You are here

America’s Indefensible Media Concentration Double Standard

Apparently America does not have “equal justice under law” when it comes to media concentration limits.

Seldom can one find a starker commercial example of unequal legal, law enforcement, and regulatory treatment of very similar commercial activities than that between old media and Internet/new media companies concerning media concentration and antitrust enforcement.

Both legacy old media companies and Internet/new media companies are in the communications business, own and/or produce media of some type, and distribute media in different physical ways, consumption formats, and time/situation dimensions.

Please see this one-page graphic that illustrates how America’s media concentration double standard treats similar old and new media companies completely dissimilarly, and how it results in a predictable stark market share dichotomy.  

Ultimately old media concentration has been limited by the traditional antitrust limits that apply to all industries and companies over the years.

That’s no longer true for Big-Internet companies like Google and Facebook.

They now enjoy de facto government-granted monopolies because they have been able to convince their company-affiliated antitrust authorities that the Internet effectively moots antitrust law, and was not meant to apply to them, because they can promise more and faster “innovation” and consumer benefit than market competition ever could, now and long-term.  

Tellingly, these specially-protected companies have become Internet monopolies much faster than any traditional monopoly before them.

For market-driven competition to work and to maximize resultant consumer welfare long-term, within reason, all similar competitive players playing in the same competitive game and playing on the same competitive playing field, need to play by the same rules and on a level playing field.

This is just common sense.

Let me be clear.

The purpose of this piece and the one-page-graphic is to expose the indefensible and unsustainable media ownership/antitrust non-enforcement policy that de facto pick a few Big Internet companies as winner-take-all, global winners, and effectively pick every other industry and company as near-certain, eventual competitive losers to the government’s chosen ones.

Now, it is for the Constitutional process of Congress and the Trump Administration to resolve this problem one way or another, or maintain the status quo knowing where it leads.

First, they could repeal antitrust law and allow companies in all industries to have the same equal opportunity to become monopolies and to enjoy de facto exemption from antitrust enforcement as Big Internet companies enjoy today.  

Second, they simply could apply the same antitrust rules that have long applied and still apply to the traditional, physical-world economy of “atoms,” to the Internet, virtual-world economy of bits, and Big Internet companies.

Third, they could come up with a new antitrust law or enforcement policy that strikes some balance between the two polar options above.

Finally, they could preserve the status quo and declare Internet companies winners and non-Internet companies the losers.

In sum, now that all “old” media – newspapers, radio, and TV, and pay TV and ISP facility providers – have all gone digital and offer their media and distribution via the Internet, why is their media and media distribution treated differently from Internet companies under the law or policy?   

It makes no sense.

The Internet has made the FCC’s legacy media ownership rules obsolete.

Congress should abolish them along with the FCC’s redundant merger review to that of the DOJ/FTC.

Current antitrust authorities and the FCC have epically failed to protect against extreme new media concentration that has occurred directly beneath their noses.

In a word, Internet companies should be subject to the same laws that apply to everyone else.

They are not special and do not deserve or warrant special treatment.

***

Scott Cleland served as Deputy U.S. Coordinator for International Communications & Information Policy in the George H. W. Bush Administration. He is President of Precursor LLC, an internetization consultancy for Fortune 500 companies, some of which are Google competitors, and Chairman of NetCompetition, a pro-competition e-forum supported by broadband interests. He is also author of “Search & Destroy: Why You Can’t Trust Google Inc.” Cleland has testified before both the Senate and House antitrust subcommittees on Google and also before the relevant House oversight subcommittee on Google’s privacy problems.

 

Q&A One Pager Debunking Net Neutrality Myths