As the latest media dust-up plays out (King Kong vs. Godzilla, Beowulf vs. the Kraken: pick your metaphor) some people realize we’re not just bystanders. Today’s media giants have changed from one-time players like General Electric and Verizon, but the information and entertainment Americans need or want are affected. So the Community Word asked two long-time area media professionals and scholars to weigh in on the industry’s health, owners and models.
Netflix and Paramount both are trying to buy Warner Bros./Discovery.
Netflix’ $82.7 billion offer was accepted, but long-time suitor Paramount/Skydance
then launched a hostile effort to buy WB with apparent support from the White
House and financing from three Persian Gulf nations. Both offers have opponents,
from unions (the NewsGuild, SAG/AFTRA and the Writers Guild) to politicians.
“A Netflix-Warner Bros. would create one massive media giant with control of
close to half of the streaming market, threatening to force Americans into
higher subscription prices and fewer choices over what and how they watch,
while putting American workers at risk,” said Massachusetts Democratic Sen
Elizabeth Warren, who also opposes Paramount’s purchase. “A Paramount
Skydance-Warner Bros. merger would be a five-alarm antitrust fire and exactly
what our anti-monopoly laws are written to prevent.”
* Do you think chain/corporate ownership makes a difference compared to regional or local ownership? Are there ways to balance business interests and public service?
John Malone - The Communications Act of 1934 established that, in exchange for the use of the [broadcast] spectrum, licensees were required to operate in the public interest, convenience and necessity. The Federal Communications Commission has licensing and regulatory jurisdiction only over the licensees who use government-owned airwaves. Since all other “non-broadcast” media companies (movie studios, Internet companies, and “Big Tech” operate outside of the purview of the FCC, the only regulatory recourse left is through anti-competitive regulation.
The notion of broadcasters serving as public trustees began to change in the late 1970s with the Carter administration’s deregulatory efforts. The Reagan administration accelerated deregulation by shifting regulatory policy away from a trusteeship model and toward a marketplace approach. Government would no longer mandate minimal hours of news programming, community-outreach efforts, maximum commercial units per hour, etc.
FCC Commissioner Mark Fowler said a television was no different than any other home appliance: “a toaster with pictures.” The National Association of Broadcasters rationale [was] “We have to provide these services because listeners expect them. If we do not serve the public, the marketplace will not be well served and we will suffer.” This philosophy failed to predict that the entire industry would scale back their “issue responsive” programming, among other news offerings. Hence, the industry as a whole would begin an incremental erosion of local content.
Remember when the “Big Three” networks (CBS, NBC, ABC) expected to lose money on its news content? CBS patriarch Bill Paley said, “I have Lucille Ball and Jack Benny to make my millions. News is considered a form of tithing for the privilege of using the airwaves.” In 1985-86, all three networks changed ownership and became part of larger publicly-traded corporations. The new deregulated FCC paved the way for massive cuts in network news. Bureaus closed, layoffs ballooned, and programming options that typically brought lower ratings than entertainment programs vanished.
The Telecommunications Act of 1996, signed by President Clinton, eliminated the national radio ownership cap. Most policymakers belatedly admitted it was a grave error. It created a “spectrum rush” where larger players gobbled up stations from their original “mom-and-pop” owners at unheard-of prices. For example, I was working at WTAZ in Morton at the time. Under existing media-valuation formulas, that station would have appraised at about $500,000. They were sold in 1998 to Kelly Communications for $1.8 million. This assumed that Kelly would flip the station in a package with the others to a large national operator.
Nationally, companies paid outrageous sums for radio stations using borrowed money. Once the payments began, they had to cut costs to meet their debt service. The largest expense is salaries, so stations were forced to pare back to minimum staffing. That necessitated cuts in content.
Basic economics includes the study of market failures, when the market no longer can make efficient adjustments. Two examples of market failure are monopolies and failure to provide for a public good. The first speaks for itself. As for public good, what profit motive exists for the creation of non-entertainment content? News departments don’t make money. So without a regulatory apparatus in place, most public good will suffer. Think of a city park. People like visiting it, but the land would produce more value as an office complex. Only regulation and government intervention preserves the park.
The bottom line is that some station formats demand issue-responsive news programming. News/Talk radio for one. And some companies do local radio better than others. The mom-and-pop operators like Charlie Wright in Canton are long gone, but some companies realize they need to remain relevant to their communities. Those who short-circuit that approach fail. Non-commercial National Public Radio-affiliated stations were more likely to maximize public-value creation, according to FCC documents.
Debbie Hedemann - I've always been of the opinion that large corporate ownership can be negative. I worked in the industry during deregulation (the Telecommunications Act of 1996). While it can provide resources and support on a larger scale to smaller stations, it also takes away control from smaller stations. I've seen instances where a station owned by a large corporation has been instructed what not to say or to talk about/cover on their news programs in order to appease ownership. News/journalism is meant to tell the public what is happening. There should not be any barriers to that.
To be honest, I don't know what the business model would be except for the big corporate owners to allow the journalists to do their job as they see best.
* It seems that audiences are eroding, too. For example, the Journal Star's own circulation numbers they published in October’s USPS Form 3526 showed a 2025 print/electronic circulation of less than 10,000 for a daily that once topped 100,000. Some blame smartphones or social media plus "news avoidance." Any thoughts or theories?
D.H. - "News avoidance" is definitely a thing. Students tell me that they don't "do" news or they try to avoid it. They do not consume news, which makes it difficult to teach them how to be journalists. The other issue is that because most of their information about the world comes from social media, their algorithms are only going to show them what they want to see. If they don't want to see the news, they won't. If they want to see cat videos, they will. If they consume biased news, they will continue seeing it without looking at other sides. False news and misinformation are real and continue to be perpetuated. If they do consume any news, often they find themselves in echo chambers where false information can be reinforced.
J.M. – Print journalism has its own problems. The industry never figured out a way to monetize the digital side until it was too late. The 2025 “Medill State of Local News” report shows that 213 out of the 3,143 counties in the country now have no local newspaper, and in another 1,524 counties there’s only one news source. Those that exist are watered-down publications nowhere near the size and scope of their predecessors. There are no easy explanations. I can remember when the Journal Star had more revenue than all of the television stations in Peoria, combined. The print industry has been forced to react to losses in revenue by cutting to the bare bones. When content is cut because of revenue shortfalls (editorial pages, local human-interest stories and features, etc.), circulation suffers.
The news business has itself to blame for much of this. The programming of news for revenue and ratings has led to the shaping of stories to serve a target audience. Fox News and MSNBC engage in this practice as a business model. But the problem is also more nuanced. Trust in journalism has eroded exponentially in recent decades. There are too many agendas and not enough solid reporting going on in major organizations. This absence of trust trickles down.
* Lastly, are local reporters still "hometown" or temporary residents with less history, familiarity or contact with everyday Peorians or sources, or just a promotion in a new media climate?
D. H. - I think that local TV reporters are still considered to be "hometown." There are many polls from groups like Pew Research, Gallup and Knight Foundation that indicate that this is true – we tend to trust our local news reporters because they're our neighbors.
J.M. - The era of long-time market legend broadcasters (Tom McIntyre, Bob Larson, etc.) is over. The new economics of the television industry have turned jobs in markets the size of Peoria/Bloomington into stepping-stones. Reporters sign a contract, stay for two years, and move on. I’m not being critical. I’m just telling the truth. How can someone become connected to a community in such a short time? This is just another outcome of the cost efficiencies expected from companies that are highly leveraged with private equity and bank debt.
Dr. John Malone is Associate Professor of Communication at Eureka College who previously was a communication professor at Lincoln College for 18 years. He started in radio in 1987 and was Operations Manager at WTAZ in the 1990s, after which he became Program Director and a host at WMBD radio. His dissertation toward earning a Doctorate of Public Administration from the University of Illinois at Springfield in 2020 addressed much of this topic.
Debbie Hedemann is chair of Illinois Central College’s communication program and manager of ICC’s Harbinger Student Media. After earning a Master of Arts in Radio, TV, Film Programming and Management from Indiana State University, her career started as a production assistant and worked many behind-the-scenes positions in programming, production, engineering, promotions and operations manager. She’s worked for an NBC affiliate in Terre Haute, Ind., a Fox affiliate in Bloomington, and Peoria affiliates of ABC, the WB, and UPN, and has taught at ICC for 22 years.
Big players: Four major corporations own key media in Peoria market
Cumulus Media radio group
Market capitalization: $1.71 million
President & CEO : Mary Berner
Cumulus holdings in metro Peoria are WFYR-FM 97.3, WGLO-FM 95.5, WIXO-FM 105.7, WVEL-AM 1140 and WZPW-FM 92.3, the market’s second-largest cluster (behind Midwest Communications). However, its 428 radio stations make the corporation the country’s second largest radio chain (behind iHeartMedia’s 860 stations).
Local Cumulus stations use some news stories from WMBD-TV 31 and the Cumulus subsidiary Westwood One, but after the January 6, 2021, attack on the US. Capitol, company executives warned on-air staff to refrain from broadcasting misinformation about election fraud.
Journal Star
USA Today Co. (corporate name changed from Gannett in September)
Market cap: $524.2 million
Chairman & CEO Mike Reed
The largest U.S. newspaper publisher, with about 100 daily newspapers and almost 1,000 weeklies, USA Today/Gannett’s CEO comes from a private-equity background with a reputation for buying newspapers and cutting them to the bone, mostly through newsroom layoffs, then leaving them a shadow of their former selves.
The Boston Globe in 2023 described how Reed’s management has resulted in “brutal and probably irreversible damage on already struggling news organizations all across this country.”
Although USA Today endorsed Biden in 2020 and opposed Trump in 2016, Reed oversaw USA Today’s decision in October 2024 not to endorse a presidential candidate. Nevertheless, President Trump that December sued the company’s daily Des Moines Register for publishing a pre-election poll that found Kamala Harris leading among Iowa voters.
WEEK-TV 25
Gray Media
Market cap: $516.9 million
Chairman & CEO Hilton Howell Jr.
Owner of the market’s NBC affiliate and operator of the ABC station (WHOI), Gray is among several companies (including Nexstar) interested in buying TV television stations owned by Cox Media Group – a deal that would require an OK by the Trump administration’s Federal Communications Commission. Given FCC Chairman Brendan Carr’s recent pledge to change broadcasting to favor mergers and acquisitions, and his complaints about content critical of the President, any approval might have conditions.
Also, federal rules for years have prohibited television-station owners from owning licensed outlets that reach more than 39% of the U.S. population. Since Gray owns or operates about 180 TV stations in more than 110 U.S. markets, “its size could prove problematic under existing regulations,” according to Matthew Keys of TheDesk.net, a media news and analysis web site.
However, Howell has made substantial contributions to Republican candidates and Super PACs, according to FEC data compiled by the nonpartisan Center for Responsive Politics, so Gray may have an edge.
WMDB-TV 31
Nexstar Media Group
Market Cap: $5.21 billion
Chairman & CEO Perry Sook
After FCC Chairman Brendan Carr in September threatened media companies that produced or aired late-night host Jimmy Kimmel’s ABC program – warning companies such as Disney and Nexstar, “We can do this the easy way or the hard way,” Nexstar announced it would preempt Kimmel’s program that aired any of its stations (it’s broadcast on WHOI in Peoria) and Disney (which owns ABC) suspended Kimmel’s show. After a public outcry, Kimmel returned to the air (and recently signed a contract extension).
The owner of Peoria’s CBS affiliate and operator of the Fox station (WYZZ), Nexstar also is looking to expand, and Sook has expressed optimism that the FCC will relax the 39% cap on TV-station ownership and other limits blocking the conglomerate from increasing its already extensive control over local-broadcast news.
Days after the 2024 election, The Hollywood Reporter said Sook implied he thought some broadcast journalism was slanted, and he hoped "fact-based journalism will come back into vogue, as well as eliminating the level of activist journalism out there."
Edited from a report by the nonpartisan, nonprofit FreePress.net, a media research and advocacy group.
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