• by Erik Sass  @eriksass1, May 23, 2008

Three Democratic senators are escalating the fight over media consolidation on Capitol Hill. Byron Dorgan (D-ND), Patrick Leahy (D-VT) and Herb Kohl (D-WI) sent a letter asking the General Accounting Office to open an investigation into the financial ramifications of media consolidation--and the likely impact on the number of independently owned broadcasters.

In their GAO letter, the senators say they "worry that the percentage of independently produced and owned content on media outlets will continue to fall, thereby limiting the number of distinct media voices."

The requested investigation would cover developments in the radio, TV and subscription cable businesses over the last decade, as well as the rise of Internet distribution. In addition to reviewing trends over the last decade, it will address their implications for the future of media.

As for the Internet, the investigation will evaluate the medium as a new outlet for independent programming that has been squeezed out of the traditional media business. While acknowledging that the Internet allows more independent distribution of content, the senators also want the GAO to determine the degree to which big media companies dominate the industry.

The investigation is clearly intended to provide ammunition for Congress in its ongoing dispute with the Federal Communications Commission over its attempt to loosen the rules governing cross-ownership of media in big media markets.

On Dec. 19, FCC chairman Kevin Martin held a vote that revised a 1974 FCC rule prohibiting a single entity from owning both broadcast and newspaper properties in the top 20 media markets. The new rule would allow a single entity to own one newspaper and one broadcast property in the same market, in the top 20 markets.

Martin organized the controversial party line vote, pitting the FCC's three Republican commissioners against two Democrats over protests from both parties. Members of Congress accused him of rushing the vote and not leaving enough time for public review and comment. Last week, a bipartisan resolution to block the rule change passed a full Senate vote; it must now be approved by the House of Representatives, where its chances of success are fair.

The House of Representatives' Commerce Committee has also rebuked Martin, and after a special bipartisan investigation, a subcommittee recently told Chairman John Dingell (D.-MI) that he should hold public hearings on Martin's alleged mismanagement, which could happen as early as June.

The new GAO investigation could also prove a stumbling block for the proposed merger of satellite broadcasters XM and Sirius, which is currently awaiting FCC approval. Recently, members of both houses of Congress have voiced reservations about the merger.

Earlier this month, Dingell and Rep. Ed Markey (D-MA), chairman of the House Telecommunications Subcommittee, sent a letter to Martin demanding that as a condition of approval for the merger, satellite radio sets manufacturers be allowed to incorporate HD radio receivers, iPod and MP3 ports and other audio hookup options to benefit consumers.