FCC Combines Ownership Rule Review

In response to criticism from Congress and a string of court setbacks, the Federal Communications Commission said Monday that it has consolidated the review of numerous media ownership rules and plans to announce a set of new rules after next spring.

The FCC, which has been struggling to reexamine half a dozen media rules, also is considering replacing the separate regulations, which affect the broadcast, cable and newspaper industries, with a single standard that would apply to all forms of media.

“There is a certain intellectual attraction to a single rule,” said Ken Ferree, head of the FCC’s media bureau, though he cautioned that no final decision has been made.

The timetable came as a disappointment to some media industry leaders, who had been hoping for a faster decision, particularly on the rule that prevents the cross-ownership of television stations and newspapers in the same market.

“It’s not surprising. It’s just disappointing,” said John Sturm, president of the American Newspaper Assn., which is lobbying to strike down the rule. “This seems like yet another delay.”

Tribune Co., owner of the Los Angeles Times, is one of the leading opponents of the ban on cross-ownership of newspapers and TV stations. Among the media companies that have a waiver on this rule is Tribune, which owns both a newspaper and TV station in markets including Los Angeles and Chicago.

Ferree said a staff recommendation on the rules would be issued by next spring. Final action by the commissioners, however, may not happen until next summer, Sturm said.

On Capitol Hill, the FCC and Chairman Michael K. Powell have been taking heat from both sides. Rep. W.J. “Billy” Tauzin (R-La.) wrote Powell this month, urging an expeditious decision on the newspaper rule. At the same time, Sen. Ernest F. Hollings (D-S.C.), who opposes relaxing the newspaper rule, has accused Powell of failing to thoroughly consider the effect of possible rule changes.

Ferree, who visited Capitol Hill last week to brief leaders about the issue, said he received support for the new timetable.

Responding to recent federal appeals court rulings that found the FCC had failed to justify the media rules, Powell has commissioned more than eight studies to provide the foundation for the FCC’s final ruling. The studies, which will be released for public comment in the fall, will examine the effect of media ownership on local coverage and diversity of viewpoints and study how consumers and advertisers perceive different types of media outlets, such as TV stations, cable and satellite operators and newspapers.

Among the major media rules to be reviewed are the newspaper-broadcast TV cross-ownership rule; a rule that prohibits a company from owning TV stations that reach more than 35% of the national broadcast audience; a “duopoly” rule, which restricts one company from owning two TV stations in a single market; and the dual-network rule, which restricts mergers between the major TV networks.

In a separate proceeding, Ferree said, the FCC will announce a decision by the end of the year on two cable and pay-TV rules that were struck down by a federal appeals court last year. One prevents a cable or pay-TV firm from serving more than 30% of the national audience, and the other prevents cable operators from owning more than 40% of the programs they offer.