|FCC Chairman Kevin Martin
Mr. Martin, a Republican who replaced Michael Powell as chairman last March, was already on the record as an opponent of the cross-ownership rule, but the sharp language he used today suggests its demise -- or at least the latest push for it -- may be imminent.
In comments to the Newspaper Association of America yesterday, Mr. Martin derided the 26-year-old rule as an outdated product of an era predating the Internet and cable TV.
“A lot has changed since those days of disco and leisure suits,” he said. “But the public has not been convinced of the need for the change, and if you all are unable to get this done, our prospects of doing so are dim,” Martin told the assembled publishing executives.
The repeal has long been thought to be inevitable --it was a key assumption in Tribune Co.’s $8 billion acquisition of Times-Mirror Co. in 2000 -- but its momentum has been stalled of late. Tribune, for instance, now needs the repeal to assure the long-term viability of its newspaper-broadcast pairings in New York, Los Angeles, Connecticut and South Florida. (Tribune CEO Dennis J. FitzSimons has said that even in a worst-case scenario appeals and waivers would likely put off any forced divestitures until after 2010.)
A phone call to Tribune VP Shaun Sheehan, who handles the company’s lobbying efforts, wasn’t immediately returned.
Still, the very fact that cross-ownership is still an open question can’t be reassuring to media conglomerates, who felt they were done with this issue after the FCC voted to repeal the ban as part of a larger media-deregulation push in 2003. But a grass-roots firestorm ensued, as groups as diverse as Common Cause and the National Rifle Association united to fight the ownership changes, which also would have allowed companies such as News Corp. and CBS Corp. to own a greater number of TV stations than they currently do. The entire package of rule changes was eventually derailed by a federal appeals court, which asked the FCC to rewrite the new rules.
Now, the whole conflict figures to play out anew. “We’re going to fight this,” says Celia Wexler, VP-advocacy at Common Cause. “Whether we’re in the Internet age or not, most people depend on local newspapers and television stations. Joint owners will dumb them down in order to cut costs.”