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Senate Panel Opposes New Federal Media Rules

The provision, inserted in an annual spending bill for the Commerce, State and Justice departments, would withhold funds for the FCC to implement its new rule to allow companies to reach up to 45 percent of the national viewing audience, an increase from the current 35 percent.

Committee Chairman Ted Stevens (R-Alaska) — who introduced the rider to the spending bill — has proposed the national market cap freeze at 35 percent for at least one year.

The Senate’s provision is similar to another measure approved by the House last July. The House provision, attached to a spending bill by Rep. David Obey (D-Wis.), received overwhelming support. The House rider would also preserve the current 35 percent cap on audience reach by a single media company.

The House and Senate actions delivered the federal agency yet another potential setback to the FCC’s new media ownership rules, already under fire from the courts and public activists.

The White House, however, has already warned it will veto any legislation seeking to roll back the FCC’s rules.

The Senate action comes one day after an appeals court in Philadelphia temporarily blocked the FCC’s new federal rules from taking effect as scheduled Thursday.

The three-judge panel of the 3rd U.S. Circuit Court of Appeals issued the temporary stay order, pending a full judicial review of the case. At the same time, the court made clear its decision was not based on its evaluation of the FCC’s new regulations.

Circuit Chief Judge Anthony Scirica, who headed the three-judge panel, said that not granting the stay, and allowing the FCC rules to come into effect as scheduled, would have harmed the interests of the Prometheus Radio Project, a Philadelphia-based media activist group which initially filed the request, and other critics who worry the FCC regulations would further limit the diversity and local interests in the media.

“Given the magnitude of this matter, and the public’s interest in reaching the proper resolution, a stay is warranted pending thorough and efficient judicial review,” the judicial order stated.

A spokesman for the FCC told Reuters: “While we are disappointed by the decision by the court to stay the new rules, we will continue to vigorously defend them and look forward to a decision by the court on the merits.”

The Republican-dominated FCC voted along party lines June 2 to relax restrictions on media ownership, including a controversial change that would allow a single company to expand its collective reach to 45 percent of the national audience — up from the current 35 percent national “television cap.” Additionally, the new rules would permit companies to own both newspapers and TV broadcasters in the same markets. The FCC vote, however, did not relax ownership limits for the radio industry.

The court’s stay order is a victory for an unusual coalition of groups, such as the National Rifle Association and the National Organization for Women, which have argued that the new rules would concentrate too much power with too few media conglomerates.

Wednesday’s court decision, on the other hand, represents a setback to large media companies, such as Viacom and News Corporation, owners of the CBS and Fox networks, respectively. Both companies had urged the FCC to increase the national audience cap to better compete in today’s international media marketplace.

The decision is also a blow to FCC Chairman Michael Powell and his goals to update media regulations to better reflect changes within the modern media industry.

Powell has already come under fire from Congress and even from his fellow commissioners. Earlier this year, the FCC chairman rejected requests by the agency’s two Democratic commissioners, Michael Copps and Jonathan Adelstein, to postpone the introduction of the rules to allow a greater national debate.

“The court has done what the commission should have down in the first place,” Copps said in response to Wednesday’s court decision.

Powell this summer responded to critics’ concerns about the new rules when he announced plans to launch a new FCC localism task force, which would monitor how well media companies accommodated local interests. The FCC is expected to release further details on the localism initiative later this month.

The court’s stay maintains the current media regulations while it examines the new FCC rules and conducts its own review, which will take an undetermined amount of time.

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