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FCC Weighs Changing Media ‘Cross-ownership’ Rules

December 17, 2007 at 6:25 PM EST
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The FCC will vote Tuesday on whether media companies should be permitted to own both a newspaper and broadcast station in the same market. Jeffrey Brown reports on the pending "cross-ownership" proposal, and then media experts discuss its potential impact.
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GWEN IFILL: And now, a look at the importance of who owns local news companies. Jeffrey Brown has our Media Unit report.

JEFFREY BROWN: How many media outlets should one company be allowed to own in a given city? That’s a question the Federal Communications Commission is taking up tomorrow when it votes on a controversial plan to ease 32-year-old restrictions on a company’s right to own both a newspaper and a TV station in the same market.

The plan was put forward by FCC Chairman Kevin Martin.

KEVIN MARTIN, FCC Chairman: I believe the revised rules would balance the need to support the availability and sustainability of local news, while not significantly increasing local concentration or harming diversity.

JEFFREY BROWN: Martin’s proposal would allow newspapers to purchase a TV station in the nation’s 20 largest markets under certain conditions. Among other things, the newspaper and TV outlet would be required to commit to maintaining editorial independence.

But consumer groups and others, including several FCC commissioners, contend that easing the rules would give too much power to too few companies, allowing fewer voices to be heard.

MICHAEL COPPS, FCC Commissioner: The FCC is lurching dangerously off course.

JEFFREY BROWN: Frustration over the measure was on display at a recent congressional hearing.

REP. MIKE DOYLE (D), Pennsylvania: Are you aware that the Association of Free Community Papers opposes lifting the cross-ownership rule?

KEVIN MARTIN: Yes.

REP. MIKE DOYLE: Are you aware that the Independent Free Papers Association opposes lifting the cross-ownership rule?

KEVIN MARTIN: No, I haven’t heard that.

REP. MIKE DOYLE: They are. Are you aware that the Community Papers of Michigan opposes lifting the cross-ownership rule?

KEVIN MARTIN: No.

REP. MIKE DOYLE: How about the Free Community Papers of New York?

KEVIN MARTIN: I knew the Free Community Papers Association was.

REP. MIKE DOYLE: The Free Community Papers of New England?

KEVIN MARTIN: No.

REP. MIKE DOYLE: The Texas Community Newspapers Association?

KEVIN MARTIN: No.

REP. MIKE DOYLE: The Wisconsin Community Papers Association?

KEVIN MARTIN: No.

JEFFREY BROWN: In spite of such concerns, the measure is expected to pass tomorrow, with the three Republican commissioners supporting Martin’s proposal and the two Democrats opposed.

Newspapers in need of 'relief'

JEFFREY BROWN: And joining me now to discuss the merits of FCC Chairman Martin's proposals are Gene Kimmelman, vice president for federal and international affairs at Consumers Union, and John Sturm, president of the Newspaper Association of America.

Welcome to both of you.

GENE KIMMELMAN, Consumers Union: Thank you.

JOHN STRUM, Newspaper Association of America: Thank you.

JEFFREY BROWN: Mr. Sturm, what would this change allow the newspapers you represent to do? And why do you think it's needed?

JOHN STURM: Well, in actuality, the change that's been discussed at the FCC in advance of tomorrow's meeting would afford just a little bit of relief to America's newspapers, in the sense of, in a few markets, it would allow the possibility of that newspaper acquiring the fourth- or fifth-rated broadcast television station in that market or a radio station.

Fairly limited relief, but nonetheless we've been at this now for over a dozen years. This regulation has been in effect for 32 years. And any kind of forward movement is at least a positive movement, in our view.

JEFFREY BROWN: Why? Why is it needed?

JOHN STURM: It's needed because this regulation went into effect in 1975 in a media world that doesn't exist any more. And guess what? It won't exist in the future.

And this regulation should go away just based on the fact that it is not current. It has no basis in today's media world. We've seen the largest explosion of media in the history of the world since the mid-'70s, and yet this rule -- and it's the only FCC broadcast rule that has never been changed, never been modified to fit the times -- this rule should be changed immediately.

Others point to loopholes

JEFFREY BROWN: Mr. Kimmelman, how do you define the stakes? And why do you oppose this?

GENE KIMMELMAN: I wish it were as narrow as John said. We're afraid it's laced with loopholes that we're hoping to close before tomorrow morning.

But here's what has not changed, which is very important. This rule is about local news. This isn't national; this isn't global. How do you get your local news? In every survey we've done and independent sources have done, citizens say they turn mostly to their local daily newspaper for local news and their local broadcast TV stations.

And on cable, almost all you get is the local broadcast TV stations with local news. On the Internet, you get your newspaper, dot-com, you get your broadcast station, dot-com. It's the same sources of news using new media, new technology, as John points out.

So we're worried about two few owners controlling the points of view, the bias, the information presented in local news, and all the new media being furthering and amplifying those voices, rather than providing diversity and competition.

So a narrow change in the rules may not be the end of the world. But we're worried about the loopholes that are there that could mean it's much more than the fourth or fifth station in many more than 20 markets.

JEFFREY BROWN: Is there evidence that the fewer owners makes for less diversity of ideas, and views, and news in local markets?

GENE KIMMELMAN: Every study that the FCC has done, every independent study shows that there is bias in news, that there is some interference, not every day, not for every newscast, not for every newspaper story written, of course, very seldom maybe, but at key points in time near elections, or when a city council vote is up, when you want to find out whether the garbage men are corrupt in your town, there could be influence. There has been.

The voice, the point of view of the owner inserted, that's the danger. And it's not just to diversity. This is the basis of our democracy. Everyone says they turn to newspapers and newspapers online, broadcasts, broadcasts online, to figure out how to make decisions in their community other than what their families can help them with. So if we don't have the straight story here, if we don't have enough information, we're harming our democracy.

JEFFREY BROWN: Would you dispute that?

JOHN STURM: I would dispute...

JEFFREY BROWN: The editorial points?

JOHN STURM: I would certainly dispute the editorial point. I think the culture -- it's clear that the culture of newspapers and the history of journalism in this country is strongest on the newspaper side, in terms of the independence.

Whether a newspaper is owned by a large company or is an independent, those editorial decisions are made with the editors and in the editorial area of the newspaper. They are not made in some other location.

Local news is point of contention

JOHN STURM: What we do agree on is the importance of local news. And I would argue that what this rule change will do, at least give the prospect of having additional investment in local news. Gene's right: It is the most important thing.

But what we see now is a plethora of media channels from all over, but not much investment in local news. And if you let the newspapers, which is the most local of all medium, invest in local broadcast stations, they're going to do more -- and this is what the studies show -- more and better local news on those stations.

The trend on television right now is for more and more stations to give up local news, not do any local news. We would like to reverse that trend by owning a few more radio and television stations around the country and let newspapers do what they do best, which is local news.

JEFFREY BROWN: What about his earlier point about the total change in the media universe, that there are so many outlets now that people have and so many different kinds of media that these rules, 30 years and running, are kind of an anachronism?

GENE KIMMELMAN: Well, when you look closely at that, you find that, yes, the medium has changed, the Internet, cable television, but it doesn't bring in very many more independent voices, opinions about local matters.

Yes, all around the world you get more information. You can get news from Africa and Asia. But if you wanted it about your local community, it's your local newspaper and your local broadcasters you need to turn to for that reporting.

And John's right: We need to boost local reporting. We need more investment in it. But the data also show that, where you have cross-owned entities, you actually get less overall news in the market. You may get one company doing more news, but we worry it's one point of view or not diverse points of view, and you get less overall news in the market.

That's dangerous to competition and really fundamentally to what democracy is about, getting a real fight about information and points of view so that people can make up their own minds about how they'll vote and what they think is really going on in their community.

JEFFREY BROWN: You started this by saying you would like this to go much further...

JOHN STURM: Absolutely.

JEFFREY BROWN: ... than what Chairman Martin is proposing, which would sort of go to what he fears the most here.

JOHN STURM: Well, I'm not sure that Gene really has much to fear. But what we see now is the opportunity for local newspapers to also get in, let's say, radio in small- and medium-sized markets where there just really isn't much local news on radio at all.

As these stations have been owned by larger companies from outside the market, newspapers have been kept out for 30-some years. There would be more all-news radio stations around the country if newspapers were allowed to own radio stations.

So on radio or television, newspapers stand ready to put more and better local news and serve the public in the way that every other medium can do so.

You opened the program with a discussion about how many outlets you can own in a community. Well, anyone else can own all the outlets, as long as they don't own the newspaper in connection with the broadcast station. So anyone else can own anything they want, except the local newspaper.

GENE KIMMELMAN: But local TV broadcasters can't own any two stations of the top four stations. So what Chairman Martin has proposed is actually emulating that same limit there, that you want to keep the dominant newspaper from owning or be owned by any of the four top broadcasters in the market.

That really prevents the worst kind of bias and control of news in a market. Beyond that, it's less dangerous. As long as he really sticks to that limit, I think this would not have nearly as dramatic an effect as we worry.

Congress and the courts weigh in

JEFFREY BROWN: There does seem to be an effort afoot in Congress to try to delay this or push the process through the next few months. There was an earlier effort, of course, by Chairman Powell, which ran into trouble with the courts. Briefly, what do you see happening this time, looking at court action again?

JOHN STURM: A historical note. The lifting of the ban, which the FCC did do under Chairman Powell, was affirmed by the court in Philadelphia. What was sent back to the FCC was a new set of rules.

The court agreed that there is no reason, no public interest reason for this ban anymore. And that was several years ago. We've seen more media since then.

But I think it is now time for the commission to move ahead and really bring some sense to their regulation of broadcast ownership as it pertains to newspapers.

JEFFREY BROWN: Quick response?

GENE KIMMELMAN: My view is the court threw this out because it found it to be irrational and illogical and shipped it back to the FCC. Congress has intervened appropriately, because the chairman has been rushing. The process has been just horrible.

There's been no transparency; the review of the studies have been really just atrocious. So on a process basis, this could very easily end up back in court, as well.

JEFFREY BROWN: All right, Gene Kimmelman and John Sturm, thank you both very much.

JOHN STURM: Thank you.

GENE KIMMELMAN: Thank you.