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Argentina Tackles Media Ownership Concentration

Submitted on November 1, 2013

[Editor’s note: In this week’s round-up, new Headlines Writing Associate Rebecca Ellis looks at a significant media policy decision from Argentina that did not get much press here in the U.S. Looking at international coverage in English and Spanish, Ellis offers a take on the Supreme Court of Argentina’s ruling that upholds a new law that limits media ownership concentration.]

It doesn’t look good for Argentina’s biggest broadcast conglomerate. After four years of battles between Argentine President Cristina Fernández de Kirchner’s government and Argentine multimedia mogul Clarín Group, Supreme Court judges, by a 6-1 vote, declared constitutional a law that forces media companies to shrink their broadcast divisions.

Argentina’s media law has been heralded by UNESCO officials as a model of media democratization in an effort to combat public disinformation and media monopolies, according to Prensa Latina. The Supreme Court of Argentina sided with the government on curtailing the size of large private media conglomerates like Clarín, while maintaining that public media should not be used as a “mere instrument to support government policies, or as a means of eliminating dissenting voices.” The court stressed that the Federal Authority on Audiovisual Communication Services (AFSCA), the government body regulating audiovisual media, “should be independent” and that the law in question “should be applied equitably and using due process.”

However, the Clarín Group insists that it has been unfairly treated by the Fernández de Kirchner administration and singled out in the process. Ricardo Kirschbaum, Clarin’s editor-in-chief, told The Telegraph last week, “This is a political ruling.” He added that it would affect “the free exercise of journalism.” A statement read by the editor of a Clarín-owned daily in the northern town of Tucumán denounced government policies that “discriminate between different operators, favoring the control of the media by companies contracted by the government,” and “privileges pro-government opinions.” With its nationwide television network, cable operations and multiple regional TV and radio stations as well as newspaper interests, Clarín claim it is the only media company big enough to feel the greatest impact from Argentina’s new ownership restrictions.

The law, the Audiovisual Communication Services Act (or LSCA by its Spanish acronym), was passed in 2009, but it has not been fully put into effect because of Clarín’s challenges in the courts. The latest ruling, however, means Clarín must immediately start the process of divesting itself of assets, according to AFSCA President Martín Sabbatella. In its nearly 400-page ruling, the top court said that Clarín must present its plan to begin the divestment process. “After four years of court delays, the gluttonous giant Clarín, following a ruling by the Supreme Court, will have to comply with the law,” said Sabbatella. He called the ruling "a triumph of democracy."

Clarín certainly has more to lose than any other ownership group. The company owns 41% of Argentia's radio market, 38% of the broadcast television market, 59% of the cable market according to data published by Argentina’s federal communications regulating agency. As it stands, the group is Argentina's biggest newspaper publisher with seven titles and a news agency. It owns the second most popular TV channel, three provincial channels, 10 radio stations and 158 broadcasting licenses.

Now upheld, the law is a big blow to media ownership concentration. A single company cannot exceed 35% of the national broadcast television market or 35% of the country’s cable television audience. It reduces the number of radio and TV broadcast stations a company can own from 24 to 10. It is estimated that although some 21 media companies will lose 330 licenses in total, 150 to 200 of those belong to Clarín.

Clarín asserts President Fernández de Kirchner’s Front for Victory Party has the company in the crosshairs. Clarín's Kirschbaum says that the new media law is a thinly disguised attempt to silence a leading voice against the Fernandez de Kirchner government. Indeed, Kirschbaum claims that the Argentine government controls (directly or indirectly) more of the media than Clarín does. Moreover, the court victory is considered by analysts to be a breath of fresh air for President Fernández de Kirchner and Front for Victory just 48 hours after the party’s disappointing results in the legislative elections. According to La Nación, “the Court threw the politically drowning Fernandez administration a life-saver so it can come up for air.” Meanwhile, supporters of President Fernández de Kirchner believe that Clarín has been leading a campaign, disseminating anti-government propaganda to destabilize her government.

Ultimately the court concluded that the law “favors freedom of speech by limiting market concentration,” because “without the needed protection only a nominal democracy would exist.” Interestingly, Clarín counters the decision with the same argument. The group maintains that the ruling will negatively impact “the free exercise of journalism.” CEO Kirschbaum said, "[The government is] not only looking to silence the Clarín group, but any voice that is out of line with the official discourse."

Many on Argentina's political left and other administrative supporters criticize concentrated media ownership as a holdover from the recent military dictatorship in Argentina (1976-1983), therefore welcoming media regulation with open arms. The LSCA was intended to replace the Radio Broadcasting Act, which was originally enacted by Argentina’s military dictatorship in 1980. On the occasion of the 30th anniversary of the return of democracy to Argentina, journalist Horacio Verbitsky highlighted that the ruling represents a democratic battle that has been won against a corporate power who positioned itself against the elected public mandate. Segments of Argentine society ranging from university professors, intellectuals, activists, unionists, and other political parties also support the ruling.

A similar high level of media ownership concentration exists in neighboring Chile, which was likewise subjected to a brutal dictatorship from 1973 to 1989 under General Augusto Pinochet. Media conglomerates COPESA and El Mercurio own most of the nationally-circulated press (over 40% of market) in Chile. The Pinochet regime allowed commercial TV stations in Chile to retain their licenses indefinitely, a legacy of the authoritarian regimes of Latin America’s recent past that proponents of the new Argentine media law seek to turn around.

Clarín says it will respect the ruling, but vows that it will defend its legally-obtained and legitimate broadcasting licenses in the courts. The company is also considering taking the issue to international courts.

Given Latin America’s authoritarian history, a reexamination of media freedom and laissez-faire media policy may be overdue. Free market proponents insist that less government interference is the only way to ensure free media -- an argument that we often hear here in the U.S., too. But these proponents are slow to admit to market failures that can lead to undue corporate control of a nation’s media outlets.

We’ll keep tracking important updates of media ownership debates both here in the U.S. and abroad. And we’ll see you in the Headlines.

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