Wednesday, January 26, 2005

Newspapers under antitrust scrutiny

In case you thought that America's newspapers could wave the First Amendment at the government and remain immune from government interference, think again. The press's big business owners are being reminded that the feds can stick their nose into the business practices of the press - especially when that practice leads to excessive concentration of ownership. The Benton Foundation notes a Wall Street Journal article that focuses on Justice Department's antitrust investigations of Gannett and The New York Times Company.
    The Justice Department is investigating Gannett's proposed buyout of HomeTown Communications Network, a Midwest community-newspaper publisher based in Livonia (MI), and has opened a preliminary inquiry into the New York Times's plans to take a 49% stake in Metro Boston, a free daily that competes with the Boston Globe, which is also owned by the Times. In some markets, advertisers have told the Justice Department that the pending deals could give local publishers enough clout to raise ad rates in the cities they serve. Competitors in Detroit and Boston, including the Boston Herald, have also told the Justice Department that they believe the deals would violate antitrust law.

More and more people are getting worried about excessive concentration of press and media ownership - especially in a single market where a single owner could manipulate news content and ad rates. There's also a concern that "traditional" newspapers are moving to take over the only print competition they have in most towns and cities: the free daily "Metro" papers and/or weekly "alternative" and communty papers that compete for advertising dollars.

It's also worth mentioning that apart from Justice Department actions of the antitrust variety, the press is also limited in its consolidation activities by FCC regulations that are supposed to prevent cross-ownership of a TV station and a newspaper in a single market. The FCC has often granted temporary waivers of cross-ownership rules, but, as I mentioned back on Jan 4, there are signs of opposition to that trend: Free Press and the NAACP have "petitioned the Federal Communications Commission to deny Media General Inc.’s request for permission to keep both WMBB-TV Panama City, Fla., and the Jackson County Floridan, one of the market’s daily newspapers." I hope they're successful.


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