“The only security of all is in a free press. The force of public opinion cannot be resisted when permitted freely to be expressed. The agitation it produces must be submitted to. It is necessary, to keep the waters pure.” —Thomas Jefferson, 1823
Thomas Jefferson, a slaveowner himself, represented slave-owning interests in the coalition leading the bourgeois-democratic struggle that won independence for the 13 colonies from Britain, while retaining slavery for nearly another century. Nevertheless, he along with other “founding fathers” of the United States came to recognize the power of public opinion and its connection with freedom of information through a free press.
Thus, under popular pressure, they adopted the First Amendment to the Constitution in 1791: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.”
At the time Jefferson assumed the presidency in 1801, there were 200 newspapers in the U.S. By 1940, the country had more than 1,800 general-circulation daily papers, with many cities having multiple competing papers. The number then declined steadily with the advent of television. Now many big cities have just one paper, typically part of a gigantic media conglomerate that includes multiple radio and TV stations, one or more networks, movie studios and other media outlets, including cable television.
The biggest and best known of these, along with major holdings, are the following:
· Comcast, headed by billionaire Brian Roberts (the largest mass media and communications company in the world by revenue—nearly $65 billion in 2013, owns NBC, won Consumerist’s “Worst Company in America Award” in 2010);
· Rupert Murdoch’s 21st Century Fox (owner of the 20th Century Fox film studio and Fox television network, among other assets spun off from his infamous News Corp, which continues to hold the previous company’s publishing assets,including Dow Jones & Company, Inc., the Wall Street Journal and New York Post);
· Walt Disney Company (owns ABC, ESPN, A&E Networks, theme parks and a cruise line);
· CBS Corp. (mass media corporation focused on commercial broadcasting, publishing, billboards and television production);
· Viacom (has interests primarily in, but not limited to, cinema and cable television, as of 2010 the world’s fourth-largest media conglomerate behind Disney, Time Warner and News Corp);
· Time Warner (has major operations in film, television, and publishing, subsidiaries include New Line Cinema, Time Inc., HBO, Turner Broadcasting System, The CW Television Network, TheWB.com, Warner Bros., Kids’ WB, Cartoon Network, Boomerang, Adult Swim, CNN, DC Comics, Warner Bros. Animation, Cartoon Network Studios, Hanna-Barbera, and Castle Rock Entertainment.;
· Liberty Media, headed by billionaire John Malone (holds big stakes in Charter Communications, Barnes and Noble, Inc., Sirius XM Radio Inc., and the Atlanta Braves baseball team); and
· Sony Corporation of America (principal businesses include Sony Electronics Inc., Sony Pictures Entertainment Inc., Sony Computer Entertainment Inc., Sony Music Entertainment Inc., and Sony/ATV Music Publishing).
On Feb. 13, cable giant Comcast announced its offer to buy out Time Warner Cable with shares of its own stock valued at about $45 billion, or $159 per Time Warner share. Previously, Charter had offered $37.8 billion for Time Warner, which was turned down.
In some of its markets, Comcast is the only entity providing cable and broadband service. With the Time Warner Cable acquisition, Comcast would have about a third of all broadband subscribers and 30 million cable TV subscribers in the U.S.
The merger cannot go through until the FCC, Department of Justice, and Federal Trade Commission weigh in, which could take months.
Development of monopoly
As with most other sectors of the economy, the media industry has been going through a process of concentration of capital in larger and larger units and centralization of ownership in fewer and fewer hands. This is part of what Karl Marx called “the general law of capitalist accumulation.” In “Capital” and other writings, Marx explained that capitalism had a built-in tendency, because of competition, economies of scale, and periodic crises of overproduction, to become more concentrated and centralized in the long run. The opposite process can also occur at times—especially in new industries, such as high tech and social media today—but only temporarily.
Outcomes of this economic law have included (among other things):
· The development of monopoly capitalism/imperialism beginning in the latter part of the 19th century and culminating in the U.S. world empire established in the mid-20th century;
· Imperialist wars, including two devastating world wars in which tens of millions lost their lives and large parts of the world were laid waste;
· Subsequent “smaller” wars, starting with the Korean War, in which millions were killed and entire countries destroyed;
· The current drone wars that have killed thousands in a desperate effort to shore up the U.S. world empire; and
· The trend toward a growing “reserve army of unemployed,” an expanding “pauperized” sector of the population, and increasing inequality in general.
On the other hand, Marx pointed out, the growing concentration and centralization of capital in the form of corporations—collectively as opposed to individually owned by capitalists—represents an important stage in the socialization of capital. This stage has unfolded independently of anyone’s subjective desires pro or con, and has objectively laid the basis for a new system—socialism—in which the system of private ownership of the means of production, distribution and communication is abolished and replaced by a system of collective ownership, freedom of information and genuine equality based on the associated producers.
Media monopolies in decline
Media monopolies, like the U.S. empire, had their heyday but are now in decline. This is especially the case for those companies using cable and satellite infrastructure to deliver media content. These companies are increasingly threatened by newer entries into the media market that deliver content over the Internet at a much lower cost, and by the virtually free distribution made possible by the Internet itself.
Increasing numbers of former cable and satellite subscribers are “cutting the cord”—saying bye-bye to the profit-gouging media monopolies and instead watching movies and other programs distributed by Netflix, Hulu Plus and other rising competitors over the Internet. They also increasingly get their news and other needed information both live and on demand from sources of their own choosing, often free of charge via the Internet.
According to MarketWatch online: “Subscribers have been declining since 2004, and analysts say there’s no end in sight. Roughly 54.8 million households currently pay for cable TV, down 3.3% from 2012 and down 17.6% from a decade prior, according to research firm IHS. Cable companies are expected to shed roughly 1.3 million subscribers in 2014.”
Destructive response
Like the U.S. empire in decline, the cable and satellite monopolies have responded in ways that are destructive to our lives and hard-won democratic rights. They appear to have formed what is in effect an old-fashioned cartel to protect their monopolies and, from their viewpoint, achieve a more level playing field—at our expense as consumers while also infringing on our free and ready access to information, critical to the exercise of our First Amendment rights.
In the process, free or low-cost access to entertainment and information is jeopardized—along with “net neutrality.” Wikipedia defines this key concept as “the principle that Internet service providers and governments should treat all data on the Internet equally, not discriminating or charging differentially by user, content, site, platform, application, type of attached equipment, and modes of communication.”
Federal Communications Commission guidelines that ostensibly enforced this principle were recently thrown out by a federal court at the behest of Comcast and Verizon. The FCC opted not to appeal the decision but instead to re-write the rules. It remains to be seen what the outcome will be, but if there is only weak opposition to the plans of the media giants, it is not likely to be good. Meanwhile, media monopolies violate net neutrality with apparent impunity.
Comcast’s NBC, for example, bought the exclusive rights to broadcast the Olympics from Sochi, Russia. NBC made the coverage, both live and archival, available on the Internet, but with a catch. You had to prove you were a subscriber to a cable or satellite TV provider; otherwise, all you got by clicking on the play button was a blank screen. And this is not an isolated case.
In 2007, Comcast was caught “throttling” BitTorrent, a video service that competed with its own on-demand video, bringing the issue of net neutrality into prominence for the first time.
More recently, subscribers to Netflix began reporting pauses or more prolonged halts in their movie streams, even though they had broadband connections to the Internet. Netflix’s monthly report of streaming speeds showed a 27 percent decline among Comcast subscribers from October to January.
The mounting customer complaints forced Netflix to negotiate a deal, announced Feb. 23, in which they will pay Comcast for direct access to Comcast’s network instead of going through intermediary distribution companies such as Cogent and Level 3.
The price of the deal was undisclosed but will likely result in higher costs for Netflix customers sooner or later. Cogent and other distributors of video content will be cut out of a lot of business, and Comcast and other cable/satellite monopolies will be free to jack up their fees to content providers for direct access to their networks in the future. That, in turn, will inevitably mean higher prices for consumers.
Reflecting the views of competing high-tech business interests, the editors of Silicon Valley’s only daily newspaper, the San Jose Mercury News, complained Feb. 25: “Netflix’s agreement to pay Comcast for smoother streaming of movies and TV shows marks the end of an era for the Internet. It should send shivers down the spines of anybody who relies on online information.
“The deal marks the first time an Internet content provider has agreed to pay for direct access to a broadband provider’s customers. It’s a direct hit on the concept of an open, free Internet, a principle that helped unleash the Information Age and transformed the world.”
No ‘restraint of trade’?
Comcast justifies its merger with Time Warner on the basis that it will be beneficial to customers and will not bring any “restraint of trade,” which is illegal under the antitrust Sherman Act, passed in 1890, the Clayton Act of 1914, and the Federal Trade Commission Act of 1914. Obviously, NBC’s blocking of its Olympics coverage to anyone not a cable/satellite television subscriber and Comcast’s strong-arming of Netflix amount to restraint of trade and gross violations of net neutrality.
It remains to be seen if the Obama administration will reach the same conclusion and block the merger of Comcast and Time Warner. In view of the divisions within the ruling class regarding the merger and the likelihood of mass opposition from progressive and working-class forces, this is by no means a done deal. Among other groups fighting for a free and open Internet, Free Press has launched a campaign to block the merger, an effort that deserves wide support.
In the longer run, we need to fight for public ownership of all Internet-related infrastructure, democratically controlled by the workers involved and communities served, and free, high-speed access to the Internet for all. That would go a long way to ensure that our First Amendment rights can be exercised to the full, and progressive social change advanced.
