Media Monopoly in Champaign-Urbana?: Consolidation, Absentee Ownership Both on the Increase

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by Paul Riismandel and John Wason

Ever wonder why local news coverage on TV actually adds up to only a few minutes a day? Curious why there seems to be little difference between ‘extreme’ rock, ‘modern’ rock, and ‘mix’ rock radio? And why do the TV and radio stations in Champaign-Urbana look and sound just like their counterparts in Charlotte and Cheyenne?

A major answer is consolidation, which has become a 21st century buzzword as multinational corporations play the dating game, merging into ever-larger behemoths. In no other arena is this phenomenon more evident than in the mass media. Twenty years ago scholar and former journalist Ben Bagdikian documented this trend when he published The Media Monopoly. In its first edition, Bagdikian identified fifty corporations that he saw dominating the US media scene.

The massive deregulation effected by the Telecommunications Act of 1996-which received little coverage in the mainstream press-touched off a wave of media mergers that is still ongoing. The impact on broadcast television and radio was astounding. By raising the limits on how many broadcast stations a company may own, both in a given market and nationwide, the act’s passage spurred broadcast conglomerates to gobble up independent stations. When those were gone, they began to gobble up each other. By the fifth edition of Bagdikian’s book, published in 1997, the dominant media club enjoyed a more rarefied membership of only ten companies.

At its core, consolidation has the effect of limiting diversity. While on the surface there are just as many media channels as there were before the Telecommunications Act, there are actually fewer companies producing all of the content for these stations. In practice this means that channels share more programming and do more cross-promotion, engaging in what the industry calls “synergy”-making sure that the “products” of various channels work together. For example, this is why you frequently see the heavy promotion of Disney movies and characters on ABC television, which is owned by Disney.

When consolidation hits local media markets-when local TV and radio stations are bought by larger, frequently non-local companies-there are effects similar to what we see with Disney/ABC. In this case local programming gets replaced by national programming, and what local programming is left is often homogenized to match what that company broadcasts through its other stations. There is also a strong emphasis on cost cutting, so that in TV news, for example, investigative news is often neglected in favor of less expensive, moresuperficial reporting of violent crime, celebrity news, and sports.

In radio the changes are not always as clear-cut as in TV, especially on music stations, which usually retain at least some of the local DJs. But decisions about programming, such as what songs are played, begin to be determined on a more national basis. Local program directors lose some or all control over what is played on their stations, and more dictates are handed down by national offices, which may be programming tens or hundreds of stations across the country. This change may be difficult to detect at first, but it becomes much clearer when you notice that fewer new artists are being introduced. Then you might notice that your favorite station now carries a greater percentage of syndicated programs, such as the Bob and Tom morning show or Rush Limbaugh. When you travel outside your community, you hear pretty much the same morning shows, the same talk shows, and the same set of songs everywhere you go. That’s consolidation at work.

As local stations are purchased by large corporate entities, their management and staff are often cut and consolidated, too. The most drastic change occurs in ad sales. When several local stations have the same ownership, it is common practice for the sales staff to sell advertising on all the stations as a package, usually at a rate that is less than it would cost to buy ad time on the stations separately. While this may seem like a good deal for local advertisers, in reality it has the effect of raising overall ad costs. Some advertisers may want to advertise only on the country station and not on the hard rock station, but they may no longer have that option, or they may have to pay much higher rates for the privilege of advertising to a target demographic.

These package ad rates also tend to undercut independently owned stations, who can’t offer the same sort of packages, and whose costs tend to be higher. Thus the consolidation of one group of stations in a particular market has the ripple effect of forcing the consolidation of other stations, who need to cut costs in order to compete.

The combination of higher ownership limits for broadcast companies, and the increased competition for ad dollars, has brought about an explosion in the selling prices of radio stations. When you consider the fact that the federal government charges nothing for a broadcast radio license, it is amazing to see stations in the largest markets changing hands for as much as $100 million.

A further reason why radio stations are growing more costly to purchase is the fact that the spaces left on the dial for new stations are almost all gone-even in Champaign-Urbana. In most urban areas it has become virtually impossible to put a new station on the air, so millions of dollars are needed to buy an existing station. This effectively prevents local organizations or independent entrepreneurs from getting into the broadcast business and establishing independent radio stations.

At first glance Champaign-Urbana might seem like a backwater market of little value or interest to any large corporate entity. Such a presumption, however, would be entirely incorrect. While the largest broadcast industry powerhouses such as Clear Channel Communications, owner of 468 radio stations, have yet to set up shop in town, stations in the area have nonetheless become hot properties. For instance, just last year WKIO-FM, “Oldies 92”, was purchased for $7 million by Grosse Point, Michigan-based Saga Communications. Oldies 92 became the third station in Saga’s local line-up, along with WLRW “Mix 94.5” and WIXY 100.3 FM.

The same week that WKIO changed hands, Rhode Island-based AAA Entertainment acquired four Champaign-Urbana area stations for a total of $5.3 million: WBNB 95.3 FM and WQQB 96.1 FM, both licensed to Rantoul, WGKC 105.9 FM, licensed to Mahomet, and WEBX 93.5 FM, licensed to Tuscola. In a deal that would have been illegal prior to 1996, AAA Entertainment thus became the largest owner of radio stations in the area.

In total, 30 broadcast stations program to the Champaign-Urbana market: 18 FM radio, 3 AM radio, and 9 television stations. At first glance the C-U broadcast media market doesn’t seem terribly consolidated. Those 30 stations have 18 different owners-a ratio of about 1.6 stations per owner. But a closer look at how those statistics break down presents a somewhat different picture.

Perhaps the most glaring fact about C-U media is that out of 18 owners, only seven are located in the area. And five of those seven are non-profits: Illini Media Company (WPGU 107.1 FM), the University of Illinois (WILL-AM, FM, TV), Prairie Air (WEFT 90.1 FM), Parkland College (WPCD 88.7 FM) and Good News Radio (WGNJ 89.3 FM, WGNN 102.5 FM, and W280DE 103.9 FM). Only two for-profit radio companies are based locally: Professional Impressions Media Group (WDWS 1400 AM and WHMS 97.5 FM) and WBCP, Inc. (1580 AM). The only locally-owned television station is the public TV station, WILL channel 12, owned by the University of Illinois.

One effect of this increasingly non-local ownership of the broadcast media is that a great deal of the profits derived from the use of the Champaign-Urbana airwaves are siphonedout of the local economy. And while not yet in the league of CBS/Infinity or of Rupert Murdoch’s News Corporation, the companies reaping the spoils from C-U airwaves are by no means small players. Among the largest are Sinclair Broadcast Group, the Maryland-based owner of NBC affiliate WICD-TV, with annual revenues in the neighborhood of $700 million, and Saga Communications, which earned $101.7 million last fiscal year.

When considering media consolidation in Champaign-Urbana, it is important to note that the two daily newspapers also own radio stations, though both are locally-owned. The News-Gazette’s parent company has WDWS-AM and WHMS-FM, while the Illini Media Company, publisher of the Daily Illini, owns WPGU-FM. Under the federal government’s current “duopoly” rule, one company cannot own both a newspaper and a television station in thesame media market. This is why our local newspapers own only radio stations at present. However, Sinclair Broadcasting, owner of WICD-TV Channel 15, the local NBC affiliate, is currently contesting this rule in court. A victory for Sinclair could resultin even greater media consolidation.

When you look at who actually owns your local broadcast media outlets (see accompanying table) it becomes clear that few owners have any kind of roots or stake in the community. Of the three network TV stations offering local news, the owner of only one-WAND Channel 17, the ABC affiliate-has been in the area for more than five years.

So what’s the bottom line? What does this trend toward increasing corporatization and non-local ownership of the American media mean to the average citizen in a community such as Champaign-Urbana? Far more than the fact that capital, in the form of advertising revenues and eliminated jobs, flows out of the local community to distant centers of corporate power.

The old homily that “you are what you eat” could be more accurately stated “you are what you consume.” We are, all of us, consumers not only of food, the air we breathe, and material goods, but of information. And, to invoke another truism, information is indeed power. As independently-owned sources of information┬żnewspapers, radio stations, and television stations┬żare removed from local control and transformed into corporate “profit centers”, independent voices are silenced. As news and other information becomes increasingly homogenized, unique perspectives and voices of dissent are stifled.

In his book The Press and Foreign Policy, published in 1963, author Bernard Cohen stated, “It (the press) may not be successful much of the time in telling people what to think, but it is stunningly successful in telling its readers what to think about.” If that statement was true in 1963, it is even more true today as a consequence of media consolidation, and it applies equally to the broadcast media. A corollary of Cohen’s observation is that what is not said is frequently at least as important as what is said. As corporate control of the media tightens, our awareness of the world in which we live slowly but inexorably and insidiously becomes constricted, often without our conscious awareness of the process.

Even former FCC Chairman William Kennard and former President Clinton have both recently expressed regret over the policies that created the climate of consolidation. Is it too late for regrets, or are they just in time?

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