FCC PONDERS NETS AS AD REPS;ALSO IN DISCUSSION: FORBIDDING AFFILIATE PRE-EMPTIONS

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The Federal Communications Commission staff is said to be recommending the agency allow TV networks to serve as advertising representatives for their affiliates.

The FCC staff is also recommending the agency permit networks to bar affiliates from pre-empting programming solely for financial reasons.

At press time, though, it appeared Chairman Reed Hundt lacked the votes he needs to adopt either proposal. Both issues are said to be scheduled for a June 12 vote. A spokesman for the chairman said no final decision has been made about what will be on the agenda.

TOO MUCH POWER

FCC regulations have long barred networks from serving as ad reps for their affiliates with the argument that it would give the networks too much power.

The effort to kill the regulation has been opposed by many affiliates and established rep firms on the grounds that networks and stations compete for national spot advertising dollars, business now sold for stations by independent rep firms.

"There is no one who says this is a good thing except the networks," said Gerard Waldron, counsel for the Station Representatives Association. "The rule preserves competition in the national TV advertising market."

National spot advertising is a $9 billion a year business.

PROTECTING AN OLIGOPOLY?

Countered Rick Cotton, NBC exec VP-general counsel: "Under the protection of these anti-competitive rules, there has been extraordinary consolidation of the rep firms to the point where there are only three. The notion that some commissioners would protect this three-company oligopoly is difficult to believe."

On the other front, current interpretations of the FCC's so-called "right to reject" regulation allow affiliates to pre-empt network programming at will.

The change being contemplated would be limited to breaking news, public affairs and other programming deemed to be in the public interest, said those familiar with the proposal.

LOCAL SPORTS AFFECTED

The change could hurt affiliates' pocketbooks the most by infringing on their ability to carry local and regional syndicated sports.

Some station operators are arguing that even with the change, pre-emptions for sports programming could be justified.

But network representatives argue the rule is obsolete.

"The rule is unnecessary because it is based on a theory of network power that doesn't exist anymore, if it ever did," said a spokeswoman for Capital Cites/ABC.

Mr. Halonen is Washington bureau chief of Electronic Media.

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