FCC Rules Changes to Be Voted on June 2

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WASHINGTON ( -- Senators on Capitol Hill today said the Federal Communications Commissions was moving too swiftly with its proposed media ownership rules changes while Viacom President-CEO Mel Karmazin defended the highly contentious proposal.

The Senate Commerce Committee held a hearing this morning after the FCC sent a draft of its rules changes covering media properties to its five commissioners for a vote. Committee members said the FCC's decision will alter the media landscape and "is a high-risk proposition if we are wrong," Sen. Olympia Snowe, R-Maine, said.

Great risks
"We should pause. It is more important

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to get it right because the risks are too great," she said.

The rules, due to be voted on June 2 by the FCC commissioners, would make three major changes provided the draft stands unchanged.

  • Media companies with TV stations would be allowed to reach 45% of the nation's viewers, up from 35%. The FCC discounts the reach of UHF stations, which means the actual number could reach far higher.

  • Media companies would be able to own a newspaper and a broadcast station in the same markets.

  • More TV markets could have one media company owning two TV stations, and in larger markets one company could own as many as three TV stations.

Delay vote?
FCC Commissioner Jonathon S. Adelstein asked on behalf of himself and Commissioner Michael J. Copps that the vote be delayed a month because of the proposal's complexity and also to assure that it will withstand court tests. A spokesman for FCC Chairman Michael Powell said he told Mr. Adelstein he would "think long and hard" about the request and review it with the other commissioners. Mr. Powell two weeks ago had expressed a reluctance to delay the vote.

Senate oversight
The Commerce Committee maintains Senate oversight of the FCC, and a majority of the committee's members have previously written Mr. Powell to express their concern about the proposed changes.

Sen. Maria Cantwell, D-Wash., warned the rules changes could threaten the diversity of programming and news.

"I believe communities are a melting pot. This proposal is about stripping that away and making [programming] more vanilla," She said. "What's the rush?"

FCC chairman
Last month at the Newspaper Association of America convention in Seattle, Mr. Powell said the assumption that the public interest was served by regulating against concentrated media ownership "is simply false."

Mr. Powell has strenuously insisted the current rules aren't coherent when viewed against the present media markets and aren't being supported by the courts, and that the changes weren't as "melodramatic" as critics have suggested.

Media executives
At today's hearing Mr. Karmazin and William Dean Singleton, vice chairman and CEO of the Media News Group, supported the rules changes while Frank A. Blethen, publisher of the Seattle Times, and Jim Goodmon, president-CEO of Capitol Broadcasting Co. in Raleigh, N.C., came out aginst the.

Mr. Karmazin said broadcast TV's economics demand changes because the only way networks can recover their programming investments is by owning more stations.

He described network TV as "not a good business" but TV station ownership as a "very good business." If networks aren't allowed to buy more TV stations, he said, "what you will be doing is encouraging networks to put more content on cable."

Mr. Goodmon said the FCC's role is not to create a better economic environment for networks but to ensure diversity, localism and competition.

"I do not think there is a substitute for local broadcasters," he said, adding that the broadcast industry is already very profitable.

Outdated scheme
Mr. Singleton called the ban on newspaper-broadcast ownership the "last vestige" of an outdated regulatory scheme and said that allowing newspapers to own broadcasters would help provide additional news to communities whose broadcasters have small news departments or who are eliminating news programming.

Mr. Blethen disagreed, saying that cross-ownership could reduce the number of independent voices in a community and that if allowed to proceed, "we will see the beginning of the end of our democracy."

The ranking Democratic senator on the committee, Ernest F. "Fritz" Hollings, D-S.C., wasn't in attendance but in a statement said he intended to introduce bipartisan legislation blocking the 45% rule from taking effect.

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