Tribune's New Owners Ask for Cross-ownership Pass From FCC

Wants to Avoid Selling TV, Radio or Newspapers in Major Markets

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WASHINGTON (AdAge.com) -- The Tribune Employee Stock Ownership Plan asked the Federal Communications Commission to let it keep its newspapers in major markets where it also owns TV and radio stations pending new media ownership rules.
Sam Zell
Sam Zell Credit: Bloomberg News

In filings yesterday, made necessary by Tribune Co.'s $8.2 billion sale to Sam Zell and the Employee Stock Ownership Plan, the company argues that the stations -- among them WPIX, KTLA and WGN -- operate in very competitive media markets and the combination benefits consumers. Tribune Co. owns the Chicago Tribune, Newsday, the Los Angeles Times, the Hartford (Connecticut) Courant and the South Florida Sun-Sentinel.

FCC's earlier position
In its filing, the Tribune also noted that the FCC had previously decided that newspaper-broadcast cross-ownership limits are "no longer in the public interest," until an appellate court ordered the FCC to review a series of new ownership rules.

"Tribune is entitled to the requested waiver as the commission endeavors to fulfill its decade-long commitment to revise the rule to be consistent with today's marketplace," Tribune argues in its filings.

The latest filing reflects two cross-ownership problems for the Tribune. The Tribune bought the former Times Mirror in 2000, which gained the company TV stations and newspapers in Los Angeles, Hartford and Miami and violated the original FCC ban. Chicago was added to the list of cities after Mr. Zell and the employee group bought the Tribune Co. The sale eliminated the exemption Tribune had held there because it owned WGN and the Chicago Tribune before the ban took effect.

Benefits consumers
Tribune in separate filings on each market argues that having joint ownership benefits consumers in the markets and doesn't adversely affect advertisers. It also cites growing competition, including with the internet. "The combination of WPIX and Newsday [in the New York metropolitan area] has not measurably or adversely affected diversity or competition," according to the filing.

Consumer groups have promised to fight against the FCC granting a waiver, arguing the Tribune should be forced to follow the current FCC rules and that the combination of broadcast and newspapers in a market give viewers and readers fewer independent news sources.
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