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Despite the intent of antitrust laws to ensure diversity of corporate ownership, companies have easily avoided these laws since the 1980s. They have done so by diversifying their holdings and by forming local monopolies, especially in newspapers and cable. These efforts have resulted in fewer voices in the marketplace and less competition among industry players.

Expanding through Diversification

Diversification promotes oligopolies in which a few large companies control the majority of production and distribution of media content. Most media companies diversify among different media products (such as television stations and film studios), never fully dominating a particular media industry. Time Warner, for example, spreads its holdings among television programming, film, publishing, cable channels, and its Internet divisions. However, Time Warner competes directly with only a few other big companies like Disney, Viacom, and News Corp.

This kind of economic arrangement makes it difficult for companies outside the oligopoly to compete in the marketplace. For example, an independent film production company may be unable to attract enough investment to get its movies distributed nationwide.

Building Local Monopolies

Antitrust laws aim to curb national monopolies, so most media monopolies today operate locally. Nearly every cable company has been granted monopoly status in its local community. These firms alone decide which channels are made available and what rates are charged. Independent voices have little opportunity or means to raise the questions that regulatory groups—such as the Justice Department and the FCC—need to hear in order to shape the laws.