Safeguarding diversity

The concept of media diversity

The concept of media diversity contains several dimensions. Different strategies exist to stimulate media diversity which can be related to the four types of diversity (i.e. diversity of suppliers, editorial programming, content and exposure). In many countries, concerns with regard to diversity have been translated into legislation on supplier concentration. However, a wave of deregulation in ownership rules has been signalled in the studied countries.

In building on the various aspects that make up the concept of pluralism, governments may employ various instruments to stimulate supplier diversity (i.e. external pluralism) as well as cultural diversity (i.e. internal pluralism). Five types of measures can be distinguished:1

  • Restrictions on media concentration, for example in terms of ownership;
  • “Counterweights”, efforts and systems that provide the audience with alternative to the free-market or commercial media outlets, for example public service broadcasting, non-profit (or ‘community’) media, internet;
  • Economic interventions, for example reduced tax rates, financial support for development, etc.
  • Transparency measures, for example providing the public with insight into the ownership relationships of media companies;
  • Organizational measures, such as the establishment of independent authorities that monitor media concentrations, such as the Dutch Media Authority.

From this wide range of options to regulate diversity in the media landscape, the focus of this report lies on restrictions on media concentration in the European countries in relation to the institutions that are authorized to enforce compliance with the rules and regulations.

Media concentration policies are a national concern. No legislation exists at European level that specifically aims to ensure media diversity. The European Commission focuses on stimulating competition and supplier diversity. This, however, refers to general Competition Law which covers antitrust (agreements, abuse of dominant positions by means of horizontal and vertical concentration) and mergers of companies on any market.

Concerns about media pluralism have been a topic of debate in the European Union since the 1970s and have resulted in several green papers and a general definition of media pluralism.[2] Although there are voices that call for regulation of ownership at European level, the member states are reluctant with regard to interference from Brussels on this issue. Alternatively, a large comparative study has been carried out to develop a tool to monitor media pluralism in the EU Member States.[3] The defined indicators take the socio-cultural aspects of media pluralism, as well as economic aspects such as ownership and control, into account. The study has developed a systematic method to signal factors that may put constraints on pluralism, but is in no way binding.[4]

Given the Dutch Mediamonitor’s particular focus on media concentration, it is argued that the study on indicators of media pluralism provides a profound theoretical background for discussing national regulations.[5] This section aims to draw a brief overview of legislation on media concentration (general competition law will not be discussed) in the Netherlands.

Dutch legislation

For several years, the Netherlands had different rules limiting ownership in the broadcasting and daily newspaper market; restrictions in granting broadcasting licences initially laid down in the Media Act. A single party with a market share of 25 percent in the national daily newspaper market or 50 percent in the local and regional market could not gain a licence for radio or television broadcasting. The government set up a commission in 1998 to investigate the necessity of implementing additional legislation to guarantee a minimal number of players in the media markets. Publishers, supported by the Media Authority, called for relaxation of the 25 percent threshold in order to stimulate innovation in electronic means of distribution. With the ‘Temporary Act Media Concentration’ coming into force in 2007 (this Act existed alongside the Media Act and the general Competition Act), a new cross-media ownership limitation was introduced with a specific threshold for the daily newspaper market.

First, the Act prohibited mergers that would lead to a market share of over 90 percent of at least two of the following markets collectively: daily newspaper, television and radio markets (where the three markets together count for 300 percent) (note that only interests in one single company of 50 percent or greater are counted). Market shares were calculated on the basis of circulation for daily newspapers and viewer or listener ratings for television or radio respectively. If a media company’s market share exceeded the stated thresholds due to autonomous growth, no measures would be taken. Second, the Act prohibited mergers that would lead to a market share greater than 35 percent of the daily newspaper market. With this special rule for the daily newspaper market, the Act supported newspapers in providing a counterweight against the strong position of public broadcasting in the coverage of news and public affairs.

Given the ongoing increase of media concentration and the government’s concern for the distribution of power in public opinion formation, the Temporary Act was extended in December 2009 to January 2012. However, the Act was recently repealed. From January 2011, specific legislation on media concentration no longer exists in the Netherlands. Publishers had called for relaxation of the ownership rules. The 35 percent threshold was argued to impede their cross-media development and it was supposed that daily newspaper titles would disappear if the thresholds remained in existence. Moreover, the ongoing increase of alternative news sources was argued to provide sufficient counterweight against the larger media companies. As for the prevention of dominant positions of suppliers, general competition law also applies to the media markets. This is not to say that the assessment for mergers and acquisitions has been relaxed; there have been cases where competition law has been stricter than the Act on media concentration. For example, the Dutch Competition Authority forced publisher De Persgroep to sell its daily newspaper NRC after it took over its parent company PCM in 2009. Although this takeover was in accordance with the rules as set out in the Temporary Act, it could not be approved based on competition law.

Apart from the issue of media concentration, restrictions with regard to licensing could be perceived as an entrance barrier to the media market. As for the radio, the Radio Communications Agency (Agentschap Telecom) grants frequency space to commercial parties on the basis of application order, auctions or a comparative testing (Telecommunications Act, Art. 3.3 (4)). Note that the frequencies held by licence holders may change due to mergers or acquisitions. To safeguard diversity, specific requirements for some of the frequencies determine what music style may be broadcast (Media Act 2008, Art. 6.23). Regional and local public radio are prioritized in granting frequencies (Telecommunications Act, Art. 3.3 (2, 3), but they have to comply with programming requirements that aim at securing a minimum amount of (regional or local) information, culture and education (Media Act 2008, Art. 2.70).

Most broadcasters, either radio or television (via the airwaves, cable or satellite), need a licence from the Dutch Media Authority to broadcast television and/or radio programmes. Only the national public broadcasters’ licences are granted by the Minister. Whereas radio broadcasters have to obtain frequency space, television broadcasters have to assign cable operators or buy airtime on an existing channel to transmit their programmes. Public broadcasters enjoy a must-carry rule, and are therefore ensured of cable transmission (Media Act, Art. 6.13). There is no limitation on the number of licences one may hold for commercial broadcasting – as long as a company complies with general Competition Law. In contrast, one cannot hold more than one public broadcasting licence.

1. Cavallin, J. (1998). European Policies and Regulations on Media Concentration. International Journal of Communications Law and Policy, 3(1).
2. Idem.
3. Three academic institutes (i.e. Katholieke Universiteit Leuven, Central European University and Jönköping International Business School) together with one consultancy firm (Ernst & Young Belgium) have been concerned with the development of the Indicators of Media Pluralism.
4. Katholieke Universiteit Leuven (ICRI), Central European University (CMCS), Jönköping International Business School (MMTC), & Ernst & Young Belgium (2009). Independent study on indicators for media pluralism in the member states – Towards a risk-based approach. Prepared for the European Commission Directorate-General Information Society and Media. KUL: Leuven. 93
Available: http://ec.europa.eu/information_society/media_taskforce/doc/pluralism/study/final_report_09.pdf
5. The overviews of legislation in the European countries have been verified for factual correctness.

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