Concentration of media ownership

From ArticleWorld

Concentration of media ownership is a phenomenon described by politicians and critics of the media. It is characterized by the ownership of a large number of media outlets by a small number of corporations or media conglomerates. The six largest media-owning corporations, sharing 90% of the market, are Bertelsmann, Disney, General Electric, News Corporation, Time Warner, and Viacom.

A state of concentrated ownership can be either a monopoly or an oligopoly. A monopoly exists when a single corporation owns the entire market. An oligopoly is similar, but the market is instead owned by two or more extremely large conglomerates who dominate the market together and compete only with each other. The film and music industries are both oligopolic.

There are also instances of concentrated ownership that are neither. While the Clear Channel corporation owns over a thousand radio stations across the United States, the local markets for radio and television are by their nature oligopolic, whether or not there is a large national corporation involved. This is because there are only a small number of stations available for license by the FCC. Therefore, only a small number of corporations can own the broadcast media in a small area.

Cable television and satellite radio may create some media variety in concentrated local markets. However, the cable stations are standardized across the nation, and most are still owned by a small number of corporations.

Newspapers and magazines are also generally concentrated in ownership. This is true even of some local "independent" weeklies.

The effects of media concentration

Some see the concentration of media ownership as having a negative effect on the market and on society as a whole. Others argue that there are benefits to this concentrated market structure.

Proponents of oligopolic media market structures say that media conglomerates can run the media more efficiently and cost effectively than a host of small local stations. This is because production costs decrease as certain tasks are merged and standardized across a large number of stations. This should give them the necessary capital to meet the specific needs of local markets while competing with other national and international media conglomerates.

Critics say that competition is nonexistent when there are so few corporations to compete. When there is no competition, consumer costs rise and the quality of service diminishes. This is especially true in the case of a monopoly. There are also concerns about whether the views being expressed by the mass media reflect the diversity of the communities served. When the media is standardized, these critics assert, opinions become standardized as well.