Cross-ownership fight renewed p.14

By: Kelvin Childs Bill would lift FCC ban on newspaper acquisition of radio/TV stations

The vice chairman of the House subcommittee on telecommunications has reintroduced a bill calling for the end of the newspaper/TV cross-ownership ban.
H.R. 598 would have the Federal Communications Commission (FCC) do away with any provisions forbidding a newspaper from acquiring or renewing an AM, FM, or TV station broadcast license. It was introduced Feb. 4 by U.S. Rep. Michael G. Oxley, R-Ohio, of the subcommittee on Telecommunications, Consumer Protection, and Trade.
"Diversity and competition abound in the news media and information industries," Oxley says. "The ban is outdated and anti-competitive."
The FCC has the authority to rescind the rule on its own but hasn't moved to do so. Under the Telecommunications Act of 1996, the agency is required to review all its broadcast rules every two years and sunset those no longer in the public interest.
The FCC, however, took the opportunity to reconsider all its rules and hasn't finished the review for 1998, begun last August. In December, commissioner Harold Furchtgott-Roth issued a status report on the review critical of the slow pace of the effort.
The FCC held hearings Feb. 12 on a related rule that forbids one owner from owning TV and radio stations in the same markets.
"Those proceedings have not come before the commission for a vote up until now, and so they're still basically being reviewed and under study by the Mass Media bureau," says FCC spokesman David Fiske. As for Oxley's bill, Fiske says the agency as a general rule does not take a position on pending legislation.
A number of media companies, as well as the Newspaper Association of America (NAA) and the National Association of Broadcasters, have called for the end of the cross-ownership rule almost since it was instituted in 1975. The rule is meant to ensure a diversity of viewpoints by preventing an owner from buying multiple outlets and dominating the market. The rules do allow newspapers to buy TV and radio stations in areas where they don't circulate.
"NAA and other interested parties, once again, have presented an overwhelming and persuasive amount of evidence that the newspaper/broadcast cross-ownership restriction no longer serves the public interest, if it ever did. It is time for the commission to recognize the vast changes in the mass media marketplace and allow newspapers to purchase radio and television stations in their local markets," says NAA president and CEO John F. Sturm.
Mike McCarthy, executive vice president and general counsel of the A.H. Belo Corp., testified at the hearing on the duopoly rule. He says Belo's view is that these rules are long overdue for revision and noted that cable TV companies aren't under such limits.
"We don't believe the newspaper cross-ownership ban is good public policy, nor is it constitutional," says Charles Sennett, counsel for Tribune Co. Tribune is under a temporary waiver of the rule, over a Miami TV station it acquired when it merged with Renaissance Communications Corp. in 1997. The FCC regards the TV station as being within the same market as the Tribune's Sun-Sentinel newspaper in Fort Lauderdale, contrary to the Tribune's contention.
Tribune lost a court challenge to the FCC's order to sell the newspaper or the TV station within a year of the merger. That sale date, in March 1998, fell just a few months before the FCC began the biennial review. The FCC initially refused to grant a temporary waiver for the duration of the review but granted it last March.
"Tribune's job is not to make policy for the whole country," says Sennett, but he adds that the company's view is that the FCC should ease the restriction with regard to purchases in competitive markets. There has been some discussion of easing the waiver policy so that sales are judged case by case, he says.
Mimi Feller, vice president of public affairs and government relations for Gannett Co., says the ban has kept Gannett out of large markets like New York City and San Francisco because it owns papers in Westchester County, N.Y., and Marin County, Calif. Although FCC rules allow a broadcast owner to reach 35% of the United States, Gannett reaches 16.6%, and the rule hampers its ability to reach more, says Feller.
However, Thomas P. Van Wazer, a lawyer at the Washington firm of Sidley & Austin, which represents Tribune Co., wonders how far Oxley's bill could go without strong congressional support. "I don't see that it sends any message to the FCC," he says.
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