In the recent past, we cannot deny that the media industry has experienced monumental growth both in terms of revenues and global expansion. Like other businesses, such as banking and manufacturing, the media business has enjoyed globalized operations to expand and grow, becoming one of the biggest conglomerates in the world. World media has proactively employed information technology and advancement in communication to expand their operations spanning several nations and continents. The news sector of world media seems to have captured most audience. Big corporations such as Cable News Network (CNN), Fox News, British Broadcasting Corporation (BBC) and CBS dominate the news corporations with a worldwide reach. In the same regard, entertainment media, such as movies and television shows have also experienced immense growth.
Companies from the U.S., for instance Walt Disney, Time Warner, News Corporation and New York Times Company are some of the biggest companies in world media market. U.S. firms have been able to pose formidable media entities in print and digital media services. They have also played an active role in asserting the views of the West with respect to the world issues and, therefore, becoming key players in the global media industry. Thus, for such commendable growth to be witnessed, the United States government must have, in one way or another, assisted these firms to grow and expand to the global market. While the U.S. government has always maintained zero interference in media, such policy is by itself is an active role. This essay will discusses the role of the United States government in assisting U.S. firms expand to the international market.
Neoliberal Policies of the 1980s One of the most profound roles of the government in allowing growth in media and globalization is the neoliberal policies and stances adopted in the 1980s. The U.S. government with other likeminded governments, such as the United Kingdom, adopted neoliberal policies in the media industry. The term neoliberal is a multifaceted ideology with different meanings under dissimilar circumstances. However, Pickard (2007) argues that the term simply refers to efforts towards privatization, liberalization, deregulation and globalization of an industry. The U.S. government sought to allow the media industry propelling itself as guided by economics and other drivers of business. Privatization Drive Neoliberal polices first allowed and encouraged the privatization of media companies. With regard to this, private investors took up media operations an introduced new ways of running such businesses.
Efficiency and competition became the norm and advertising transformed into a target of the competition. Similarly, foreign investors accepted the lure of privately run media corporations and thus created domestic competition that was unrivalled elsewhere in the world. Such competition led to mergers and buyouts; as a result, a few giants were left to compete in the market. Soon, the expansion in the U.S. was only possible in slight increments and, hence, expansion to the global market was paramount. Such magnificent growth in the United States motivated other nations, especially in the European Union, adopt similar policies (McChesney 2001). Open and competitive market gave the U.S. conglomerates an opportunity to invest in other countries. Today, the biggest media firms in the world are the American firms that expanded after privatizations of businesses.
Loosening of Restrictions on Ownership Structures Additionally, neoliberal policies reduced restrictions in antitrust laws and cross ownership of business (Yong 2012). This allowed media businesses to undertake both horizontal and vertical integration. Horizontal integration is where a business diversifies its operation by owning subsidiaries of different sectors (Deloitte 2012). For instance, Time Warner is known print media, news networks and movie productions houses. On the other hand, vertical integration can be defined as businesses owning a business with one main stream of business or practice. Thus, loosening of cross ownership restrictions gave room for business to expand to different units and to the global market. A new approach to media business that emerged was the convergence of business. Convergence of business is where two, proportionately big firms, join to share audience as well as brand names (McChesney 2001).
A notable case of convergence in the U.S. media industry was the convergence between AOL and Time Warner. While other convergences have also been experienced, the economic results have been mixed. The AOL merger experienced difficult economic conditions that they later preferred to de-converge. In all loosen restrictions on laws has provided for media to explore all sorts of business arrangement. Zero Government Intervention The United States government has always taken pride in itself as one of the most liberal government in the world. The term liberal has been used in the sense that the government adopts a hands-off policy towards the content and the manner in which media houses are run. To this end, the responsibility of ensuring that content and information dissemination is done in a responsible way rests with the media firms.
Global Expansion of US Media Industries 5 Such a non regulated media demands that media firms seek professionalism in passing information. Pickard (2007) argues that a media free of government intervention has to go an extra mile in order to gain public acceptance. The U.S. media firm has employed professionalism in reporting and entertaining the public. Democracy and open space that the U.S. government has maintained has allowed media firms expressing varied opinion on different issues. Further, the freedom of expression that has been assured by the constitution and protected by the government has fostered a media that can be termed ‘the peoples’ ‘watchdog’. Thus the government has opened up itself for scrutiny by privately owned media firms in a move that improves on transparency (Reportlinker.org 2012). Such a responsible media has made other nations around the world to envy such media firms. American news networks such as CNN and Fox News broadcast to almost every corner of the globe. Many countries have these news broadcasts translated as their differences languages.
These firms have been deemed as independent and professional media houses. Such acceptance is due to the good perception that these media firms enjoy back home. The U.S. government, by providing free space, has allowed U.S. media firms being accepted all over the world and, thus, facilitated the expansion. Conclusion From all of the information, it can be concluded that the United States media firms are one of the biggest non-financial conglomerates in the world. Companies such as Vivendi, Sony, AOL Time Warner and Viacom report billions of dollars in revenues. While the firm may appear to operate like other old conglomerates, the companies did not exist two decades ago. The American government played a vital role in fostering media firm expansions. The first change that the government implemented was the introduction of the neoliberal policies that the
Global Expansion of US Media Industries 6 government instituted in the 1980s. These policies first allowed private ownership of media firms. Privatization of media firms allowed private investors running media firms and employ sound business practices. Either, privatization of media firms allowed foreign investors seeking stake in these firms and pursuing expansion. Global expansion was a result of massive expansion and competition. The second role hat neoliberal policies played was the loosening of media ownership restrictions.
This allowed media houses practicing both vertical and horizontal integration as practiced in other sectors. The final and perhaps the most important role that the government has played is establishing independence of the media. The U.S. government has adopted a policy where the government has fully eliminated itself from the media business. Independence of media has created public trust within the country and beyond. This allows media houses broadcasting and disseminating information in the regions other than the United States.
Deloitte 2012, Where the true growth lies; the market for digital media, Deloitte ConsultingLLP.
McChesney, R 2001, Global media, neoliberalism & imperialism, viewed 22 October 2012, .
Pickard, V 2007, ‘Neoliberal visions and revisions in global communications policy from NWICO to WSIS’, Journal of Communication Inquiry, vol. 31, no. 2, pp. 118-139.
Reportlinker.org 2012, Media industry: market research reports, statistics and analysis, viewed 22 October 2012, http://www.reportlinker.com/ci02088/Media.html.
Yong, D 2012, The political Eeconomies of media: the transformation of the global media industries, viewed 22 October 2012, http://www.bloomsburyacademic.com/view/PoliticalEconomiesMedia_9781849664264/c hapter-ba-9781849664264-chapter-008.xml.
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