Studios Expected to Win in FCC Ruling on Reruns

The Federal Communications Commission, which next week will decide whether the television networks should be allowed to share in the lucrative rerun market, is expected to back a plan that mostly favors the Hollywood studios, industry sources said Thursday.

Such a vote would be a major blow to the networks, which have lobbied hard in Washington for several years to get a piece of the $3-billion-a-year TV rerun market.

Andrew Barrett, one of five FCC commissioners, has been regarded as the swing vote in the decision because the other four commissioners have split their support between the networks and the Hollywood production community.

Sources said Barrett has told his colleagues that he backs a plan to revise the “financial interest and syndication rules” advocated by fellow FCC Commissioners Sherrie Marshall and Ervin Duggan, who are both viewed as sympathetic to Hollywood’s interests. The three would thus outvote the “pro-network” faction represented by Commissioner James Quello and FCC Chairman Alfred C. Sikes.

A CBS spokesman called the reported plan “stunning” and said it “imposed a whole new layer of regulation for which there is no public interest justification.”

Jack Valenti, president of the Motion Picture Assn. of America and Hollywood’s chief lobbyist in Washington, declined comment until the FCC votes next Thursday.

Fox, which last year initiated the FCC’s review of the fin/syn rules when it petitioned for exemption, would suffer as a result of the plan.

It would either have to cut its prime-time programming to 11 hours a week or get out of certain parts of the syndication business.

Sources said the majority plan would allow the networks to take a financial interest in all of the shows on their prime-time schedule. Under present rules, the networks are prohibited from taking a stake in programs that they do not produce themselves. Instead, they license the overwhelming majority of their prime-time schedules from Hollywood suppliers.

But the “option period”--the length of time a show can stay on a network before it becomes available to competitors--would be reduced to two years from four. In addition, a network would be allowed to produce only 40% of its prime-time schedule itself.

Most important, however, is a provision that would bar the networks from syndicating shows--that is, selling reruns--in which they were only partial owners. The syndication business would thus largely remain in the hands of the major Hollywood studios and smaller independent distributors.

The networks would only be allowed to syndicate programs that they completely owned.

The networks would also be barred from the first-run syndication business, which has become increasingly profitable for the major studios. These include game shows such as “Wheel of Fortune” and talk shows such as “Donahue.”

The majority plan, which sources said was largely designed by Marshall, is only the latest to surface as the FCC moves toward its vote.

The networks have lobbied for years to win repeal of the fin/syn rules, which were enacted 20 years ago to curb their power over programming. But they have argued that the economics of the business have changed radically in recent years because of competition from cable, independent TV stations, the emerging network Fox and home video.