Senate Bill Would Slow FCC Media Ownership Review

Martin seems to be sticking with his plan for a Dec. 18 vote on new rules, two FCC officials said. Martin’s order probably will seek to end a decades-old ban on a company owning a newspaper and broadcast property in a market. John Lavine, dean of Northwestern University’s Medill School of Journalism, was the only witness to advocate that the commission immediately rescind the ban. Other witnesses said lifting cross-ownership rules would reduce local news. Capitol Broadcasting President James Goodmon said the FCC shouldn’t act until after the DTV transition. The FCC holds its final ownership hearing Friday in Seattle. (See separate report in this issue.)

The Senate legislation, the Media Ownership Act of 2007, would make the FCC take a number of steps on localism and minorities before issuing an ownership order. It would require 90 days for public comment on ownership rules, said Dorgan. Under Martin’s plan -- which other commissioners haven’t backed -- the period would be about a month. The bill would require the agency to finish a proceeding on how well broadcasters serve their communities and then give the public three months to comment on that rulemaking. The legislation also would tell the FCC to form a panel of experts from outside the agency to review minority ownership proposals and issue recommendations.

Martin has been cool to any proposal that would slow down the review. Dorgan’s bill is co-sponsored by Democratic Sens. Barack Obama of Illinois, John Kerry of Massachusetts, Bill Nelson of Florida, Maria Cantwell of Washington and Dianne Feinstein of California. Republican Sens. Trent Lott of Mississippi and Olympia Snowe of Maine also are sponsors. Six of the senators are Commerce Committee members. An FCC spokeswoman declined to comment on the measure.

Martin will get a chance to make his case for ownership deregulation at a Senate Commerce Committee hearing next month. Chairman Daniel Inouye, D-Hawaii, said Martin and other commissioners will be invited to testify at a hearing to be held around Dec. 13. Inouye said he told Martin at a private meeting Wednesday that “rushing to judgment before the end of this year would be a mistake.” A mid-December hearing “should give the commission sufficient time to listen to our voices, our concerns, and I hope they'll make the right decision,” added Inouye.

Republicans on the committee were divided on deregulation at the hearing Thursday. Sens. Gordon Smith of Oregon and Alaska’s Ted Stevens, the committee’s ranking member, said broadcasters face a barrage of competition from the Internet. Smith said cross-ownership helps broadcasters remain in the black. “They're going under,” he said. “They're not profitable… We can’t demand the market reform in a certain way when the market is not there.” Stevens said he hopes members of the committee and the commission will try as “much as possible to understand the changes in the marketplace.” He pointed to the proliferation of online content in the face of declining newspaper readership. “We ought to keep in mind that it’s still a changing entertainment world,” said Stevens.

Snowe and Sen. John Thune, R-S.D., sounded cautionary notes. Thune said he wasn’t sure how independently owned broadcasters could compete with stations with large, out-of- town owners. But Lavine said radio and TV stations were up to the challenge, saying a large body of research shows cross-owned stations cover local news better than others. “Let’s not go overboard -- big is not always bad,” Lavine said. “Drop that ban so we can get news in many towns in America where it doesn’t exist,” he said of the FCC’s cross-ownership prohibition.

Snowe asked for Lavine’s assessment of 10 ownership studies the FCC paid for, which opponents of consolidation have said are riddled with errors. Lavine replied that the research showed “more politics, public information and public policy” were covered by cross-owned broadcasters than others. Snowe didn’t seem convinced and said the committee should consider criticism of the research. “I would urge that the FCC consider the comments that are made here today,” Snowe said, noting the FCC’s last ownership order in 2003 was remanded by the 3rd U.S. Circuit Court of Appeals in Philadelphia. “We've already been there, and it seems like ‘here we go again’ in this pursuit of easing up on these regulations,” Snowe said.

Martin should reconsider his plan for a vote by the commissioners next month, said Nelson and other committee members. Sen. John Rockefeller, D-W.Va., said he was prepared to join Dorgan and Lott in supporting a resolution of disapproval if the agency doesn’t deal with “areas of concern.” But “I don’t think we're they're yet,” he added, noting that senators are speaking with FCC officials. Cantwell wondered aloud whether deregulation is a forgone conclusion at the commission. “There is the sense that the die has already been cast,” she said. “While increased media consolidation may be good for Wall Street, it is certainly bad for Main Street.”

Kerry lamented the lack of minority owners of TV stations in many large cities with large minority populations. Further deregulation could worsen the problem, he suggested. “Who in their right mind can look at this and say this is an acceptable direction to move in?” he asked. Calling Dec. 18 an “arbitrary date,” he said “the FCC needs to know that that approach will not stand and the Congress will not allow it.” Minorities own about 6 percent of radio and TV stations in the U.S., National Hispanic Media Coalition President Alex Nogales testified. “The FCC has neglected its responsibility” to minorities, he said. “Chairman Martin has rejected these appeals as he races to a vote at year’s end.”

Small publishers might be helped by lifting cross-ownership rules because the action would allow them to buy radio or TV stations where their newspapers are published, Lavine said in an interview. “We've got 32 years of a perfect laboratory experiment” in which broadcasters that owned papers before the cross-ownership rules produced more news than other stations, he said. It may make sense for the commission to immediately issue an order lifting the cross-ownership restriction and deal with other ownership limits later, he said. Newspaper Association of America President John Sturm sat behind Lavine as he testified, and they conferred often. Lavine said he hasn’t received money from the NAA, the NAB or other industry groups, although Northwestern gets industry money.

It’s high time the commission authorize cross ownership, Sturm said in an interview. “We've been studying it for 10 years,” he added. “We've had multiple studies multiple times.” Free Press Policy Director Ben Scott, who attended the hearing, said he was cheered by the senators’ comments. “I'm pleased so many members came out and expressed so much concern on this issue.”