Have you ever wondered why there are more and more similar television shows being produced? Who owns the media? How do media companies actually make profit? Although media are everywhere in our life, we seldom give careful thought to these questions. Media, like all businesses, are profit-driven. Economics of mass media is the fundamental principle controlling the operation and production of media products. Due to economic constraints, increasing concentration of media ownership has created a society dominated by few hands of conglomerates. It is essential to assess the condition of contemporary media industry since our definition, interpretation, and understanding of the world is largely affected by the mass media. And this leads us to the central question to be explored in this essay: is conglomeration good or bad? In the following essay, I would examine and evaluate both the advantages and disadvantages of conglomeration, and also provide my personal perspective on this issue.
We are exposed to all the different kinds of media everyday. Media not only facilitate communication between the sender and receiver, but also build up bridges for the public in the social world. In chapter two of “Media Society”, the importance of the economic dimension of the media industry is being clearly introduced. This is the first time I realized the great impact that media owners can have on the social world. I was amazed by the idea that media conglomerates can influence the content and forms of media products and they have the power of controlling human behavior and thoughts. Croteau and Hoynes thoroughly explained the main theme of concentration of ownership and supported their arguments with examples in chapter two of the textbook.
The text helps readers to form a picture of the current media environment. The contemporary pattern of media ownership is the increasing concentration of media ownership. This is represented by the oligopolistic or monopolistic media structure where media conglomerates dominate the media industry. The U.S music industry, currently dominated by five companies (Vivendi/Universal, Sony, AOL Time Warner, Bertelsmann and EMI), is a good example used by Croteau and Hoynes to illustrate the idea of concentration of ownership. (David Croteau, William Hoynes. P34 – 44) Large media corporations buy up small media companies and work more closely together to attain the for-profit goal. As a result, there are fewer corporations owning the media.
Conglomeration can be achieved by horizontal integration and vertical integration. Horizontal integration describes the process which media firms own a variety of media companies across the media spectrum. Media corporations use this idea to sell a product in different media markets over a wide geographical area. In the article written by Alison Gregor, the merger between Univision Communications and Hispanic Broadcasting Corporation (HBC) is an example of horizontal integration. These two firms will work as a conglomerate and operate to “reach as much as 10 percent of the total U.S population.” (Gregor, 2003) Gregor estimated the potential profit the merger is likely to bring to the conglomerates. He provided his opinions both for and against this merger. Vertical integration refers to the phenomenon of controlling a mass media industry at its three essential levels: production, distribution, and exhibition. (Fogel discussion, 2005) These readings helped me to apply the concept of conglomeration to real-world examples and further helped me to evaluate the pros and cons of the issue.
The advantage of conglomeration is that conglomerates such as the Spanish media merger firms and Advance Publications can often benefit from synergy. Under the Advance Publications and Spanish firms branches are the diversified business companies. These companies can integrate and work together to produce maximum profits. The Spanish media firms are expected to receive “more than 70 percent of national advertising dollars” after the merger process is completed. (Gregor, 2003) Hence conglomeration can lead to a more effective and profitable operation. They are able to promote and advertise media products through their branched companies instead of purchasing advertisement from other media firms. This would reduce their cost of running the business and therefore lead to an increase in revenue and profit.
However, in my opinion, recent development and evolution of the media conglomeration has negative impacts on our society. Croteau and Hoynes explained explicitly the effect of increasing concentration of ownership on the political power under topic “Media Control and Political Power” in chapter two. In U.S, private interest largely control the media information system.
A few conglomerates dominate the media industry and behave like a state information system. These conglomerates can use their news outlets to promote and disseminate ideas that favors certain parties and exclude ideas from opposing parties. It is my belief that this threatens the freedom of speech and undermines the “basic democratic right of citizens” as voices of minorities will be excluded from the media. (The Campaign for Press and Broadcasting Freedom, 2002) Audiences are not presented with diversified views; instead, we are presented with partial or even false truths delivered by conglomerates. We are merely behaving like puppets whose perceptions are controlled by conglomerates.
I believe that conglomerates can even use cultural and financial strategies to influence public policy. In the article written by Dunbar, Lathrop and Morlino, it is stated that “communications industry has spent $1.1 billion since 1998 to affect election outcomes and influence legislation before Congree and the White House.” (Dunbar, Lathrop, Morlino. 2004)
The article fully investigates financial strategies which influence legislations of the media industry. Charts, graphs and statistics are extensively used to help illustrating authers’ arguments. This article serves as an evidence of the effect of media on political power. These conglomerates control the information system which shape the views of audiences and readers. The media indutry restricts freedom of media movements within the media framework. Public are not aware of certain truth. It is my belief that the restricted media is likely to cause audiences to make false value judgement and decisions which further affect their daily life.
The increasing comglomeration has resulted in the lack of competition in the media market and this will further lead to the production of homogeneous media products, known as the homogezation hypothesis. Concentrated media ownership is likely to produce media products which lack diversity. I can imagine that public will have less choice and fewer selection of media products. If a large established firm dominates the market, it will become the monopolist.
Due to the lack of competition, firms do not need to worry about competing with others, and I think that this will result in the production of lower quality products. Firms will operate less effectively and resources will be wasted. The public will lose from this market because they have no other choice but have to accept the only low-qualitied services provided. Also, Gregor also argued in the article “What’s Spanish for Big Media” that a single dominant such as the Spanish media firm “might easily manupulate the flow of ideas and control advertising prices” (Gregor, 2003). I believe that conglomerates will restrict freedom of idea movements within the media framework. And again, this undermines the audiences’ right to hear and to be heard.
Under the topic of “The Impact of Conglomeration” in chapter two, we learned that conglomeration has affected the print media too. As media conglomerates tries to maximise profit, their news outlet cuts cost by reducing the number of journalists, cuts back long term investigation that produce small number of stories and relies on a small elites as regular news source. For instance, It is mentioned in the “Canned News” (2003) article that “NewsProNet…produces generic news-you-can-use reports and investigations and peddles them to resources-starved broadcast outlets around the country.” Due to the lack of journalist and time constraint, news outlet can save the cost of finding news sources and use these available news articles as their “own locally produced segments”. This, leads us back to the idea of homogenization hypothesis. In my view, this has negative effect on our society since it is likely to result in the production of homogeneous media products as different newspaper firms use the same stories everyday.
I believe that conglomeration is closely related to the country’s economy. Conglomeration is a strong homogenizing force. It only presents certain truths and neglects others. Consequently, it has the ability to lead an economy to either success or crisis. For instance, in 1997, the media widely disseminates the belief and raised the fear that the South East Asian economies will soon move to recession.
Views of the opponents were seldom presented in the news. This worsens the condition and the South East Asian financial crisis soon began in July of 1997. I believe that the media is one of the major causes of the crisis. If conglomerates present positive images of the economy, investors will be optimistic and their business confidence will increase. This will further lead them to increase their level of investment and as a result, lead to economic growth. Again, the image of audiences behaving like puppets is vivid here. Our behaviour is directly shaped by the images conglomerations delivere to us.
We can see that conglomeration can have great negative impacts on our society. It is therefore important to implement measures to protect public interest and enhance the rights of audiences. In my opinion, government should first of all implement legislations to stop the growing trend of conglomeration. And government should continue to promote public broadcating in order to serve public interest by presenting diversified viewpoints on current affairs and political issues. Citizens hould be informed of their basic communication rights. Ideally, the communication industry should represent diversified interests and opinions; voices of monorities should be heard. The issue of comglomeration should be addressed seriously in order to form a healthy communication environment.
1. David Croteau, William Hoynes (2002). Media/Society. Pine Forge Press. 3rd edition
2. John Dunbar, Daniel Lathrop, Robert Morlino. (2004). Networks of Influence. The Center for Public Integrity.
3. Canned News – What Does It Mean When Local TV News Isn’t Local?. (2003). Retrieved October 24th, 2005. From http://www.cjr.org/issues/2003/6/comment.asp?printerfriendly=yes
4. Alison Gregor (2003). Voices – What’s Spanish for ‘Big Media’?. Retrieved October 24th, 2005. From
5. Who Owns What – Advance Publications (2003). Retrieved October 24th, 2005. From
6. Campaign Statement. The Campaign for Press and Broadcasting Freedom, (2002)
Retrieved October 24th, 2005. From