Friday, January 2, 2009

How Big Government helped destroy the newspaper industry

The absurd idea that a Connecticut newspaper might get a government bailout prompts Jules Crittenden to one of the few useful suggestions for saving print journalism:
Throwing out the FCC’s cross-ownership ban once and for all might also help.
The FCC's obsolete prohibition on newspaper publishers owning broadcast franchises in the same markets has been bent, over the years, for a few politically-connected conglomerates -- for instance, Cox owns both the Atlanta Journal-Constitution and WSB TV/radio in Atlanta.

There was a time when, if the ban had been repealed, newspapers would have purchased broadcasting outlets. If the ban were lifted now, the buyout pattern would be the other way around. But too little attention has been paid to how the FCC, by preventing consolidation between print and broadcast media, undermined the economic viability of print journalism.

The rise of cable television in the 1980s changed the game. Cable is not "broadcast" and thus is exempt from FCC regulation, and anyone who was paying attention should have realized how the growth of this new technology invalidated the FCC's original rationale in banning cross-ownership. Newspapers could have benefitted by sharing editorial staff between print and broadcast, and using the broadcast outlet to promote the print product. But the entrenched New Deal-era mentality among regulators stifled such insights, and so the absurd wall between broadcast and print remained -- with strategic exceptions, of course, for the big conglomorates that could curry favor in Washington.

Repealing the ban now would probably be too little, too late to save failing papers like the Bristol Press, but it might save others. It's a tragedy, however, that nothing was done sooner.

1 comment:

  1. Proving once again, that when the Government steps into the free market to "fix" something, they end up breaking something else.

    We are doomed. Here comes Obama's America!