ACTION ALERT: Media Giants Cast Aside Regulatory “Chains”: FCC should resist attempt to gut ownership restrictions

Last week, the District of Columbia Court of Appeals overturned one of the country’s last-remaining regulatory protections against media monopoly, and ordered the review of another.

March 1, 2002

Last week, the District of Columbia Court of Appeals overturned one of the country’s last-remaining regulatory protections against media monopoly, and ordered the review of another.

The court overturned the rule that had prevented one company from owning both television stations and cable franchises in a single market. The court also ordered that the FCC either justify or rewrite the rule that bars a company from owning television stations which reach more than 35 percent of U.S. households, stating that as is, the rule is arbitrary and illegal. Both rulings were in response to a suit filed by Fox, AOL Time Warner, NBC and Viacom.

The court called the 35 percent TV ownership cap arbitrary, saying that the FCC hadn’t provided proof that such a restriction was necessary. As for the broadcast-cable cross-ownership rule, the court claimed that the increased number of TV stations today and the competition from the proliferation of new services like satellite TV make the rule outdated and unnecessary to protect diversity (Broadcasting & Cable, 2/19/02).

Most news coverage echoed the broadcast industry’s perspective, portraying the rules as ancient relics that the FCC was using to hold back vital new media companies. The New York Times (2/20/02), for instance, described the station ownership cap as having its antecedents in the 1940s and being “rooted in the fears of the European experience at the time that the television industry in the United States could come to be dominated by a few powerful interests.”

References to “decades-old ownership restrictions” were common in mainstream coverage, giving a misleading impression of an industry constrained by “old” laws. The station ownership cap has been much revised since the ‘40s, when networks could only own three stations apiece. The numerical limit was increased a number of times over the years and finally eliminated by the Telecommunications Act of 1996, which allowed a network to own enough stations to reach 35 percent of the audience.

As one unusually frank article on pointed out (2/20/02), the idea that the government has been trying to keep media giants down is a myth. The FCC has been granting exemptions from ownership rules for years: “Pundits claimed that the court ruling ‘opens the door’ for a new wave of mergers among cable television conglomerates and broadcast companies,” wrote Forbes, “But when was that door ever closed? Media companies have been merging with abandon for the last decade, rules or no rules.”

What kind of changes can viewers expect from this latest round of deregulation? The New York Times enumerated a few: the bigger, more powerful networks created might gain “leverage over smaller stations” and force them to eliminate local programming to make room for network shows; networks could buy “syndicated programs, like ‘Judge Judy’” on better terms; and networks would be free to increase cross promotion. “For example,” explained the Times, “the more stations NBC owns the more times it can promote the ‘Tonight’ show in the late local newscast” (2/21/02). None of this suggests the increased diversity of offerings that media companies frequently promise when seeking the elimination of ownership regulations.

Several public interest groups– including Consumers Union, Consumer Federation of America, Media Access Project, Center for Digital Democracy, and the Civil Rights Forum– recently filed a joint comment with the FCC in support of maintaining ownership restrictions (press release, 2/19/02). They point out that “among broadcast TV markets, one-seventh are monopolies, one-quarter are duopolies, one-half are tight oligopolies, and the rest are moderately concentrated.” The groups also noted that while the number of TV stations has increased from 952 to 1,678 between 1975 and 2000, the number of station owners has actually declined from 543 to 360 in the same period (TV, 2/6/02).

The relaxation in ownership rules seems to have generated some opposition in Congress– Senate Commerce Committee Chairman Ernest Hollings plans to hold a hearing on the issue in March (Electronic Media, 2/27/02)– but not much at the FCC.

If the FCC wanted to stand up for the public, the agency could appeal the decision to the Supreme Court. It could also, as the appeals court suggested, muster new evidence to justify the ownership cap. But neither course seems likely, given the deregulatory zeal of FCC chair Michael Powell, who once declared that “the oppressor here is regulation” and has said that he has “no idea” what the public interest is (Extra!, 9-10/01).

The FCC’s lackluster response suggests that the agency has forsaken its mission of safeguarding the public interest, and is prepared to allow corporations to redraw the media landscape as they please with little or no public debate.

ACTION: Please write to FCC chairman Michael Powell and let him know that the public is not willing to give up on democratic, diverse and decentralized media. Urge him to appeal the recent Court of Appeals decision that overturned the television-cable cross-ownership rule and to vigorously defend the 35 percent television ownership cap.

Michael Powell, Chairman
Federal Communications Commission
445 12th St. S.W. Washington DC 20554

As always, please remember that your comments are taken more seriously if you maintain a polite tone. Please cc with your correspondence.

MORE ACTION: An ad-hoc coalition of media activists is planning to rally outside the FCC in support of media diversity on March 22. The organizers include the Philadelphia-based Media Tank and Prometheus Radio Project. FAIR is one of the many groups endorsing the rally.

For details on how to get involved in the rally, see:

Author: FAIR

News Service: Fairness & Accuracy In Reporting


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