Here comes Ma Bell again

The more things change, the more they stay the same, or so it seems. With the announcement that AT&T is to buy Bell South for $67 billion, the world of telecommunications is moving one step closer to the reassembly of an old monopoly: namely the old "Ma Bell"/AT&T local and long-distance telephone monopoly that dominated U.S. telecommunications for nearly 70 years. The monopoly (or near-monopoly) was not dissolved until 1984. It was allowed to remain in place for so long because AT&T managed to argue successfully that its business was a "natural monopoly" that wouldn't work effectively in a competitive environment.

Now one of the "Baby Bells," Bell South, is coming back to momma in a deal that, if approved, will see four of the original 7 Baby Bells brought back together under AT&T's wing. Ironically, perhaps, the old "monopoly" is reassembling precisely because of fear of competition. And it's not exactly a monopoly anymore precisely because of all that competition--which is not from other traditional phone companies but from cable companies, cell phone companies, internet companies and other hi-tech firms all entering the digitally converging new media environment of 2006.

So it's a very different AT&T ("Ma Bell") than the one that used to rule the roost from the 1920s through the 1970s. But although it won't be a monopoly--natural or otherwise--it will be huge. The New York Times notes that with all this competition, "and more and more services available on mobile phones and on the Internet, companies like AT&T are trying to bulk up and turn themselves into one-stop shops for all communications needs." And AT&T is really bulking up for this battle. The "new" AT&T--which, as NPR's Jim Zarolli notes, already has more customers than any other U.S. telecom--will be dramatically expanded under this deal. The combined company "would also have full control of Cingular Wireless, the largest cell phone provider in the U.S." It will have 360,000 employees, 70 million local telephone customers, 10 million broadband customers, and it'll be a massive player in all aspects of the telecom business. And it'll be streets ahead of its nearest rival, Verizon. In fact it might be a bit too big and powerful for its own good. The deal has to be approved by the government's antitrust regulators in the Justice Department. Let's see what happens there.

Can we save newspapers?

Last November a Washington Post piece by Frank Ahrens made the following point about the newspaper industry as it is currently structured: "To the list of challenges faced by newspapers--declining circulation, rising newsprint costs and increased competition from more up-to-the-minute media--add another: rising pressure from investors to make more money and reverse sliding stock prices."

Ahrens was talking about the latest woes afflicting the troubled Knight Ridder group, owner of the Philadelphia Inquirer, the San Jose Mercury News, and the Miami Herald.

Now Douglas McCollam follows up on this issue in a piece in the January/February edition of Columbia Journalism Review ("A Way Out?"). McCollam again recounts the sorry situation newspaper most newsapaper companies find themeselves in--of sustaining profit margins (around 20%) that would be fantastic in almost any other industry, but which are deemed sub-par by the shareholders who expect even higher profits from their media holdings. The impact of this on the newspapers themselves--and on our notion of a healthy Fourth Estate press functioning in a vibrant democracy--should be of great concern to all.

The November Washington Post article also outlined the scale of the problem. To review:

Knight Ridder is vulnerable to a sell-off because its stock price has steadily declined, and the same holds true for other major media companies that own newspapers. Gannett Co.'s stock is down 21 percent over the past year, The Washington Post Co.'s is down 19 percent and the New York Times Co.'s is down 30 percent--opening the door to shareholder dissent.

(I had previously noted in a mediaville blog post the particular problems suffered by Tribune Media--owner of the Los Angeles Times and Chicago Tribune--which "recently secured a profit margin of 'only' 17.5 per cent -- high by almost any other industry's measures, but low for the obscenely profitable mainstream media").

CJR's McCollam points out that, by the end of 2005, Tribune's stock was down 29 percent. And the rest of McCollam's figures are even more depressing than those provided by Ahrens. This, then, is a serious problem. But McCollam gives us an insight into just how serious the problem is, pointing out that "In an effort to arrest the slide and appease shareholders, virtually every major newspaper in the country got busy slashing editorial positions and aggressively cutting costs." He goes on:

In response [to shareholder pressure], many newspapers are desperately trying to convince the market that they, too, are sexy, hi-tech companies. To please the market, companies like Knight Ridder have done almost everything their large shareholders have asked — slashing staff, making stories more “reader friendly,” searching for Internet strategies that might magically transform newspapers from dead-wood deadbeats into new-media darlings. To date, none of it has worked.

So what's the answer? Are newspapers--and the huge reservoir of journalistic expertise and professionalism (yes, really!) they provide--headed for the chopping block in a vain attempt to be "sexy"? Can they be saved before they're destroyed in the race for ever-higher profits? Well, yes they can, argues McCollam: By being taken back into private ownership (i.e., by ceasing to be publically traded companies on the stock exchange).

Ahrens also brought this up in his November Washington Post piece when he pointed out that "Some within the industry think newspapers are better suited to private rather than public ownership," he notes. "Private companies attempt to minimize earnings, which are taxable, and maximize cash flow, which can be used to pay down debts. Public companies, however, are pressured to maximize earnings to appease shareholders." McCollam elaborates on this point in his piece:

What newspapers really need, above all else, is ownership that values journalism and understands that the work of gathering, writing, and publishing the news is an inherently inefficient business that is in a period of profound transition. The private press baron of the past might have been a blowhard propagandist with the ethics of a wharf rat, but at least he loved the trade. Compared with the lineup of bloodless managers and mandarins currently squeezing the life out of journalism, Charles Foster Kane looks pretty damn good. So while there is no guarantee that the private ownership of today would recognize the value of journalism, it has already been established that Wall Street does not. Maybe it’s time we took our chances.

McCollam writes a well-considered piece that points out the potential pitfalls as well as the potential benefits of privates ownership. But he makes a convincing argument that the private route is better for newspapers--which are qualitatively different from entertainment companies--and ultimately better for a thriving democracy.

Two views on the coming digital TV transfer

Here are two recent examples of where the press is getting it right and getting it wrong in covering the pending transfer from analog to digital television--now scheduled for Feb. 17, 2009 (the date that federal lawmakers have set for "the last broadcast of conventional television.") In other words (notes the LA Times) that's the date "when analog TV signals will be turned off in favor of digital broadcasts, which offer improved pictures and more programming choices". (See here for a wikipedia backgrounder.)

The LA Times gets it (more or less) right. The Tribune-owned paper has been getting hammered by its parent company of late (see this current Coumbia Journalism Review article to understand why), but it's still able to come up with some useful and insightful editorial comments from time to time. A Times editorial from just before Christmas focuses on the downside of the Feb. 2009 deadline for the transition, especially for poor people. It reminds readers--most of whom who probably still haven't completely grasped this--"that tuning in the new signals requires either a digital TV, which the vast majority of homes don't have, or a converter box (possibly from a cable or satellite TV service) to translate the digital broadcasts into analog pictures." What's more, "with an estimated 73 million TVs in more than 30 million homes tuning in analog signals through antennas today, a lot of viewers are likely to be caught unprepared when those signals vanish."

But the Times holds that, although Congress has enacted legislation granting vouchers to help with the purchase of set-top converters, lawmakers are generally less concerned with helping poorer, unprepared citizens than with raking in the $10 billion to $30 billion of revenue that the auction of the analog spectrum could provide the U.S. Treasury. The editorial goes on:

Washington should not let the quest for revenue override a more fundamental goal: If the high bidders in the auctions are affiliated with the local telephone and cable companies that already offer high-speed Internet service, they're not likely to use the airwaves for a cheaper version of broadband. Similarly, the high bidders might be more interested in offering movies to cellphones than a fat pipe to the Web. That's why Washington should leave some of the reclaimed frequencies open to the public without need for lease or license. With the right technologies and rules to guard against interference, these airwaves could not only enable community-based high-speed Internet services, but provide a laboratory for wireless innovation. By opening a few slivers of the spectrum to unlicensed wireless data services in 1986, the FCC made possible an explosion in Wi-Fi, or wireless fidelity, communication gear and services that continues to this day. The reclaimed analog TV frequencies hold even more promise. Rather than mining every bit for auction revenue, lawmakers should reserve some of the airwaves for whatever services and applications that innovative technologists and community groups can squeeze into them.

While the LA Times editorial staff makes some sensible points on the digital handover a Wall Street Journal goes off on a tangent, missing the point (at least in this case), by choosing to carp about government handouts to the poor. The WSJ piece (which requires a subscription, so you can't read the original unless you pay), points out that

In the best government giveaway since cheese handouts from the Reagan Administration, Congress has voted to provide consumers $40 vouchers to buy digital-to-analog converter boxes. Essentially, Congress is budgeting $1.5 billion for millions of Americans who don't need the money -- so that they can keep using obsolete technology. Moreover, most people won't notice a change in 2009. They will already have digital TVs (all new sets sold after mid-2007 must be digital), or they will still be subscribing to cable or satellite services that can send digital signals even to analog TVs. One universally acknowledged truth -- even in Congress -- is that the people who gobble up many of those vouchers will not be needy. Millions of households with satellite dishes and new big-screen TVs also have at least one old analog set lying around, and each family is entitled to two $40 vouchers. As we learned when many of the non-poor joined long queues for Reagan cheese, Americans would stand in line for marmoset pelts if they were labeled "free." To encourage such grabbiness in 2009, Congress has earmarked $5 million for voucher advertising. Mark your calendars.

These comments stir up echoes of Reagan-era "welfare queen" mythmaking, and they provide some pretty strong evidence of where the Wall Street Journal editorial board's sympathies--or lack thereof--lie.

The battle for à la carte cable is resumed

One of the more interesting media developments in recent weeks is the resumption of the debate over cable pricing. FCC chair Kevin J. Martin has come out in favor of "a la carte" pricing on cable systems. In other words, cable subscribers would be allowed to pick and choose which individual channels they would like to pay for (beyond a basic tier of broadcast and cable networks). This is a sharp reversal of the FCC's previous position, which was to support the cable industry's desire to retain the current system of bundling channels into ever larger cable packages (this is of course very profitable for the cable operators). The motive for this new initiative is, as ever with the federal government these days, a desire to protect children from indecency and violence on television. (It seems that, in terms of regulation in the "public interest," the cry of "indecency" is the only call to action that federal regulators pay attention to anymore.) Martin now thinks it would in fact be a good thing to let viewers block--and not have to pay for--"edgier" basic cable offerings such as Comedy Central and MTV. Martin now seems to have concluded that the best way to protect the children is to allow subscribers to pick and choose their own channels. Cable operators argue that if this was mandated by the government, consumers would end up paying more for fewer channels.

The FCC has no power to mandate a switch to a la carte pricing--that power is left to Congress. But Martin is certainly in an influential position to get the debate moving. As for the cable industry, it has little public support for its current strategy, that could be construed as price-gouging unhappy cable consumers. (And big cable Multiple System Operators such as Time Warner and Comcast are now scrambling to head off any possible regulatory moves.) But for years the cable industry has blithely added more and more channels to their cable lineups. Most viewers only watch a fraction of these channels--typically 17 channels out of an averagge of 88 available to subscribers, according to a 2004 FCC report (cited in USA Today on Nov 30). Yet since cable was deregulated in the mid-1990s, cable subscription rates have increased at well in excess of the rate of inflation. Many subscribers wonder why they're paying so much for scores of channels they never watch.

And now AT&T is backing the move to a la carte pricing. AT&T was for a while one of the biggest MSOs (Multiple System Operators); it got out of the business in 2001 when its cable operations were bought up by rival Comcast; but the company is now looking to get back into the game through promoting its own a la carte programming services.

(For a fuller insight into both sides of the argument, USA Today runs a pro- and con debate over a la carte pricing in its Dec 1 edition -- see here for the pro-pick and choose position and here for the leave-things-as-they-are argument.)

Lastly, it's interesting to see how this debate mixes up the ideological debate over free choice, consumer rights, regulation/deregulation, and the public interest. Those on both the left and the right seem to be divided over whether a la carte - and government moves to mandate and regulate a move to a la carte - would be a good thing. The more interesting debate, if only because it involves the people who are actually in charge of everything these days, is within the right - between, on the one hand, social-cultural conservatives operating from an indeceny-morality frame, and on the other, economic conservatives who favor leaving the market alone. The latter position is summed up by the Wall Street Journal's Holman Jenkins (thanks to a faculty colleague for pointing me to this), who notes in a WSJ commentary piece (taken from the Benton Foundation Comm Policy listserv - original requires subscription):

What about this "à la carte" debate? Supporters prattle about consumer rights, but consumers don't have a right to anything except that which somebody is willing to sell to them (without force or fraud). And everything we buy is really a package deal. Buy a garden hose at Wal-Mart and you're purchasing both a manufactured good and a service (Wal-Mart's logistics chain). Don't listen to any ninny who tells you that, because you're entitled to buy ketchup without buying mayonnaise, you should be entitled to buy ESPN without buying CNN. You can buy ketchup without mayonnaise because somebody is willing to sell it to you. In turn, you've demonstrated a willingness to make it worth his while. Today's basic cable package represents a complex set of bargains involving not just cable providers and subscribers, but two other parties: advertisers (who help pay your cable bill) and programming suppliers (who use the bargaining clout of their popular networks to get their niche networks on the air too). It's a solution that works: Everybody pays the same basic rate for channels they mostly don't watch, which is no different from saying they pay the same basic rate for the few channels they do watch -- but a lot more tastes are satisfied.

As I say, this is an interesting wrinkle on the traditional left-right bun fight over free choice, consumer rights, etc. The "solution that works" referred to above sounds surprisingly communitarian to me (at least insofar as it dovetails with commercial interests). In any contest between what individual consumers want and what big business wants, it's clear where Jenkins' loyalties lie. But one thing that Jenkins says is likely to find more general agreement: "Technology is likely to render the whole issue moot. The concept of a 'channel' is an eroding one. Internet TV will be more akin to a library, in which you order up for instant viewing the fare you care to receive."

Philly gets closer to wireless

Just before Thanksgiving, PBS's News Hour with Jim Lehrer included a segment (by media correspondent Terence Smith) on Philadelphia's ambitious (for the U.S.) plans to connect up the entire city for wi-fi, or wireless internet access. Since I was staying with my wife's family in the Philly suburbs over Turkey Day--and I sort of consider Philadelphia to be my "home" city in the U.S.--I'm particularly interested in seeing how this pans out.

"Wireless Philadelphia" is the name of a project to build a wi-fi (wireless) system for the entire city "within a year". The system follows a universal access model, based on 3,000 small antennae distributed throughout 135 square miles of the city. When complete, you'll be able to get stable wireless access anywhere in the city, indoors or out. The project, which is being pushed hard by Mayor John Street, would make Philly the first "city of its size in the nation to have wireless broadband access available to everyone, regardless of income, at below- market prices." Mayor Street sees wi-fi as an essential utility that needs to be available at affordable rates--like water or electricity. The PBS piece notes that the plan is to offer the service to all of Philadelphia's 560,000 homes and 1.5 million inhabitants, at rates between $10 and $20 per month. The goal is to erase the so-called "digital divide," which separates poor Philadelphians from their richer and middle-class counterparts, the majority of whom now have wireless internet access at home. The city took a major step forward back in early October when it tapped Earthlink to complete the network. Wireless Philadelphia is thus a public-private partnership.

Of course, other private internet providers such as Comcast and Verizon are not happy about this. These companies (and Time Warner Cable, which provides my home wi fi access in Rochester) prefer to hook people up home by home rather than provide a broad-based, public system. These companies also prefer to charge $40-50 per month rather than $10-20 per month.

A battle is shaping up between these ISPs, who see a huge revenue generator being removed from them, and cities, who see cheap and universal wireless internet access to all citizens as an essential precondition for economic growth. A recent Washington Post piece quoted Ben Scott, a policy director of Free Press, "a nonprofit group that favors the development of municipal wireless," as follows:

Increasingly, city officials view broadband in the 21st century the same way they viewed electricity 100 years ago and telephone service 50 years ago. It's falling into the category of a necessary and essential social service. . . . Cities see this as a way to spur economic growth: on the one hand to put tools in the hands of the underprivileged and give them a leg up, and on the other to provide incentives to small businesses to locate in these cities and to expand their operations.

Meanwhile, other countries, especially in Asia, push ahead with much more ambitious national wireless access plans. The U.S. strategy of leaving braodband access in the sole hands of private commercial interests has already seriously impeded growth in this sector. The result, according to a recent study reported in Slate.com ("The Fight Over Wireless"), is that "the United States has dropped to 16th in the percentage of citizens with access to broadband, trailing South Korea, Canada, Israel, and Japan, among others. There is consensus across the political spectrum that we need to go wireless—and fast." The trouble is, the federal government isn't doing much to push universal access. Most of the government impetus is coming from cities and states.

"Wireless Philadelphia" is a good start. But it's only a start. Let's hope it and programs like it don't get stymied by big cable companies and their friends in state legislatures and in Congress.

Sodexho

Dr. Rohini Anand, Senior Vice President and Chief Diversity Officer of Sodexho, will deliver Geneseo's third annual President's Lecture on Diversity on Wednesday, December 7, 2005, at 3:00 p.m. in the Robert W. MacVittie College Union Ballroom.

When I first saw this announcement the name Sodexho sounded familiar but I could not place it. Later someone told me it was the notorious corporation that had attracted so much attention for its vigorous union busting activities, ownership of private prisons, and a class action discrimination suit. I wondered why someone from a company like that had been invited to Geneseo to talk about diversity.

A little Googling turned up one possible reason. The campaign against Sodexho seems to have forced some company changes. Colorado Collge Fair Labor (CCFL), a student group, gives details about their campaign and its successes. Students, labor unions, and community groups can work together and win sometimes.

However, CCFL also concluded that "Sodexho still does not pay its workers enough, still has employees without health insurance for their families, and still runs anti-union campaigns."

Sodexho is a transnational corporation. The U.S. subsidiary may have made some changes but the larger entity has not. Corporate Watch UK has an extensive website detailing Sodexho's bad habits. Read them and judge for yourself.

There are some successes in Canada.

UNITE HERE workers win an organizing campaign at two Sodexho sites in Toronto.

UNITE HERE Canada has begun organizing the employees of Sodexho Canada on the York University campus.

It is harder to win organizing campaigns in the U.S., but not impossible, because U.S. laws are more favorable to companies than to unions and the National Labor Relations Board, especially under the Bush administration, is essentially anti-union.

I don't know what Dr. Anand will tell us about diversity, but I doubt that her experience at Sodexho can teach us much about community. The food service workers, grounds keepers, custodial workers, and others at Geneseo are represented by unions. They don't get paid enough and their working conditions are not as good as they should be, but they are better off working at Geneseo that they would be if that work had been outsourced to Sodexho (or one of its competitors).

I hope that members of the Community and Diversity Commission or the department chairs in their meetings with Dr. Anand will ask her about Sodexho's current actions when their workers want to form a union.

Teaching media versus researching media

The weekend prior to Thanksgiving I was part of a SUNY Geneseo contingent that attended the annual Lilly Conference on Higher Education, at Miami University of Ohio. (It was great fun, and kudos to Becky Glass at our Teaching and Learning Center for doing such a magnificent job organizing the whole thing). This was a long weekend full of interesting and engaging (well, most of the time) presentations and interactive sessions on how to make teaching and learning more effective in the college setting. Shortly after I got back I happened to read a piece by Scott McLemee ("Meet the Press") in Inside Higher Ed -- a piece that clicked with how I see college teaching and learning evolving, particularly in the field of communication and media studies. McLemee's central argument is that, in the broader public debate about journalism's role in society, academic media analysis "plays no part at all, at least in its theoretically articulated variants" in influencing that debate. In other words, most of the academic research in the field of communication and media studies has little direct impact on journalists and their bosses as they go about their work. The problem, as he sees it, is that even the best academic analyses in the field of media studies don't have "traction" within newsrooms. Or, in McLemee's own words: "The most subtle and cogent analysis by a rhetorician of how The Times or CNN frames its stories has all the pertinence to a reporter or editor that a spectrographic analysis of jalapeno powder would to someone cooking chili."

Up to a point I'd agree with that, though I'd contend that academic media studies do have a palpable influence on journalism, though it's slow, indirect and often hard to find--apart from anything else, working journalists who have already entered the field would hate to admit to being directly influenced by academic studies. And that brings me to teaching and learning in higher ed. Because I think that professors in communication are best served by striving to show comm students (actually, all students) how to be more critically aware media producers and media consumers while they're still at college. This is especially important in the U.S., which has such a woefully inadequate record of teaching media literacy in high school (in sharp contrast to countries such as Canada, Australia, and England). I could write a dozen peer-reviewed scholarly journal articles analyzing the media's role in society. Yes, it'd be great to have that sort of publishing record behind me. And yes, I believe that sort of scholarly activity still has worth (for one thing, it shows that published professors do have real expertise in their field of inquiry; and some of the ideas and findings from all this research does eventually seep through into the professional press and even into the newsrooms). But ultimately, for me, it's more important to have some direct impact on my students -- to help them become better critical thinkers. Part of that direct impact comes from my ability to engage in meaningful and publishable research. But it's also important to encourage them to conduct some original analysis and research of their own (in class or outside class). The extent to which I can facilitate that is the extent to which I'll be an effective educator.

In that spirit, McLemee concludes his piece as follows:

It is now much easier to publish and broadcast than ever before. In other words, the power to cover and event or a topic has increased. But the skills necessary to foster meaningful discussion are not programmed into the software. They have to be cultivated.

That’s where people from academe come in. The most substantial interventions in shaping mass media probably won’t come from conference papers and journal articles, but in the classroom — by giving the future citizen journalist access, not just to technology, but to cognitive tools.

So research does have an important and ongoing role to play--as long as it stays closely connected to student learning. That applies whether it's me doing the research or the students.

Hope you all had a happy--and safe--Thanksgiving.