Deregulation Fallout Feared

Jun 2, 2003  •  Post A Comment

When Federal Communications Commission Republicans vote as expected June 2 to substantially loosen the agency’s media ownership restrictions, the nation’s major media conglomerates will be the immediate beneficiaries because the latest round of deregulation will clear the way for them to significantly consolidate their market power.

The vote may be a foregone conclusion, but the anger among Democrats and others inside and outside the FCC over the heavy-handed way the vote was pushed forward isn’t likely to die anytime soon, with key Democratic presidential hopefuls even threatening to turn it into an issue in their campaigns.

“If George Bush loses the election, one of the key culprits will be [FCC Chairman] Michael Powell,” said Jeff Chester, executive director of the watchdog Center for Digital Democracy.

Under the FCC’s existing rules, newspapers and broadcasters in the same market are barred from merging. In addition, agency regulations limit broadcasters from owning more than one TV station in all but the nation’s largest markets.

The proposed changes put forward by FCC Republicans, however, would free major- media companies to own a daily newspaper and up to three TV stations in the nation’s largest markets.

Media corporations say the changes are warranted because some of the regulations have been on the books since the days when there were only a handful of broadcast TV stations in any market. Now, it is argued, consumers can get entertainment and information from hundreds of cable TV channels and on the Internet. But foes of deregulation insist that the rules are needed to ensure that a handful of media giants don’t get a stranglehold on the public’s information pipeline.

As the controversy peaked last week, Democratic presidential hopefuls Howard Dean and Sen. John Edwards, D-N.C., joined the parade of critics urging the FCC to put off the vote. In a letter to Mr. Powell, Mr. Dean said that in his travels around the country, he had found that the proposed deregulation was one of the foremost issues on citizens’ minds.

Mr. Dean also said the FCC’s proposed actions would allow “a few massive conglomerates to gobble up our local news sources,” threatening free speech and free discussion.

Before any vote, Mr. Dean said he believed Mr. Powell should testify before Congress on the agency’s plans and give the public additional time to comment. “This deregulation, like so many actions pushed by the Bush administration, would benefit a few at the expense of the rest of us,” Mr. Dean said.

In another letter, Sen. Edwards said he was particularly leery about an agency proposal to raise the cap that currently bars broadcasters from owning stations reaching more than 35 percent of the nation’s TV homes. “Diversity in the media is enormously important to our democracy,” Sen. Edwards said. “As citizens, Americans should have access to different ideas and points of view. The government has a responsibility to foster this diversity of expression. Unfortunately, the FCC’s new rules are likely to undermine it.”

Credit for stirring up much of the controversy goes to the FCC’s two Democrats-Michael Copps and Jonathan Adelstein. In their latest maneuver, the two hosted a protest of sorts at the agency last week, convening representatives of more than 20 opposition groups. Their visual prop in the FCC’s meeting room consisted of dozens of boxes filled with the hundreds of thousands of written protests from members of groups ranging from the conservative National Rifle Association to the liberal MoveOn.org.

“Put all the public comment together … and it’s running at around 99.9 percent against loosening our concentration protections,” said Mr. Copps.

In a bit of an irony, it also appeared last week that the National Association of Broadcasters would emerge as a loser in the vote’s wake, because it failed to deliver the more-extensive deregulation that its members wanted. The NAB has pitched several new proposals to the FCC in the last couple of weeks.

NAB Still Pitching

In a last-ditch effort to win additional duopoly relief in smaller markets, however, the NAB pitched yet another deregulatory proposal to the FCC late last week, one that would allow a broadcaster to own up to three TV stations in the same market, as long as no more than two are among the market’s four top-rated. The deals would be subject to the condition that the combined viewing share of the properties, including any co-owned cable channels, could not exceed 30 percent.

However, sources said the agency’s GOP majority was standing firm. They support an FCC proposal that would limit broadcasters to owning two TV stations in markets with six independent TV stations, including PBS outlets, with the caveat that only one of the merged stations could be among the market’s four top-rated.