A View on FCC Media Consolidation Hearings --Moving Closer to a Totalitarian Society?

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Remarks of Taplin, CEO of Intertainer, to the FCC Media

Consolidation Hearing ( )

LOS ANGELES, Apr 28, 2003 /PRNewswire via COMTEX/ -- The following

remarks are from Taplin, CEO of Intertainer, to the FCC Media

Consolidation Hearing, sponsored by the USC Center for Communication

Law and Policy:

Commissioner Copps and distinguished guests, I appreciate the

opportunity to present my views this morning. I come to this stage

with more than 30 years of experience in the entertainment business,

starting the day I graduated from Princeton in 1969. I've been

fortunate to work as a Producer with some of the great artists of my

generation including, Bob Dylan, Scorsese, The Band,

on, Gus Van Sant and many others. I come to this question of

Media Consolidation from the searing experience of the last five years

when along with a group of talented engineers, I built the first Video

On Demand company called Intertainer. We had as shareholders three of

the largest media companies in the world: AOL Time Warner, Sony, and

Vivendi Universal. Some of these shareholders had Board observer's

seats and all of them had access to our most secret documents,

architecture and business plans. For the first three years of our life

they gladly supplied us with thousands of films for our service while

we slowly built and market tested our software and security systems.

But literally on the day we deployed the service nationally,

everything changed. They cut off our film supply and almost

immediately began to plan their own competing service, hiring away our

most crucial software architects and doing everything possible to

destroy our company. When I was first starting the company, one

executive from a movie company said to me, " You don't think the

studios are going to let you create another HBO do you? " Maybe I was

naive, but I said yes.

So I guess that is the key question here. Is there a role for smaller

independent media companies in the American system? When I started in

this business there were many small companies and now there are six

companies that seem to totally control all media. Chairman has

had a survey done which somehow has convinced him that there is

tremendous diversity of voices in the American media Universe and so

he seems determined this June to remove any remaining caps on the

media ownership rules that have served us well for half a century.

Well I've done my own little survey and I'd like to share it with you.

It's centered on the radio system because I think it gives us an

insight into what TV will look like if these caps are removed. I have

a friend who lives in Eugene, Oregon; a nice average sized American

town. In that town there are two talk radio stations, one owned by

Clear Channel and one owned by Cumulus. Two weeks ago he did a survey

of the political bias of those two stations and this is what he found.

Between the two stations, there are 80 hours per week, more than 4,000

hours per year, programmed for Republican and conservative hosts of

political talk radio, with not so much as one second programmed for a

Democratic or liberal perspective. Political opinions expressed on

talk radio are approaching the level of uniformity that would normally

be achieved only in a totalitarian society. There is nothing fair,

balanced or democratic about it.

So how did we get to this point? I believe it was a very brilliant

strategy planned by Newt Gingrich and the Republican right in the

early 80's with two major allies in the media business: Lowry Mays at

Clear Channel and Rupert Murdoch at News Corp. Step one was to get rid

of the Fairness Doctrine. Understanding television's power to

manufacture consent, the FCC took the view in 1949, that station

licensees were " public trustees, " and as such had an obligation to

afford reasonable opportunity for discussion of contrasting points of

view on controversial issues of public importance. The policy of the

FCC that became known as the " Fairness Doctrine " was an attempt to

ensure that all coverage of controversial issues by a broadcast

station be balanced and fair. For thirty years this system served our

Democracy well and as late as 1979 the FCC asserted that Fairness was

" the sine qua non test for renewing broadcast licenses. "

The position of the FCC dramatically changed when President Reagan

appointed Mark Fowler as chairman in 1981. Fowler was a lawyer who had

worked on Reagan's campaign, and who specialized in representing

broadcasters. Before his nomination, which was well received by the

broadcast industry, Fowler had been a critic of the Fairness Doctrine.

As FCC chairman, Fowler made clear his opinion that " the perception of

broadcasters as community trustees should be replaced by a view of

broadcasters as marketplace participants. " With Gingrich and company

pushing hard and a Republican FCC, they were able to eliminate the

fairness doctrine by 1987.

Step two was to remove the media ownership caps. Gingrich's two

allies, Mays and Murdoch had very clear needs on that level. Murdoch

had been forced to sell the New York Post because of Media

cross-ownership rules and May's Clear Channel needed to own multiple

stations in a single market in order to squeeze local advertisers. In

many markets today, Clear Channel owns all of the stations. Since Rush

Limbaugh was the main star of Clear Channel's network, he was the

perfect tool to help Gingrich and Mays achieve their agenda. With

Limbaugh cheering him on, Gingrich delivered big time by shepherding

through his newly controlled congress the Telecommunications Act of

1996 which essentially eliminated the public service obligations of

local station. These two actions, killing the fairness doctrine and

deregulating ownership rules have led us to a situation that even

Barry Diller describes as a Media Oligopoly.

I believe that if the FCC and Congress continue to rollover for the

Media Cartel, our Democracy is in peril. Two companies will own 80% of

the nations radio stations. Five companies will own 80% of the nations

television Broadcasting. Four companies will own 70% of the nations

Cable systems. And they will fill these channels with content they own

and exclude content they don't own and as Bruce Springsteen says; it

will be " 57 channels and nothing on " .

Two vastly different ideas of what our future might look like stretch

out before us. Down one road lies the Founders original conception of

an independent media as a steward to our democracy. Down the other

lies a world that can only be described by the word " Plutocracy " . I

believe the FCC has to postpone its June Deadline to decide on the

ownership caps issue. It should then begin a comprehensive review of

four issues:

1. Would maintaining and even strengthening existing ownership

limits

lead to a more democratic and pluralistic media system that

would

restore the community trusteeship nature of broadcasting

licenses? 2. Should the Commission mandate that cable and

satellite networks should

also have a public service component in return for the

anti-trust

exemption given to their owners, the major MSO's and Media

Conglomerates? 3. Is there any reason not to restore the

Fairness Doctrine in order to

ensure that issues of vital public importance be covered in a

balanced

and fair manner? 4. That the commission ensure that

Broadband Internet providers be bound

by the same " Common r " statutes that have ensured that

the

narrowband Internet is an open system and not a " Walled

Garden " owned

by the 7 companies that control 80% of the broadband pipe to

the home.

The next four weeks is perhaps the most critical period in the history

of the FCC. The Media Cartel believes the fight is already over and

they have the Republican votes to lift the last vestiges of regulation

from their shoulders. You should understand that the Fox News motto of

" Fair and Balanced " is nothing but a very unsubtle attempt to mock the

Commission's impotence in the face of the power of money. Ninety years

ago Woodrow said, " The government, which was designed for the

people, has got into the hands of the corporate bosses, the special

interests. An invisible empire has been set up above the forms of

democracy. " Let it not be said that this great Commission allowed that

to happen to the American Media.

Thank you

Press Contact:

Reddy

310-264-4242

jenn@...

SOURCE Intertainer

http://www.prnewswire.com

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