Online Media Ownership Trends | Project for Excellence in Journalism (PEJ)

March 13, 2006

The traffic numbers for the top sites raise another issue. In its earliest days, the Internet was celebrated as a liberating force from what many derided as the homogenized, mass -market approach that characterized so-called old media: radio, television, newspapers and magazines. And while anyone with a modem and computer can now produce either a news site or a blog, the most popular online news sites remain very much a mirror image of other news industries in which a relatively small handful of media conglomerates own a large majority of news outlets.

Some media critics, most notably Ben Bagdikian, former dean of the graduate school of journalism at the University of California, Berkeley, see a dangerous lack of diversity in the online news world:

“The American population is remarkably diverse in background, politics, geography, and tastes, and has always needed this variety reflected in a parallel diversity in its public information and entertainment…With the country’s widest disseminators of news, commentary, and ideas firmly entrenched among a small number of the world’s wealthiest corporations, it may not be surprising that their news and commentary is limited to an unrepresentative narrow spectrum of politics.”13

As we have noted in earlier years, of the top 20 online news sites, 80% are owned by the 100 largest media companies in terms of total net media revenue generated in the U.S., as reported by Advertising Age. For example, Time Warner was the top company in media revenue ($37 billion) and it is the parent of the third and fourth most popular sites, CNN.com and AOL News. Gannett is 12th among leading media companies, and it owns two of the most popular news sites, USA Today.com and the aggregation of its own many local newspaper sites.14

Compared to last year, the same percentage of sites (80%) are owned by the top media companies while the share of sites owned by the 10 sites with the most revenue fell from 32% to 25% in 2005.

What accounts for the relative stability in media concentration trends? Perhaps one reason is the FCC’s decision in 2005 not to rule on the “cross-ownership” ban that bars companies from owning newspapers and television stations in the same market.

Two of the four sites not owned by leading U.S. media companies are the property of behemoths in their own right, BBC News and the Associated Press. The other two, Internet Broadcasting and World Now, are really aggregations of many sites.

BBC and the Associated Press are media organizations that offer a business model different from the traditional media corporation. BBC is financed by a television license owned by households and “does not have to serve the interests of advertisers, or produce a return for shareholders.”15 Meanwhile, the Associated Press is a not-for-profit cooperative with 3,700 employees working in 240 news bureaus around the world.16