Mar 29, 2004  •  Post A Comment

Jack Valenti’s announcement last week that he will resign as chairman of the Motion Picture Association of America after four decades as Hollywood’s high-profile voice in Washington brought a flurry of well-deserved accolades for his work on behalf of the movie business.
However, none of the stories reflected on Mr. Valenti’s huge impact on television and the American communications industry. For nearly 25 years, Mr. Valenti led a virtual crusade to keep in place regulations and a consent decree that put stringent limits on the broadcast networks’ ability to own the shows they aired. “It was one of the most exciting battles we had,” Mr. Valenti recalled last week. “We kept those rules in place from 1971 until 1995. Twenty-four years. Not bad.”
During those years Mr. Valenti preached the gospel of the First Amendment. He defended the need for separation of production and distribution, warning that without rules there could be dire consequences for the industry, the economy and the nation.
“Unless there are some safeguards installed which prevent an abuse of network power,” Mr. Valenti told the Federal Communications Commission on Dec. 14, 1990, “they will do anything and everything permissible to intimidate producers and force them to the networks’ will. They did it before. They will do it again.”
Today, it is clear Mr. Valenti was dead on. The vast majority of shows on the Big 6 networks are owned by those same networks. The impact of the end of what were known as the financial interest and syndication rules, or simply fin-syn, was the rapid consolidation of production and distribution into the hands of a small number of giant companies; and the corollary demise of the indie producer-distributor.
Within months of the end of fin-syn, Disney bought ABC, and soon after CBS (including UPN) was sold twice, eventually to Viacom. Next month the circle will be complete when NBC is merged with Universal. All commercial broadcasters, including The WB, will be part of much larger conglomerates. The concentration of media that Mr. Valenti feared will be fully in place. And the one person who won’t complain is Mr. Valenti.
“That is the Shakespearean tragedy of Jack Valenti: that the message he so eloquently trumpeted for years, the fight against deregulation, the fight on behalf of competition and open markets, gave him a choir that sang in key and responded to his baton,” said producer Leonard Hill, who played an active role in the fight on behalf of his fellow independents. “As soon as the rules were eliminated, the huge oligopolies arose that were inherently in conflict each with the other.”
The MPAA represents the biggest studios, but beginning in the early 1980s Mr. Valenti built a coalition that included high-profile independent producers and performers whose individual stories were more compelling than those of big companies. In that era, top producers such as Norman Lear, Mary Tyler Moore, Stephen J. Cannell and others were paraded on Capitol Hill to make the fin-syn argument. Those efforts were supported behind the scenes by power brokers such as Mr. Valenti, the late Dean Burch (who had chaired the FCC) and the late Lew Wasserman, who headed Universal Studios.
The Coalition to Preserve the Financial Interest and Syndication Rule, as it was known, scored its greatest triumph in 1983 when Mark Fowler’s FCC tried to end fin-syn, but the coalition successfully lobbied then-President Ronald Reagan and Congress.
The rules stayed uninterrupted until Rupert Murdoch and Barry Diller launched Fox in the early ’90s as the fourth network and sought a waiver from the fin-syn rules. That re-opened the entire matter and led to the end of fin-syn with the passage of the 1996 Telecommunications Act.
Mr. Valenti virtually withdrew from the TV arena, with a few exceptions, such as chairing the group that created a TV ratings system and influencing the bill that mandated a broadcast flag identification in all digital programming. He switched his considerable energy and magnificent oratorical skills to fighting piracy and a few other things that all seven MPAA companies could still agree on.
“The great tragedy, in effect, is that Jack was such an important part of the team and the effort that involved so many people, both independent producers and major studios,” said Michael “Mickey” Gardner, who was lead attorney for the coalition from 1983 until about 1994, “… and then, obviously, he was totally conflicted out from articulating the concerns he had spoke of so compellingly back then. Because his membership now are the networks.”
Mr. Gardner said there were about 300 independent producers in the coalition at its height. Today, he said, you can count the survivors on one hand. “Since that time the worst-case scenario has happened, and happened almost overnight,” said Mr. Gardner, who continues to represent Hollywood on policy issues in D.C. “It’s not just the demise of a whole cottage industry out there. It’s really what the American public is now subject to. It is the broad unease about media consolidation that is apparent today.”
Mr. Valenti shrugs it off. “Circumstances changed,” he said. “We fought against Japan in World War II and now Japan is our greatest ally. Things change. You move with the change. You don’t fight change. You challenge it. So when the circumstances did a complete 180-degree turn, there was no longer any reason for me to go against the interests of the member companies.”
One reason no one person will ever have the power and trust that was vested in Mr. Valenti is that his members’ interests are often at odds.
“I think Jack continues to be a fierce advocate of the First Amendment,” Mr. Gardner said. “But this fin-syn deregulation put his members in a whole different mode. He was put in a straitjacket. And as a good representative of the MPAA, he had to articulate the new agenda, which was, unfortunately, to do it in-house and the hell with the independent producers.”