Media Ownership Regulation Redux: A Reality Check

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Last week, the Third Circuit Court of Appeals threw out most of the FCC's new media ownership rules,arguing that the agency had not done a sufficient job justifying arelaxation of existing regulatory constraints. This claim seemedstrange given the voluminous record the FCC created to justify itsnew rules, which included not only its final 250-page rulemaking, but adozen "Media Ownership Working Group" studies, which providedextensive empirical support for relaxation of the rules.

But that wasn't good enough for the Third Circuit, and now thecourt will apparently act as a de facto review board for future FCCmedia ownership decisions. This will leave media law in thiscountry "in a clouded and confused state" as FCC chairman MichaelPowell noted in the wake of the decision. Worse yet,this decision turns back the clock on mass media regulation inAmerica and pretends that nothing has changed in recent decades tojustify a relaxation of the rules that bind the media sector.

There's no need to go into a long-winded dissertation about justhow wrong-headed this thinking is when the facts do the talking sonicely on their own. Media critics have repeatedly shown theirpreference to use emotionalism, hyperbolic rhetoric, and shamelessfear-mongering to make their case for extensive media ownershipregulation. But a dispassionate review of the facts about modernmedia makes it clear that to the extent there has ever been a"Golden Age" of media in America, we are living in it today. Thefollowing facts are taken from a forthcoming Cato Institute bookMedia Myths: Making Sense of the Debate over Media OwnershipRegulation:

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," claims InformationAnxiety author Richard Saul Wurman. A 1987 report entitledInformation Skills for an Information Society found thatmore new information had been produced within the last 30 yearsthan in the last 5000.
  • According to Ben Bagdikian, a leading critic of mediaderegulation, there are 37,000 different media outlets in America.That number jumps to 54,000 if all weeklies, semiweeklies,advertising weeklies, and periodicals are included, and to 178,000if all "information industries" are included. And yet the title ofBagdikian's most recent book is The New MediaMonopoly.
  • Investment banker Veronis Suhler Stevenson reports that by 2007 the average American will spend3,874 hours per year using major consumer media, an increase of 792hours per year from the 3,082 hours per year that the averageperson spent using consumer media in 1977.
  • According to various sources, as of 2003 household penetrationrates for various media and communications technologies were veryhigh: VCR-88 percent; DVD-50 percent; DBS-24 percent; cellphones-70 percent; personal computers-66 percent; and Internetaccess-75 percent. With the exception of VCRs, none of thesetechnologies were in American homes in 1980.
  • According to Plunkett's Entertainment & Media IndustryAlmanac, in 2002, the average consumer spent $212 forbasic cable, $100 for books, $110 for home videos, $71 for musicrecordings, $58 for daily newspapers, $45 for magazines, $45 foronline Internet services, and $36 on movies.
  • A three-minute coast-to-coast long-distance phone call whichcost roughly $1.35 in 1970 cost only15 cents in 2003, according toW. Michael Cox, chief economist of the Federal Reserve Bank ofDallas.

Television / Video Competition:

  • The FCC has found that 88 percent of Americans nowsubscribe to cable and satellite "pay TV" sources even though"free, over-the-air" television remains at their disposal.
  • The FCC notes: "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 per home."
  • There are more than 308 satellite-delivered nationalnonbroadcast television networks available for carriage over cable,DBS, and other systems today. The FCC concludes, "We are moving to a system served byliterally hundreds of networks serving all conceivableinterests."

Magazines:

  • According to the Magazine Publishers of America , there were17,321 magazines produced in 2002, up from 14,870 in 1992. As theMPA's annual Magazine Handbook notes, "For virtually every human interest, there is amagazine."
  • There were 949 new magazine launches in 2003, up from 289 newlaunches in 2002, according to Samir Husni's Guide to NewMagazines.

Newspapers:

  • In 1900 the average newspaper had only 8 pages according toBenjamin Compaine of MIT. In the year 2000, by contrast, according to the Encarta encyclopedia,"Daily general-circulation newspapers average[d] about 65 pagesduring the week and more than 200 pages in the weekendedition."

Radio:

  • According to FCC data, the number of radio stations in Americahas roughly doubled since 1970. As of March 2004, there were 13,476radio stations in America, up from 6,751 in January 1970.
  • Satellite radio (XM and Sirius), an industry that did not evenexist before December 2001, today boasts more than two millionsubscribers nationwide according to company reports.

Internet / Online Services:

  • Seventy-two percent of Americans are now online and spend anaverage of nine hours weekly on the Internet according to the FCC.
  • Online search giant Google recently reported that its collection of 6 billion itemsincludes "4.28 billion web pages, 880 million images, 845 millionUsenet messages, and a growing collection of book-relatedinformation pages."
  • The Internet Archive "Wayback Machine" (www.archive.org)offers 30 billion web pages archived from 1996 to the present. Itcontains approximately one pedabyte of data and is currentlygrowing at a rate of 20 terabytes per month. The site notes:"This eclipses the amount of text contained in the world's largestlibraries, including the Library of Congress. If you tried to placethe entire contents of the archive onto floppy disks . . . and laidthem end to end, it would stretch from New York, past Los Angeles,and halfway to Hawaii."

So, let us once again ask the question: Has nothing reallychanged in America's media universe?