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FCC Votes to Ease Key Limits on Media Ownership

BY Admin  June 2, 2003 at 12:00 PM EST

FCC Chairman Michael Powell and his two fellow Republican commissioners, Kathleen Abernathy and Kevin Martin, voted to relax several longtime restrictions, which previously limited the number of newspapers, television outlets and radio stations that one company could own in specific markets and nationwide.

The FCC’s new rules lift the decades-old ban on the dual ownership of a newspaper and a television or radio station in the same market, and the “cross-ownership” restrictions that had prohibited a company from owning multiple television stations in markets with nine or more television outlets.

Now, a single company can purchase up to three stations in the largest markets, such as New York City and Los Angeles, and two television stations in most markets. Under previous FCC rules, a single company was barred from owning more than two stations in the same market.

The FCC also determined that broadcast networks can now own more television stations to collectively reach up to 45 percent of U.S. households, a marked increase from the current 35 percent limit.

Smaller markets with three or fewer TV stations will retain some limits on multiple TV station ownership and the ban on cross-ownership.

Powell said the decades-old rules had failed to keep up with the new technologies of today’s media landscape and needed to reflect changes in the current marketplace.

“Our actions will advance our goals of diversity and localism,” Powell noted, saying the FCC staff “wrote [new] rules to match the times.”

The agency’s two Democrat commissioners, Michael Copps and Jonathan Adelstein, supplied the two dissenting votes, warning that the new plan would allow a few large corporations to dominate the media industry. Greater consolidation would reduce the diversity of voices available to the public and stifle the coverage of local news and events, the two Democrat commissioners said.

“I strongly dissent with this decision… Today the Federal Communications Commission empowers America’s new media elite with unacceptable levels of influence over the ideas and information upon which our society and our democracy depend,” Copps told the FCC panel Monday.

“The more you dig into this order the worse things get,” Copps said, warning that such changes would enable a few corporations to control news and entertainment.

Adelstein said the relaxed ownership rules are “likely to damage the media landscape for decades to come.”

Powell acknowledged the public’s concern about “excessive consolidation,” noting that “[t]hey have introduced a note of caution in the choices we have made.”

Still, the chairman defended his deregulation agenda — stressing that the Internet, satellite broadcasts, and cable television programming offer the public numerous and diverse resources for entertainment, news and information.

The FCC’s move to eliminate a number of ownership limits was sought by major media companies such as News Corp., owner of the Fox network, and Viacom, the parent company of CBS and UPN.

Mel Karmazin, president of Viacom, told the Senate Commerce Committee late last month that the FCC’s rules hampered companies’ efforts to create and deliver better programming and media services. Viacom and News Corp., among other large companies, initially sought to eliminate the 35 percent limit on a company’s reach of the national audience.

Meanwhile, smaller broadcasters, like Jim Goodmon, president of the Capitol Broadcasting Company based in Raleigh, N.C., told a Senate panel last May that raising the 35 percent cap to 45 percent would give media conglomerates too much control over local stations and would replace “localism and community standards with financial opportunity and corporate objectives.”

John Sturm, president of the Newspaper Association of America, a trade group that represents some of the nation’s larger newspaper companies such as Gannett Inc. and the Tribune Company, applauded the FCC move to allow cross-ownership.

“Newspaper-owed television stations program more and better news and public affairs than any other stations,” Sturm said Monday.

However, Frank Blethen, publisher of The Seattle Times, warned of grave consequences to relaxing current ownership rules.

“I think we see the beginning of the end of our democracy. All you have to do is look at the decrease in the variety of voices and investment in news and editorial and increase and concentration in the last 20 years and project it forward another 20 years,” Blethen told the Senate Commerce Committee May 13.

The FCC’s vote did not relax all of the six regulations under review. The FCC preserved a ban on mergers among the “Big Four” television networks – ABC, owned by Walt Disney Co.; CBS, owned by Viacom Inc.; Fox network, owned by News Corp.; and NBC, owned by General Electric.

The FCC also tightened rules to prevent further consolidation in the radio industry by redrawing market districts and maintaining the maximum number of radio stations a single company can purchase, up to eight stations in markets where there are at least 45 radio stations.

FCC spokesman David Fiske told the Online NewsHour the new FCC rules would likely come into effect some 30 days after their publication in the US Federal Registry, or within two months.

However, a number of lawmakers expressed strong opposition to the FCC’s decision.

Leaders of the Congressional Hispanic Caucus, the Congressional Black Caucus and the Congressional Asian Pacific American Caucus issued a statement warning the decision would have a negative impact on media diversity.

“We are extremely concerned that these new changes will significantly undermine current FCC rules that were intended to promote minority participation, and preserve multiple media voices and opinions in the electronic and print media industries,” the groups said in a written statement Monday.

Sen. Byron Dorgan (D-N.D.), a member of the Senate Commerce Committee, which has congressional oversight of the FCC, called the decision “dumb and dangerous,” saying it will result in “an orgy” of mergers and acquisitions. He cautioned the new rules would create a system with many stations, but just “one ventriloquist.”

Dorgan — backed by a bipartisan group of lawmakers from the Commerce Committee including Sen. Olympia Snowe (R-Maine), Sen. Trent Lott (R-Miss.), Sen. Fritz Hollings (D-S.C.) — said he planned to propose legislation to prevent the FCC’s rules from going into effect.

Despite this bipartisan support, Senate Commerce Committee Chairman John McCain (R-Ariz.) indicated earlier he would oppose the bill and doubted it would pass, though he stopped short of saying he would try to block it, Reuters reported.

The Senate Commerce Committee has scheduled a hearing for Wednesday as part of the committee’s ongoing examination of media ownership, in which all five FCC commissioners are expected to testify.