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Fox Flourishes 

by Jeff Chester


The Bush administration will make sure that no Grinch spoils Rupert Murdoch's holiday season. By the new year, Murdoch's News Corporation will be in control of the country's largest direct-broadcast satellite service, DirecTV. The takeover of this company, with its 11 million subscribers, will greatly increase Murdoch's power over the American TV landscape. It will also mean that conservatives will have an even greater ability to push their agenda. Both the Justice Department and Michael Powell's FCC are on board to rubber-stamp the arrangement, in deference to the administration's indebtedness to Murdoch. With Fox News a 24/7 commercial for the Bush White House and with the Weekly Standard's constant cheerleading, Murdoch is an especially valuable friend.


This latest deal -- which means, as the News Corp. Web site proudly proclaims, that it rules the skies over "five continents" -- should have raised the hackles of Democrats, especially the presidential contenders, who could have pointed to the danger of ever more media consolidation. But sadly, Democratic leaders, unions and progressive advocates have been silent, allowing the merger to sail through the review process. Potential critics could also have seized on issues of corporate governance, supposedly an area of greater concern in the post-Enron era. Murdoch has placed several old cronies on the board of Hughes Electronics, owner of DirecTV, to serve as reputedly "independent" directors. But they are unlikely to challenge any business plan that would harm News Corp.'s interests over the concerns of shareholders or competitors.


Murdoch's political success with this merger didn't depend solely on his ability to have Fox News support the administration and give Republican politicians airtime. He also worked the old-fashioned way. Murdoch personally met with FCC commissioners several times, as well as with key lawmakers. From 1999 to 2002, his company spent almost $10 million on its lobbying operations. It has already poured $200,000 in contributions into the 2004 election, having donated nearly $1.8 million during the 2000 and 2002 campaigns. The majority of its funds (unlike those of many of its show biz brethren) go to the GOP.


The acquisition of DirecTV makes Murdoch one of the most powerful U.S. media moguls -- with a vast "triple play" TV empire in broadcasting, cable and now satellite. News Corp. will be free to create new channels, since Murdoch will have easy access to the immense channel capacity of his new U.S. satellite service. For example, it has already announced that Fox News is considering several spinoffs. In addition, DirecTV service has the capability to beam a channel into a particular city. Hello, Fox News Cleveland, Atlanta and Los Angeles.


Murdoch's power won't be limited much by his new cable competitors, such as Comcast, Time Warner and Cox. While the rationale for the merger is that a News Corp.-led DirecTV will finally give those monopolists a fierce competitor, what is more likely is some form of cable "cosa nostra" deal: You accommodate my new channels, and I will treat yours well. Or else. After all, Murdoch can force such a deal. His Fox is already a major owner of highly successful cable TV programming. Its 20 sports networks alone earn some of the highest fees from cable operators. Moreover, cable knows that the combined power of News Corp.'s 25 TV stations and 196 affiliates can effectively force cable operators -- as a result of favorable policy made possible because of lobbying by Fox and other broadcasters -- to give vast chunks of channel space to Fox.


Meanwhile, Fox alone among the four networks has demanded that its affiliates turn over to it the invaluable new digital airwaves they received in the 1996 Telecommunications Act. (The 600-member association of affiliates -- which claims Fox's demand is illegal -- has thus far failed to convince the FCC to investigate the charge.) These digital airwaves will enable Fox to further expand the number of channels it can provide to cable.


In addition to controlling more of the programming Americans now receive, Murdoch plans, thanks to his latest moves, to quickly adopt new technology designed to make TV more interactive. In Britain, for example, the Sky satellite system (run by Murdoch's son James) features a host of gambling services (e.g., skybetvegas.com), video games and audience polls. Get ready for Fox TV on steroids.


While Murdoch is greatly expanding his media empire, and ultimately the right's media influence, former Vice President Al Gore has been, literally, begging Vivendi/Universal to sell him a single, poorly distributed cable channel. He says he wants to start a new news channel, presumably to counter the slant of Fox. The Gore initiative is an example of why, as the debate on media ownership rules resumes in Congress in the new year, it's time for those concerned about media reform to look to the future. We must secure access to the expanded capacity of TV (now that it is becoming an all-digital platform) for a new generation of programmers, especially those who want to create serious news and cultural channels. But to do so, we must look ahead to where TV and the online world are headed. Rupert Murdoch already has.





Jeff Chester is executive director of the Center for Digital Democracy (www.democraticmedia.org), a Washington, D.C.-based nonprofit. His book on U.S. media politics, Digital Destiny, will be published next year by the New Press. This commentary first appeared in The Nation.





Publication date: 12/11/03
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