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White House, Congress Reach Compromise on FCC Rule

BY Admin  November 25, 2003 at 12:00 PM EST

In June, the Republican-dominated FCC voted along party lines to ease a number of media ownership regulations, including one that would allow television networks to purchase more stations, extending their national reach from 35 percent to 45 percent of the nation’s viewing audience.

Many members of Congress and advocacy groups, like Consumers Union, have opposed raising the national ownership cap from 35 to 45 percent, arguing networks would wield too much control over local programming and broadcast content.

Sen. Ted Stevens, R-Alaska, attached a rider to a catch-all appropriations bill that would effectively keep the national cap at 35 percent by budgeting no funding for the FCC to implement the new regulation.

The White House threatened to veto any legislation that contained language to undo the FCC rules. Yet, Stevens — backed by a bipartisan Senate coalition — refused to remove the FCC provision. In July, the House approved a spending bill that included similar language to Stevens’ attachment.

Congressional and White House aides told news agencies the compromise struck Monday evening would set the national cap at 39 percent. The agreement effectively removed a major obstacle to congressional approval of the $330 billion appropriations bill covering a third of all federal programs, including the FCC and the departments of Commerce, Justice, State, Education, Labor, Health and Human Services, Agriculture and Veterans Affairs.

The late-night deal drew immediate criticism from Senate Minority Leader Tom Daschle, D-S.D., who told reporters that the 35 percent provision “had strong bipartisan support, and to reopen it now is unacceptable.”

Sen. John McCain, R-Ariz., also said he would object to approving the appropriations bill containing the 39 percent compromise.

“I think I ought to be allowed my chance to amend and debate,” McCain said, stressing that he has not yet read through the bill. As chairman of the Senate’s Commerce Committee, McCain held a number of hearings examining the impact of the FCC’s new media regulations; he has indicated he would support rolling back the national cap to 35 percent.

If the 39 percent settlement were signed into law, major TV networks, such as ABC and NBC, would be eligible to purchase a few more television stations. NBC, owned by General Electric Corp., reaches approximately 35 percent of national viewers; ABC, owned by the Walt Disney Co., owns the smallest group of stations, reaching about 25 percent of the national audience.

The apparent losers of the compromise deal would be Viacom Inc., owner of CBS and UPN, and News Corp., owner of Fox, whose respective groups of TV stations already reach around 39 percent of the national audience each; both networks would not be eligible to purchase more TV stations. Furthermore, if the national cap remains at 35 percent, CBS and Fox could be compelled to shed some of their stations.

“This is a backroom deal to let the two largest networks keep all of their stations,” Gene Kimmelman, public policy director for Consumers Union, which opposed the new media rules, told The Washington Post.

Monday night’s agreement could resolve at least one front in an ongoing battle between members of Congress, advocacy groups, and the FCC’s three Republican commissioners, led by Chairman Michael Powell.

In September, a federal court in Philadelphia issued a stay to prevent the new rules from going into effect, saying they could harm the public interest. The FCC has insisted that the stay should be lifted, arguing the new regulations will enable broadcast companies to better compete against cable, satellite and other content providers.

“We believe that small but modest increases in ownership opportunities at the local level would increase the ability for those stations to compete against cable, against satellite, against the Internet, against satellite radio and against all the many consumer devices that are increasingly delivering news and information to citizens,” Powell said in a NewsHour interview June 2.

Powell and other proponents of media deregulation have also asserted that there may be no legal justification for setting any ownership cap for TV networks.

The House and Senate could act on the larger spending measure in December, but several Senators and congressional aides expressed doubt that Congress would approve the bill before adjourning for the year.