Will cross-media holdings curb genuine competition?

Will cross-media holdings curb genuine competition?

Driven by deep pockets, there has been a spate of efforts at creating so-called integrated media houses that offer myriad content—film, news, music and gaming—across multiple distribution formats.

For example, News Corp.’s Star India is present across the television value chain, directly or through strategic stakes, in content (Anandabazar Patrika group and, until recently, with Balaji Telefilms Ltd), broadcast channel (Star Network) and distribution (Hathway and Tata Sky).

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This kind of integration and the growth of pan-media conglomerates across platforms, content and geographies is inevitable. If the current economic slump extends well into 2009, takeovers, mergers, joint ventures and alliances will reduce smaller and weaker players, many of whom will continue to be bought, absorbed or simply run out of money.

This won’t become an issue if genuine competition continues to exist, and if quality and diversity continue. However, the experience outside India, and to some extent even here, is that media industry convergence is a result of shared business needs and interests, and doesn’t necessarily foster healthy competition.

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In India, with cross-media holdings on the rise, there are clear implications for media dominance and monopolistic practices. We have already seen such trends in relation to the advertising revenue pie as well as control of distribution platforms that have restricted smaller and local players.

Meanwhile, the Indian media is still dominated by a large number of such small and regional players who will all have to face up to the consolidation issue sooner or later. One could argue that the very idea of pluralism requires both diversity of media owners and diversity of content.

In India, we often proudly say that we have a free media. But a media free from direct government control doesn’t mean it is an accessible media.

Some 40% of India’s population, for instance, doesn’t have access to satellite and cable television. And a free media can also be entirely uninterested in covering issues of concern to people living in rural India or in reflecting the perspectives of poor people.

My research suggests only around 8% of prime time television news in 2008 was on developmental issues. And a free media can mostly be owned by those with special interests, such as political families or quasi-politicians, all with direct or indirect connections to the government. We have already seen examples in Tamil Nadu where the power of local political parties is highly correlated with the control of information and media dominance.

Any real plural media is one that takes issues of access, content and ownership into account.

Emerging cross-media ownership patterns are also impacting behaviours such as bundling of content and advertiser or promotional services, many of which aren’t always disclosed or apparent to audiences.

Clearly digital technologies are allowing companies to offer multiple formats and content to more consumers in a bundled fashion but in terms of content, innovation and experimentation are not so visible, with more of the same being the norm, even if there are many more of them.

Typically, media ownership rules try to strike a balance between plurality and access, and giving private enterprise the freedom to expand, innovate and grow profitably.

It is important to look at the broader regulatory environment than impose arbitrary restrictions as is currently being proposed on media ownership.

This lack of long-term policy vision will have severe implications to India’s democracy and development.

P.N. Vasanti is director of New Delhi-based multidisciplinary research organization, Centre for Media Studies.

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