Local News

FCC Votes To Change Media Ownership Rules

Posted June 2, 2003

— Federal regulators relaxed decades-old rulesrestricting media ownership Monday, permitting companies to buymore television stations and own a newspaper and a broadcast outletin the same city.

The Republican-controlled Federal Communications Commissionvoted 3-2 -- along party lines -- to adopt a series of changesfavored by media companies.

Companies argued that existing ownership rules wereoutmoded on a media landscape that has been substantially alteredby cable TV, satellite broadcasts and the Internet.

Critics say the eased restrictions likely would lead to a waveof mergers landing a few giant media companies in control of evenmore of what the public sees, hears and reads.

The decision was a victory for FCC Chairman Michael Powell, whohas faced growing criticism from diverse interests opposed to hismove toward deregulation.

"Our actions will advance our goals of diversity andlocalism," Powell said. He said the old restrictions were toooutdated to survive legal challenges and the FCC "wrote rules tomatch the times."

The FCC said a single company can now own TV stations that reach45 percent of U.S. households instead of 35 percent.

The major networks wanted the cap eliminated, while smaller broadcasters saida higher cap would allow the networks to gobble up stations and take away local control of programming.

Congressman David Price of Chapel Hill said he was disappointed by Monday's voting results. He urged Congress to scrutinize the new rules and the effect they will have on the public's access to independent and locally-oriented news and information.

"Today's vote is a blow to the basic democratic values of diversity, localism and competition in media," Price said. "This loosening of the rules will lead to fewer voices controlling more of the news we watch, read and listen to. It will undermine our access to the independent, unbiased, local information that matters to our communities."

In March, Price joined U.S. Rep. Richard Burr and FCC Commissioner Michael Copps in convening a hearing at Duke University to raise awareness and receive public input on the issue.

Last month, Price also signed a letter to Powell, who was the driving force behind Monday's decision to loosen ownership rules. In the letter, Price and nearly 100 of his colleagues urged Powell to delay the decision to allow further public input, reminding him that radio deregulation in 1996 resulted in just two companies owning more than 1,400 stations nationwide.

"What we've seen in radio is more than just a cautionary tale; it's an alarming glimpse into the future of television news," Price said. "As a result of today's decision, more and more television stations will offer the same 'cookie-cutter' national approach that radio stations have, opting not to focus on local communities.

"I will keep pushing Congress to step up and review these new rules and alter them to serve the public interest -- not the big media companies in search of a profit."

The FCC largely ended a ban on joint ownership of a newspaper and a broadcast station in the same city. The provision lifts all "cross-ownership" restrictions in markets with nine or more TVstations.

Smaller markets would face some limits, and cross-ownership would be banned in markets with three or fewer TV stations.

The agency also eased rules governing local TV ownership, so onecompany can own two television stations in more markets and threestations in the largest cities such as New York and Los Angeles.

"The more you dig into this order the worse things get," said Copps, one of the commission's Democrats. He said the changes empower "a new media elite" to control news andentertainment.

Fellow Democrat Jonathan Adelstein said the changes are "likely to damage the media landscape for decades to come.

The rule changes are expected to face court challenges from media companies wanting more deregulation and consumer groups seeking stricter restrictions.

The FCC also changed how local radio markets are defined tocorrect a problem that has allowed companies to exceed ownershiplimits in some areas.

The government adopted the ownership rules between 1941 and 1975to encourage competition and prevent monopoly control of the media.

A 1996 law requires the FCC to study ownership rules every twoyears and repeal or modify regulations determined to be no longerin the public interest. Many previous proposed changes wereunfinished or were sent back to the FCC after court challenges.

As the vote approached, opposition intensified. Critics boughttelevision and newspaper ads, wrote letters and e-mails, anddemonstrated outside television stations owned by major mediacompanies.

Some ads took on Rupert Murdoch, whose News Corp. owns Fox NewsChannel, 20th Century Fox TV and film studios, the New York Postand other media properties. Murdoch told a Senate committee lastmonth he has no plan for a media buying spree after the changes,other than his proposed acquisition of DirecTV, the nation'slargest satellite television provider.

The critics of eased rules include consumer advocates, civilrights and religious groups, small broadcasters, writers,musicians, academicians and the National Rifle Association. Theysay most people still get news mainly from television andnewspapers, and combining the two is dangerous because thoseentities will not monitor each other and provide differingopinions.

Large newspaper companies such as Tribune Co. and Gannett Inc.wanted the "cross-ownership" ban lifted.

"Newspaper-owed television stations program more and betternews and public affairs than any other stations," said John Sturm,president of the Newspaper Association of America.

News Corp. and Viacom Inc., which owns CBS and UPN, stand tobenefit from a higher national TV ownership cap because mergershave left them above the 35 percent level. Those companies, alongwith NBC, persuaded an appeals court last year to reject that capand send it back to the FCC for revision.

Lawmakers have split mainly along party lines. Democrats demandmore public scrutiny of the changes while Republicans supportPowell. Some lawmakers critical of the FCC have proposedlegislation to counter relaxed regulations.


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