The Real Dangers
of Conglomerate Control

In media circles, the 1996 Word of the Year was "synergy." Again. Ever since the summer of 1995, when Disney's chief, Michael Eisner, embraced the term during his company's purchase of Capital Cities/ABC for some $19 billion - "The synergies are under every rock we turn over," he bubbled at one point - it's been the buzzword of choice for executives seeking to describe the dazzling possibilities for power, profit, and prestige they see as they make the leap from large company to enormous conglomerate.
But "synergy" also has been the buzzword of choice for many journalists and other observers to describe the possibilities for difficulty and danger they see in this headlong rush toward conglomeration. As more and more news organizations are bought by companies whose primary business has never been anything remotely resembling journalism - many of them companies with profit interests in such global businesses as aviation, nuclear power, financial services, sports teams, hazardous waste disposal, and other favorite targets of nosy journalists - commentators have taken to using "synergy" as a synonym for everything from "a worrisome potential for censorship" to "the death of journalism as we know it."
In November, the Columbia Journalism Review devoted a special breakfast forum to exploring what the consequences for journalism will be of the trend toward conglomeration. An invited group of 250 journalists, media executives, and other opinion leaders gathered to hear - and to argue with - a panel made up of four influential media critics, who presented anything but a united front in their views on the scope and seriousness of the threat to journalistic values. Moderating the panel was Ken Auletta, a longtime media critic and author who has been writing the "Annals of Communication" column for The New Yorker since 1992.
- Andie Tucher

 Following are excerpts from the panelists' remarks and the audience's responses.

Ken Auletta: If you went to the press conferences when Disney took over ABC or when Westinghouse took over CBS or when Viacom took over Paramount, you heard the word synergy repeated over and over again.

 Increasingly, it's also a word you hear more and more in magazines and newspapers. People talk about the importance of enticing departments to work together, to enthuse advertisers, to get new revenues through "brand extensions." And maybe the spate of alliances that are taking place in the communications business will lead to synergy and will make journalism better. But I would argue that there's scant evidence that synergy is journalism's friend.

 Let me review just a few factual arguments against synergy.

 We see that in Asia Rupert Murdoch dropped the BBC from his Star satellite news service. Why? Because the BBC was offensive to the Chinese government and Rupert Murdoch and his News Corp. wanted very much to make nice to the Chinese government.

 We witness the lawyers at CBS killing for a time a 60 Minutes report on the tobacco industry. Why? Because it was deemed that CBS would face a potential lawsuit. Well, The New York Times faced a similar potential lawsuit, as did The Washington Post, with the Pentagon Papers, but the publishers decided to go forward. The argument made (in the 60 Minutes case) was that the costs were so grave, that we shouldn't do it. I think it was really a synergy argument.

 You could also make the case that a similar argument was made at ABC, when they decided to apologize, thus avoiding a potential libel award of $10 billion, to the Philip Morris Company. The question is: Was ABC's decision based on the journalistic merits? That would be, "We were wrong. We made a mistake and we're owning up to it."

 Or was it a decision of corporate convenience? That would be, "We can't do anything to impede the merger of ABC and Disney." I suspect that you pick up here the scent of synergy.

 Nor is synergistic thinking a stranger to the newspaper world. Take a look at what happened at the Times Mirror Company with the new c.e.o. who comes in and says, "We have to get our profit margins up from 8 percent to, eventually, 16 percent."

 Well, you can make an argument that there's a lot of fat at Times Mirror. But if you talk privately to business people at the Times Mirror Company, they will tell you that there's a point at which you go beyond cutting fat, to cutting bone. Now, the truth of the matter is it's much easier to measure your costs or profit margins than it is to quantify something that's very dear to those of us in journalism, which is quality.

 As communications Goliaths merge and partner, occasions for these journalistic conflicts of interest will inevitably increase. Will ABC News aggressively cover a proposed Disney theme park on an old Civil War site? Will NBC News go easy on its online partner, Microsoft?

 Did Paramount executives agree to curb the paparazzi that violate the privacy of Hollywood stars because they thought it was an outrageous intrusion of privacy? Or did they curb them because they want to make nice to stars like George Clooney and get them to do movies for Paramount? Will the New York Post continue to be used as a weapon by Rupert Murdoch to bludgeon political or business opponents?

 Will The New Yorker accept too many excerpts of books from Random House, which is part of its parent company? Will Forbes slyly drop another profile, as they did two years ago with the agent Michael Ovitz, without telling people that Ovitz was, in fact, a private consultant to Forbes?

 Or, conversely, is it true, as my friend Walter Isaacson at Time argues, that journalists are more insulated from intrusion from their corporate bosses when they work in the bosom of a large company, which is less interested in the outcome of particular stories, than they might be in a smaller one? There's some evidence of that, but I think there is a greater journalistic peril in a large conglomerate. It comes not from Jack Welch, the head of General Electric, reaching down and saying, "Do this story." It comes from self-censorship, from anticipatory censorship. People saying, "God! If we run this story, will it ruin our careers? Will we be labeled non-team players?"

 Witness, for instance, how NBC issued an apology after Bob Costas made a perfectly reasonable statement on the network during the Olympics about human rights abuses in China. An NBC spokesman, a couple of days later, issued the following statement, speaking about China, "We wanted to make it clear that we didn't intend to hurt their feelings." Now, presumably, NBC also didn't want to hurt the business interests of the corporate parent, General Electric, which is bidding for business in China.

 Inevitably, the synergy notion produces a clash of values between the corporate culture of the parent and the culture of journalism. The new mega-corporations in the communications world value things like teamwork. They use leverage to boost sales of their products. They dream of a borderless company that eliminates the defensive interior barriers and walls within those companies.

 But journalists are meant to prize their independence, not teamwork. To keep a distance from advertisers, not to seek synergies with them. Journalists need borders. That is to say, a degree of independence, in order to do our jobs. Journalists don't aspire to a borderless company, because we want to keep the business and the advertising department the hell out of the news room. That's part of our mission.

 So the more corporate retreats you invite editors to, the more the danger you have of converting those editors into tame, corporate citizens. This, of course, often gets complicated and there are other sides to this argument. Only paranoids, for instance, want editors to be implacable foes of the publishers.

 And it is true that journalism is a business, not a philanthropic activity. If you don't make money, as New York Newsday didn't make money, you should be closed no matter how good a product you produce.

 One can make the argument that media conglomerates will restrict the information we receive, that we citizens will be victims of a homogenized, commercial sameness. There is plenty of evidence that entertainment values have infected our business. Perhaps you saw the Diane Sawyer interview with Fergie, as they call her at ABC News. It was an entire hour of what used to be documentary time, devoted to a one-hour interview with the Duchess of York.

 But one could also argue the opposite, that George Orwell was wrong, that technology will not imprison us, will not become a tool for totalitarian governments or for big companies. Instead, as happened in Eastern Europe, with the introduction of fax machines and satellite and cellular phones, borders and Berlin Walls were proved to be porous.

 The Chinese can talk about controlling the Internet. But they will not be able to do it. Meanwhile, back at home, the questions arise: Need we fear the concentration of media power? Is bigness journalism's enemy, or its own enemy? Will more sources of news equal more choice or more infotainment?

 We'll try to identify now the poison.

 Ken Auletta's remarks were followed by comment from:

 Frank Rich, an op-ed columnist and former theater critic for The New York Times;

Dorothy Rabinowitz, media columnist for The Wall Street Journal and a member of the Journal's editorial board;

Alex Jones, the host of National Public Radio's On the Media, who won a 1987 Pulitzer Prize for his New York Times reports on the fall of the Bingham newspaper dynasty in Louisville, Kentucky; and

Howard Kurtz, media reporter for The Washington Post and the author most recently of Hot Air: All Talk, All the Time.

 FRANK RICH: This summer I was on vacation in Italy. And about three days after I arrived there, I suddenly turned to my wife and said, "I realize that something is different about this culture, in addition to all the other things that are different about Italy." And it was that there was no palpable Disney presence.

 If you believe, as I do, that culture is also news, this consolidation of power in a handful of companies not only affects whether stories about Philip Morris run, or whether there's coverage of the telecom bill - which there essentially was not - when it was before Congress. It also affects the whole air we breathe. In terms of what we all call synergy. Because these companies disseminate their products in every possible outlet. And it really affects our values, what we think of as our culture.

 And, while there is this explosion of news sources, in terms of the Web, I still don't think we know where that's going to all lead.

 DOROTHY RABINOWITZ: As long as I've been a journalist, there have been these dark, threatening phantoms looming before us, threatening to undermine journalistic independence and integrity. This time it is synergism. But I think that the enemy of journalism remains what it always was.

 The enemy has always been the herd mentality, the wish not to step out of line with the prevailing moral order. It isn't synergy or the threat of conglomerates that is causing reporters everywhere to report a story in lock-step, with tremendous fear of offending - you know the overused term - political correctness.

 I don't remember any golden age of journalism. There was a fellow at The Washington Star who had lurched over to The Washington Times. Then, when the Reverend Sun Myung Moon bought the Times, somebody asked him, "Isn't it going to be terrible that you're going to be working for the Reverend Sun Myung Moon?" And he answered, "I don't know. As long as I've been in journalism, I never met a publisher who didn't think he was God."

 Let us deal with the demons that are here before us in journalism that have always been here. And worry less about these varying threats to the perceived independence of journalists.

 ALEX JONES: At the turn of the century, people were anxious about concentrations of power, just the way they are today. But the concentrations they were more worried about were the insurance trusts and the railroads, and the embodiment of that sort of thing was J.P. Morgan. Americans have a deep, visceral fear of that sort of power. When you start trying to crack why people are saying the things they do about the media these days, one aspect of it is pure visceral anxiety about a creature that they feel they have no real way to control. Something that has become vastly powerful, something that is to a large degree faceless.

 The leading news organs in this country are the TV networks, and those networks are now divisions of branches of subsidiaries. In other words, the people who control the most important news outlets in this country have absolutely no understanding or value for news and journalism values. That has never been true before. There's another kind of pernicious aspect to this. And that is the sense that we all have that even though there's a huge amount of competition and rivalry with Time Warner and News Corp. and Conde Nast and Viacom and Bill Gates and John Malone and Dow Jones, that it's one large corporation. Because they are now not only becoming these synergistic creatures unto themselves but they are also forming alliances that are making them one. And Americans viscerally and intellectually, rationally sense that. Do I find it a disturbing concept? Yes, I certainly and very much do.

 HOWARD KURTZ: It's important that we not mythologize the nonexisting good old days because it is obviously true that people like Mr. Hearst and Mr. Pulitzer were also interested in making money. In this age when I can think of myself as a content provider instead of just an aging hack, a more important point to me - rather than will NBC aggressively cover General Electric, because there always will be somebody to blow the whistle on malfeasance at General Electric - is whether these companies are willing to spend money. Spend real serious resources on news. I surf the Web a lot, and go onto these sites that have got all these great bells and whistles and interactivity. But what you don't see on most of these sites is much or any original reporting.

 One of the reasons for that is reporting is expensive. Investigative reporting is expensive. Why? Because you spend weeks, months, gathering documents. Sometimes the story doesn't pan out. It requires not only an investment, but a commitment to doing serious journalism. And it is risky, in terms of lawsuits and the threat of lawsuits. When you do original, aggressive enterprise reporting, you step on powerful toes.

 So, it is certainly true that we are now moving into an age where we will have more choices of news than ever before. But in watching some of the new cable channels that are coming online, I see a lot of talk, a lot of analysis, a lot of opinion, a lot of blather. I don't see that much newsgathering. Because newsgathering is very expensive.

 We don't have to speculate about how ABC will cover Disney. We have a real live example that occurred just a few weeks ago when Good Morning America devoted most of its two hours to a show in, about, and celebrating Disney World's twenty-fifth anniversary.

 Charlie Gibson and Joan Lunden and the whole crew went down to Orlando at great expense and, just to give you the tone of this hard-hitting report, here is some of what was said:
Joan Lunden - "Disney World rocks around the clock. . . . The attention to detail in this place is really astounding."
 Charlie Gibson - "Probably the greatest man-made vacation center that has ever been built."
 Joan Lunden - "Just another example of going all out to impress even the most hard-to-please visitors."
 And then of course, there was the obligatory interview with Disney c.e.o. Michael Eisner. I asked Charlie Gibson about it and he was candid enough to say "I'd be lying to you if I didn't say there were some people who weren't comfortable about it."

 Notice the careful phrase "some people" leaving open the possibility of whether that included him. This was as close to an infomercial as I have ever seen on network television. Perhaps if it had been by some other network that wasn't owned by Disney it would just have been in poor taste but I thought it was something more serious.

 RICH: We're still at the beginning of this phenomenon. A company like ABC still has producers in ABC News who came out of what we think of as a journalistic tradition. A magazine like Time still has a number of the same editors who were working there when I was there long before it became Time Warner. But these people are going to retire, fade away. And the question is, will people who come in be people who have no institutional memory of what journalism is or journalistic values? Will there be a whole new kind of nonjournalistic employee who comes out of a corporate culture where everything is about publicity? Because that's what synergy is.

 KURTZ: We have the convergence of two important developments. One is bigger and bigger companies getting involved in the news business. That is probably not so different except in degree from what we've seen in the past century. The other is the speed of the news cycle, which now seems permanently stuck on fast forward.

 Those two things are important because one of the reasons you have people filling up the air time with not terribly insightful blather is that there's a lot of air time to fill. And there is less and less time and in some cases less and less inclination f or what we used to think of as sort of the mainstream, old-line traditional - some would say dinosaur - news organizations to check out these stories that get into this media culture from a hundred different sources. A story about O.J. can start on an L.A. TV station and rocket around the world and be in newspapers and be on the Internet in a matter of hours before anybody happens to know whether it's true or not.

 So some of the safeguards that we used to have that made us slow, that probably made us elitists, have vanished. Now there's a good side to that because it means that more voices come into the conversation. But there's also a dangerous side to it.

 JONES: The press's problem is not enough resources and not enough corporate will and not enough real leadership in newsrooms.

 I'm not talking about The Washington Post and The Wall Street Journal and so forth. But at small newspapers around the country there are executives and editors who are simply not allowed to lead their newsrooms in ways that are going to be threatening to the interests of the bottom line.

 Journalists are among the most idealistic and driven people in American society. There's a real crisis of confidence and in morale among journalists now because they feel they're not being led right. They're simply not being told that they're doing something really important and they're not being allowed to do many of the things that brought them into journalism in the first place.

 The panelists' remarks were followed by questions and comments from the floor - and responses from the panel.

 GUEST: I cannot recall a time when big business and powerful interests were more scrutinized by the press than now. NBC may not want to take on General Electric but CBS and ABC will do so without any question. My point is journalism is still free and com petition for news makes almost any powerful interest vulnerable. But when I was a reporter we had sacred top cows; we never reported an elevator accident in a large department store that advertised.

 GUEST: There's a piece of this synergism that you left out. That's the relationship between the corporations and the government and their dependence on government contracts, particularly military. The public perception is that the media are now p.r. people for the government. That's where a lot of the cynicism comes from.

 GUEST: We are letting ourselves off much too lightly. Every anecdote, every incident that was mentioned today - except perhaps for Murdoch and the BBC - represents a real terrible of failure of nerve and duty by the journalists. Are we using this corporate stuff as a scapegoat for bad journalism and nerveless journalism?

 JONES: The only people in the broadcast news departments who have any real power are the stars. They're also enormously paid, so they have an enormous vested interest in not rocking a boat.

 But they are the only ones who really have the power to embarrass or to shame a network news operation into doing something that it does not feel is in its interest to do. It's not really going to matter in many of those operations whether the news direct or resigns. If Mike Wallace had walked off, it would have made a big difference. I think this is going to put a great deal of pressure on these star journalists to be the ones who put themselves on the line when journalistic crises come along.

 KURTZ: Let me dissent slightly. I think that a lot of journalists in the trenches do have the power to just say no. There is always the threat that somebody in that position can go public and cause an awful lot of bad publicity, which media companies hate as intensely if not more intensely than other types of companies. The fact is that if more of us would blow the whistle rather than just blaming the big, bad corporate owners, then some of these excesses would be curbed.

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