My beef with big media: how government protects big media - and shuts out upstarts like me.

In the late 1960s, when Turner Communications was a business of billboards and radio stations and I was spending much of my energy ocean racing, a UHF-TV station came up for sale in Atlanta. It was losing $50,000 a month and its programs were viewed by fewer than 5 percent of the market.

I acquired it.

When I moved to buy a second station in Charlotte--this one worse than the first--my accountant quit in protest, and the company's board vetoed the deal. So I mortgaged my house and bought it myself. The Atlanta purchase turned into the Superstation; the Charlotte purchase--when I sold it 10 years later--gave me the capital to launch CNN.

Both purchases played a role in revolutionizing television. Both required a streak of independence and a taste for risk. And neither could happen today. In the current climate of consolidation, independent broadcasters simply don't survive for long. That's why we haven't seen a new generation of people like me or even Rupert Murdoch--independent television upstarts who challenge the big boys and force the whole industry to compete and change.

It's not that there aren't entrepreneurs eager to make their names and fortunes in broadcasting if given the chance. If nothing else, the 1990s dot-com boom showed that the spirit of entrepreneurship is alive and well in America, with plenty of investors willing to put real money into new media ventures. The difference is that Washington has changed the rules of the game. When I was getting into the television business, lawmakers and the Federal Communications Commission (FCC) took seriously the commission's mandate to promote diversity, localism, and competition in the media marketplace. They wanted to make sure that the big, established networks--CBS, ABC, NBC--wouldn't forever dominate what the American public could watch on TV. They wanted independent producers to thrive. They wanted more people to be able to own TV stations. They believed in the value of competition.

So when the FCC received a glut of applications for new television stations after World War II, the agency set aside dozens of channels on the new UHF spectrum so independents could get a foothold in television. That helped me get my start 35 years ago. Congress also passed a law in 1962 requiring that TVs be equipped to receive both UHF and VHF channels. That's how I was able to compete as a UHF station, although it was never easy. (I used to tell potential advertisers that our UHF viewers were smarter than the rest, because you had to be a genius just to figure out how to tune us in.) And in 1972, the FCC ruled that cable TV operators could import distant signals. That's how we were able to beam our Atlanta station to homes throughout the South. Five years later, with the help of an RCA satellite, we were sending our signal across the nation, and the Superstation was born.

That was then.

Today, media companies are more concentrated than at any time over the past 40 years, thanks to a continual loosening of ownership rules by Washington. The media giants now own not only broadcast networks and local stations; they also own the cable companies that pipe in the signals of their competitors and the studios that produce most of the programming. To get a flavor of how consolidated the industry has become, consider this: In 1990, the major broadcast networks--ABC, CBS, NBC, and Fox--fully or partially owned just 12.5 percent of the new series they aired. By 2000, it was 56.3 percent. Just two years later, it had surged to 77.5 percent.

In this environment, most independent media firms either get gobbled up by one of the big companies or driven out of business altogether. Yet instead of balancing the rules to give independent broadcasters a fair chance in the market, Washington continues to tilt the playing field to favor the biggest players. Last summer, the FCC passed another round of sweeping pro-consolidation rules that, among other things, further raised the cap on the number of TV stations a company can own.

In the media, as in any industry, big corporations play a vital role, but so do small, emerging ones. When you lose small businesses, you lose big ideas. People who own their own businesses are their own bosses. They are independent thinkers. They know they can't compete by imitating the big guys--they have to innovate, so they're less obsessed with earnings than they are with ideas. They are quicker to seize on new technologies and new product ideas. They steal market share from the big companies, spurring them to adopt new approaches. This process promotes competition, which leads to higher product and service quality, more jobs, and greater wealth. It's called capitalism.

But without the proper rules, healthy capitalist markets turn into sluggish oligopolies, and that is what's happening in media today. Large corporations are more profit-focused and risk-averse. They often kill local programming because it's expensive, and they push national programming because it's cheap--even if their decisions run counter to local interests and community values. Their managers are more averse to innovation because they're afraid of being fired for an idea that fails. They prefer to sit on the sidelines, waiting to buy the businesses of the risk-takers who succeed.

Unless we have a climate that will allow more independent media companies to survive, a dangerously high percentage of what we see--and what we don't see--will be shaped by the profit motives and political interests of large, publicly traded conglomerates. The economy will suffer, and so will the quality of our public life.

Let me be clear: As a business proposition, consolidation makes sense. The moguls behind the mergers are acting in their corporate interests and playing by the rules. We just shouldn't have those rules. They make sense for a corporation. But for a society, it's like over-fishing the oceans. When the independent businesses are gone, where will the new ideas come from? We have to do more than keep media giants from growing larger; they're already too big. We need a new set of rules that will break these huge companies to pieces.

I. THE BIG SQUEEZE

In the 1970s, I became convinced that a 24-hour all-news network could make money, and perhaps even change the world. But when I invited two large media corporations to invest in the launch of CNN, they turned me down. I couldn't believe it. Together we could have launched the network for a traction of what it would have taken me alone; they had all the infrastructure, contacts, experience, knowledge. When no one would go in with me, I risked my personal wealth to start CNN.

Soon after our launch in 1980, our expenses were twice what we had expected and revenues half what we had projected. Our losses were so high that our loans were called in. I refinanced at 18 percent interest, up from 9, and stayed just a step ahead of the bankers. Eventually, we not only became profitable, but also changed the nature of news--from watching something that happened to watching it as it happened.

But even as CNN was getting its start, the climate for independent broadcasting was turning hostile. This trend began in 1984, when the FCC raised the number of stations a single entity could own from seven--where it had been capped since the 1950s--to 12. A year later, it revised its rule again, adding a national audience-reach cap of 25 percent to the 12 station limit--meaning media companies were prohibited from owning TV stations that together reached more than 25 percent of the national audience. In 1996, the FCC did away with numerical caps altogether and raised the audience-reach cap to 35 percent. This wasn't necessarily bad for Turner Broadcasting; we had already achieved scale. But seeing these rules changed was like watching someone knock down the ladder I had already climbed.

Meanwhile, the forces of consolidation focused their attention on another rule, one that restricted ownership of content. Throughout the 1980s, network lobbyists worked to overturn the so-called Financial Interest and Syndication Rules, or fin-syn, which had been put in place in 1970, after federal officials became alarmed at the networks' growing control over programming. As the FCC wrote in the fin-syn decision: "The power to determine form and content rests only in the three networks and is exercised extensively and exclusively by them, hourly and daily." In 1957, the commission pointed out, independent companies had produced a third of all network shows; by 1968, that number had dropped to 4 percent. The rules essentially forbade networks from profiting from reselling programs that they had already aired.

This had the result of forcing networks to sell off their syndication arms, as CBS did with Viacom in 1973. Once networks no longer produced their own content, new competition was launched, creating fresh opportunities for independents.

For a time, Hollywood and its production studios were politically strong enough to keep the fin-syn rules in place. But by the early 1990s, the networks began arguing that their dominance had been undercut by the rise of independent broadcasters, cable networks, and even videocassettes, which they claimed gave viewers enough choice to make fin-syn unnecessary. The FCC ultimately agreed--and suddenly the broadcast networks could tell independent production studios, "We won't air it unless we own it." The networks then bought up the weakened studios or were bought out by their own syndication arms, the way Viacom turned the tables on CBS, buying the network in 2000. This silenced the major political opponents of consolidation.

Even before the repeal of fin-syn, I could see that the trend toward consolidation spelled trouble for independents like me. In a climate of consolidation, there would be only one sure way to win: bring a broadcast network, production studios, and cable and satellite systems under one roof. If you didn't have it inside, you'd have to get it outside--and that meant, increasingly, from a large corporation that was competing with you. It's difficult to survive when your suppliers are owned by your competitors. I had tried and failed to buy a major broadcast network, but the repeal of fin-syn turned up the pressure. Since I couldn't buy a network, I bought MGM to bring more content in-house, and I kept looking for other ways to gain scale. In the end, I found the only way to stay competitive was to merge with Time Warner and relinquish control of my companies.

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