FCC Deregulation Of Media Ownership Rules in 2003

The following are excerpts from an issue of The Washington Spectator, July 1, 2003

Stay Tuned? -- You Won't Have
Much Choice From Now On

Top Holding Companies
Top FCC Travelers

"The conservative columnist William Safire wrote in the New York Times that "no other decision made in Washington will more directly affect how you will be information, persuaded and entertained." Putting broadcast and print outlets in fewer, and bigger, hands profits the few at the cost of the many, he said...

"According to Ted Turner, the founder of CNN and chairman of Turner Enterprises Inc., the FCC changes will stifle debate, inhibit new ideas and shut out smaller businesses trying to compete...

"Barry Diller, the creator of Fox Broadcasting Company.. [said] independent companies prodiced 16 new television series ten years ago, but just one in 2002. "The barrier to entry is now so incredibly high that the ability of a new entrant to actually go out and get a voice is practically nil," he said. "The conventional wisdom is wrong--we need more regulation, not less."

"A study of five years of data by the Project for Excellence in Journalism found that local stations owned by small companies were twice as likely to produce the highest quality news as were stations owned by the nation's top 10 media groups...

The Rules: Old and New

Reach---"According to the old rule, no broadcast company could own stations that reach more than 35 percent of the national audience.

"The new rule raisess the limit to 45 percent, with immediate impact on the News Corporation, which owns the Fox network, and on Viacom, which owns CBS. Both had already exceeded the 35 percent limit but are now forgiven and will not have to sell any stations.

Cross Ownership---"Under the old rule, companies could not own broadcast stations and newspapers in the same market.

That ban is now lifted in large markets where there are nine or more TV stations. In mid-sized markets, with between four and eight tlevision stations, companies have a few options. They can (1) own a newspaper, a television station and half the radio stations allowed; (2) own a newspaper and all the radio stations allowed, but no television stations; or (3) own two television stations and all the radio stations allowed, but no newspaper. In the smallest markets, with fewer than four TV stations, the cross ownership ban remains.

Multiple Local Television Stations---"The old rule limited ownership to two stations in one market if they were not large stations and there were at least eight stations in the market.

"Under the new rule, in the largest markets--with at least 18 stations--companies can own three stations. In markets with at least five stations, companies can own two stations as long as both are not in the top four, according to ratings.

Network Ownership---"The old rule prohibited the top four networks (ABC, CBS, NBC, and Fox) from buying any of the other three. They are allowed to buy smaller networks, such as Viacom, which owns UPN in addition to CBS.

"The new rule leaves this unchanged.

Radio Ownership---"The old rule limited companies to owning eight stations in the largest local markets, but the 1996 act removed limits on how many stations a company could own nationwide.

The new rule remaps the markets to prevent further massive concentration of the kind where one company can own all the local stations in a city."

"A handful of self-serving corporate fiefdoms controls practically all of our mass-market sources of news and information. GE now owns NBC, Disney owns ABC, Viacom owns CBS, NewsCorp. owns Fox, and TimeWarner owns CNN; these five have a lock on TV news...These aloof giants openly assert that meeting their own profit needs is the media's reason for existence... Clear Channel.. (which owns.. a third of all the [radio] stations in America), opines that: "We're not in the business of providing news and information. We're simply in the business of selling our customers' products."

"This single-minded mercenary focus combines with general corporate arrogance to bloat the egos of media chieftains... "We paid $3 billion for these television stations," said an executive with Fox... "We decide what the news is. The news is what we tell you it is."" (Jim Hightower. "Just Because They Could." Texas Observer, 7/30/04: 15).

Please send comments to: Professor C. Glass, PhDc, MLIS, MAc, MS, Prof. Emeritus