FCC Reviewing Rules Governing Media Ownership

The Federal Communications Commission on Thursday kicked off a comprehensive review of the government’s long-standing media-ownership rules, with a majority of commissioners signaling that they support relaxing or consolidating at least some of the decades-old restrictions.

Among other things, the current rules prohibit one company from owning TV stations and newspapers in the same market, prevent TV station owners from reaching more than 35% of the national audience and limit the ownership of local radio stations.

The step by the FCC on Thursday was largely a formality. It followed the commission’s announcement in June that it would consolidate reviews of various media-ownership rules to create a single set of guidelines, expected to be completed next spring.

But the decision is likely to intensify lobbying by media giants--including Tribune Co., parent of the Los Angeles Times; Viacom Inc., operator of the CBS and UPN television networks; and News Corp., Fox network’s owner--which say the rules are outdated. Meanwhile, consumer groups fear that a relaxation of the rules would trigger another wave of media consolidation and reduce the diversity of viewpoints and programming.

The media-ownership rules have had a string of legal defeats over the last two years in a federal appellate court that has ordered the FCC to either justify the need for the restrictions or abandon them.

The commission said it will examine whether the rise of new technologies, such as cable, satellite TV and the Internet, has reduced the need for ownership restrictions on broadcasters.

“It’s ambitious, but--I submit--long overdue,” said FCC Chairman Michael K. Powell.

The FCC decided Thursday to scrap at least one of its media rules: a ban on a company owning a cable TV system in the same market where it also owns broadcast stations. The rule was overturned in February by the U.S. Court of Appeals in Washington.

“It’s finished,” said W. Kenneth Ferree, head of the FCC’s media bureau. “The court vacated it and we did not propose breathing new life into it.”

However, cross-ownership of cable systems and TV stations in the same market may still run afoul of the final rules, Powell cautioned. Rather than create separate regulations for broadcast, cable and newspaper industries, the commission is moving toward one standard that would apply to all media.

Powell, who has long advocated overhauling the rules, received support Thursday from fellow Republicans on the commission.

Commissioner Kathleen Q. Abernathy said the commission needs to reconcile its patchwork of rules, which she called frustrating and difficult to understand.

Commissioner Kevin J. Martin expressed disappointment that the agency was not moving more quickly to revise the newspaper-broadcast rule, particularly in larger media markets, where many agree the rule is no longer needed.

But Commissioner Michael J. Copps, a Democrat, warned against moving too quickly and suggested that he may not vote on the media-ownership review unless the commission holds public hearings to gather more input.

“I don’t know of any issue before the commission that is more fraught with serious consequences for the American people than the media-ownership rules,” Copps said.

By the end of this month, the FCC is expected to release about 10 studies it has commissioned to examine how consumers use different media, how cross-ownership and consolidation affects the diversity of news and programming on TV and how consolidation affects radio programming and advertising rates in local markets.

The studies are expected to serve as the foundation for the commission’s final ownership rules as well as a defense in any court challenges to the rules.

Separately on Thursday, the FCC requested public comment on whether it should reverse its position and let mobile phone companies off the hook for the $15.9 billion they pledged in a controversial auction of wireless airwaves held by NextWave Telecom Inc., which had filed for bankruptcy protection. The FCC repossessed NextWave’s licenses and auctioned them to Verizon Wireless Inc., VoiceStream Wireless Corp. and other carriers in January 2001.

That sale was later invalidated by the U.S. Court of Appeals in Washington, which ruled that the government could not repossess the licenses without violating the U.S. Bankruptcy Code. The FCC has appealed the decision to the Supreme Court. A court decision is expected next month.

The commission also voted Thursday to consider establishing, in cooperation with the Federal Trade Commission, a way for consumers to remove their names from telemarketing lists.

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Times Staff Writer Jube Shiver Jr. contributed to this report.