Can You Repeat That? Patterns of Media Ownership and the “Repurposing” Trend

Abstract

The article examines shifting patterns of ownership for cable programming services from 1994 to 2003. In these years, vertical integration in the cable industry declined, as cable's multi-system operators divested equity in programming services. Meanwhile, broadcast network-owning media conglomerates invested heavily in cable, tripling their holdings among the top 20 most fully distributed cable channels, as well as launching and acquiring dozens of additional, less widely distributed channels. In light of the Federal Communications Commissions' recent attempts to revise rules regarding television ownership, the author argues that while vertical integration has declined, the market power of the broadcast networks has grown by means of a new kind of horizontal integration that reaches across broadcast and cable channels. This shift is reshaping cable as a market which, despite growing product differentiation, is trending toward less competitive conditions that are akin to the broadcast oligopoly. This article shows that these broadcast-cable alliances contributed to the development of the new synergistic practice of repurposing.

The author thanks Susan G. Davis, Anthony Freitas, Robert Horwitz, Pauline Kennedy, and Ellen Seiter, as well as the editors of The Communication Review and two anonymous reviewers, for thoughtful comments on this essay.

Notes

The author thanks Susan G. Davis, Anthony Freitas, Robert Horwitz, Pauline Kennedy, and Ellen Seiter, as well as the editors of The Communication Review and two anonymous reviewers, for thoughtful comments on this essay.

1. The FCC ruling would have also revised the Broadcast-Newspaper Cross-Ownership Rule, the Local Radio Ownership Rule, and the Local TV Multiple Ownership Rule (see FCC, 2003) (for a journalistic summary of how the rule changes and the movement opposing them came about, see Beckerman, 2003).

2. While the compromise received relatively light media coverage, NBC's White House drama The West Wing incorporated the decision into its April 21, 2004 episode “Talking Points,” in which Press Secretary C. J. Cregg (Allison Janey) wonders how the unusual figure of 39.37% was determined, and implores journalists to cover the matter of media consolidation.

3. This knot is so intricate that even federal regulators are sometimes confused about who-owns-whom: a recent FCC report admitted, “our calculations may not be perfectly accurate because the ownership issue is so complex” (FCC, 2002b, p. 59). Some examples may hint at this complexity: Liberty Media owns some 18% of News Corporation, which in turn owns Fox broadcast and cable networks. Liberty Media also owned about 3% of Vivendi/Universal, the principal shareholder in USA and Sci-Fi Networks (Liberty Media, 2003; FCC, 2002b) prior to its merger with NBC.

4. Seven of these 10 reports have been released with reference to a singular “market” in the title (FCC, 1994, 1995, 1997, 2001, 2002a, 2002b, 2004). The other three were released with reference to the plural “markets,” reinscribing the historical assumption that broadcasting and cable are distinct (FCC, 1998a, 1998b, 2000). The difference is ideological, not simply grammatical; pro-deregulation commissioners such as Harold Furchtgott-Roth have sometimes appended dissents to these reports when “markets” is used in the title (see FCC, 2000).

5. These reports are imperfect, but as official documents through which federal regulators account for the industry, remain necessary objects of analysis. In constructing the tables included in this article, the data has been cross-checked and updated as necessary. For example, Table C-6 in the Tenth Annual Report erroneously lists VH1 as property of AOL Time Warner; VH1 is in fact owned by Viacom (FCC, 2004, p. 147).

6. Alternatively, the FCC defines the top cable channels as those with the highest average prime time Nielsen ratings. There is extensive, but not complete, overlap between lists of top-twenty determined by subscribers reached and top-twenty (or top-fifteen, to which some of the FCC reports confine their data) determined by ratings. A few top-rated channels (Cartoon Network, Sci Fi) have not ranked among the 20 most widely distributed. Conversely, a few of the most widely distributed (C-SPAN 1, The Weather Channel, CNBC, QVC, VH1, AMC) have never or rarely been among the most watched. I have not included data by ratings here, in part for the sake of brevity, in part because the lists do overlap significantly and therefore reflect similar trends. Moreover, cable ratings warrant analysis more extensive than can be incorporated into this article, which would indicate the degree to which broadcast-cable affiliations have made up for audience share lost by the broadcast networks to cable channels.

7. Tracking market share of the largest cable system operators, Parsons found that “in the absence of strict, consistent, federal ownership constraints, the process of the amalgamation of cable property has never fully stopped grinding away” (2003, p. 38).

8. A study of program diversity (or viewpoint) would, of course, require analysis of large amounts of data culled from TV schedules over some long term, an undertaking also beyond the scope of this article.

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