The department is said to be close to issuing a decision on a request to combine a Columbus, Ohio, ABC station and a Fox station under a local marketing agreement that would give one company control of a big chunk of the market's TV advertising.
Just as the first Justice Department decisions on radio consolidations set an antitrust standard for future radio deals-40% control of a radio ad market will attract scrutiny-the Columbus case could set the standard for TV.
The Justice Department decision also could supersede much of the current debate at the Federal Communications Commission over the future of local marketing agreements, increasingly common in TV. Top officials at Justice on several occasions have questioned whether local marketing agreements are, in fact, station sales.
Justice Department guidelines on advertising control would leave the FCC to look at other remaining issues, like diversity, but perhaps with far fewer agreements to examine.
The Columbus market gained importance as a result of Sinclair Broadcast Group's now nearly 2-year-old plan to combine its Fox affiliate, WTTE, with ABC station WSYX, owned by River City Broadcasting, under a local marketing agreement.
USUALLY NO SCRUTINY
Normally, neither the FCC nor Justice regularly tracks local marketing agreements, in which one broadcaster handles programming and ad sales on a station whose license is owned by another.
But in Columbus, Sinclair's April 1996 plan to purchase a number of River City Broadcasting's stations required Justice Department review.
When the plans for Columbus threatened to delay Justice approval of the overall agreement, Sinclair agreed to keep the two stations apart and proceed separately with the Columbus local marketing agreement, letting Justice review any subsequent pact.
4 A'S CONCERNS
The American Association of Advertising Agencies had been pushing the Justice Department to examine the radio consolidations that resulted from the 1995 Telecommunications Act reforms. Four A's executives acknowledge that one of their biggest concerns was that any decisions reached on radio would set the trend for TV, where national advertisers have a much bigger interest.
DEALS CALLED `ANTI-COMPETITIVE'
"At least in radio there are a lot of different formats, and with the exception of those reaching teens, few we must buy," said Jean Pool, exec VP-director of North American media services for J. Walter Thompson USA, New York. "With TV, every demographic is reachable. If they start consolidating, they will own the market," she said.
Allen Banks, North American media director for Saatchi & Saatchi Worldwide, New York, a member of the Four A's committee dealing with the issue, said he had a problem with local marketing agreements. "They are anti-competitive; they don't allow the marketplace to work," he said.
In some ways, the Columbus market is an odd one to use for taking a media-consolidation stand.
The publisher of the Columbus Dispatch owns a TV station and two radio outlets that were consolidated in the Jacor/Citicasters deal, one of the first radio cases reviewed by the Justice Department.