Tuesday, January 2, 2018

Rethinking crossownership

[Warning, I'm pretty much shooting from the hip here. This is not an area where I am knowledgeable and I do not have the time to research the subject properly. As a result, this is very much written to the good-enough-for-blogging standard, so it would be wise to double check any of the following assertions before passing them on.]

As a general rule, I tend to be skeptical of "we need this to be competitive" arguments against regulation and antitrust enforcement. Usually these claims come down to an excuse for gouging the customer or an attempt by incompetent managers to survive by gaming the system. If you can't make a go of a business without monopoly/monopsony power, then you probably aren't very good at your job.

There are, of course, exceptions, cases where technological and economic changes really have made it difficult for even the best run companies to survive, even when those companies serve a real and necessary social good. Local journalism is a perfect case in point. Some of the best reporting I've seen over the past few years has come out of newspapers, and yes, television stations outside of the major markets of New York and LA. I particularly want to single out the TV reporters because, though we all tend to mock them, they've been responsible for some remarkably good work on stories that, though important, are often ignored by institutions like the New York Times.

John Oliver hit many of these same points in his excellent piece on Sinclair broadcasting.


Anything we can do to encourage more and better local journalism is worth pursuing. There are considerable synergies and cost savings from combining a newspaper and a television (and possibly even a radio) station. Furthermore, in an age of cable and the Internet, I am much less concerned with the potential abuses from having this kind of cross ownership.

The key word here (and it is absolutely essential) is "local." As soon as you start to scale up, the social benefits start to drop off while the potential for abuse increases exponentially. As the experience with Sinclair has shown us, ownership across many markets actually tends to decrease the amount of local journalism and, perhaps more importantly, the amount of local editorial control.

Put simply, the standard I have in mind is that crossownership is acceptable, perhaps even desirable, if you're talking about relatively small players in relatively constrained regions. If, on the other hand, you're talking about big players (particularly those like Sinclair with a history of stifling local journalistic autonomy), the tighter the ownership restrictions the better.

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