Media ownership regulations and local news programming on broadcast television: an empirical analysis

Journal of Broadcasting & Electronic Media, March, 2007 by Philip M. Napoli, Michael Zhaoxu Yan

In the vast and complex U.S. media landscape, local television news occupies an important place. The starring role of local news plays out in several interrelated ways. First, local television news continues to be the primary news source for Americans despite its decline in popularity in recent years (Pew Research Center for the People and the Press, 2004). (1) This fact speaks to the potential influence that local news can have on viewers and society at large. Local news has been regarded as both the harbinger of the abject state of television news and the bearer of hope for civic, community-centered journalism (Barkin, 2003). Good or bad, the impact of local news is unequivocally significant.

Financially, providing local news can be a lucrative business for television stations. With a profit margin commonly at 45% to 50%, local news accounts for more than 40% of the annual revenues for stations that run local news (Project for Excellence in Journalism, 2005). In addition, local news plays a crucial and peculiar role in U.S. media regulation. Partly due to the popularity of local news among audiences and its significance in informing people and forming their opinions and beliefs, the Federal Communications Commission (FCC) has traditionally associated broadcaster service in the "public interest" with the production of local news. Thus, standards of viewpoint diversity are often evaluated through news and public affairs programming, just as Iocalism is premised on the production of local content and the coverage of local events that is responsive to local needs and interests (Kang, 2005).

The predominant role of local news programming in U.S. media policy is evident in the ongoing debates surrounding media ownership regulations. For example, in relaxing the local television multiple ownership rules in 2003, the FCC assumed that the new, relaxed rules would allow the commonly owned stations to operate more efficiently by taking advantage of their combined resources, thus increasing local news and public affairs programming in the local market (FCC, 2003). In addition, to support its decisions to further increase the national television ownership cap and to lift the broadcast and newspaper ban, the FCC, citing findings from one of its internal studies, stated that network-owned stations broadcast more local news and public affairs programming than affiliate stations in markets where the two station types compete directly, and that newspaper-owned affiliate stations outperformed other affiliates in terms of the quantity and quality of their local news programming (Spavins, Denison, Roberts, & Frenette, 2002).

This study suffered from some significant methodological shortcomings (see Napoli, 2004). Consequently, the validity of the assumption that relaxed ownership regulations will contribute to the production of more local news and informational programming remains very much open to question. If the supervening norm of the public interest principle as it relates to broadcaster behavior is "practically identical to the number of hours of local news a station broadcasts" (Kang, 2005, p. 1550), it is important to thoroughly investigate the following question: How are ownership structures and market conditions related to the provision of local news programming on broadcast television?

This study is an effort to address this general question. It presents descriptive information on station provision of local news programming and examines how station ownership characteristics and market conditions are related to the amount of local news on television stations through regression analysis. The next section of this article reviews the literature focusing on the relation between market and ownership characteristics and the provision of local television news. This section is followed by a description of the methodology employed for this study, which is followed by a presentation of the results. The concluding section discusses the policy implications of the results.

Literature Review

Absent any governmental stipulation, the amount of local news that a television station airs reflects its programming choices. Previous research suggests that station provision of local news programming may be a function of a wide range of factors that are related to consumer preferences, program costs, number of competitors, and governmental policies. These factors can be organized into two broad categories: station factors and market factors.

From a theoretical standpoint, most of these factors can be associated with two perspectives. The first involves the principle of Iocalism. The underlying logic of Iocalism in communications policymaking often has been based on the assumption that better service to the local community can be achieved via a media system in which the ownership and management of media outlets is as closely tied to the local community as possible (Napoli, 2001). From this perspective, ownership structures in which owners are embedded within the local communities are likely to produce more sensitivity and commitment to the needs and interests of local communities, as are programming arrangements that favor local autonomy over national-level decision making (e.g., independent stations vs. network affiliates). The second theoretical perspective is primarily economic. Specifically, Hamilton's (2004) model of news production emphasizes four basic components: tastes, endowments, technology, and institutions. Tastes and endowments refer to the characteristics (in terms of content preferences and financial value to advertisers) of audiences; technology and institutions refer to the technological characteristics of the marketplace and the institutional factors affecting the profitability of providing a given amount or type of news good. The specific factors outlined next as potentially related to the provision of local news programming can be related to one or more of these theoretical perspectives.