NAA Undaunted By Court’s Cross-Ownership Ruling

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By: Jennifer Saba

Monday’s Supreme Court decision not to review cross-ownership rules wasn’t seen as a full setback, at least not to the Newspaper Association of America. ?Like most everything in Washington, this is a multiple-act play,? said John Sturm, President and CEO of the NAA. ?The Supreme Court closed one act but there will be more.?

In August 2003, the Federal Communications Commission relaxed cross-ownership rules that had been in affect for roughly 30 years. In June 2004, the Third Circuit Court of Appeals struck down the FCC’s revisions — the court agreed with the commission decision but sent back the guidelines to be re-worked. The NAA has been one of many organizations and media companies fighting for the FCC’s original draft. The FCC however, chose not to pursue the review.

The Supreme Court’s silence on the matter now means that the FCC will most likely go back and draft new regulations. Sturm told E&P that the NAA will fight to comment on revisions. Prudential Equity Research released a note today predicting that it will take nine to 12 months minimum before more is heard on new guidelines.

In a statement released today, FCC Chairman Kevin Martin said, ?I am now looking forward to working with all of my colleagues as we reevaluate our media ownership rules consistent with the Third Circuit’s guidance and our statutory obligations.?

FCC Commissioner Jonathan S. Adelstein called for public hearings and Congressional input before the FCC makes any final revisions. ?The decision is a rare victory for the public over some of the most powerful corporations in America,? he said in a statement. ?The court’s decision puts the issue of media consolidation right back into the FCC’s hands and gives us the opportunity for a fresh start, so we better get it right this time?We can’t let a handful of media giants dominate the discourse in any community.?

Sturm said that newspaper-owned TV stations do more local news, a criterion the FCC looks at to determine cross ownership and market dominance.

Prudential didn’t see much upside, however, calling today’s announcement a ?blow to media companies, but largely an expected one.? The report said it was widely speculated that today’s petition requesting review would be denied.

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