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Commentary: Antitrust Cops Shouldn't Police Free Expression


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Commentary: Antitrust Cops Shouldn't Police Free Expression

Ever since the emergence of the Chicago School of Economics three decades ago, antitrust law has been all about dollars and cents. Unless a merger is apt to increase consumer costs, the Federal Trade Commission and the Justice Dept. will almost surely give it a green light.

But as the antitrust cops prepare to review the AOL-Time Warner merger, commentators are proposing a radical idea: that factors other than economics--for example, the protection of free expression--should be looked at in scrutinizing media deals. It's a notion that's appealing in theory but ugly in practice.

Specifically, many media critics would like the antitrust agency that gets the AOL-Time Warner assignment to take into account whether media concentration threatens the diversity, independence, and integrity of the American press corps. "The merger of these two behemoths [has] deep implications for democracy," editorialized The Nation. "We need far-ranging discussions of how antitrust policy should apply to these hydra-headed media creations."BIG IDEA. Supporters of this view note that the creators of the Sherman antitrust act cared about much more than economic efficiency. They were also worried about the cultural and political implications of mergers. From the 1890s until the mid-1970s, antitrust law was widely used as a tool to preserve local ownership of important industries, protect small businessmen, and in some cases to defend free expression. In a landmark 1945 ruling, for example, the Supreme Court forced the Associated Press to drop a rule that only one paper in any one community could belong to the news-gathering service.

For the first time in years, it's possible to imagine that antitrust might be used in an expansive way again. Under the leadership of Robert Pitofsky and Joel I. Klein, the FTC and Justice have both shown a cautious willingness to expand the law in new directions. Their suits against Intel and Microsoft, for example, were both based on innovative interpretations of traditional antitrust doctrine.

Meanwhile, Hawaii Attorney General Earl I. Anzai in October filed a suit to block the sale of the afternoon Honolulu Star Bulletin to the morning Honolulu Advertiser. Arguing that the deal would eliminate "a significant forum for the airing of ideas and thoughts," he has won a preliminary injunction postponing the sale. His moves have inspired a group of San Franciscans to file a similar antitrust suit to stop that city's afternoon Examiner from buying the morning Chronicle.

The sentiments underlying these lawsuits are easy to understand. As more independent news organizations disappear, there is a genuine threat to the quality of journalism. But as important as the fight against media concentration may be, the antitrust laws aren't the right tool for the job.

It's much harder to analyze whether a particular merger will injure free expression than it is to evaluate whether such a deal will lead to, say, higher prices. While regulators have developed sophisticated tools for predicting the economic impact of corporate combinations, there's no way of measuring how badly a given deal hurts the marketplace of ideas. "We don't have a particularly good calculus for taking variables like free expression into account, or for weighing the trade-off between an injury to free expression against a gain in efficiency," says George Washington University Law School antitrust professor William E. Kovacic.

As a result, it's all but impossible to develop objective rules for deciding which media mergers are O.K. and which are dangerous. Judges would be free to do pretty much whatever they wished. There would be unfair differences in the way similar deals were treated. What's more, businesspeople couldn't predict how the law would apply in any given case.

That's the opposite of the way the law is supposed to work. Sure, media concentration is scary. But we still don't have a good handle on the issue. Until someone comes up with a more probing way to analyze when media mergers harm the free flow of information, using antitrust law to solve the problem will do more harm than good.By Mike France; France Covers Legal Affairs from New York.


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