Multiple Ownership Rules

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Two articles published today talk about on-line media, and the growing importance of local content in advertising and audience growth.  These articles emphasize the long-term importance for broadcasters to capture the local audience that they have controlled over-the-air for so long as that audience makes the transition to the world of Internet media.  This growth of…

For the last 10 years, since the liberalization of ownership rules under the 1996 Telecommunications Act, the broadcast industry has been in the process of putting together cross-market platforms in radio, television and newspapers in markets across the country.  In the flap over media ownership that began with the FCC’s 2003 multiple ownership decision, and which continues through the current proceeding, media critics have sought the shrinking of big media companies, which they hold responsible for everything from violence and indecency on the airwaves to the lack of new music on radio.  Now, suddenly, 2006 has brought a restructuring of big media, without any government intervention whatsoever.  What impact will this restructuring have on the current proceeding?

The announcement by Clear Channel Communications that it is being sold, and at the same time it’s selling all of its television stations and over 400 of its radio stations in 90 smaller markets, is but the most recent example of that emerging trend.  CBS, which itself was split off from Viacom, is in the process of selling off a number of its radio properties in smaller markets.  ABC also has a deal to sell off the bulk of its radio properties, and announced in its comments in the current multiple ownership proceeding that it did not care what the FCC did, as it had no intent of acquiring any additional broadcast stations or newspaper properties.  Similarly, Tribune is exploring strategic options that reportedly include splitting its broadcast and newspaper properties.  The New York Times has also announced that its exploring spinning off its television properties.

All of this unforced media divestiture should have an impact on the current multiple ownership proceeding.  On a practical level, who is going to push for the current proceeding to be completed?  Many of the players who were active in the past no longer seem like they will care about the outcome of this proceeding, and others seem like they will be preoccupied, at least in the short term, with their business deals.  While the FCC has announced the scheduling of its second field hearing (in Nashville on December 11), it still has 4 more promised hearings to hold at some point in the future.  Unless these are scheduled quickly, and without the big players pushing the FCC to move quickly, the decision could easily drag.  

So who is left to actively push the FCC to reach a decision in this proceeding?  On the TV side, Fox and Sinclair seem likely to be the most active proponents of great deregulation – and, based on past history, most likely to pursue court actions to obtain ownership relief if the FCC does not move quickly on the current proceeding.  Gannett and the Journal Corporation own newspaper and TV stations and may push for more relief.  Clear Channel had been the major proponent of further radio deregulation.  Will their activity continue?

Continue Reading 2006 – Shrinking Big Media – Without Ownership Reform

In Today’s New York Times, a columnist concludes that the FCC’s multiple ownership proceeding is "yesterday’s news."  Looking at the Tribune Company’s recent financial issues and possible sale, the column asks whether anyone should really care about ownership issues in the light of the rapid changes in the media landscape brought about by the digital revolution.  Whether or not anyone cares, the changes in media competition, and potentially in the political landscape after next week’s election, may well mean that there will be no significant ownership reform for quite some time, perhaps not until 2009 – after the next Presidential election.

The Times column talks about Tribune’s discussions of selling off its television stations as part of a financial restructuring.  (The article does not mention that the New York Times itself is considering the sale of its television stations).  Tribune has certainly been one of the parties pushing newspaper-television cross-ownership relief.  As they look at restructuring, will they pay attention to the FCC’s proceedings?  And Clear Channel was one of the parties in the forefront of attempts to further loosen radio ownership restrictions.  They, too, are reportedly considering a financial restructuring or sale.  Will these actions distract two of the most active proponents of relaxing the ownership rules?

In the comments in this proceeding filed last week, ABC Disney essentially took itself out of the proceeding saying that they did not advocate changes in the ownership rules, as they are selling their primary radio assets, are out of newspapers, and are investing in new technologies to get their message out.  With the opportunities of the Internet distribution of video and audio programming, are there other broadcasters, anxious to own more traditional media, who will take the lead in this proceeding?  With over-the-air digital radio and digital television both offering multicast opportunities, do these technologies themselves take some of the urgency out of ownership relief?  Continue Reading Multiple Ownership – Still Relevant?

With only a week to go before comments are due in the FCC proceeding to determine whether or not to change the Multiple Ownership Rules (our summary of the issues on which the Commission sought comment can be found here), a controversy has arisen over a 2004 study concerning the effects of local ownership on news programming.  During the confirmation hearing on Chairman Martin’s second term on the Commission, soon after the Chairman expressed his open mind about the outcome of the multiple ownership proceeding, California Senator Barbara Boxer produced a surprise.  She produced a report written by FCC economists purporting to show that television stations that are locally owned air more local news programming.  This report, though written in 2004, had never been released to the public.

The clear implication was that the Commission had tried to bury the report though as it contradicted FCC proposals to loosen ownership restrictions.  According to a report in TV Newsday,  the Chairman today sent a letter to Senator Boxer stating that neither he nor any of the other Commissioners knew of the existence of the report or any efforts to suppress its release.  However, in another news report released today, a former FCC attorney said that senior managers at the Commission ordered "every last piece" of the report destroyed.  Continue Reading Flurry Over Consolidation Study