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FCC OKs rule letting some broadcasters own newspapers

Wednesday, December 19, 2007

WASHINGTON -- The Federal Communications Commission, overturning a 32-year-old ban, voted Tuesday to allow broadcasters in the nation's 20 largest media markets to also own a newspaper.

FCC chairman Kevin Martin was joined by his two Republican colleagues in favor of the proposal, while the commission's two Democrats voted against it.

Martin pushed the vote through despite intense pressure from House and Senate members on Capitol Hill to delay it. The chairman, however, has the support of the White House, which has pledged to turn back any congressional action that seeks to undo the vote.

At Tuesday's meeting, the chairman described the media ownership proceeding as "the most contentious and divisive issue" to come before the commission.

That proved true as the two Democrats blasted Martin's plan in unusually strong language for the normally sedate agency.

Martin said his proposal represented "a relatively minor loosening" of the cross-ownership rule. He noted concern for the steady decline in revenue for newspaper companies and said his proposal "strikes a balance" between the realities of the changing media marketplace and the preservation of diversity and competition in broadcasting.

As the commission loosened ownership requirements on one industry, it tightened the reins on another by approving a 30 percent national cap on subscribers for cable companies. The move, opposed by cable companies, would prevent a single cable television provider from serving 30 percent or more of the national pay television audience.

Martin was joined by the two Democrats in voting in favor of the cap while the two Republicans on the commission were opposed.

While Democrats Michael Copps and Jonathan Adelstein supported Martin on the cable cap, they were bitterly opposed to his media ownership rule.

The two men criticized Martin for making changes to his proposal "in the dead of night" and just prior to the meeting that they said created new loopholes in the rule instead of closing them, as Martin pledged during a recent hearing on Capitol Hill.

"Anybody who thinks our processes are open, thoughtful or deliberative should think twice in light of these nocturnal escapades," said Adelstein.

Adelstein said Martin's proposal "will allow for waivers for six new newspaper-broadcast combinations and 36 grandfathered stations."

In a lengthy statement, Copps described the commission's action as a "terrible decision."

"In the final analysis, the real winners today are businesses that are in many cases quite healthy, and the real losers are going to be all of us who depend on the news media to learn what's happening in our communities and to keep an eye on local government," he said.

Republican Commissioner Deborah Taylor Tate described the media ownership review process as "transparent and thorough." She said the changes proposed are narrow and noted she favored a greater liberalization of the media ownership rules.

Fellow Republican Commissioner Robert McDowell also defended the proposal, pointing out the explosion of new media in the modern marketplace and the agency's lengthy review of the issues.

Martin, addressing Adelstein's comment about new waivers, said the great majority were existing combinations that predated the 1975 ownership ban. The others are stations owned by companies that have yet to renew their licenses and not been forced to comply with the ban.

According to several sources familiar with the as-yet unreleased final order, the waivers include Phoenix, where Gannett Co. Inc. owns the Arizona Republic and KPNX-TV, and several smaller cities with cross-owned properties owned by Media General Inc.

The cross-ownership ban was approved by the FCC in 1975 to serve "the twin goals of diversity of viewpoints and economic competition." The FCC noted at the time that "it is unrealistic to expect true diversity from a commonly owned station-newspaper combination."

Opponents of the ban say in the past decade there has been great expansion of news outlets thanks to cable television and the Internet and that such restrictions are no longer necessary. Ban supporters say there may be additional outlets, but there has been no corresponding increase in news gatherers and producers, especially at the local level.

On Monday, 25 senators, including four Republicans, sent Martin a letter threatening that if he goes ahead with the vote, they will move legislation to revoke the rule and nullify the commission's action.

But a letter that surfaced later the same day makes it clear that the chairman has the full support of the White House. Commerce Secretary Carlos Gutierrez wrote Senate Majority Leader Harry Reid on Dec. 4 opposing a Senate bill that would have delayed the vote, "or any other attempt to delay or overturn these revised rules by legislative means."

The agency first tried to loosen the ban in 2003, but the move was rejected by a federal appeals court. Since then, the commissioners have been trying to craft a new set of rules that will survive judicial scrutiny.

Under Martin's proposal, one entity would be permitted to own a newspaper and one broadcast station in the same market.

But it must be among the 20 largest media markets in the nation and following the transaction, at least eight independently owned-and-operated media voices must remain. In addition, the television station may not be among the top four in the market.

Regarding the cable ownership issue, the FCC at one time capped cable subscribership at 30 percent, but the limit was invalidated by a court decision in 2001. The cap will prevent large cable companies like Comcast Corp. from getting larger.

Comcast, the nation's largest cable company, reported 26.2 million subscribers to the FCC through Sept. 30, for a nationwide market share of pay-television subscribers of 27 percent.

McDowell said the cap is out of date, bad public policy and will be struck down again in court. He described the rule as "the ghost of Christmas past."


On the Net:

Federal Communications Commission: http://www.fcc.gov/


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