A Loophole That’s Hurting Local Journalism

Local news outlets in Youngstown, OH have entered into shared service agreements that allow them to use the exact same content on each station.

by Matthew L. Schafer

In 2008, a majority of Americans reported that they regularly got their news from local television. Yet the quality and diversity of this “trusted news source” has declined, thanks in part to loopholes in media ownership rules — rules that by themselves already allow massive media consolidation and cross-ownership.

The Federal Communications Commission recently announced a Notice of Inquiry to review all past broadcast media rules, and has an opportunity to change some of its past mistakes. But will it look at one of the most alarming ways media corporations are eroding local journalism?

Current FCC rules limit an individual’s or company’s ownership to two local news stations in the same Designated Market Area (DMA) so long as one of the stations is not among the top four ranked stations in the market (by ratings), and eight independent TV stations remain in the DMA.

But corporate media has found a way around this rule in the form of “Shared Services Agreements” (SSA). An SSA is an agreement between two media companies that effectively transfers control of one station to another, while not transferring the actual license. More importantly, an SSA appears to result in the consolidation of control of news reporting and production. Where once there were two or more teams covering local news, the SSA reduces that number to one.

What does this mean for the news consumer, the news content and the journalist? It means that consumers are stuck with content that lacks diversity and quality. For the journalist, it means the loss of a job.

What does this look like when it’s played out? Let’s examine the case of one agreement among stations in Youngstown, Ohio, where New Vision Television, a media company based in Los Angeles, owned both the local FOX and CBS affiliates.  Then in 2007, New Vision took control of the local ABC affiliate as well. How did this happen?

First, the FCC approved the transfer of the license for ABC affiliate WYTV from Chelsey Broadcasting to Parkin Broadcasting. Indeed, the FCC wrote in its decision that “We find that grant of the application will further the public interest, convenience and necessity.”

Parkin Broadcasting then turned around and entered into an agreement with New Vision Television, according to which New Vision Television would assume control of the once independent ABC affiliate’s newscast. That was in 2007. Where are they now?

In 2009, New Vision Television filed for bankruptcy. Today, each local New Vision Television controlled affiliate publishes the exact same online content as the other New Vision Television affiliates. The average story on each affiliate’s website comes in at a paltry 162 words in length in our sample, and the sites share the same video spots.  WYTV, the ABC affiliate operated by New Vision Television through the SSA, now only employees 13 people on its news team, seven of whom are also employed by “its competitors.”

As Don Shilling of the local newspaper The Vindicator said after the agreement first took effect, “The local TV market will never be the same.”

It’s clear that these backdoor takeovers of the local broadcast stations in Youngstown are not in the public interest. They inhibit the diversity of viewpoints, sources and content. They impede localism, with decisions being made, in this case, in Los Angeles and not in Youngstown. They impinge on enterprise and local investigative journalism, as the operators of stations with an SSA often opt to lay off journalists and support staff.

A new outsourcing agreement in Omaha, Nebraska will also result in local news personnel losing their jobs as local news production will be outsourced to Iowa.  A press release from the local news station, KPTM, said the station was entering into the agreement in order to “increase the number of award-winning enterprise reporters who will cover local news.”  It is unclear, however, how KPTM will cover local news from 300 miles away from the community it serves.

The FCC has the chance to close the loophole this year and restore a competitive, vibrant and robust local television news environment through its review. Because local news outlets, as author Phyllis Kaniss put it, “have always played an important role in the way a city and region understand its problems, its opportunities, and its sense of local identity,” it’s important to protect the meaningful pursuit of news and investigative reporting that is promoted by competition among multiple news outlets.


Note: A similar version of this report originally appeared on the website www.StopBigMedia.com.

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About Matthew L. Schafer

Matthew L. Schafer graduated from the University of Illinois in 2009 with a Bachelor of Science in Media Studies. He later attended Louisiana State University’s Manship School of Mass Communication where he earned a Masters of Mass Communication and Georgetown University Law Center where he earned his J.D.
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One Response to A Loophole That’s Hurting Local Journalism

  1. Pingback: Why the Old Media’s View of “New News” Is Old News | Lippmann Would Roll

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