Media Diversity, Data, and Decisionmaking V. 1

1 1 (October 18, 2017)

$handle is hein.crs/govcgwu0001 and id is 1 raw text is: FF. ' ,iE ,E .$r, i , October 18, 2017 Media Diversity, Data, and Decisionmaking overMedia,, Dheterst The representation of diverse points of view and diverse ownership of businesses within the television industry has long been of interest to Congress. Section 257 of the Telecommunications Act of 1996 directs the Federal Communications Commission (FCC) to promote policies that promote diverse viewpoints in the media, economic competition, and technological advancement. In addition, Section 308(j)(3)(B) of the Communications Act of 1934 specifies that when the FCC is awarding new licenses (including broadcast licenses) by competitive bidding, the agency must promote opportunities for businesses owned by members of minority groups and women. Given this statutory direction, the FCC has sought to encourage diversity of viewpoints, as reflected in the availability of media content offering a variety of perspectives, and diversity of programming, as indicated by a variety of formats and content. To accomplish this, the FCC has relied on its authority over broadcasters, as well as and cable and satellite services that distribute television programming to consumers. For example, the FCC's Equal Employment Opportunity (EEO) rules and policies govern the job recruitment by broadcast stations, as well as cable and satellite video programming distributors. On April 24, 2017, FCC Chairman Ajit Pai announced the formation of the FCC's Advisory Committee on Diversity and Digital Empowerment (ACDDE). The ACDDE's purpose is to issue recommendations to the FCC on how to empower disadvantaged communities and accelerate the entry of small businesses, including those owned by women and minorities, into the media, digital news and information, and audio and video programming industries, including as owners, suppliers, and employees. However, structural and technological changes in the television industry, including the growing importance of entities not subject to FCC regulation, are complicating its efforts to achieve these policy goals. For the last 60 years, broadcast networks, and then cable networks, were the gatekeepers of television programs. While FCC has never had direct authority over television programming, it has been able to use its oversight of broadcasting and satellite and cable distribution to encourage diversity in programming. For example, when the FCC approved Comcast Corporation's purchase of NBC Universal's broadcast television stations, networks, and studios in 2011, the agency required Comcast to distribute 10 new independently owned and operated cable networks. Furthermore, the FCC cited Comcast's commitment to expand its offering of programming targeting racial and ethnic minority audiences as evidence of Comcast's commitment to diversity. Over the last five years, however, subscription online video distributors (OVDs), such as Netflix, Amazon Prime Video, and Hulu, have attracted an increasing number of subscribers while subscriptions to cable and satellite services have declined. Combined, broadcast networks, cable networks, and OVDs generate about $100 billion in annual revenues. The OVDs have provided new opportunities for program creators by competing with networks to commission new programs. Traditional television networks have responded to this competition by launching their own OVDs with exclusive programs. This may create new opportunities for production companies, including those owned by minorities and women. In addition to increasing competition in the commissioning of original television programs, OVDs are changing the way the success of television shows is measured, which in turn affects whether television networks and other aggregators are willing to renew them. The emergence of OVDs offers both opportunities and challenges for diversity in employment and the creation of programs that reflect the experiences of a variety of demographic groups. Showrunners are central to the changes that are possible. Showrunners, the people who head production companies, are a creative force behind television programs. In addition to having creative authority, they have overall managerial responsibility, hiring and overseeing the cast, producers, directors, and crew. In addition, showrunners must ensure that the team they oversee meets the expectations of the television studios that finance programs' production and then license the programming to television networks and OVDs. Because television programs are creative products, their financial success is unpredictable. When pitching new programs to television networks, production companies create a sample filmed episode, called a pilot. Of all pilots, networks order only a small fraction, and fewer than half of those are renewed for a second season. For studios, which typically provide financing to production companies and license their products to networks and OVDs, financing such a large number of unsuccessful pilots is risky. In the past, in an effort to alleviate financial risks, studios generally would hire people they knew, who may have shared similar demographic characteristics. According to a 2007 report published by the Writers Guild of America, West (WGA), in 1999, 7% of television writers were K~:> mppm qq\ p\w gn'a', ggmm a 'S I 11LULANUALiN,$

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