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2010-01-07

A Look at the Future of TV: Media Consolidation Opponent Byron Dorgan to Retire, Comcast Takeover of NBC Under Review

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Sen. Byron Dorgan’s decision to retire from the Senate stunned many in Washington. Dorgan has been a leading opponent of media consolidation and US trade policy. We speak with the Center for Digital Democracy’s Jeff Chester about Dorgan’s retirement, as well as what the future holds for the digital media landscape with Comcast’s deal to acquire a controlling interest in NBC Universal under review, and the dispute resolved between Time Warner Cable and News Corp. [includes rush transcript]

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: We turn now to another guest in Washington, particularly on Byron Dorgan. Juan?

JUAN GONZALEZ: We’re joined by Washington — by Jeff Chester, executive director of the Center for Digital Democracy.

Jeff, talk about Byron Dorgan’s role as an opponent of media consolidation and a supporter of net neutrality.

JEFF CHESTER: Well, Senator Dorgan’s departure is going to be missed. He has really been consistently, over the last dozen years, the leading Senate critic of media consolidation, promoting policies for the FCC that would rein in the media giants and try to restore some accountability that the public should have over the cable and broadcasting and online giants. He has been a voice of conscience. He has been an effective legislator. He led the effort to overturn in the Senate the rules that Bush FCC chairman Michael Powell pushed through that would have deregulated almost everything in the US electronic media system. So we are going to need someone to fill his very large and important shoes, especially at this critical moment with the US media system.

JUAN GONZALEZ: Well, Jeff, specifically with the Obama administration, the issue of net neutrality is increasingly a big topic at the FCC. What’s your sense how the administration has begun dealing with the issue of net neutrality?

JEFF CHESTER: Well, this is a very critical moment for the future of US and, of course, global digital communications. I mean, the reason you’re seeing Comcast buying NBC, this fight between Time Warner and Fox, the battle over network neutrality, is that our media system is in this fundamental transition, how we consume media and how we distribute media. And the big media giants want to have as much control over the new system as they’ve been able to do over the old system of broadcasting and cable. I think the FCC under the Obama administration is on a course to enshrine rules around network neutrality, but whether or not they will truly be effective, given these new mergers that are emerging and other powerful interests shaping the future of media, remains to be seen.

I think the Comcast-NBC potential merger is a real test case for the Obama administration, Juan, and I hope you don’t mind me moving to that beyond network neutrality, because we’re going to see whether or not the Obama administration is willing to take a proactive media democracy stand on the future of media, because if you allow that merger to occur, Comcast taking over one of the largest broadcasting and cable networks, and if you don’t have some limits on their power, then even rules on network neutrality won’t be able to dent the very powerful control that a very tiny handful of big companies are able to leverage throughout broadcast, cable, and potentially online.

AMY GOODMAN: Juan, actually, let’s talk for —-

JEFF CHESTER: And I also think, and I want to say, I think that -—

AMY GOODMAN: Jeff, just one second. I just wanted to really clarify what it is you’re talking about. Juan, if you could talk more about the significance.

JUAN GONZALEZ: Well, on Wednesday, the Justice Department did confirm it will lead an antitrust review of Comcast’s deal to acquire a controlling interest in NBC Universal. Comcast is already the nation’s largest cable TV company and the largest broadband internet service provider. And if the deal is approved, Comcast would take control of not only the NBC network, the Spanish-language Telemundo network, cable channels including MSNBC, dozens of local television stations and the Universal film studio.

Critics are saying that governmental regulators should reject the merger, and a recent report by the media group Free Press said, quote, "A vertically integrated Comcast/NBC would not only control marquee television and movie content, it would also control the primary avenues for distributing that content: a major television broadcast network, a major cable system operator and a major broadband Internet access provider.”

AMY GOODMAN: Meanwhile, in another closely watched story about the media, a major dispute between the nation’s second-largest cable company, Time Warner Cable, and Rupert Murdoch’s News Corp. has finally been resolved. The dispute centered on how much the cable company should pay for the right to deliver the Fox network. Jeff, continue to talk about these issues.

JEFF CHESTER: Well, that’s my point and why I didn’t respond directly to Juan’s network neutrality question and why I do think that the future of US media has to be at the top of progressive agenda, because the big companies are moving to control as much as they can of new media. They want to make sure that their very lucrative business model, which is basically a monopoly model — getting money from us each month for cable or satellite service; even though there are some benefits to the satellite service, these big giants are able to get, you know, monopoly subscription fees — they want to extend that pay-as-you-view model to the online world.

I think it’s important to recognize that in the not-too-distant future — and Google’s new phone released this week is a good example — we’ll be watching our video and creating our video not just through television and not through our PCs, but also, and particularly important, mobile devices. So the whole distribution landscape is changing. Young people are very comfortable watching and creating video through their mobile devices.

Comcast, Time Warner, the big cable operators and the big content companies are very worried that the current free model for online access is a real threat to their monopoly profits. They want to rein in the internet, so to speak, and transfer their current business model to the online world. And that’s why people should read that excellent report and regulatory complaint released this week by Free Press, with other groups including Consumer Federation of America supporting them, because it exposes the Comcast and the cable and broadcast industry’s plan to begin charging, in essence, when accessing content that now, more or less, is free online.

JUAN GONZALEZ: And Jeff, isn’t that alliance —-

JEFF CHESTER: So, the question is, where do we end -—

JUAN GONZALEZ: Jeff, isn’t that alliance sort of like symbolized by this new announcement of Comcast, what they’re calling “TV Everywhere,” where apparently now there’s —-

JEFF CHESTER: That is -— that is [inaudible] —-

JUAN GONZALEZ: —- the grand alliance between the cable companies, the digital broadcasters to control TV content on the internet?

JEFF CHESTER: Absolutely. You know, Professor Robert McChesney, the co-founder of Free Press, likes to talk about the scene in the Godfather

movie where the Mafia chiefs are in Miami, and they’re — I mean, in Cuba, in pre-revolutionary Cuba, and they’re carving up the cake, they’re carving up the pie. “You take this territory. You take this territory.” That’s why the Free Press complaint is right on when it talks about collusion and other kinds of illegal activity. The big cable and entertainment media companies are trying to carve up the online pie — it’s called “TV Everywhere” — and extend their control.

So you have the worst of several possible worlds. You have a handful of companies controlling television, in essence, broadcast and cable television, and they’ll be able to extend that to online and get hefty fees from us for cable service, for broadband service, plus all kinds of new forms of advertising. And that’s why I think it’s a test case for the Obama administration.

But I also think it’s a test case for progressives, because while we need to support the work a Free Press and Consumer Federation of America and Media Access Project and other groups trying to keep this system open, I think we have to ask ourselves, where does progressive media end up ten years from now? Even if the system is open or slightly open, and there’s no guarantees that it will be, you know, will we have a robust and vibrant, interactive, progressive media sector that can help drive this country towards the social justice goals that we know it requires? And unless progressives begin spending more time creating content locally and nationally and figuring out how it can survive, I am very worried that we’re going to see a kind of closing of the door. You’ll have the Comcast, you’ll have the Googles, you’ll have basically a Hollywood show biz business model dominating how the media is created and distributed. And we’ll still be left out in the margins. We need more than just, pardon me saying it, Democracy Now! and Huffington Post. This is a time when progressives also need to be working together to change the media system, not just on a regulatory basis, but on a content basis.

AMY GOODMAN: The issue —-

JEFF CHESTER: And I have to say, yeah, when you think -— when you look at the — yeah, go ahead, Amy, I’m sorry.

AMY GOODMAN: No, go ahead, Jeff.

JEFF CHESTER: I mean, when you look — we like to follow the venture investment in digital media. You don’t see money, not surprisingly, going into content owned by Hispanics, African Americans, certainly not of interests for poor people. You don’t see that investment. So we’re being shut out. Now, right now, because the internet is still wide open, we have an opportunity now to accede all kinds of new services that can help us do the kind of organizing and public education and mobilizing we’re going to need in the future. And if we ignore that, if we don’t seize this opportunity and only, frankly, trust the regulatory process — there’s no guarantee the Obama administration is going to come through for us, frankly — then I think we’re going to really regret it ten years from now.

AMY GOODMAN: I wanted to read to you from the American Spectator a very interesting piece about the resignation of Susan Crawford who, they said, “resigned last week to little fanfare, but some White House insiders say her leaving may reveal growing tensions in the Obama Administration about just how radical the administration has become in developing policies.”

They say she was a leading voice in choosing people in the Federal Communications Commission, a strong proponent of net neutrality regulations. “But White House sources say,” the American Spectator writes, “that she ran afoul of senior White House economics adviser Larry Summers, who claimed he and other senior Obama officials were unaware of how radical the draft Net Neutrality regulations were when they were initially internally circulated to Obama administration officials several weeks ago. ‘All of sudden Larry is getting calls from CEOs, Wall Street folks he talks to, Republicans and Democrats, asking him what the Administration is doing with the policies, and he isn’t sure what they’re talking about,’ says one White House aide.” He went on to say, or the White House aide went on to say, “He felt blind-sided, and Susan was one of those people who heard about it.” “In the end, the proposed regulations were slightly moderated,” says the American Spectator, “from the original language.”

Now, Susan Crawford is denying that this is the reason. She’s saying she’s going back to teach at the University of Michigan Law School. But, Jeff Chester, what about her leaving?

JEFF CHESTER: Well, I don’t really know the facts of the case. I was very surprised that Professor Crawford left so early. She was, in fact, a kind of progressive public interest light within the Obama White House system, overseeing telecommunications, communications policy. I wouldn’t be surprised, frankly — and I hope, if it’s not true, she’ll correct me — that she didn’t, in fact, grow unhappy there.

I see within the Obama administration a kind of Clintonesque rerun. I mean, that’s why I say it’s a test case, because the Obama folks came in, and they said, “We’re going to do antitrust in a different, more vigorous way,” and they appointed a new antitrust chief, Christine Varney, who’s brought together a very good staff, by the way, the best possible people to look at the Comcast-NBC merger. But, you know, they don’t want — they want to work with Silicon Valley, because it is an important part of economic growth. They don’t really want to, I think, butt heads too much with the big media companies. Frankly, I think FCC Chairman Julius Genachowski, who comes out of the digital media industry — he worked for Barry Diller as his lawyer, was a venture capitalist — I think he’d rather sort of, you know, coexist with the current system instead of taking them on. So I wouldn’t be surprised if Susan got disillusioned or decided that she’d be more useful outside of the administration.

That’s why we have to put a lot of pressure on the Obama administration now to really act tough when it comes to Comcast-NBCU. Comcast is the biggest cable company. It’s the leading broadband-providing company. It has investments in wireless communications. It’s going to be taking over one of the big networks, one of the big television news operations, MSNBC, which of course has Rachel Maddow and other kinds of shows, a big interest in the online service Hulu. There is absolutely no reason why the Obama administration should allow the most powerful cable and broadband monopoly to take over a television network studio, online operation. And we’ll see whether or not, you know, we become as disillusioned as perhaps Susan Crawford became, if the Obama administration fails to support public interest media.

JUAN GONZALEZ: Jeff, I’d like to ask you about another issue —- I’d like to ask you about another issue that many in the media reform movement are reluctant to talk about, and that is the role of some of the major national civil rights organizations in some of these major media reform issues -—

JEFF CHESTER: Right.

JUAN GONZALEZ: — such as net neutrality and some of these big mergers. The civil rights groups in the ’60s and ’70s really led the way in media reform, in challenging licenses of many broadcast stations. But now, increasingly, because they’ve been receiving a lot of money from telecoms and cable companies — and they say that’s not the reason, but they have been receiving quite a bit of money — many of these groups seem to be supporting the agenda of the telecoms and the cable companies. Your sense of what’s happening? And is there a rift developing between some civil rights organizations and the media reform movement?

JEFF CHESTER: Well, look, this has been going on for quite a while, and that’s a real problem, Juan, that — and I — you know, not to plug my book only, but in my book that came out a couple years ago, I talk about this, because in the late 1990s, when open — when network neutrality and all these issues were coming up, the big companies — Time Warner, AOL — gave a lot of money to the civil rights groups. They didn’t support the civil rights groups, a progressive media agenda then, and they’re not doing it really now. They’re taking a lot of money — Hispanic groups, African American groups — and it’s really tragic.

Now, as one civil rights leader explained to me — you know, I won’t — Verizon, you know, paid for their website. “What could your,” quote, he told me — your, quote “foundations do for me?” In the absence of support, you know, these civil rights groups claim, it’s only logical that they have to survive. They’re doing good work on healthcare and immigration reform, and they need the money. But it’s incredibly short-sighted and tragic, because right now the civil rights groups should be walking arm in arm with the media reform community, not just to sort of democratize what we have today, but, as I said before, ensure that we have real independent channels owned by African Americans, owned by Hispanics, Asian Americans, gays and lesbians. This is the time to really diversify control of the media. And I think it can be done with government help, but also without government help. But right now, many of the big civil rights groups are simply playing along with the media monopoly.

AMY GOODMAN: Jeff Chester, on an earlier point, it’s interesting you mentioned MSNBC, because apparently Ed Schultz, who’s on MSNBC, now in the lineup, said that the North Dakota Democratic Party has asked him to run for Byron Dorgan’s seat. He says at this point he is not doing that. But just an interesting point.

Jeff Chester, I want to thank you very much for being with us, executive director of the Center for Digital Democracy.

JEFF CHESTER: Thank you both.

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