Disney vs. Comcast
Why you should worry about a Disney media consolidation
Tuesday, March 9, 2004
by Sarah Olson, contributing writer
Comcast's $54 billion bid for the Walt Disney Company on February
11 last month sent shockwaves through the telecommunications industry,
Wall Street, Disney shareholders, and media consumers alike. Should Comcast's
bid to take over Disney be successful, the largest media merger to date
would create the world's largest media company.
Among those perturbed by the announcement is a smallbut growinggroup
of media activists, independent journalists, and consumers who want access
to a variety of radio, television, and print reporting, and more diverse
arts and cultural entertainment.
We live in a society where the average media consumereach and every
one of us whether we realize it or nothas access to hundreds of
cable channels, radio stations for every genre imaginable, at least one
daily newspaper, countless Web sites, and near complete advertisement
saturation in the form of billboards, audio, video, and print commercials,
coffee cup sleeves, pop-up ads and so on. And while it may seem that this
information suggests an increased diversity of media, it is instructive
to look at who owns what within today's media landscape: While an increased
number of channels is available to today media consumer, the ownership
of media outlets has steadily decreased over the last decade.
And why is this problematic? Why should a Disney shareholder or media
consumer care about the consolidation of media into an increasingly small
number of companies? In order to answer these questions, let's take a
look at what happened to radio after the Telecommunications Act of 1996
deregulated the radio industry.
Proponents of the Telecommunications Act lauded it as a bill that would
increase and promote diversity of programming and diversity in the
viewpoints expressed, according to Reed Hundt, chair of the Federal
Communications Commission (FCC) in 1996. But more recent studies have
found that the deregulation of the radio industry has done just the opposite.
According to a recent study by the Future of Music Coalition, 10 parent
companies control two-thirds of radio broadcasts and radio revenue in
the United States.
Moreover, two companies, Clear Channel and Viacom, control 42 percent
of radio broadcasts. Clear Channel alone has grown from 40 stations in
1995 to over 1,240 today, and currently has over 100 million listeners.
The effects of this can be seen in almost every market sector and every
genre. Just four companies control 70 percent or greater of every large
radio market in the United States. In smaller markets, these same four
companies control up to 90 percent of market share. Additionally, four
parent companies also control two-thirds of the county's news radio listeners.
The ramifications of this tightened control on radio venues are stark.
There are countless examples of radio disk jockeys behaving badly, including
instances where morning disc jockeys slaughtered animals live on the air,
encouraged drivers to run bicyclists off the road, and one instance where
a San Jose, California disc jockey invited a young girl into the studio
to read sexually explicit jokes. And the problem is highlighted when listeners
realize that they have nowhere else to go. In effect, they cannot boycott
the radio without turning it off entirely.
One of the most notorious examples of the very real dangers of media
consolidation, combined with irresponsible use of the airwaves occurred
in Minot, North Dakota. In January 2002, a train carrying 200,000 gallons
of poisonous anhydrous ammonia, a chemical used in fertilizer, overturned,
unleashing a cloud of the deadly gas over portions of this small farm
When authorities called the radio stations asking them to implement
the emergency broadcast system, no radio personnel was there to answer
Unfortunately, each of the nine radio stations in the Minot area is owned
by Clear Channel, which widely uses the practice of voice tracking, or
piping in musical programming from a far away location. So, when authorities
called the radio stations asking them to implement the emergency broadcast
system, no radio personnel was there to answer the phone. The entire city
went for hours without knowing that there was a problem, in part
due to the fact that there was no mention of it on any local radio station.
Today, larger and larger portions of the American public are saying that
the state of radio consolidation is not OK with them, and that they are
unwilling to allow the rest of media outlets to consolidate in the same
Last June 2, the FCC, headed by Michael Powell (son of Colin Powell),
voted to relax a series of rules designed to limit the consolidation of
ownership among media outlets. The rules that the FCC voted to jettison
included a broadcast and print cross-ownership ban where one company could
not own a newspaper and a television station in the same market, as well
as a national 35 percent market ownership cap, and a cap preventing broadcasters
from owning more than two television stations in the same market.
The FCC passed this rule relaxation after a record number of people around
the country submitted public comments that asked the FCC not to relax
those media ownership regulations. In addition, citizens around the country
flocked to public hearings held by two sympathetic members of the FCC,
Jonathan Adelstein and Michael Copps. In spite of this public outcry,
the FCC passed these new relaxed regulations, potentially opening up media
venues to a swarm of new proposed mergers, and turning the entire United
States media landscape into a repeat of the radio industry consolidations
in the post-1996 era. The FCC decision sparked congressional investigation,
public protest, and is currently being challenged in court.
Meanwhile, Comcast has approximately 21 million households subscribing
to its services. Combine that with the Walt Disney Company's ownership
of ABC TV, the Disney Channel, ESPN, Radio Disney, Hyperion, five magazine
publishing groups, four newspapers, theme parks, hotels, Disney Cruise
Line, Touchstone, Miramax Films, and Buena Vista, and you have redefined
the meaning of the word monopoly.
Because of the growing size of these mergers, it is helpful to ask some
- Just what constitutes too much control of the nation's broadcast outlets?
- How might original programming be hindered?
- Could independent cable operators and locally produced network broadcasts
- What's the likely cost impact on the consumer?
- What is the benefit to media consumers?
While public opinion has not yet changed the course of media consolidation,
it is conceivable that in the foreseeable future we as a nation might
say enough is enough. If the prospect of what you see and what you hear
being controlled by an increasingly limited number corporations owned
by an increasingly limited number of people concerns you, there are a
number of actions that you can take.
First, you can write your elected officials. The Senate Commerce Committee
took up the issue of media consolidation last summer. Both the Senate
and the House will be looking at new laws for indecency, and during this
election year the issue of media consolidation is sure to be addressed
within the spectrum of political discourse. You can make sure that it
is, and that the concerns of media consumers are well represented.
Second, you can write to the FCC and express your concerns about the
effect that media consolidation may have on local and independent artists,
musicians and journalists. Write the FCC at:
Federal Communications Commission
445 12th Street,
SW Washington, DC 20554
You can also find the contact information for individual commissioners
online at the FCC's Web site (link).
Additionally, if you are a Disney Corporation shareholder, your opinion
is important. Let Disney know that you are concerned about the upcoming
And finally, you can encourage localism and diversity in media by supporting
independent news, music, and cultural outlets within your local community.
Thoughts, questions, or comments?
Contact Sarah at solson75(at)yahoo(dot)com.
Write the Federal Communications Commission (FCC) at:
Federal Communications Commission
445 12th Street,
SW Washington, DC 20554
For more information on this subject:
Media Channel, a global network for democratic
Media Alliance, a nonprofit training and
resource center for media workers, community organizations, and political
Future of Music Coalition, a not-for-profit
collaboration between members of the music, technology, public policy
and intellectual property law communities (link).
Sarah Olson is a part-time radio producer and journalist,
and a full-time technical writer based in the San Francisco Bay Area.
She covers a wide range of issues, from politics and economics to immigration