The New Global Media | The Nation


The New Global Media

  • Share
  • Decrease text size Increase text size

The nineties have been a typical fin de siècle decade in at least one important respect: The realm of media is on the brink of a profound transformation. Whereas previously media systems were primarily national, in the past few years a global commercial-media market has emerged. "What you are seeing," says Christopher Dixon, media analyst for the investment firm PaineWebber, "is the creation of a global oligopoly. It happened to the oil and automotive industries earlier this century; now it is happening to the entertainment industry."

This article is adapted from Robert W. McChesney's Rich Media, Poor Democracy (Illinois).
Three charts accompany this article: "Global Media Moguls," "Who Owns the Movies?" and "Who Owns the Music?"

About the Author

Robert W. McChesney
Robert McChesney is Gutgsell Endowed Professor in the Department of Communication at the University of Illinois. He...

Also by the Author

It’s time to get back to our roots—the grassroots—to fight for reform of an increasingly monopolistic and manipulative media.

Special interests dominate Washington and undermine our democracy.

Together, the deregulation of media ownership, the privatization of television in lucrative European and Asian markets, and new communications technologies have made it possible for media giants to establish powerful distribution and production networks within and among nations. In short order, the global media market has come to be dominated by the same eight transnational corporations, or TNCs, that rule US media: General Electric, AT&T/Liberty Media, Disney, Time Warner, Sony, News Corporation, Viacom and Seagram, plus Bertelsmann, the Germany-based conglomerate. At the same time, a number of new firms and different political and social factors enter the picture as one turns to the global system, and the struggle for domination continues among the nine giants and their closest competitors. But as in the United States, at a global level this is a highly concentrated industry; the largest media corporation in the world in terms of annual revenues, Time Warner (1998 revenues: $27 billion), is some fifty times larger in terms of annual sales than the world's fiftieth-largest media firm.

A few global corporations are horizontally integrated; that is, they control a significant slice of specific media sectors, like book publishing, which has undergone extensive consolidation in the late nineties. "We have never seen this kind of concentration before," says an attorney who specializes in publishing deals. But even more striking has been the rapid vertical integration of the global media market, with the same firms gaining ownership of content and the means to distribute it. What distinguishes the dominant firms is their ability to exploit the "synergy" among the companies they own. Nearly all the major Hollywood studios are owned by one of these conglomerates, which in turn control the cable channels and TV networks that air the movies. Only two of the nine are not major content producers: AT&T and GE. But GE owns NBC, AT&T has major media content holdings through Liberty Media, and both firms are in a position to acquire assets as they become necessary.

The major media companies have moved aggressively to become global players. Even Time Warner and Disney, which still get most of their revenues in the United States, project non-US sales to yield a majority of their revenues within a decade. The point is to capitalize on the potential for growth abroad--and not get outflanked by competitors--since the US market is well developed and only permits incremental expansion. As Viacom CEO Sumner Redstone has put it, "Companies are focusing on those markets promising the best return, which means overseas." Frank Biondi, former chairman of Seagram's Universal Studios, asserts that "99 percent of the success of these companies long-term is going to be successful execution offshore."

Prior to the eighties and nineties, national media systems were typified by domestically owned radio, television and newspaper industries. Newspaper publishing remains a largely national phenomenon, but the face of television has changed almost beyond recognition. Neoliberal free-market policies have opened up ownership of stations as well as cable and digital satellite TV systems to private and transnational interests, producing scores of new channels operated by the media TNCs that dominate cable ownership in the United States. The channels in turn generate new revenue streams for the TNCs: The major Hollywood studios, for example, expect to generate $11 billion from global TV rights to their film libraries in 2002, up from $7 billion in 1998.

While media conglomerates press for policies to facilitate their domination of markets throughout the world, strong traditions of protection for domestic media and cultural industries persist. Nations ranging from Norway, Denmark and Spain to Mexico, South Africa and South Korea keep their small domestic film production industries alive with government subsidies. In the summer of 1998 culture ministers from twenty nations, including Brazil, Mexico, Sweden, Italy and Ivory Coast, met in Ottawa to discuss how they could "build some ground rules" to protect their cultural fare from "the Hollywood juggernaut." Their main recommendation was to keep culture out of the control of the World Trade Organization. A similar 1998 gathering, sponsored by the United Nations in Stockholm, recommended that culture be granted special exemptions in global trade deals.

Nevertheless, the trend is clearly in the direction of opening markets. Proponents of neoliberalism in every country argue that cultural trade barriers and regulations harm consumers, and that subsidies inhibit the ability of nations to develop their own competitive media firms. There are often strong commercial-media lobbies within nations that perceive they have more to gain by opening up their borders than by maintaining trade barriers. In 1998, for example, when the British government proposed a voluntary levy on film theater revenues (mostly Hollywood films) to benefit the British commercial film industry, British broadcasters, not wishing to antagonize the firms who supply their programming, lobbied against the measure until it died.

  • Share
  • Decrease text size Increase text size