JILT 1997 (3) - Mike Feintuck
Regulating the Media Revolution:
In Search of the Public Interest
Dr. Mike Feintuck
Lecturer in Law
University of Hull
m.j.feintuck@law.hull.ac.uk
Contents
Abstract
Ongoing trends of globalisation, horizontal and vertical integration, and technological convergence in the media indicate the need for a fundamental review of the rationales, objectives and techniques of media regulation. While relevant legal reforms and academic commentaries have largely focused on institutional and structural reform, or have considered the relative merits of structural or behavioural modes of regulation, this piece seeks to look beneath these levels, and focuses primarily on the rationales and values that underpin the regulatory regime. Too often, the justification for regulation is given in terms of an ill-defined concept: 'the public interest'.
Rather than treating structural and behavioural regulation as competing or mutually exclusive techniques for intervention, acknowledging weaknesses in the exclusive use of either approach, the author instead recommends the use of each on a pragmatic basis, though within an accountable and transparent structure informed by an organising principle. Collins and Murroni's citizenship rationale for media regulation is considered, and the author concludes that support of citizenship ideals, and in particular the avoidance of social exclusion, could form the basis of a meaningful focal point for the regulatory endeavour, providing a clear, consistent and rational basis for intervention which should inform both the activities of regulators and the regulatory structure itself.
Keywords: regulation; public law; public interest; citizenship; DTT; CAS; Oftel
While acknowledging full responsibility for any defects in this article, the author wishes to express his gratitude for the assistance provided by JILT's guest editor and her editorial team and referees, and Cosmo Graham and Lisa Whitehouse at the University of Hull who commented on earlier drafts.
The author would be pleased to receive comments at <m.j.feintuck@law.hull.ac.uk>.
This is a Refereed Article published on 31 October 1997.
Citation: Feintuck M, 'Regulating the Media Revolution: In Search of the Public Interest', 1997 (3) The Journal of Information, Law and Technology (JILT). <http://elj.warwick.ac.uk/jilt/commsreg/97_3fein/>. New citation as at 1/1/04: <http://www2.warwick.ac.uk/fac/soc/law/elj/jilt/1997_3/feintuck/>
1. Introduction
1.1 The context
Within the last forty years, as television has come to dominate our cultural life, television (and radio) broadcasting in Britain has moved from a position of a BBC monopoly to the doorstep of a new era of virtually unlimited channels, high quality picture and sound and the availability of interactive services through the convergence of broadcasting, telecommunications and computer facilities. At the same time, arguably, an obvious potential for domination of this brave new world by unaccountable and unashamedly commercial international conglomerates has developed.
The position and role of regulators has come under increasing scrutiny and strain over this period, and especially over the last fifteen years or so, as the pace of change has increased. However, the level of debate has in many ways failed to move beyond that apparent at the time of the first break in the BBC monopoly, with the arrival of commercial independent broadcasting in the 1950s. In revised forms, admittedly, the same tensions exist between the demands of commercial markets and so-called 'public service' philosophies. Meanwhile, reactive regulatory reform has resulted in a curious mix of structural, behavioural and content-specific regulation which will often pull regulators in different directions, and can easily obscure regulatory objectives. The fundamental rationales for, and objectives of, regulation stand in desperate need of reappraisal, and new, or at least radically reconstructed versions of old concepts must be developed if regulatory approaches are to be relevant to the changed and still-changing media environment.
That the media is going through a period of revolution is a truism. The degree of change, in terms of both technological convergence between media and the globalisation of media markets, is massive and far-reaching, and far from completed. (see Herman and McChesney, 1997) The potential for 'interactive television', especially through broad-band cable technology allowing the combination of conventional and interactive television with computer network and telecommunications facilities, demonstrates the need for a regulatory regime based on new foundations. If concrete evidence of convergence is needed, Marsden (1997) provides it when he refers us to an attempt by Microsoft, Intel and Compaq to set PC-dominated standards for digital television, an event which he describes as 'a watershed in the convergence of computing and telecommunications'.
To a limited extent, as noted at 1.2, below, the British regulatory regime has already been altered to address this phenomenon. However, as I have noted elsewhere (Feintuck, 1997), the latest relevant British legislation, the Broadcasting Act 1996, can best be viewed as a holding operation, and in the medium-term, steps such as splitting responsibility for the regulation of digital terrestrial television (DTT) between the ITC and Oftel, seem just as likely to create confusion and uncertainty as consistent, effective regulation. The nature and degree of the media revolution is such that ad hoc, incremental and often reactive change in light of new circumstances will not be sufficient, yet as Humphreys (1996: 303) notes in his study of mass media policy in Western Europe, 'Increasingly, public policies have tended to follow technological and market developments'. If media regulation is to achieve anything meaningful, what is needed as a matter of urgency is a more fundamental review of the rationales, techniques and consequences relating to media regulation, that can lay a sound foundation for responses to ongoing and future developments. In Oftel's terms (Oftel, 1996), what is needed is 'a systematic effort to ensure consistency of approach to the regulation of communications networks, whether these are wire or fibre-based or wireless, or broadcast or hybrids of these'.
However, the challenges to media regulation do not arise solely out of technological developments. Changes of corporate structure in the media market have produced, for example, the domination of conventional commercial broadcasting in Italy by Berlusconi and the domination of the British press by two news groups, demonstrating the need for reappraisal of the regulatory regime if pluralism is to be maintained. As Bagdikian (1992: 35) summarises the issue, 'If a small number of publishers, all with the same special outlook, dominate the marketplace of public ideas, something vital is lost to an open society'.
The kind of international cross-media empire developed by Murdoch, or the dominance of Canal+ and Kirch on mainland Europe, poses a further clear threat to pluralism, but cannot properly be addressed either on a sectoral basis or within individual legal jurisdictions. Over-spill of broadcasting, across national borders, presents one obvious practical problem for national regulators concerned, for example, with the control of violent or sexually explicit imagery. Collins and Murroni (1996: 188) refer to this phenomenon, succinctly as 'the erosion of national communications sovereignty through technological change'. While the global nature of the Internet presents a particular set of international problems, the US Supreme Court's recent decision regarding the Communications Decency Act 1996 (Reno, AG of US, et al v ACLU, et al 1997) demonstrates the difficulties of legislating on such matters even in a domestic setting. The maintenance of plurality within a domestic market also becomes more difficult, if not impossible, when ownership is contained within a series of international media conglomerates which may have little in the way of meaningful national affiliations. From the perspective of ensuring competition, national efforts to limit the growth of cross-media empires may be undermined by the perceived national economic interest in allowing such conglomerates to grow large if they are to compete effectively on the international arena. To quote Bagdikian (1992: 249) again, 'some national governments encourage formation of dominant national firms so that they can better compete in a world-wide race'.
These outcomes of the media revolution appear to demand a root and branch review of regulatory policy and practice, yet to date we have seen only marginal changes. Proposals for a single media or communications regulator appear to be gathering momentum, and international, especially European, organisations play an increasingly significant part in media regulation. However, such developments may in themselves be doomed to failure if inadequate consideration is given to what may be considered the first order question of 'why regulate?', or, more specifically, 'what are the objectives and values that underlie the regulatory endeavour?'.
1.2 An example
It is useful to start by focusing on a single recent example (to which we will return) which epitomises the nature of the issues raised in the context of the changing television market in Britain.
While the arrival of Channel 5, the last new national analogue terrestrial licence to be awarded in Britain, could scarcely be described as revolutionary, the imminent arrival of DTT carries with it rather more hopes, expectations and fears. The supposed benefits of digitalisation, in terms of more channels as a result of digital compression, better quality sound and wide screen picture display are seen as the biggest change to television in Britain since the arrival of, depending on which commentator you listen to, colour pictures or the remote control.
However, commentators agree that the electronic programme guides and conditional access systems (CASs) required for the viewer to receive DTT, form new pinch-points in the commercial television market, with control of these gateways permitting the possibility of domination of the market by one player. BSkyB, is already the virtual monopoly player in British satellite television, and is part of Rupert Murdoch's News Corporation group that controls over 35 per cent of the British national press. This group also looks likely to be first in the field with DTT decoders, and, as the probable key supplier of major programming to DTT (through exclusive control of major sporting events and new films) has the potential to develop rapidly a monopoly power over this new market.
Under the new structure created by the Broadcasting Act 1996, and, the Advanced Television Services Regulations 1996 (SI 1996/3151) which implements EC Directive 95/47 (Advanced Television Standards Directive), the telecommunications regulator, Oftel, has now been given a key role in licensing the decoder systems (CASs) which will be necessary in order to receive DTT, and in establishing guidelines for the CAS sector. (see Feintuck, 1997 and Oftel, 1997c) Oftel's brief extends also to the more general objective of avoiding the risks of abuse of dominant positions within new markets (Feintuck, 1997: 206-7), and it can be argued that this role will be crucial if widespread benefit is to accrue from the advent of the digital era.
In June 1997, despite acknowledging the qualities of a competing bid from Digital Television Network (DTN), the ITC awarded control (ITC, 1997) of the three commercial multiplexes for DTT to the British Digital Broadcasting (BDB) consortium. However, influenced in part, no doubt by advice from Oftel (Oftel, 1997a), the ITC was only prepared to accept the BDB bid if BSkyB were to sell its one-third equity holding to the other consortium members, Granada and Carlton.
The losing bidder for the multiplexes, DTN, was reported (Financial Times, 25.6.97; Guardian, 25.6.97) as considering an application for judicial review in relation to the licence award, however, precedent suggests that such a step would be more related to publicity than anything else, given the courts' track-record of reluctance in overturning ITC licence allocation decisions. (Consider R v ITC ex parte TSW (1992) and R v ITC ex parte Virgin Television (1996). See Jones, 1992; Marsden, 1996; Prosser, 1997 for commentary) Evidence in this field suggests that the British courts cannot necessarily be relied upon to ensure rationality or even transparency in the exercise of the power such as the award of licences to broadcasters. It can be argued that British courts, basing their actions to a large extent upon the limited concept of 'Wednesbury reasonableness', do not apply the same, rigorous standards of review as do, for example, their US counterparts. (See Harden and Lewis, 1986)
Despite BSkyB's withdrawal from the consortium, Oftel continued to express concern regarding BSkyB's likely position of dominance in relation to programme supply to the new channels, especially in the key areas of sport coverage and movie premieres. Don Cruickshank, Oftel's Director General, noted that, even with BSkyB excluded from holding a share in multiplex licences, 'the participation of BSkyB . . . as a long term supplier of certain pay TV services, in particular sports programming, raised substantial competition concerns in the pay TV network and conditional access markets'. (Oftel, 1997b) This reflects the situation described by Herman and McChesney (1997: 68) in the US, where they note that even organisations of the size of NBC and CBS can be 'shut out' of the system if media giants like Disney and Time Warner increasingly provide their own products, notably films, on a privileged basis to their own channels.
On the day after the announcement of the ITC's decision, The Guardian's financial pages included the following observation:
The BDB affair has exposed the regulatory turf war between Mr. Cruickshank's Oftel and the ITC, making it even more imperative for the Government to produce a new, more robust regulatory system for the new media technologies . . .(Guardian, 25.6.97)
This example demonstrates the fact that the kind of reactive and marginal reform of the British media regulation regime brought about in recent years has failed to resolve tensions between competing regulatory approaches and philosophies. Indeed, in confirming attempts to allow the co-existence of competing and potentially conflicting rationales, it indicates a degree of complacency and myopia which is likely to prove dangerous in the context of the ongoing media revolution.
A degree of tension between regulators sharing jurisdiction is inevitable, and perhaps even helpful in the short term if it facilitates the articulation of clear regulatory standards. However, in the longer term it might be expected to result primarily in uncertainty, and may impede the identification and attainment of regulatory goals.
1.3 What can the public lawyer offer?
The issues raised for the public lawyer in the context of media regulation are both widespread and obvious. Extending beyond the intricacies of individual court decisions in judicial review cases involving regulatory bodies, the network of, often interrelating and overlapping regulatory institutions and the role of government in relation to them, and, the existence of both statutory and non-statutory regimes all provide obvious focal points. We can also readily identify problems arising out of the different approaches which are likely to be adopted by national and international bodies which may approach issues from different jurisprudential, constitutional and economic perspectives. (consider Coleman and McMurtrie, 1995)
It is therefore surprising to find that while adequate legal commentaries are readily available (Barendt, 1995; Robertson and Nicol, 1992), surprisingly little analysis has been carried out by public lawyers, in the UK at least. There are honourable exceptions to this: in the past, Norman D. Lewis (1975) and Mike Elliott (1981) have identified and focused upon aspects of this agenda, and Tom Gibbons (1991) has taken the time and trouble to pursue a more wide-ranging analysis, though this work has now been largely overtaken by events. More recently still, Lesley Hitchens (1994 and 1995) has made a significant contribution in scrutinising recent developments and indicating the need for a more thorough and considered policy review, a process to which this article is intended to contribute. However, the net effect of these contributions, while enlightening in many ways, is to leave largely untouched the underlying issues, focusing as they do primarily upon specific developments and occurrences rather than the broader issues and rationales which underlie the subject. Put more specifically, rather like the activities of government and the media regulators, the focus of commentators has tended to be on amendments to the institutional structure and the outcomes of regulation and its reform rather than upon the rationales for the regulatory endeavour.
Such tinkering with the fine detail is unlikely to equip us adequately to address the challenges posed by the ongoing media revolution. It seems largely futile to examine regulatory policies, mechanisms and outcomes without first reflecting upon the objectives, deriving from principles, in turn born of the rationales for intervention.
The range of rationales in play suggest a significant role for the media specialist, the political scientist, economist, sociologist and many others, but the lawyer, arguably, must justify their interest. Conventional British legal academics have done little more than to catalogue or chronicle the legal rules in play, however, a wider view of law can be applied.
While public lawyers clearly have an interest in the administrative law and practice applicable to an area such as media regulation, they must also place this in its constitutional context, and scrutinise legitimacy and rationality as well as mere legality. Such an approach demands not only the examination of technical rules, but also their relationship to fundamental constitutional and democratic values. It is this, more holistic approach to public law that is adopted in this article. A conventional public law analysis of the institutions of media regulation can offer much, both in terms of substantive and procedural comment. However, there is a sense in which such critique becomes vacuous if not integrated with an understanding of the values which inform any such regime.
At the heart of liberal-democratic theory is a concept of citizenship. If citizenship implies effective participation in society, it can be argued that in an era where effective participation has come to rely increasingly upon access to the media as the primary arena for political and cultural communication, access to the media has itself become a prerequisite of effective citizenship. 'Access', in this context, clearly implies the ability to receive media output, but also, arguably, implies an ability to input to the media and influence the agenda (consider Barendt, 1995: Chapter 7). Even if, as in this article, the focus is predominantly on access to the media in terms of receiving media output, the public lawyer, in addition to considering the nature of rules and norms existing in this field, and the quality of the administrative process, must also recognise that access to the media (as an aspect of citizenship and social inclusion) should be utilised as a yardstick when examining existing and proposed regulatory mechanisms.
In the absence of adequate clarity regarding the rationales and objectives of regulation, it is unlikely that we can analyse meaningfully the policies, mechanisms and results of regulation. Therefore, I seek to argue here that we must step back from the intricacies and specifics of institutional design and focus instead upon the justifications, principles and goals of media regulation. In the context of this article I provide only a tentative outline which will be further developed elsewhere. (Feintuck, 1998)
2. Regulatory techniques and objectives
2.1 An overview
A potentially bewildering array of regulatory techniques have grown up in Britain and comparable jurisdictions, ranging from statutory to self-regulatory methods, and based at both national and international levels. These various approaches can be divided further into general and media-specific competition measures, and those focused on form (or structure of ownership) and effects (or behaviour and its consequences) within media markets. Specific regulatory frameworks may exist not only in relation to ownership and licensing of broadcasting or print-media corporations, but also in relation to content or output. Increasingly, regulatory attention must turn also to delivery mechanisms, and CASs and the like. Often, specific techniques have been developed in relation to particular sectors of the media, but modern developments require a global view on a cross-media basis cutting across conventional sectoral divides.
Acknowledgement of the convergence of telecommunications and broadcasting media can be seen to be implicitly acknowledged in the overlapping roles of the ITC and Oftel in relation to licensing and regulation of the CAS arrangements for DTT, yet this must be viewed simply as one more incremental change, rather than the radical overhaul of the regulatory regime that is indicated.
Marsden (1997) suggests that regulation for competition between platforms (DTT, direct-to-home (DTH) satellite, and cable) must be the key for telecommunications liberalisation. Though delivery of television by cable in Britain remains far below the levels achieved in mainland Europe, DTH satellite broadcasting provides an obvious source of competition to DTT, though is itself dominated by BSkyB. Ensuring the existence of a range of platforms would, however, require a high degree of structural regulation, and arguably a degree of intervention which no British government would be likely to support. Indeed, though committed to the activities of market forces in relation to the media, preferring largely, for example, to allow an industry standard for CASs to emerge rather than imposing one, all government (both Conservative and Labour) rhetoric and legislative activity in the last two years has supported the development of DTT, for example by seeking to ensure quality and attractiveness of product by guaranteeing space on the multiplexes for the conventional, terrestrial, public service broadcasters.
In so far as a common thread can be discerned running through the regulatory arrangements, this thread can be identified as market-oriented. In Britain, and other countries in which current perceptions of democracy tend to push governments away from direct intervention in media output, regulation of ownership, in the name of market competition, has become a significant means of seeking to achieve desired outcomes. General competition law provisions provide the background here though differences in emphasis between different regimes should be noted. In Britain, investigations into mergers and take-overs will normally be triggered by the acquisition taking a holding beyond a stated limit within a market (form-based competition regulation) while within the EU, the emphasis is on effects rather than form, based on the provisions of Articles 85 and 86 which seek to prohibit restriction or distortion of competition or abuse of a dominant position within a market. However, in addition to general competition law provisions, media specific measures seek to establish limits on ownership and control of enterprises either within or across media sectors. These range from the provisions of the Fair Trading Act 1973, which allows wide discretion to the Secretary of State in regulating control of newspaper take-overs and mergers, to the complex provisions on cross-media ownership contained in the Broadcasting Act 1996. The overall objective here would appear to be diversity of output, though the regulatory focus is clearly on ownership.
There is a real sense in which the focus on competition via control of ownership can be viewed as surrogate for regulation for plurality in output. This option is obviously tempting given that, though by no means easy, and subject to varying methods of calculation (c.f. e.g. DNH, 1995: 6.7-6.15; Broadcasting Act 1996, Schedule 2; Peak and Fisher 1996:11), it is somewhat easier to measure and impose limits on ownership than to determine and define requirements of diversity in output. However, the emphasis on competition law, both general and media-specific measures, as the primary mechanism of ensuring plurality in the media can be questioned, a number of commentators having identified the underlying problem.
Humphreys (1996:309) states that '. . . one of the main challenges for the future will be to keep the media diverse and pluralistic in the face of powerful pressures towards economic concentration'. Meanwhile, Beltrame (1996) correctly identifies the extent to which competition law can be seen as too blunt an instrument to ensure the desired diversity of output, noting that the European Commission 'argues that the objectives of competition law and those of media ownership laws are profoundly different, in that mergers which, economically speaking do not threaten competition, might well suffocate plurality of media'. Expressing a similar point, slightly more directly, Collins and Murroni (1996:12) note that, '[I]n spite of technological change, media and communication markets do not fit the paradigms on which competition law is built'.
This raises a concept to which we will return, namely, that the media, by virtue of their power and influence, cannot be treated simply as another commodity market, but that the recipients of media products have expectations not only as consumers, but also as citizens. The fact that the media supplies and influences our view of the world, and has become the primary means for civic, political and cultural communication, demands a degree of equality of access to the media's output if equality of citizenship is acknowledged as a legitimate objective.
However, it is the perceived benefits of market competition that underlie the basic framework of competition law, and also drove the British government to take a passive attitude towards the development of CAS equipment, preferring to allow a market driven standard to emerge. European moves towards regulation via structural separation of programming from carriage (Marsden, 1997) are premised on consumer benefit which will arise from markets being liberalised and gateways kept open or opened. However, Harcourt (1996) notes that despite repeated pressure from the European Parliament, moves towards EU measures on media concentration have been delayed by the nature of the institutional dynamics within and between the Directorates General of the Commission, and political tensions between Member States, indicating the risk of institutional inertia arising in the absence of an appropriate regulatory framework being established.
2.2 Different regulatory traditions
Marsden also correctly draws attention to the problems raised for regulators operating within different regulatory traditions. In liberalised and privatised telecommunications markets such as Britain, telecommunications have largely been regulated by reference to behavioural standards, while regulation of television has largely continued to be carried out on a structural basis, the emphasis being very much on ownership, though with the addition of industry-specific behavioural controls in the form of regulation of content. Where regulators operating from different traditions are called to act together, tensions will be inevitable. Marsden seems to indicate the likelihood of the 'turf war' between the ITC and Oftel over regulation of CASs being decided in Oftel's favour, with the resulting probability of behavioural regulation predominating. This, it can be argued, would be fundamentally unsatisfactory, at least if behavioural regulation became the predominant or single track approach.
It is true to suggest that, ultimately, behavioural regulation in relation to specific pinch-points addresses directly the perceived problems of competition within the market, but, such regulation cannot operate effectively alone. It depends for its effectiveness upon the existence of a genuinely competitive market environment beyond specific bottlenecks which in itself, arguably, requires structural regulation. Anti-competitive behaviour at particular pinch-points will be influenced and shaped by pressures arising from activities in the broader field, and attempts to regulate behaviour, say, in relation to CASs for DTT, will be doomed to failure if the entire environment in which DTT operates is ultimately shaped by the structure of the broader media industry beyond the DTT marketplace. (Consider Herman and McChesney, 1997) This is the very structural problem which Oftel correctly identifies as problematic in its advice to the ITC (Oftel: 1997b) regarding DTT multiplex licence allocation.
All this appears to take us down a road towards suggesting a unified scheme of regulation for broadcasting and telecommunications though probably, logically, in light of the increasingly international nature of media holdings, one with a significant international focus. Such an institutional structure must draw on aspects of both structural and behavioural regulation (considering both the corporate structure of media conglomerates and their share of markets, but also, how dominant positions are actually used in relation to competition) but before it can carry out such a task effectively, meaningful objectives must be determined from more clearly articulated rationales for intervention.
In part, any mismatch between regulatory mechanisms and outcomes on the one hand and regulatory values and objectives on the other may be explained by virtue of the clear inconsistencies and conflicts discernible both within and between the various justifications for media regulation. In particular, the conflict between economies of scale, and perceived national interests in the development of large domestic media corporations must be set against the claimed benefits of pluralism and diversity. The failure to develop a rational basis for the resolution of this conflict may be considered to be the most obvious cause of inconsistent and unsatisfactory regulation under existing and past arrangements. However, it can be argued that the greater degree of lack of achievement in regulation arises simply out of inadequate consideration of the fundamental, underlying values. Such lack of reflection on fundamentals, and the failure to articulate objectives with reasonable clarity goes some way towards explaining the generally reactive nature of regulatory change noted by Elliott (1981) over fifteen years ago.
The apparent objectives of regulation vary between prevention of monopoly (or abuse of monopolistic/monopsonistic/oligopolistic power), the protection of differing versions of 'public service' values, and the provision of choice, in terms of product, political viewpoint, and cultural diversity. Arguably, the debate over objectives has increasingly been focused on consumer choice of media product, at the expense of broader, citizen oriented, expectations such as those underlying the public service tradition in broadcasting or the imposition of Universal Service Obligations (USOs) in relation to utilities. Emphasising consumer choice, apparently as an end in itself, avoids the establishment of policy preferences in terms of specific, substantive outcomes or objectives. This produces not only an undue emphasis on (a version of) one rationale for regulatory intervention, but also, by allowing consumer choice to determine the ultimate shape of the media market, creates a high degree of uncertainty. For example, it is unclear whether, in an open market, the consumer would ultimately be tempted most by the charms of DTT, or satellite services, or broad-band cable facilities. Traders in each will be plying their wares, but ultimately this may result in an undesirable trade war, replicating in a new forum the kind of battle of formats between VHS and Betamax in the home video market which resulted in so much consumer dissatisfaction before VHS finally won-out.
The address to the Royal Television Society in September 1997 by Chris Smith, Secretary of State for Culture, Media and Sport (The Independent, 29.9.97) confirmed that the present government is following the lead of its predecessor, in facilitating the development of DTT. However, it is by no means certain that this is what the consumer market would or will prefer. If serious about the creation of market choice, a government may find itself with no logical alternative to regulating for a range of acceptable, alternative delivery platforms though even this must be carried out in such a way as to integrate the regulation of control of platforms alongside transmission, production and CASs as part of the broadcasting market as a whole.
It is probably correct for the regulatory emphasis to shift increasingly towards delivery mechanisms, however, when focusing on this particular area, the regime must remain aware of the broader market context in which delivery mechanisms exist, and be informed by clear objectives, arising out of clearly defined rationales for intervention. To intervene is not to deny market forces, but to give effect to them. Almost nowhere does a market survive which is not regulated, and in an area such as the media, which shows such clear tendencies towards monopoly, regulation is the necessary partner of market forces if the perceived benefits of the market are to accrue.
3. Regulatory rationales
3.1 Four different approaches
Ultimately, a consistent and effective regime of regulation can only exist where the justification for regulation is articulated with reasonable clarity, and in this respect difficult choices must be made between competing and often conflicting rationales. It is this area of the debate where failure to date has been the greatest.
Justifications for regulating the media can, broadly, be broken-down into three or four groups.
The first relates to effectiveness of communication. In the context of the broadcast media, a particular related version of this argument has been that effective broadcast communication of necessity required regulation of broadcasting, as a result of the need to allocate and separate frequencies to avoid intermodulation (cross-channel interference). While of some strength historically, this argument is about to lose all currency in the context of the vast, almost infinite, expansion of channels available as a result of digital and satellite technology.
The second group of arguments for regulating the media derive from arguments which can, again, be broadly classified as pluralist. Thus, arising from an acknowledgement of the power of the media, we find, in the liberal-democratic context, arguments for diversity of ownership, with the aim of ensuring the circulation of a range of views: cultural and political diversity. On occasion, such arguments can be amended significantly to provide a cultural-protectionist version. The protection of minority languages such as Dutch, or even major languages such as French, against the cultural imperialism of a (US) English dominated world media can be conceived as an argument for cultural and linguistic diversity on the global scale.
These first two rationales for regulation seem to derive from rationales for freedom of expression based on arguments from truth, self-fulfilment or citizen participation (a typology adopted by Barendt, 1985) though both are clearly premised on the perceived liberal-democratic ideal of the ability of all to have access to the 'market-place of ideas'.
Running parallel to this is a third, economics based, argument, that monopoly, and even possibly oligopoly, is undesirable as it denies the perceived benefits that are said to derive from the operation of an effective market.
Deriving from the second argument's concern with plurality of media material, and potentially (though not necessarily) cutting across the third of avoidance of monopoly, is a fourth line of argument. This concerns a public service ethos, which though encapsulated in Britain by Reith's tripartite typology of 'informing, educating and entertaining' will be interpreted differently in different countries (see Humphreys, 1996). While regulation with a sole objective of preserving public service values may inhibit market developments, and may indeed ultimately stifle plurality of media product, the public service rationale for media regulation is said to derive from a desire to ensure the availability of a range of quality products, especially in relation to the media's role of enhancing the viewer's or reader's view of the world. The public service approach is related to the 'social responsibility' model identified by Siebert et al (1956), acknowledging the crucial role played by the media in equipping individual citizens for participation in society, while also acknowledging that the media is hugely significant in terms of providing 'a cultural cohesion to the nation' (Negrine, 1994: 198).
3.2 The public interest
All of these various rationales for regulating the media must be considered when regulatory reform is broached. It is only rarely, however, that the competing rationales can be or will be neatly separated. Rather, they will often be melded together and encapsulated in what can prove to be a singularly unhelpful term: 'the public interest'. Whenever this term appears it requires the closest possible scrutiny, as it invariably comprises a portmanteau, the contents of which must be examined closely. Sometimes, it will contain a meaning approximating to one of the rationales set-out above, sometimes more than one, sometimes all four in some combination. Part of my intention here is to seek to develop a framework which will lead to the development of a meaningful concept of the public interest in relation to the regulation of the media, or, alternatively, the discarding of the concept in this context entirely. An example may be helpful here, in demonstrating the inherent contradictions that may be contained within the 'public interest' as presently applied.
Under the terms of Paragraphs 9-13 of Schedule 2 to the Broadcasting Act 1996, the ITC and the Radio Authority are charged with applying a test of public interest when considering the acquisition of commercial broadcasting licences by cross-media corporations already controlling one or more newspapers. The criteria to be applied as indicative of the public interest as set-out in Paragraph 13, include:
a) the desirability of promoting -
i) plurality of ownership in the broadcasting and newspaper industries, and
ii) diversity in the sources of information available to the public and in the opinions expressed on television or radio or in newspapers,
b) any economic benefits . . . . . . . . . .
c) the effect of the holding of the licence by that body on the proper operation of the market within the broadcasting and newspaper industries or any section of them.
The tension and conflict between these competing public interest claims is obvious. The regulators will have to balance potential economic benefits against the values of plurality and diversity and the effects on competition. This leaves the regulators with an unenviable task, akin to comparing apples with oranges, and, in the British context, we cannot be sure that any such decision will be taken via a transparent process, or even that adequate reasons will be given or required to enable us to check the rationality of such decision-making. Thus, the absence of a meaningful construct of 'public interest' not only permits, if not encourages, inconsistency in regulation, but also hands to regulators significant, and largely unchecked, discretionary power.
Underlying various rationales for regulation are differing versions of arguments relating to freedom of effective expression, dependant increasingly upon access to the media. The approaches adopted often take on board arguments relating to diversity in media products, both in political and cultural terms, but will also often be influenced also by economic, market-driven arguments, and may also seek to perpetuate public service values. It is argued that all of these approaches are, within the context of liberal-democracies, premised upon expectations of citizenship, and that effective access to the media (in terms of both input and output) is in effect a prerequisite of effective citizenship. With this in mind, to place citizenship at the heart of any meaningful concept of 'the public interest' would seem to be a logical necessity.
The move away from a world of five analogue, terrestrial television channels to a new era of interactive television integrated with wider computer and telecommunications facilities, accessible in many cases via costly gateway facilities, presents the risk of heightened social division; an increase in the hierarchy of information 'haves' and 'have nots' and therefore heightened social inequality. Given the necessity of media access for effective citizenship, it seems reasonable to privilege equality of citizenship as the key rationale for media regulation.
4. Conclusions
It is far from clear whether the media revolution will result in the end of mass-media, with fragmentation along the lines of electronic publishing resulting, or monopoly by dominant programme or delivery mechanism suppliers. While Herman and McChesney (1997) suggest the latter, at least in the medium term, it is possible to envisage elements of both co-existing. A degree of cultural fragmentation can be expected when not everyone will have watched the same sport or soap, or surfed the same site the night before; when not everyone will have had access to the same range of options. The 'cultural cohesion' to which Negrine (1994) refers, will inevitably be challenged. At the same time, however, the market may be dominated through control of transmission or gateway facilities by one or two major players, be those people Rupert Murdoch, Bill Gates, or whoever, who may be seen as exercising undue influence over the available range of products. The latter phenomenon may result in a high degree of homogeneity of product and a very limited degree of plurality of political standpoints.
Either of these outcomes might intuitively be considered undesirable, but some such outcome seems inevitable if active regulation is not undertaken quickly. Limits on sectoral or even cross-media ownership seem to have limited effects, unless adequate regulatory attention is paid to key bottlenecks or pinch-points. Likewise, no matter how effective regulatory action ensuring free-flow through these bottlenecks is, the range of media products flowing through may be limited if the production and distribution process is subjected to an undue degree of domination.
At the most general level, Collins and Murroni (1996:12) state that 'What is needed is competition policy where competition can thrive in the public interest and regulation where it cannot'. In itself, this seems perfectly reasonable, though ultimately is heavily dependant upon an adequately developed and transparent concept of 'the public interest'.
While this analysis indicates clearly the need for regulation based on both structural and behavioural foundations, such a prescription may do more harm than good if it stifles innovation and/or has an adverse impact on economic development. For this prescription to provide positive outcomes, it must be applied as part of a broader regime of treatment, but focused on identified goals derived from rational, public and widespread and informed debate. Despite emphasising the necessity of viewing the media increasingly on a global basis, and the growing presence in this field of regional organisations such as the EU, Herman and McChesney (1997: 64) note that 'nation states remain the most important political forces in communication and much else'. Thus, national responses to global phenomena must still be determined.
The classical arena for such discourse in a liberal-democracy such as Britain is via the conventional political channels, however, in an age in which the zeitgeist appears to demand liberalisation or de-regulation, it may prove difficult to persuade politicians to grasp this regulatory nettle. In an era in which market-based philosophy enjoys a virtually unchallenged hegemonic position, it is difficult for a government to take so unfashionable a position as to limit the influence of market forces by reference to other, arguably higher, values. However, for a government said to value citizenship and community, taking steps to ensure social inclusion and equality of citizenship would be perfectly consistent.
In a sense, therefore, unfashionably, Collins and Murroni (1996:16) advocate the active exercise of policy-making power, and also regulatory power, in the public interest. This active, policy-making role is unfashionable in the sense that hands-off government, and liberalisation or de-regulation, is the dominant philosophy in British politics, exemplifying the hegemonic success of Thatcherite 'philosophy'. However, we only have to consider the present state of confusion over media regulation, the failure of regulation in Italy and Britain to control the rise to dominance of Berlusconi and Murdoch respectively, and the reactive, ill-considered nature of policy-making in this area identified by Hitchens (1995), to realise that Humphreys (1996:313) is correct in noting that 'liberalising re-regulation' is unlikely to provide an adequate response.
The major problem is the identification and articulation of regulatory objectives, often masked by the use of the nebulous 'public interest'. The common thread underlying the public interest claims in relation to media regulation can best be described as feeding into the broader constitutional endeavour of effective citizen participation. Effective participation can be equated with informed participation, and this in turn requires a diverse range of views to be in circulation and accessible to as wide a range of the population as possible in order to allow for comparison and triangulation.
Concentration in media markets, though not necessarily contrary to diversity of content, tends to have a strong contingent effect of limiting the range of views available for scrutiny. This effect can already be readily observed in the British newspaper sector, and now, with increasing dependence upon new technology to access broadcast information (for example via DTT) and computer information resources, both at a price, concentration presents a dual threat of risking further concentration in relation to technological gateways and simultaneously creating a two-tier information society.
However, inadequately considered responses will not help, and revisions of regulatory structures and techniques without adequately addressing the fundamental underlying value-questions, will not help either. A possible, and potentially attractive, way forward is offered by Collins and Murroni (1996), who, in presenting their analysis of the challenges currently facing media regulation, draw upon the findings of the IPPR's Commission on Social Justice. The Commission established four objectives which it believed should influence government policy:
* 'security' - policies aimed at prevention, or failing that relief, of poverty;
* 'opportunity' - policies designed 'to increase autonomy and life chances';
* 'democracy' - 'policies designed to ensure diffusion of power within government and between government and people';
* 'fairness' - 'policies designed to reduce unjustified inequality' (or social exclusion).
The Commission seeks to apply these as 'Benchmarks through which policy makers as well as the public can judge policy options' (Collins and Murroni, 1996:14). In our present context, we should note that, in particular, the last three of these, may also serve equally well as criteria against which the effectiveness of the activities of media regulators may be measured. Outcomes of regulation can be assessed against these standards.
To date, we have had reactive regulation, focusing on form within the sectoral and cross-media marketplaces and largely consisting of ex post facto reaction to changing technological circumstances. Now, and in the future, positive regulation will be required to ensure the widespread circulation of and access to a range of information and cultural products, and this must be positively confirmed as the key regulatory objective. Something akin to USOs may need to be imposed, but, in terms of regulatory practice, integrated regulation of the cross-media market, including control of technological gateways, focused on outcomes is necessary if this objective is to be achieved.
As has been discussed earlier, regulation of ownership in conventional media markets has often been employed as what can be viewed as a surrogate for regulating for diversity of product. In the modern context, however, attention must also be paid to regulating control of delivery mechanisms. It may be that only by regulating for the existence of a range of delivery platforms can meaningful diversity be created, or, in so far as it presently exists, be maintained. Regulation for common-carriage, as advocated by Humphreys (1996: 311), or 'must carry' requirements, also has its attractions, a form of imposing USOs on those who control delivery mechanisms. However, even this must be coupled with regulation of ownership to avoid domination of distribution and production.
The resulting complex congeries of regulatory targets will inevitably result in a confusing, and potentially contradictory regulatory framework if the underlying rationale(s) for regulation are not adequately spelled-out.
Collins and Murroni's conclusions, and their consequences, deserve careful consideration. They determine that 'general principles for governing the media and communications sector should be defined by Parliament, while their detailed implementation and enforcement should be delegated to a single regulatory agency, Ofcom'. Ofcom, they believe, should be mandated 'to secure universal access at affordable cost to the information and communication media necessary to full participation in economic, social and political life'. (Collins and Murroni, 1996: 183)
They correctly point towards confusion amongst the public arising out of the large number of different regulatory bodies currently involved in the media. Equally correctly, they indicate the need for greater representativeness, transparency and therefore accountability in the make up of any regulatory body, in part to act as bulwarks against the interference by government with the regulator's discretion. They state that the increasing convergence of media and telecommunications technology indicates the sense in moving towards a single regulator. They believe that 'a single regulator charged with both carriage and content could effectively counteract, in terms of power and resources, the giant companies it is called to regulate'. (Collins and Murroni, 1996: 186) In effect, they are advocating a mega-agency along the lines of the US Federal Communications Commission (FCC).
What has to be considered in relation to such a proposal is the very different constitutional context in which such a body would exist in Britain, when compared to the USA. In Britain, there is little tradition of multi-industry regulators exercising the kind of diverse administrative, rule-making and quasi-judicial functions exercised by the big US agencies. Admittedly, the regulators of the privatised utilities, and, even our beloved National Lottery, carry out some of these functions, but not with the degree of discretion or extent of scope enjoyed by the FCC . Independence from the executive, such as that guaranteed for US agencies is probably highly desirable, though concerns regarding the accountability of such bodies in Britain are inevitable. British agencies do not operate subject to the degree of judicial control resulting from the buoyant position enjoyed by the American judiciary under the constitution, Administrative Procedures Act, Freedom of Information Act and related measures. In the absence of such effective supervision in Britain, the merits of such agencies may be outweighed by the risks of unchecked discretion. In addition, we must take note of Barendt's observation that, while the FCC in theory has immense discretionary power, 'in practice it is significantly constrained by constant pressure from both politicians and the communications industry'. (Barendt, 1995: 85) We must therefore remain aware of the political and constitutional context in which such agencies operate, and remain vigilant regarding the ever present risk of 'agency capture' (see, e.g. Baldwin and McCrudden: 1987; Ogus, 1994), the dangers of which become proportionately more significant as agencies grow in size and power.
Thus, while a unified regulator along the lines of 'Ofcom' may be superficially attractive, in being able to offer a holistic response to the questions of media regulation, a significant pause for thought must be taken before such a route is followed. The constitutional and administrative context in Britain may result in such a step being a high-risk strategy. It may be that we would be better to trust to a range of specialist regulators, provided that their operation is rendered more transparent, but with the addition of a further body responsible for co-ordinating their activities, and overseeing media regulation at a broad level, ensuring that defined 'public interest' principles or rationales for regulation are consistently pursued and implemented. The risk, of course, with this latter model is a lack of consistency, or an overview, in regulation, and the potential for institutional inertia which Harcourt (1996) appears to suggest in relation to the EU. What appears therefore to be required is a range of specialist regulatory units to fight individual battles, while a strong 'Chief of Staff' type organisation co-ordinates their activities actively in terms of clear objectives for the 'war'. Put slightly differently, and to adopt the terminology used by Harlow and Rawlings (1984) in a different context, 'fire-fighting' operations may be best carried out by different organisations than those whose chief functions are 'fire-watching'.
A detailed structural model for delivery of this objective will not be defined here. However, what appears to be indicated is a degree of structural regulation at a macro level coupled with focused, behavioural measures at a micro level. A transparent system, open and accountable, with probably a degree of representativeness and free of government powers of appointment, seems to provide a sound basis. The present government appear to have accepted the principle of distancing themselves from aspects of long-term economic regulation in handing the setting of interest rates to the Bank of England, and the same arguments can be argued as applying to media regulation.
This does not, however, absolve government from responsibility for establishing a rational and effective forum in which meaningful regulation in pursuit of identified objectives can take place. As Herman and McChesney (1997: 11) correctly note, '[I]n all societies the question of who owns and controls the media, and for what purposes, have been political issues', and given the cultural and political significance of the media it seems correct that this should continue to be so. Whether approached from overtly commercial, or consumerist, or 'public service' perspectives, regulation will remain a necessity whatever shape the media market takes during and after the revolutionary phase.
Determining the public interest is, however, neither a simple, nor a once-and-for-all task, and the scope of this piece does not extend beyond the consideration of whether a concept of citizenship could be used as the central plank in a remodelled, rational version of this concept. It is clear that the changing nature of the media demands an immediate and fundamental reappraisal of 'the public interest', a task rendered more difficult by the failure to grasp this nettle with adequate firmness in the past. What is crucial, however, is that a clear vision of desired outcomes (i.e. behavioural and/or output objectives), deriving from well-considered and articulated rationales for intervention must inform regulation, providing a degree of what Davis (1971) refers to as 'structuring' of discretion, and must indeed be the key factor in determining the overall regulatory structure and strategy. It is reasonable to scrutinise models such as those in existence in the UK, developing in the EU, and embodied in the USA by the FCC to determine the extent to which current models meet this ideal. We are likely to conclude that to varying extents they fail, and it is likely that they fail because of the failure to identify, articulate and reiterate the rationale which underpins them. It can be argued that a vague claim of 'public interest', or marginally less vague but no more enlightening justification of 'efficacy of markets' is inadequate, and open to quiet reinterpretation or capture. A regulatory system overtly designed to give effect to 'furtherance of equality of citizenship' (or the avoidance of social exclusion) as the public interest, operating within the kind of open and accountable structure advocated by Collins and Murroni, would be less susceptible to abuse or being ignored, and would provide a starting point for the kind of rational policy-making which Hitchens (1995) identifies as necessary. It also goes some way towards providing a rational standard against which conflicts between claims of economic benefits and the merits of pluralism may be determined. In the absence of the adoption of citizenship, or arguably some other clear rationale, fundamental and systematic reform of the regulatory regime, and therefore effective and rational regulation, will remain depressingly unlikely.
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