AT&T – TimeWarner Merger: A Disaster for Consumers when Combined with Net Neutrality Repeal (Pt. 2/2)
Thursday, June 14, 2018
SHARMINI PERIES: Welcome back to my conversation with Jeff Cohen. We are discussing the consequences of the AT&T/Time merger that a judge has ruled can proceed because it does not violate the antitrust laws of the United States. Now, Jeff Cohen is founder of Fairness and Accuracy in Reporting and co-founder of RootsAction.org, and he’s the former director of the Park Center for Independent Media at Ithaca College.
Now, one very important thing that most people aren’t talking about when they’re talking about this merger is the way in which it’s going to affect the diversity of the media out there, the diversity of opinions and freedom of expression. Because if some major corporations consolidated and own all of our media, we are only going to hear about what they want us to hear. And small media outlets and diversity of opinions are going to be seriously hampered. So, Jeff, why don’t you start by talking a bit more about the consequences this decision has on the freedom of expression and diversity of opinions out there?
JEFF COHEN: Yeah. I mean, let’s face it. Trump is like a broken clock that can be right just twice a day. And he was totally right when he said, during the campaign- it’s mostly because he hates CNN- “Too much power, concentrated in too few hands, is a threat to freedom.” Too much media power, concentrated into too few hands is a threat to the First Amendment, a threat to freedom of the press, a threat to diversity. And Trump’s justice department, with their very ridiculously narrow objection to this merger, has allowed it to happen.
And when a few companies control this much media power and the company that provides you with the Internet service is also controlling content, owning content, then these diverse websites that are doing real journalism, like The Real News Network, like Democracy Now!, like Thom Hartmann, like Truthdig, like Truthout, like Common Dreams, these websites are really in threat. They’re threatened because Trump is wiping out net neutrality, the Federal Communications Commission, working hand in glove with Verizon, AT&T and Comcast. And at the same time, allowing these mergers where the Internet providers are going to be taking over more content, more websites.
And believe me, if this goes through, this AT&T/Time Warner, then you’re going to see, pretty quickly, Comcast, which already owns NBC, CBS, MSNBC, Comcast wants 21st Century Fox, the huge content provider provider. And Verizon, which already owns AOL, Huff Post, they’re trying to get CBS. There’s no doubt that’s what they’re eyeing. So, this is a very big danger, and it’s especially a big danger because Trump’s Federal Communications Commission is trying to end net neutrality, which makes these these mergers of Internet service providers with content providers just totally dangerous, as you say, Sharmini, for diversity of news media, diversity of thought in our culture.
SHARMINI PERIES: All right, Jeff. Now, on Monday, the repeal of net neutrality officially went into effect. This means that content providers, such as AT&T, are now allowed to manipulate and slow down the Internet traffic in accordance with their profit motives. Now, as you say, this means that things that you’re used to getting at the speed at which you are getting, like The Real News and Democracy Now! and the music and movies and so on, are going to be affected.
So, I have two questions for you, Jack. One is how is the mainstream media covering this merger today? And of course, the other part of it, which is, you said there is an opportunity for us to fight back, with just to- one way is to write to your congressman and to write to your senator and so on. But somehow, that just doesn’t seem enough, given the magnitude of the issue and the power of these corporations and mergers that are going on, that our meek little boys may not be able to change the order of things. Now, can you comment on what else can be done about these mergers that are going on, and net neutrality in particular?
JEFF COHEN: There’s an old saying from the media critic in the 1940s, George Seldes, that “the most sacred cow of the press is the press itself.” And in today’s era, media covers corporate power and corporate greed badly, and they cover media corporate power even worse. So, if you’re counting on getting, you know, a full picture of what’s wrong with the AT&T/Time Warner merger from corporate mainstream media, you’re out of luck. Your second question, what can be done? Well, FreePress.net is the great freedom of the press organization. They’ve been fighting this merger and they’re fighting with a lot of other groups to save net neutrality. RootsAction.org, the group I co-founded, is in the middle of that fight.
And there had been some exciting things in the fight for net neutrality. And one is that the Federal Communications Commission of Trump has ended net neutrality, but there is this thing called Congressional Review Act, where if enough senators and enough Congress members immediately step in and want to stop a regulation or deregulation from happening, they can. And the U.S. Senate, believe it or not, the Republican controlled Senate, has passed the Congressional Review Act, where they want to discuss undoing the FCC’s ending up net neutrality.
So, right now, there’s a huge fight. And RootsAction.org has been sending out mass e-mails- is get the U.S. House to follow suit. It’s also controlled by Republicans, but if enough House members, all the Democrats or almost all the Democrats and a few Republicans, sign on, then the U.S. House can intervene to overrule Trump’s Federal Communications Commission and save net neutrality. And there’s other action happening in the states, where state governments are saying, “We will not give our business to any company that there’s not a firm and a vow that they are abiding by net neutrality.” So, there’s a lot of things that state action can do. There are cities that have reacted to the ending, or the threatened ending, of net neutrality by moving to provide municipal broadband that will be totally diverse, that will not take Real News Network and Democracy Now! and shove you into slow lanes.
So, the the activity around saving net neutrality has been inspiring. It’s gone on for years, it’s as intense as ever. People can go to RootsAction.org or FreePress.net and see all the things that are happening to fight Donald Trump’s Federal Communications Commission and and these corporations, these three companies that are acquiring more content, AT&T, Verizon and Comcast. That’s the biggest freedom of the press issue today. It’s not that Donald Trump says nasty things about reporters at CNN and The New York Times. That’s not the main freedom of the press issue facing our society today. The main freedom of the press issue is saving the Internet and saving net neutrality.
SHARMINI PERIES: All right, Jeff. So much more to talk about here in terms of the history of these sorts of mergers. Give us just a brief history in terms of some of the bigger mergers we have seen, and what the fight back against those were like.
JEFF COHEN: Yes, well I’ve been involved in those. I mean, in 1948, the U.S. Supreme Court said, “You can’t have a media conduit owning the media content.” And they broke up the idea that movie studios could own movie theaters. That was illegal, now, as of 1948, the reason being that if you owned the movie theaters and someone produced the movie independently, you could block that movie from ever being seen because you controlled the conduit, the theaters. All right. So, you jump forward to the time in the early 1990s, when you had a corporate Democratic president named Bill Clinton.
And they had this- one of the earliest mergers that was really scary- it’s funny, we’re talking about, Sharmini, AT&T merging with Time Warner. In the early 90s, Time merged with Warner, and that was considered utterly outrageous, that this entertainment company based in Hollywood, Warner Brothers, Warner Communications, Warner Records, was merging with this journalism company called Time. And every time these mergers happen, the acquiring company has to go into debt, usually, to finance the acquisition. So, the new CEO of Time Warner, back in the early 90s, Stephen Ross, he proclaimed, when people were saying, “Gee, consumers could be screwed, workers could be screwed, journalists could be screwed,” he said, “Oh, no, the best thing for journalists today, in the early 1990s, is that they be part of a giant, diverse media company like Time Warner.”.
What did Time Warner do in the early 90s? As soon as the merger went through, they laid off six hundred employees at Time Inc. magazine company. And they laid off nineteen of the seventy-five Time Magazine correspondents. And what was curious is, as a result of the merger, the CEO of Time and Warner, this new company, he’s compensated, in one year, seventy million dollars. And what we calculated at Fair, at the time, was that he could have retained all six hundred magazine employees that he had just laid off if he was willing to take a pay cut from seventy-eight million dollars to forty-eight million dollars. So, again, with AOL taking over Time Warner today, I would worry about employees being laid off.
Now, jump from the early 90s to 1996. Bill Clinton, the Democratic president working with the Republican Speaker of the House, Newt Gingrich, behind closed doors they passed the Telecommunications Act of 1996, which at the time, consumer rights groups were calling, “Well, this is that Time Warner Enrichment Act, this does nothing but enrich major corporate, major media conglomerates.” And sure enough, if you look at what happened- before the Telecommunications Act of 1996, this radio company known as Clear Channel, I don’t know, they owned about thirty or forty radio stations. And within a year or two of this bipartisan, Bill Clinton, Newt Gingrich, corrupt law called the Telecom Act of 1996, they had twelve hundred radio stations.
We hear now about this right-wing, pro-Trump television company called Sinclair. They owned a couple dozen- actually, in the early 90s, the law was a TV company, in the whole country, could only own twelve, you can only own twelve TV stations. Well, after the Telecommunications Act of 1996, a bipartisan act, Sinclair immediately went to fifty or sixty television stations. And now they have two hundred. So, and within a few months of the Telecommunications Act, Time Warner picks up Turner Broadcasting/CNN. So, you can follow these acts. And every time there’s a merger, employees get laid off. The acquiring company goes into debt, and the way they solve their problem- of course, the executives get rich, the big shareholders get rich and the media employees get laid off.
So, we’ve seen this thing happen over and over. And today, Sharmini, if you look at these companies, like Sinclair Broadcast, which owns a couple hundred TV stations, it was all a result of corrupt deregulation, corporate Democratic president named Bill Clinton, working hand in glove with a Republican Speaker of the House, Newt Gingrich. And you can trace this all to today. And frankly, this judge who just approved the AT&T/Time Warner merger, the monster of all mergers which is going to lead to even bigger monsters, he was appointed by George Bush. And he’s one of these corporate deregulators, exactly the kind of judges that President Trump is appointing today as Trump expands the swamp for corporate interests. When he threatened working class voters- he promised working class voters he was going to drain that corporate swamp.
SHARMINI PERIES: And one thing I should add to that is that the U.S. antitrust division of the Justice Department rarely challenge vertical mergers. Apparently, the last time it was done was in 1979, and that was before we had cell phone and Internet.
JEFF COHEN: Yep, there’s no doubt. And these vertical mergers, especially in the area of media and communications, are a threat to freedom of the press and freedom of speech. There’s never been more importance to implementing the Sherman Antitrust Act, which I should point out, Sharmini, that’s from 1890. And you’re right, in the late 70s, Jimmy Carter’s Justice Department was breaking up these mergers. In 1948, we had the landmark breaking up, where the TV- the movie studios were said, “Okay, you want to own movie studios, you can no longer own movie theaters, own one or the other, but you can’t own both.” We need that today. And when I hear the owner of AT&T say, “Well, we’re competing with Netflix and we’re competing with Google and we’re competing with Amazon,” well damn right. A Bernie Sanders Justice Department would be looking at breaking up big conglomerates like that, as well.
SHARMINI PERIES: I thank you so much for joining us this evening.
JEFF COHEN: Thank you.
SHARMINI PERIES: And thank you for joining us here on The Real News Network.