Local media consolidation and the rise of paywalls, both meant to combat a bleak ad outlook, could deepen the growing divide between America's information consumer haves and have nots.
Driving the news: Nexstar Media Group has agreed to acquire Tribune Media for $4.1 billion, as first reported by Reuters and confirmed by Axios' Dan Primack. This would make Nexstar the largest owner of U.S. local television stations.
- With the Nexstar acquisition, over $15 billion worth of local TV stations in the U.S. have changed hands since 2016. A lot more is on the way.
Why it matters: That gap is often defined by wealth and geography, rather than the public and reader interest.
"Increasingly, journalism serves as a powerful force for exclusion, for keeping quality information away from those who need it most, for discouraging anyone but the richest, most educated citizens from participating in the public conversation."— Rodney Benson, chair of NYU's Department of Media Culture, and Communication
The big picture: Nexstar's acquisition comes on the heels of changes in decades-old media ownership rules that apply to broadcasters and newspapers, which are combining with new types of competition in news and entertainment to creating incentives for consolidation.
- A record number of newspaper sales and closures/mergers via the seven biggest newspaper investment owners have increased over the past five years.
- Only 17% of local news stories in a community are actually local, meaning they're about or having taken place within a municipality, per a study from Duke earlier this year.
- While more people say they are willing to pay for news, those with higher levels of education are more likely to do so, per a study from the American Press Institute.
Between the lines: Benson says finding ways to create a plurality in types of news ownership will help to decrease a growing information gap in the U.S.
- "You could have 20 outlets competing in a given market, but if they're all stock market traded and profit-driven above all else, they wouldn't actually provide that much diversity of news content."
- "You would probably be better off with just 10 outlets spread across a variety of ownership forms — including individual or family, nonprofit, and public (taxpayer-supported) ownership."
- Benson cites other Westernized countries that have less of an information gap because of widely-available publicly-funded broadcast television. Examples include the BBC in the U.K., SVT in Sweden or ZDF/ARD in Germany.
- The U.S. has public broadcast, but it's mostly funded by high-end donors, not taxpayer dollars. As a result, its audience share is significantly less than public media in Western Europe.
The bottom line: There's a real news and information divide between rural and urban/suburban communities as well as between the poor and rich in the United States. Consolidation and the rise of paywalls could make it worse.
Go deeper: We break down these trends in our deep dive on the Digital Divide.