Tribune buyer lobbies for cross-ownership waivers
Chicago financier Sam Zell made the rounds on Capitol Hill this week, drumming up support for a buyout of Tribune Co. in an effort to pressure federal regulators to grant waivers necessary to own both newspapers and TV stations in Los Angeles and four other cities.
The lobbying trip came as the public comment period for Tribune’s waiver requests ended Monday. The requests have drawn opposition from several groups, including the United Church of Christ, the Consumer Federation of America and the Teamsters, which represents about 2,000 company workers.
The $8.2-billion, Zell-led deal is controversial because the Federal Communications Commission has been asked to exempt the company from rules prohibiting the holding of a newspaper and TV station in the same market.
Tribune needs waivers in Los Angeles, where it owns The Times and KTLA-TV Channel 5, as well as in Chicago, New York, Fort Lauderdale, Fla., and Hartford, Conn. Tribune Chairman and Chief Executive Dennis J. FitzSimons lobbied all five FCC commissioners last month.
On Tuesday and Wednesday, Zell and FitzSimons focused on House and Senate leaders. Congress has no direct say in the waiver decision. But pressure from lawmakers could push the FCC to act quickly, and tacit approval of Democratic congressional leaders could signal that commissioners would face little blowback for granting the waivers.
Democrats generally oppose media consolidation, but Chicago-based Tribune Co. is helped by the prominence of two Illinois lawmakers in the Democratic-controlled Congress. Sen. Richard J. Durbin is the second-ranking Democrat in the Senate and Rep. Rahm Emanuel is the House Democratic caucus chairman.
Last month, Durbin, Emanuel and 12 Illinois House members wrote to FCC Chairman Kevin J. Martin, urging quick action. On Tuesday, Durbin reiterated that message and said he had encountered no problems with the company’s ownership of both the Chicago Tribune and WGN-TV in Chicago.
“I don’t find any kind of monopoly power being pushed into the market, and I think most people in the market feel ... that they’re good sources of news,” Durbin told the Tribune after a meeting Tuesday with Zell and FitzSimons that also included Senate Majority Leader Harry Reid (D-Nev.) and Sen. Charles S. Schumer (D-N.Y.).
“So from my point of view, I personally hope the situation continues ... but at a minimum, they are entitled to a prompt decision by the FCC so they can move forward with this important deal,” Durbin said.
The FCC has been holding public hearings on its media ownership rules and is considering ending the ban on owning a newspaper and TV in the same market. But action is not expected until next year.
Tribune has argued that it should be granted temporary waivers until the FCC determines the cross-ownership rule’s fate. Without the waivers, the company would have to sell either TV stations or newspapers in the five cities.
Zell wants to close the deal by December, but there is no timetable for an FCC decision. As part of the deal process, Tribune filed papers with the FCC on May 1 to transfer control of its TV station licenses.
“We need more diversity in our mass media, and allowing cross-ownership is not the way you get diversity,” said Marc Cooper, director of the Consumer Federation of America, which joined Free Press, a media reform group, and Consumers Union, publisher of Consumer Reports, in filing opposition to the waiver request.
The Newspaper Assn. of America, an industry trade group, was the only organization to formally support Tribune’s waiver request.
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