Sidney W. Dean, Jr. |
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| The Electronic Media Revolution (written 1982) |
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Preface: This biographical outline of communications media experiences was not intended for distribution. My friend, Joel Harnett, asked me for background for his publisher's column in Marketing Communications. Not knowing his intentions I assembled too much information which nevertheless may interest friends in communications and the media. My business and professional life happens to have bracketed the evolution of the electronic media. This perspective has shaped my convictions and activities in public policy. My goals continue to be to free the speech, information and programs of communications from monopoly control of the suppliers of the technical facilities of transmission as well as by government. These technical gatekeepers now control nearly the entirety of electronic media content. They have imposed upon us a socially, politically, and culturally malignant environment in which a pluralistic, self-motivating and self-governing society cannot function. |
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| A Yale graduate, I majored in English and Chemistry;
the former perhaps because I came from a family of newspaper editors and
publishers. The latter chiefly because it was the glamour science of the
twenties but which I never put directly to use. In 1927, I had a fortunate
business start in the marketing research department of the J. Walter Thompson
Company, still the largest U.S. advertising agency. Six years later I
became director of media. By the time I left for the Air Force in 1942,
I'd added six years in account service and marketing planning. Returning
in 1945, I opted for independence as a consultant and later started the
Launderette retail chain. In 1950, the opportunity to join Marian Harper
in MCann-Erickson was irresistible. Before I left the advertising business
in 1960, I'd established a multi-department Marketing Services Division
and concentrated on corporate planning and business development. Since
1960, I've been self-employed in business consulting and "public enterprise". Continuously, I've carried with me an ever-growing anxiety for the effects of broadcaster control of programs and content on our ways of life as well as our economic, cultural and political institutions. I'd experienced the pre-electronic contrasts. My crystal detector brought in the first electronic media event, The Dempsey-Carpentier fight from Hoboken. In 1922, my W.W.I. vacuum tube picked up KDKA from Pittsburg, the first commercial broadcast station. Not until I became a media buyer in the 1930's did the economics of advertising finally dictate the unprecedented control of content by technical transmission facilities - the licensed broadcasters. Not until the mid-1950's did the networks and chains finally re-act to the obvious: that their advertising revenue was governed by audience counts and audience flows. Advertisers, agencies and sponsors surrendered program control. The alternative of common carrier regulation of radio broadcast stations was anticipated by AT&T who owned the first and largest station network. Their perception may have been sound, as it may be for cable transmission today, but AT&T had no counterpart resources, taste or precedents for entering entertainment, news and advertising and sold out to RCA in 1926. Until the 1950's, the print media seemed universal and eternal. Print was free of material and technical bottlenecks or "gatekeepers"; paper and printing equipment was available for every media type and format. The postal and wholesale-retail print distribution systems functioned as defacto common carriers. Entry to publishing and access to technical facilities required only nominal capital. Diversity flourished. New York City had eleven daily newspapers. "Dime novel" outlets sold the "Origin of the Species, and' "Theory of the Leisure Class" alongside the Police Gazette and the pontifical Saturday Eveninq Post. Print had two-way, interactive capability. Pamphleteering was practical. E. Halderman Julius sold over a half-billion "little blue books" at twenty for a dollar. Bill Day of J. Walter Thompson asserted that the world-wide democratic revolution of the 18th and 19th centuries were made possible by the coincidental technologies of mass-produced muskets and mass-produced print. The techno-economics of the print media legitimatized the separated functions and legal status content and carriers. "Communications" is not an industry but a process: it is an art as well as a technology; the duality of the independent elements of content and technical facilities were institutionalized in print. The First Amendment protected content; the facilities were governed by anti-trust. The broadcasting revolution overturned-three centuries of public policies founded upon print. The unprecedented capabilities of radio broadcasting technology, like today' s broadband cable technology, was first recognized by its entrepreneurs who extracted from an uninformed Congress the unprecedented privilege of distribution systems to control their content. As the Radio Act of 1927 was debated, the Senate committee of jurisdiction made the critical decision on whether a broadcast station was analogous to a common-carrier or to a local newspaper. The outcome was determined by a single vote in favor of the newspaper analogy. There have been no further changes in fundamental public policies for the electronic media since 1927. Incremental changes, always favoring broadcasters, have been made by a subservient FCC which functions as a buffer to protect the Congress from its inability to antagonize the media or to evaluate technology. A few policy changes have been slowly and expensively made by the courts in prolonged, multi-million dollar battles of legal, technical and political hired guns in which public interest and consumer voices are feeble. In the early 1970's cable television was hailed for its multi-channel capability to restore an electronic free press. The public, distracted by witless pre-occupation with the science-fiction of future services did not grasp cable entrepreneurs' intention to control programming, following the example of television broadcaster strategies of the 1950's. The cable operators' scenario is near-realized without legislative or legal interference. Cable operators now control practically all of their potentially profitable programming. Each system is the only multi-channel broadband transmission available in its franchised territory. It allocates its channels in a descending sequence of gains and profits, demanding the best percentage or piece-of-the-action deal that it can extort. Cable systems never accept programs or services which either do or might compete with their own potentials. Only an occasional maverick like Ted Turner will turn to the courts for anti-trust remedy. It is certain that many more will, as cable's carefully concealed potential monopolies in business data, computer linkages and national/global interconnection evolve. The cable industry's assumption of public ignorance and indifference is embodied in ' the offical industry line that "cable transmission is really "electronic publishing,"entitled to the same First Amendment immunities and control of content exercised by newspapers, magazines and broadcast stations. The political slogan is "deregulation." Only by freeing content from monopolization by the technical systems of transmission can First Amendment goals be achieved. Since the inception of the electronic media, the principal public concern has not worth of what was carried but rather the possibly greater worth of the services barred from carriage by the economics of mass advertising and carriers' vertical integration of transmission and content. In 1944, the then U.S. Senator William Benton attempted in his unsuccessful pay-radio bill to sell programs and services direct to the public by scrambled transmission. Today pay-cable subscriptions are bought by 20 million residental customers and are the largest contributor to cable system revenues, although pay-per-program and business services are still untapped. Public policies must be shaped by the unique functions of broadband cable. A cable system is essentially a communications transmission service, with no other inherent function or real capabilities including programming and content innovation. Today, broadband cable has every technical capability of the telephone networks. It is inevitable that low-cost broadband transmission networks with fully switched, two-way, computer-controlled, direct per-unit pay capabilities will carry the near-entirety of communications content in every format. Yet, in June 1983 a lobby-dominated Senate passed S.66 which legalizes de facto monopoly control by cable operators over content. It is now possible that the House will pass a counterpart bill. If so, access to the public and rights to transmit as well as to receive in the electronic media will be suppressed until the 21st century. Truly, in broadband cable "we saw the future but we couldn't make it work". Our concepts of personal freedom and equality of opportunity have been founded upon the right to speak as well as to receive these capabilities of the print media activated self-government, self-development and free competitive markets. A first policy objective is therefore to phase cable into a common carrier structure perhaps over a 10-15 year period to permit amortization of present investments. As common carriers, cable systems could not engage in content supply. Broadband cable systems may remain independent but are more likely to be merged into the telephone-dominated conglomerates. If this is not feasible politically, and it may well not be, a clear alternative is to establish public telecommunications authorities funded by revenue bonds and operating as common carriers. Either of these policies will have the effect of giving electronic communications back to the communicators. It will produce an explosive growth of both popular and special interest content whose economic support will predominantly come from optional direct payments by consumers and users. Advertising income will be secondary. If political leaders and the media choose to inform the public of the vital issues and benefits at stake, these policy goals are achievable. They can regenerate our hopes for individual opportunity and expression in an open democratic society. |
Background Information
Published Works |