11 Jan 2008, Posted by Eric Karstens in Media Policy, 0 Comments

Risk management in media policy (3): The challenges of diversity

On the occasion of a study ordered by the European Commission in December, the previous articles in this series have tried to shed some light on the concept of risk-based regulation and on how risk management, a notion previously applied mostly to technological hazards, intersects with media policy in the European Union. The study, which is supposed to define indicators for media pluralism from a risk-based point of view, might very well affect the fundaments of media laws across the continent.

This article will focus on why such change is considered necessary or desirable at all.

The consideration of media pluralism from the regulatory perspective today leads inevitably right into the core of what was discussed in the last article: the question of deterministic vs. risk-based regulation. Supplementary to that, the merits of a “soft policy” approach of rather supporting and fostering than controlling the audiovisual sector must be considered. Beside the political aspects – encouraging competition and innovation rather than prescribing a state-of-the-art bound to be outmoded soon; leaving as many details as possible to the discretion of the member states – regulatory efforts in Europe now face challenges which were not conceivable at the time of the Treaty of Rome. There are three major issues to be dealt with, all of them closely related with or, indeed, determined by economic aspects.

The first one is globalisation. Media in Europe are closely intertwined with primarily the US media economy – in terms of programme content, but regarding ownership as well. Particularly the emergence of private equity funds as major shareholders in European companies has raised concerns, because the mostly short-term business interests of such capital investors are very much at odds with the traditional concept of sustainable, journalism-oriented, public-service-minded publishing and programme making as rooted very deeply in a lot of our media landscapes. This influence affects directly and indirectly both competition and pluralism. Furthermore, US companies such as Microsoft and Google have developed quasi-monopolies on their respective business sectors. They have become information brokers of such size and import that they are in a position to severely compromise the freedom of information, pluralism and competition worldwide.

The second issue is the European common market point of view, in particular with respect to Central and Eastern Europe. In a number of these states, media landscapes did not have the opportunity to mature on their own terms before they were opened to foreign investors from inside and outside the EU. Now the majority of newspapers, magazines and TV stations there are owned by Western European or American investors. Also, some of the smaller countries do not even have the economic capacity to sustain a variety of privately (or publicly, for that matter) financed media.

This places regulation in a dilemma: While it is desirable to encourage the transfer of funds and knowledge into these countries, there are strong concerns that entire cultures and political systems come under the influence of foreign shareholders with little or no interest at all in public value and local needs. This is even more worrying where no independent, opinion-forming and sufficiently funded public service broadcasters are in place. The third issue, which is in parts dependent on the other two, is with digitalisation and the Internet in general and cross-ownership in particular. On the one hand, there is a regulatory time-lag with respect to new media. While for each of the “old” media exist well-founded conceptions as to their impacts on pluralism and the appropriate requirements for their functioning, this is not the case yet for the online hemisphere, which is extremely difficult to regulate anyway. On the other hand, technology and changing economical landscapes have given rise to a new wave of concentration and cross-ownership spanning different media categories – as well on a national as on a European or even global level.

However, in today’s diverse, internationalised and economically highly developed societies there are no deterministic mechanisms and correlations any more. Mono- or oligopolistic media ownership, for example, could pose a threat to pluralism, depending on factors such as the political culture of the affected society or, in fact, economic interests. A conservative publisher, for instance, might not want to miss the business opportunity to participate in a lucrative market for left-leaning newspapers.

Or audiences might develop a healthy distrust in notoriously biased TV and radio channels and therefore engage in intense political discussions and activities outside the conventional media. Although, of course, embedded in a very special set of circumstances, phenomena like this have occurred in the countries of the former Eastern Bloc at the end of the Cold War. Currently observable in the EU Member State Romania, the “blogosphere”, i.e., the Internet, is driven by user-generated content, tries to form a counterbalance to the ostensibly biased regular newspapers.

It is, obviously, very difficult to address such additive and adverse effects appearing across borders, economies, media types, cultures or languages through universal media regulation standards. A European media governance would not want to disrespect regional specifics or jeopardise systems that have only just reached a precarious equilibrium. Therefore, the next article will explore under which circumstances a risk-based regulatory framework can successfully provide the foundation for a more appropriate and flexible contemporary media governance.