F.C.C. Chief Proposes Easing Media Ownership Rules

Filed at 2:54 p.m. ET

WASHINGTON (AP) The chairman of the Federal Communications Commission wants to eliminate a ban on radio and television broadcasters owning newspapers, but only in the nations largest media markets.

FCC Chairman Kevin Martin opted to focus on the newspaper ban only and declined to act on other media ownership rules up for consideration. The proposal still requires a full vote of the commission.

I think this is both a moderate and a fair proposal, Martin said in a conference call with reporters Tuesday afternoon. He said he is optimistic there will be a vote on Dec. 18.

Talk of lifting the cross-ownership ban has met with stiff resistance from public interest groups and commission Democrats as well as on Capitol Hill.

Martin opted not to pursue complete removal of the ban. Under his proposal, one entity would be permitted to own a newspaper and one radio station or television station, but only if it is in one of the 20 largest markets in the nation.

After the transaction, at least eight independently owned and operated media voices must remain in the market, and the television station may not be among the markets top four.

The companies would also have to show that the combined entity would increase the amount of local news in the market and that both outlets would continue to exercise independent news judgment.

Martin cited a changing media marketplace for his decision to loosen the 32-year-old ban, noting that when it was created, cable television was in a nascent stage, and neither direct broadcast satellite television nor the Internet was in existence.

He justified the loosening of the rule by noting that stock prices of newspapers are dropping and they are losing revenue and circulation. He said at least 300 daily newspapers have stopped publishing over the past 30 years.

Allowing newspapers to combine newspaper and broadcast operations would help them remain viable because they would be able to share their operational costs across multiple platforms, he said.

The last time the commission approved new rules on media ownership was in 2003. Most of that decision, which would have liberalized the ownership restrictions, was tossed out by a federal appeals court in Philadelphia.

Martin said his proposal effectively ends the commissions current media ownership proceeding, meaning there will be no loosening of rules on radio and television station ownership in local markets.

Gene Kimmelman, vice president for federal and international affairs for Consumers Union, the nonprofit publisher of Consumer Reports magazine, said he would prefer the rule be left alone, but said the chairmans position has changed dramatically from four years ago when he was in favor of obliterating it altogether.

That he is focusing on the top 20 markets is an enormous improvement, Kimmelman said.

Andrew Schwartzman, president of public interest law firm Media Access Project, said the proposed rule vastly liberalizes the waiver process which could result in cross-ownership in smaller markets, a charge Martin disputed.

Removal of the ban has been a top priority for Tribune Co., owner of the Los Angeles Times, the Chicago Tribune and 23 television stations. Tribune is currently the subject of an $8.2 billion buyout that would take the company private.

Martins proposal would provide relief in four of the five markets where Tribune owns broadcast stations and newspapers. But the company wants temporary waivers, saying a Dec. 18 vote is too late and may jeopardize financing for the deal.

Under Martins proposal Tribune would have to sell off assets in Hartford, Conn., a sub-top 20 market, where it owns the Hartford Courant and a number of television stations.

Martin would not speak specifically to the Tribune transaction, but said the commission has said previously that it will not grant temporary waivers during the ownership proceeding.

Meanwhile, Sens. Byron Dorgan, D-N.D., and Trent Lott, R-Miss., have introduced legislation that would impose a 90-day delay on any FCC decision regarding media ownership rules.

Dorgan, in a statement released Tuesday, opposed Martins plan, saying saying the chairman has yet to make the case for why any further media consolidation is necessary.

The Newspaper Association of America, which has lobbied against the ban for years, said Martin had not gone far enough.

The radical and irreversible market changes that have occurred in every community since this rule was adopted more than 30 years ago have extinguished any basis for this across-the-board ban. The ban itself should be extinguished as well, said John Sturm, president and CEO of the organization.

Public comments on the chairmans proposal will be accepted until Dec. 11. The reference number is MB Docket No. 06-121.

On the Net:

Public comment on the proposal may be submitted at http://www.fcc.gov/cgb/ecfs/

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