SENATE QUESTIONS FCC MEDIA OWNERSHIP REVIEW

FCC Chairman Says Current Rules Aren't Coherent

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WASHINGTON (AdAge.com) -- A Senate committee hearing today about changes in phone competition prompted senators from both sides of the ailse to openly question the Federal Communications Commission's push to review media ownership rules.

The FCC is currently reviewing all its rules for cross-media ownership -- that is, how many media properties one company can own in the same market -- and senators at the hearing held by the Commerce Committee questioned FCC Chairman Michael Powell and other FCC commissioners. While there was no immediate indication the Senate would step in to block FCC action, there was, however, considerable concern and suggestions that further hearings might be necessary.

'Freedom to get bigger'
"The big media companies want

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the freedom to get bigger," said Sen. Ron Wyden, D-Ore. "What the commission is about to do is shift policy so that one company could own everything in town, the paper, several TV stations and the whole ballgame. I want to hear how sky-is-the-limit policy will help consumers," he said.

Sen. Olympia J. Snowe, R-Maine, said she wanted to add her voice to concern about any relaxation. "I don't know if we have enormous competition among media outlets that is serving the public interest," she said. Sen. Kay Bailey Hutchison, R-Texas, said having diverse media ownership is important. "I hope that you will carefully weigh the adverse effect of relaxing these rules," she told Mr. Powell.

Sen. Trent Lott, R-Miss., said he was concerned that if the FCC moved the wrong way, "we could have a further deterioration of the local involvement and local coverage."

Rules are outdated
Mr. Powell said the FCC had to face the fact that its rules, developed 30 to 40 years ago before cable and satellite systems, weren't coherent when viewed against the present media markets and weren't being supported by the courts.

"I don't believe anything coming out of the commission's decision will result in one person owning everything," Mr. Powell told Sen. Wyden. "We don't know the outcome yet but I am skeptical some of the more melodramatic versions is what will come out of the commission."

He said the question is what rule most promotes the value of competition and suggested that consolidation isn't always a burden.

"A lot of times smaller stations are not being able to afford the cost of a news operation. Today, a lot of consumers have more media content than any time in history. I don't think combination is a complete good or bad. There is plenty of room [for the FCC to act] and not let 'Citizen Kane' take over," he said, adding that the FCC needed to adopt a coherent strategy.

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