the USA Today, The Wall Street Journal and TheNew York Times? In fact, 49 percent of The New York Times' dailycirculation is now outside the New York area and it offers homedelivery in 275 markets.9Such statistics reveal a healthy, competitive market at work; amarket in which citizens exercise their right to be as finicky asthey want in substituting one media option or outlet foranother.


Our media world has changed, and changed in almost every way forthe better. To the extent there was ever a "Golden Age" of Americanmedia, we are living in it today. There has never been a time inour nation's history when citizens had access to more mediaoutlets, more news and information, or more entertainment. Thisconclusion is supported by a solid factual record. Advocates ofmedia regulation, by contrast, continue to base their case forgovernment regulation on emotional appeals and baseless "ChickenLittle" doomsday scenarios.

In such an age of abundance, the question of who owns what, orhow much they own, is irrelevant. No matter how large any givenmedia outlet is today, it is ultimately just one of hundreds ofsources of news, information and entertainment that we have at ourdisposal. "Indeed," as the FCC concluded when revising these rules,"the question confronting media companies today is not whether theywill be able to dominate the distribution of news and informationin any market, but whether they will be able to be heard at allamong the cacophony of voices vying for the attention ofAmericans."10

I completely agree with the FCC. The media world has changed andso must the rules that govern it. Thank you for inviting me heretoday to discuss the facts about media in America.

Table 1. The Media Universe of Yesterday and Today

Table 2. Media Outlet Ownership in Select Markets

Table 3. S-Curves for Various Technologies

Table 4. The Relentless March of Technology

Table 5. Media Trends of Yesterday and Today

Table 6: The Expanding Video ProgrammingMarketplace On Cable and Satellite TV
News: CNN, Fox News, MSNBC, C-Span, C-Span 2,C-Span 3, BBC America
Sports: ESPN, ESPN News, Fox Sports, TNT, NBATV, NFL Network, Golf Channel, Speed Channel, Outdoor LifeNetwork
Weather: The Weather Channel
Home Renovation: Home & Garden Television,The Learning Channel, DIY
Educational: The History Channel, TheBiography Channel (A&E), The Learning Channel, DiscoveryChannel, National Geographic Channel, Animal Planet
Travel: The Travel Channel, NationalGeographic Channel
Financial: CNNfn, CNBC, BloombergTelevision
Shopping: The Shopping Channel, Home ShoppingNetwork, QVC
Female-oriented: WE, Oxygen,Lifetime
Male-oriented: Spike TV
Family / Children-oriented: Nickelodeon,Disney Channel, Cartoon Network, WAM (movie channel for 8-16 yearolds), Noggin (2-5 years)/The N Channel (9-14 years), PBS Kids,Hallmark Channel, Discovery Kids, Animal Planet, ABC Family,Boomerang, The Family Channel (FAM), HBO Family
African-American: BET, Black Starz!
Foreign / Foreign Language: Telemundo(Spanish), Univision (Spanish), Deutsche Welle (German), BBCAmerica (British), TV Asia, ZEE-TV Asia (South Asia) ART: ArabRadio and Television, The Filipino Channel (Philippines), SaigonBroadcasting Network (Vietnam), The International Channel, HBOLatino
Religious: Trinity Broadcasting Network, TheChurch Channel (TBN), World Harvest Television, Eternal WordTelevision Network
Music: MTV, MTV 2, VH1, VH1 Classic, Fuse,Country Music Television, Great American Country, Gospel MusicTelevision Network
Movies: HBO, Showtime, Cinemax, Starz, Encore,The Movie Channel, Turner Classic Movies, AMC, IFC, Sundance,Bravo, (Action, Westerns, Mystery, Love Stories, etc...), Flix,Other or General Interest Programming: TBS, USA Network, TNT, SciFiChannel

Table 7. 2003 New Magazine Launches by Interest Category

Table 8. A Clear Channel Radio Monopoly?

Table 9: Internet RadioStations
LaunchCast radio.yahoo.com
Rhapsody www.listen.com
Live 365 www.live365.com
Net Radio.com www.netradio.com
eoRadio www.eoradio.com
Totally Radio www.totallyradio.com
Soul Patrol www.soul-patrol.net
SnakeNet Metal Radio www.snakenetmetalradio.com
Recovery Net www.recoveryradio.com
Beethoven.com www.beethoven.com
Web-Radio www.web-radio.com
Radio@Netscape www.spinner.com
NPR Online www.npr.org
VH1's SonicNet.com www.sonicnet.com

Table 10. Do the "Big 3" own everything?

Table 11. Cable Ratings Share Now Tops Broadcasters

Table 12: An Assortment of Media FunFacts
General Media Facts or Trends:
  • "A weekday edition of the New York Times contains moreinformation than the average person was likely to come across in alifetime in seventeenth-century England."11 A 1987 report estimated that more newinformation has been produced within the last 30 years than in thelast 5000.12
  • According to Ben Bagdikian, there are 37,000 different mediaoutlets in America. That number jumps to 54,000 if all weeklies,semiweeklies, advertising weeklies and all periodicals areincluded, and to 178,000 if all "information industries" areincluded. And yet Bagdikian is a leading critic of mediaderegulation and the title of his most recent book is The New MediaMonopoly!13
  • An FCC survey of large and small media markets across Americafrom 1960 to 2000 revealed that, "Collectively, the number of mediaoutlets and owners increased tremendously over the 40-year period,"with an average of a 200 percent increase in the number of outletsand a 140 percent increase in the number of owners.14
  • By 2007, the average American will spend 3,874 hours per yearusing major consumer media, an increase of 792 hours per year fromthe 3,082 hours per year that the average person spent usingconsumer media in 1977.15
  • As of 2003, household penetration rates for various new mediaand communications technologies were very high and growing fast:VCR (88%); DVD (50%); DBS (24%); cell phones (70%); personalcomputers (66%); Internet access (75%). With the exception of VCRs,none of these technologies were in American homes in1980.16
  • In 2002, the average consumer spent $212 for basic cable, $100for books, $110 for home videos, $71 for music recordings, $58 fordaily newspapers, $45 for magazines, $45 for online Internetservices, and $36 on movies.17
  • A three minute coast-to-coast long-distance phone call whichcost roughly $1.35 in 1970 only cost 15 cents in 2003.18

Television / Video Competition:

  • 88% of Americans now subscribe to cable and satellite "pay TV"sources even though "free, over-the-air" television remains attheir disposal.19
  • The FCC has found that, "In 1979, the vast majority ofhouseholds had six or fewer local television stations to choosefrom, three of which were typically affiliated with a broadcastnetwork. Today the average U.S. household receives seven broadcasttelevision networks and an average of 102 channels perhome."20
  • There are more than 308 satellite-delivered nationalnon-broadcast television networks available for carriage overcable, DBS and other systems today. The FCC concludes, "We aremoving to a system served by literally hundreds of networks servingall conceivable interests."21

Newspapers and Magazines:

  • In 1900, the average newspaper had only 8 pages.22 In the year 2000, by contrast,according to the Encarta encyclopedia, "Daily general-circulationnewspapers average[d] about 65 pages during the week and more than200 pages in the weekend edition."23
  • There were 17,254 magazines produced in 2003, up from 14,302 in1993. "For virtually every human interest, there is amagazine."24
  • There were 440 new magazine launches in 2003, up from 289 newlaunches in 2002.25 Anothersource puts the number much higher at 949 new launches lastyear.26


  • The number of radio stations in America has roughly doubledsince 1970. As of March 2004, there were 13,486 radio stations inAmerica, up from 6,751 in January 1970.
  • Satellite radio (XM & Sirius), an industry that did noteven exist prior to December 2001, today boasts over 2 millionsubscribers nationwide according to company reports.

Internet / Online Services:

  • 72% of Americans are now online and spend an average of ninehours weekly on the Internet.27
  • The World Wide Web contains about 170 terabytes of informationon its surface; in volume this is seventeen times the size of theLibrary of Congress print collections.28
  • Although less than 10 years old, online auction giant E-Bay hasgrown so massive that it now handles more daily trading trafficthan the Nasdaq Stock Market according to CEO MegWhitman.29
  • Online search giant Google recently reported that itscollection of 6 billion items includes "4.28 billion web pages, 880million images, 845 million Usenet messages, and a growingcollection of book-related information pages."30
  • The Internet Archive "Wayback Machine" (www.archive.org) offers30 billion web pages archived from 1996 to the present. It containsapproximately 1 petabyte of data and is currently growing at a rateof 20 terabytes per month. The site notes, "This eclipses theamount of text contained in the world's largest libraries,including the Library of Congress. If you tried to place the entirecontents of the archive onto floppy disks... and laid them end toend, it would stretch from New York, past Los Angeles, and halfwayto Hawaii."31


1. Federal Communications Commission,In the Matter of 2002 Biennial Regulatory Review - Review ofthe Commission's Broadcast Ownership Rules and Other Rules AdoptedPursuant to Section 202 of the Telecommunications Act of 1996,FCC 03-127, June 2, 2003, p. 15, http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-03-127A1.pdf,cited hereafter as FCC, Media Ownership Proceeding.

2. The Magazine Handbook2004-5, (New York, NY: Magazine Publishers of America, 2004),p. 5, http://www.magazine.org/content/Files/MPA%5Fhandbook%5F04.pdf

3. Michael J. Wolf, "Here ComesAnother Wave of Media Mergers," The Wall Street Journal,February 21, 2002.

4. Scott Roberts, Jane Frenette andDione Stearns, "A Comparison of Media Outlets and Owners for TenSelected Markets: 1960, 1980, 2000," Federal CommunicationsCommission, Media Ownership Working Group Study no. 1,September 2002, p. 2, http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-226838A2.pdf

5. Eli M. Noam, "Media ConcentrationTrends in America: Just the Facts," In the Matter of 2002Biennial Regulatory Review - Review of the Commission's BroadcastOwnership Rules and Other Rules Adopted Pursuant to Section 202 ofthe Telecommunications Act of 1996, January 2, 2003, p. 2,http://www.citi.columbia.edu/research/readings/mediaconcentration.pdf

6. FCC, Media OwnershipProceeding, p. 148.

7. Peter Lyman and Hal R. Varian,How Much Information? 2003, School of InformationManagement and Systems, University of California at Berkeley, 2003,http://www.sims.berkeley.edu/research/projects/how-much-info-2003/printable_report.pdf

8. Federal Communications Commission,Tenth Annual Video Competition Report, January 5, 2004, p.115, http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-5A1.pdf,cited hereafter as FCC, Video Competition Report.

9. Robert J. Samuelson, "Bull Marketfor Media Bias," The Washington Post, June 23, 2004, p.A21.

10. FCC, Media OwnershipProceeding, p. 149. Vol. 52.

11. Richard Saul Wurman,Information Anxiety (New York: Doubleday, 1989), p. 32.Likewise, William Van Winkle of Computer Bits magazineargues that, "A Sunday edition of the New York Times carries moreinformation than the average 19th-century citizen accessed in hisentire life." William Van Winkle, "Information Overload,"Computer Bits,, February 1998, http://www.computerbits.com/archive/1998/0200/infoload.html

12. Susan Hubbard, in Carol CollierKuhlthau, ed., Information Skills for an Information Society: AReview of Research (Syracuse, NY: ERIC Clearinghouse onInformation Resources, December 1987).

13. Bagdikian, p. 29.

14. Scott Roberts, Jane Frenetteand Dione Stearns, "A Comparison of Media Outlets and Owners forTen Selected Markets: 1960, 1980, 2000," Federal CommunicationsCommission, Media Ownership Working Group Study no. 1,September 2002, p. 2, http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-226838A2.pdf

15. Joe Mandese, "Study: MediaOverload on the Rise," Television Week, May 17, 2004.

16. Various sources.

17. Plunkett's Entertainment& Media Industry Almanac 2002-2003 (Houston: PlunkettResearch Ltd., 2002), p. 7.

18. Noted in Christina Wise, "TheGood Ol' Days Are Now: Cox," Investor's Business Daily,April 19, 2004, p. A22.

19. Federal CommunicationsCommission, Tenth Annual Video Competition Report, January5, 2004, p. 115, http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-5A1.pdf,cited hereafter as FCC, Video Competition Report.

20.FCC, Media OwnershipProceeding, p. 15. "Non-broadcast television programmingcontinues to proliferate. Today, there are more than 308satellite-delivered national non-broadcast television networksavailable for carriage over cable, DBS and other multichannel videoprogram distribution ("MVPD") systems. In 2002, the Commission alsoidentified at least 86 regional non-broadcast networks, including31 sports channels, and 32 regional and local news networks. We aremoving to a system served by literally hundreds of networks servingall conceivable interests. Programming in particular abundance aresports, entertainment, and informational in nature. The fourlargest broadcast networks own both broadcast and cable channels.Their share of viewership is far greater than their share of thechannels received by the typical American household. Of the 102channels received by the average viewing home, the four largestbroadcast networks have an ownership interest in approximately 25%of those channels." Ibid., pp. 48-49.

21.FCC, Media OwnershipProceeding, p. 48-49.

22.Benjamin M. Compaine, "TheNewspaper Industry," in Benjamin M. Compaine and Douglas Gomery,eds., Who Owns the Media? Competition and Concentration in theMass Media Industry (Mahwah, N.J.: Lawrence ErlbaumAssociates, 3rd Edition, 2000), p. 7.

23."Newspaper," Microsoft EncartaOnline Encyclopedia, 2004, http://encarta.msn.com/encyclopedia_761564853/Newspaper.html

24.The Magazine Handbook2004-5, (New York, NY: Magazine Publishers of America, 2004),p. 5, http://www.magazine.org/content/Files/MPA%5Fhandbook%5F04.pdf

25.Ibid., p. 7.

26.Samir Husni, Samir Husni'sGuide to New Magazines 2004, 19th Edition, http://www.shgncm.com/shgncm/

27.FCC, Media OwnershipProceeding, p. 148.

28.Peter Lyman and Hal R. Varian,How Much Information? 2003, School of InformationManagement and Systems, University of California at Berkeley, 2003,http://www.sims.berkeley.edu/research/projects/how-much-info-2003/printable_report.pdf

29.Leslie Walker, "EBay GatheringPuts Highs, Lows On Full Display," The Washington Post,July 1, 2004, p. E1, http://www.washingtonpost.com/wp-dyn/articles/A17604-2004Jun30.html

30."Google Achieves SearchMilestone With Immediate Access To More Than 6 Billion Items,"Google Press Release, February 17, 2004, http://www.google.com/press/pressrel/6billion.html

31."Frequently Asked Questions,"Internet Archive Wayback Machine, http://www.archive.org/about/faqs.php

Adam D. Thierer

Committee on Commerce, Science and Transportation
United States Senate