The Process of Media Industry C O N G L O M E R A T I O N

The Process of Media Industry Conglomeration

Najib Altawell

The Process of Media Industry Conglomeration

Introduction
The process of media conglomeration has involved the regrouping of multinational companies, which as a result, has created a power of considerable proportions. This means that these companies have the control of the local and the international market. Their control over the market has been accelerated with the launching of satellites and other development in the media, such as in the field of digital press, digital music and digital videos. One of the main issues is related to the effects of the Western media; particularly the American media on other cultures, as it continuously dominate the international market. This issue raises doubts about diversity of choice, quality and competition. With the development and scope of satellite technology, it can be argued that the local culture of many countries, in particular the underdeveloped ones, has become the main victim as a result of this kind of media domination in a world of faster global communications. The local programmers and film production in the underdeveloped countries have suffered badly as the international companies sell their media products so cheaply that the local producers cannot compete with them. From the above, we can see that we have underdeveloped countries almost entirely dependent on cheap western programmes to fill the time on their television screens. The irony is that money was made available to the television companies in these underdeveloped countries so that they could buy the American media products instead of the help needed to produce their own Programmes.

The Global Market

With the launching of the satellite communication systems, the global market assumed different dimensions. The world suddenly became much smaller than used to be, smaller in the sense of the scope of and access of media mass communication, consequently the phrase global village became the expression of the day used by the media regularly they wanted to refer to the world as a whole. As a result, the individual nation market became the market for any nation who possessed the latest technology in commercial satellite communication. This situation brought life back to all old western media products, especially the American products. Therefore, the selling in this situation increased at an incredible rate selling all old programmes and movies, which no one in the West wanted to watch, to many African and Asian countries. In this new era of communication, there is a huge market, a market to fill the time on every television channel around the world the dawn of the conglomeration market. The underdeveloped world has nothing to compete with this. To produce their own films or their own programmes is too expensive in comparison with what is available on the international market. Therefore, it is not surprising to see on TV in a small African country an American soap opera made more than 20 years ago. The big international companies are growing bigger every day as the number of their viewers increase all over the world. What this mean is that a few media corporations from the West are controlling the whole international market, which is one of the main issues related to media conglomeration. One positive argument for the process of conglomeration is that the free markets will bring competition which consequently makes the diversity of the media products a reality for all the customers around the globe. This is what the owners of the big corporation believe, such as Mr Murdoch. The local people would prefer to see on their TV channel the reflection of their own daily life, rather than what is/was happening in faraway places (e.g. a high proportion of Zimbabwe people watched Root). It appears that the danger in a situation like this one is that the people in that African country, and especially the new generation, see Western media production as a model which should be copied in their own daily life, as this documentary showed us that the saturation of American television programmes causes appetite for it. As a result of this, the local culture, which should be protected, is destroyed gradually.

Power and Control

The power and control exercised by conglomeration is an important issue as the affects the opportunity of speech. Fair competition between businesses and freedom of speech in a democratic society is an important factor for progress within any culture. Unfortunately, this is not the case with the Western media products. The big corporations want other countries to depend on their products. Access to media, therefore, is limited to a few companies and consequently the choice is limited. For example, the local producer in any underdeveloped country will be always struggling to launch his/her new product, and even if he/she is successful in launching it, the financial gain, in some cases, will hardly cover the cost. Therefore, there is an argument for diversity and choice of media products, i.e. it is important not to have in any country saturation of any media products, such as with the present situation concerning the saturated market of American media production. When it comes to the music industry, the market and the power of controlling it again is the main issue. The $30 billion industry generates its income from massive international market. For example, one album Thriller by Michael Jackson sold more than 40 million copies, which consequently produced a profit for CBS of more than $60 million. The Japanese Sony saw that there was an opportunity for their hardware industry in this market, so when the CBS company decided to sell their record division, they (the Japanese) bought it for $2 billion. The sale meant a new door opening for more sales to Sony, i.e. with their new technology at that time, e.g. CD, software, etc, they can sell the music all over again on a new format. From the above takeover, the big corporations in the music industry copied Sonys action by buying market shares of other smaller music companies. The last music business Virgin sold to EMI Thorn for $500 million. There are , consequently, a few big corporations which control the music industry worldwide, such as Thorn-EMI, Sony, Philips/Polygram, Matsushita/MCA, Time Warner and Bertelsmann/BMG. The above companies have penetrated the worldwide market and have an overall monopoly of this market, which consequently, as has been mentioned in connection with the film and TV industry, bring with it a limitation of consumer choice.

The Print Industry (Publications)

Concerning the print industry, i.e. publications such as newspapers, magazines and books, the statistics show that between 1985 and 1995 the number of media products and distribution systems has increased noticeably. However, this does not mean that these new products have successfully established themselves in the market. Many of the new launches at that time such as News on Sunday, The Sunday Correspondent and The Post could not survive the competition and consequently closed down. Many critics believe that the close down of a number of newspapers is the result of Mr. Murdochs price war.

For example, account for News Corporation during 1994 indicated a loss more than 45 million in the United Kingdom alone. However, the profits at BSKyB rose to over 186 million. News corporation also suffered a drop in profit outside UK but at the same time had a rise in television and films profits. Mr. Murddoch tried to increase the sale of his newspapers that means taking readers away from newspapers such as the Daily Telegraph and The Independent. He reduced the price of The Times newspaper as well as introducing upmarket bingo, bringing more sensational stories in the Sunday Times (the false Hitler Diaries), all these had limited success.

Najib Altawell