House Votes to Bounce FCC Media Rules

The House of Representatives voted Wednesday afternoon to block the Federal Communications Commission's efforts to allow companies to own television stations that serve up to 45% of the nation's viewers.

The 400-21 vote throws into doubt the FCC's 18-month odyssey through a minefield of controversy in court- and Congressional-mandated reviews of the media ownership rules. The FCC voted 3-2 on June 2 to change the ceiling, which is now 35%. The House's vote, building on a groundswell of bipartisan support in the House and the Senate, flies in the face of GOP leadership and a threatened veto of the measure by President Bush. It would be Bush's first veto in his more than two years in office, although some cast doubt over whether the president would veto a spending bill because of the inclusion of the rule aimed at the FCC.

The battle isn't over in Congress, either. The Senate will work on its version of the bill, which already has the support of key members on both sides of the aisle. There are many Congressmen who would like to see the measure go further, restraining a company from owning both television and newspapers in the same market under certain circumstances. An amendment that would have spiked the whole FCC ruling, sponsored by Rep. Maurice Hinchey, D-N.Y., failed Tuesday by a vote of 254-174.



Advocates who had been battling the FCC ruling celebrated the at least partial victory, which they had been told couldn't happen.

"This has been a massive shift of the tide. We went from 'insiders' telling us that we were absolutely dead in the House, because the House leadership was going to stand in the way of any changes of the FCC rules," said Chris Murray, legislative counsel of Consumers Union, publishers of Consumer Reports and one of the most vocal opponents of the FCC's planned rules change. "But here we have not just a majority but virtual unanimity in the House. What was supposed to be this enormous roadblock has just been obliterated."

Murray said that Congress was telling the FCC that its 1996 deregulation of the radio industry wasn't the right road to travel when it came to regulating the television and newspaper industries.

"Radio [deregulation] is an abysmal disaster that Congress is trying to figure out how to fix. The problem is that once the genie's out of the bottle, you can't put him back in," Murray said.

But others say that who think relaxing media ownership rules will cause more consolidation and less diversity isn't paying attention to what's going on in the marketplace already. Beyond the First Amendment issues, said the Cato Institute's Adam Thierer, it's likely that the whole issue has been overblown. Thierer points out that no single media company owns even 10% of the total market nationwide now. With 1,340 commercial television stations in the United States, Viacom owns 2.9%, Fox owns 2.8%, NBC owns 2.2% and ABC owns 0.8%.

Under the new rules, companies that already exceed the 35% cap could purchase what the FCC termed a handful of additional stations, up to a half a percent of stations nationwide. FCC Chairman Michael Powell, in a statement released Wednesday before the House vote, said that would amount to about a half a percent of stations nationwide.

"Our democracy is strong. It is not threatened by half a percent. It would be irresponsible to ignore the diversity of viewpoints provided by cable, satellite and the Internet," Powell said.

Thierer said that it wasn't about market share.

"This is a mind-boggling misperception," said Thierer, who is director of telecommunications studies for the Washington, D.C.-based think tank. "It's a potential audience share restriction. The way they count that audience share is riddled with problems."

He said that today's media landscape is diverse and getting more so.

"Everything that we look at in terms of gauges and diversity in media is better than it was five, 10, 20, 30 years ago," Thierer said. "I can't imagine how people can make an argument against that."

Murray said the House's current action doesn't go far enough on rolling back the planned easing of media rules.

"The most important of rules in our opinion is the rule that broadcast television station owners can't also buy a newspaper in the same community," Murray said. "More than half the communities in this country have only one [daily] newspaper. And if you allow the dominant broadcaster in the community to own the only newspaper in that community, that does a lot of damage to the competition in local media markets. It simply narrows the number of voices in the community in a very obvious way."

It wouldn't have been the first time that restrictions on media ownership have been eased, primarily through big mergers like Viacom's purchase of CBS in 2000 and NBC's deal for Telemundo.

"We created enforceable rules that reflect the realities of today's media marketplace. The rules will benefit Americans by protecting localism, competition and diversity," Powell said.

Thierer said that the FCC was the unwilling pawn in this drama, having been forced by Congress and the courts to revise portions of the Telecommunications Act of 1996. In February 2002, a federal court said the FCC's existing media ownership rules were "arbitrary and capricious and contrary to law." There's the chance that even the new FCC regulations, if enacted, could be ruled unconstitutional.

"There's a major disconnect between Congress and the courts. And the FCC is stuck in the ugly middle of all this," Thierer said.

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