media ownership

A recent column in Mediaweek serves as reminder that those concerned with media ownership need to increasingly track website ownership. Groups like Writers Guild of America, AFTRA, the Caucus for Television Producers, Writers & Directors and others that have weighed in against further vertical and horizontal media consolidation need to keep up the pressure on broadcast networks – and keep an eye on the emerging media landscape. If not they may end up winning a battle in a war that is already over.

The article argues that the largest online companies such as Google consolidate content but produce none of it. That leaves them open to the whims of others, is relatively economically inefficient (they have to buy retail), and there is no assurance of consistent quality – as the column points out, “But when I breathlessly asked a programming bigwig about breakout Web clips and viral video content in general, he brought me back down to earth. "Yeah, we watch them, but my first question is always: 'Can you do it again and again and again?'" The answer is probably no, because consistent original production, even on the Web, costs real money.”

The logical solution for content consolidators is to buy content producers. This would allow owners of offline and online outlets to develop and move content between media seamlessly, and offers new avenues for revenue (selling advertisers packages of on- and offline ads for example). And given that no one really knows what the next content landscape looks like – or how to make money off of it – it makes sense for large content aggregators to buy popular websites and start bringing production in-house.

If a handful of companies own most of the content and most of the most popular outlets on which that content is viewed, the market could reasonably called vertically integrated. This has already happened to television and is now happening to the internet.

Prior to 1970 television networks could own everything they showed, the market was vertically integrated. The same companies owned the mines, the railroads and the mills. Enter the financial interest and syndication rules (fin-syn) that limited the amount of programming a network could own. There was an explosion of independent producers making a wide range of programming. Twenty years later the rules began to unravel and by 1995 they were gone. Networks argued that with cable television there was no need to mandate independent ownership any more. Fin-syn went away the networks bought the cable channels, and now the medium is vertically integrated again. The internet is quickly going the way of cable. Newscorp (the Fox family of channels) owns MySpace. The most popular news and sports sites are owned by television networks. And every day brings more news of small websites being purchased by one of a handful of big companies.

Media and internet companies are consolidating now – those concerned about consolidation need to act now as well or risk losing again.

Yesterday the Writers Guild of America – East held a mock debate between the WGA-E and the Alliance of the Motion Picture and Television Producers in the Rayburn House Office Building. The debaters and two protesters were striking writers from The Daily Show with Jon Stewart and the Colbert Report. The debate was moderated by former Clinton Press Secretary Dee Dee Myers. Predictably it was pretty funny (coverage here, here and here).

Unfortunately none of the stories mentioned US Rep. Steve Cohen’s (D – Tenn.) quoting his friend, the late Warren Zevon, saying that David Letterman is the funniest man alive. Kudos to Congressman Cohen for honoring a Desperado under the Eaves.

More to the point, the connection between the strike and media consolidation was noted by several of the speakers.

As I have noted elsewhere, the WGA strike and the media ownership debate have proceeded along different tracks. Many who care about the former care about the latter, and the WGA has made opposition to the vertical integration of television part of its policy agenda. But the two issues have not been formally joined.

Connecting ownership to the strike presents opportunities for opponents of media consolidation and supporters of the WGA and others who bargain with film and television companies. But the clock is ticking, the strike will end (hopefully soon) and the opportunity could be missed.

In a world in which television producers owned their shows, writers could agree to contracts with their immediate employers – Jon Stewart’s folks making a deal with Jon Stewart. But that world ended with the demise of the financial interest and syndication rules (fin-syn). Most of what most of us watch most of the time – on broadcast, cable or satellite - is owned by one of about half a dozen companies. That means that writers for The Tonight Show with Jay Leno have to negotiate with the owners of 30 Rock and Friday Night Lights. David Letterman is one of the few who owns his own show; as a result he could make a deal with the writers.

Now is the time for the WGA and the other Guilds to increase their efforts around vertical media integration. By connecting the strike to ownership the debate is expanded, new allies are engaged and new outcomes become possible.