Historically, the US government has prevented media ownership monopolies.
Independent film and television have been an integral part of American culture. Recognizing that a thriving independent industry fosters competition and enriches America’s free marketplace of ideas, the federal government has in the past taken decisive steps to prevent major motion picture studios from dominating the broadcast industry. In addition to FCC ownership rules, there were the 1970 Financial Interest and Syndication Rules and the Consent Decree of 1977, which prevented the networks from establishing massive media conglomerates.
Rollback of media ownership rules has stifled competition.
Since the mid '90s, safeguards against media monopolies have been stripped away. The result has been the emergence of a handful of giant media conglomerates that now dominate the film and television industries.
These conglomerates produce their own programming, show it on their own networks, and rerun it on their secondary networks or affiliated cable stations. This has made it nearly impossible for independents to enter the market. For example, the major television networks have stopped acquiring independent feature films or movies of the week for broadcast. Independent production has fallen from 50 percent in the mid-1990’s to only 18 percent of current network prime time programming. It was once hoped that the cable networks would be the antidote to this trend. However, they are now commonly owned with the networks and, in significant part, have also closed their doors to the independents. Few cable networks will acquire from independents on equitable terms (if at all).
When independents can’t compete, it is the viewer who loses out.
This total domination of the market has forced independents to produce pilots at a loss, placed independently produced shows in less attractive time slots, and in some cases even driven them out of business altogether. For example, by 2002, both TV networks and cable channels made clear that they would no longer acquire independently produced children’s programming or family films. Companies that had handled this important programming have now shifted to other genres in order to stay in business.
Reasonable and limited regulations can restore balance in the TV and Cable marketplace.
IFTA has sought to rectify this situation by commenting in the FCC’s current rulemaking on this issue (MB Docket No. 06-121, etc.) and requesting that the FCC impose curbs on self-dealing between program suppliers and their affiliated broadcast/cable arms. IFTA asked the FCC to mandate that no more than 75 percent of programming on:
The national networks’ prime time schedules
The entire daily schedule of network multiplex channels provided to affiliates
The entire daily schedule of basic cable, pay cable, and satellite channels
Should be produced by:
A national television network, or any captive or affiliated entity.
Entities controlled by or affiliated with any other major national television network.
Entities controlled by or affiliated with any of the top ten national cable operators or any national, direct broadcast satellite operator.
Thus, 25 percent of all television programming would then be available to be filled by independents.
The FCC expressly declined to consider this important issue in its proceeding, as it also so declined in its prior review of media ownership issues, despite the strong public outcry at hearings and in comments about the issue.
Congress should encourage the FCC to issue a rule that will serve the American viewer by preserving the independent production community and adopt the recommendations proposed by IFTA.
Open access to the Internet also must be protected
The Internet is the last open channel by which independently-produced programs can reach the public. There is the potential for discrimination by broadband providers in favor of certain content or applications and this threat must be eliminated by thoughtful regulatory oversight. IFTA has endorsed the principle of “net neutrality” and believes that:
Congress and the FCC must remain vigilant to ensure that the principles of 1) open, non-discriminatory access for all lawful content and applications and 2) transparency and choice for consumers are protected as the Internet further develops.