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Analysis: FCC changes promote diversity

By
PETER ROFF, UPI National Political Analyst

WASHINGTON, June 3 (UPI) -- After much debate, the Federal Communications Commission has, by a vote of 3-to-2, loosened restrictions on the ownership of broadcast properties.

Citing the agency's "statutory duty" to protect the public interest, FCC Chairman Michael Powell says the rules adopted Monday will "advance our diversity and localism goals and maintain a vigorously competitive environment."

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The move is controversial: Supporters say it will lead to increased competition and a more diverse flow of information; political groups on the left and the right oppose loosening the standards.

Former Green Party presidential candidate Ralph Nader, perhaps better known for activism on corporate issues, identified the breadth of the opposition while attacking the decision.

"Whether they are the National Organization for Women or the National Rifle Association, or media magnates Barry Diller or Ted Turner, of Common Cause or William Safire, none want five or six corporate chief executives to decide what they hear, read or see," Nader says.

Conservative media critic L. Brent Bozell agrees, arguing that liberalized ownership rules will not increase or preserve diversity in the marketplace. "Rather, it will mean ... more control of the airwaves by the few, with even less accountability to the market than they demonstrate today," he says.

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According a Bozell analysis, ABC, CBS and NBC control 48 percent of all television programming. If Fox, AOL-Time-Warner and ATT/Liberty are added, these six, as he calls them, "megacorporations" control almost two-thirds of the programming.

This is a huge advance toward consolidation, say opponents of the move. Bozell points out that, since 1989 when the rules were last relaxed, the big three broadcast networks controlled 17 percent of programming.

What that ignores, say those who favor the change, is that the sheer number of outlets has increased dramatically in the years since the change. Television and radio programming is, they say, much more diverse even if fewer companies sit atop the ownership pyramid.

"There are now vastly more media outlets and sources of news and information than there were when the rules were adopted 30 or 40 years ago," Randolph May of the Progress and Freedom Foundation, a pro-technology group, says.

The existing rules were put in place "before 85 percent of the American households subscribed to 300-channel cable and satellite television systems and before the Internet revolutionized information dissemination," May adds.

The changes are, by some standards, fairly modest. The cap on total market share cap for any one company was raised from 35 percent of U.S. households to 45 percent. The rules preventing cross-ownership between television and radio stations or newspapers and broadcast outlets in the same media market were largely eliminated.

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Companies will now be able to own two television stations in the same media market if there are a total of five or more outlets and as long as only one of the two stations is among the top four in the ratings.

Fred Smith, the president of the pro-competition Competitive Enterprise Institute, calls the changes "A valuable but still baby step toward freeing America's communications from political interference."

Smith says concerns about consolidation are a distraction from the real issue. "What does it mean to talk about a local market in a global world?" Smith asks, pointing out that most of the television and radio stations in the United States can now be heard via the Internet.

The technological revolution that began in the mid-1990s is still playing itself out. Broadband, wireless, digital cable, satellite radio -- these are all developments that were not even considered when the ownership rules were originally written.

Bringing such developments to the marketplace is a capital-intensive activity, potentially out of the reach of "Mom-and-Pop" operations. The companies that Bozell and other deride as "megacorporations" may be the only ones who can make the necessary investments in new and faster systems to deliver news, information and entertainment.

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There are millions, if not billions, of dollars at stake in how the issue plays out. Opponents have tried to instill a fear of one company manipulating political coverage, providing only one viewpoint.

Smith finds such concerns silly and, pointing out how they have come mostly from the political left and largely been directed at Rupert Murdoch's Fox News, hypocritical.

"There were few complaints when there were only three television channels and the liberals ran them all. If Rush Limbaugh doesn't represent diversity, then who does?" Smith says. "Does anyone really believe that Fox, CNN and MSNBC aren't already locked in a death struggle?"

Before the decision was affirmed, there was considerable and bipartisan discussion on Capitol Hill about ways to reverse or enjoin the rules changes from taking effect through legislation.

No specific proposals have been put forward but, just hours after the commission voted, Sens. Byron Dorgan, D-N.D.; Fritz Hollings, D-S.C.; and Trent Lott, R-Miss., denounced the changes in a joint news conference.

Legislation to overturn the FCC's move is expected to be introduced in the Senate within a matter of weeks.

Whether it will go anywhere is another matter. Majority Whip Tom DeLay, R-Texas; and Rep. Bill Tauzin, R-La., the chairman of the influential Energy and Commerce Committee, have voiced support for the changes. It is unlikely that the House would move to reverse the FCC without their support.

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Smith believes there are plenty of examples in the market that point to the wisdom of the FCC's move toward deregulation, something he hopes policy makers will take into account in coming weeks.

"Look at food sales in America," he says. "When the local 'Mom and Pop' had the local monopoly, there was much less choice and we paid much higher prices."

"Today, with just a handful of supermarket giants, we have vastly more choices and much better prices," he says. "Competition isn't about bean counting, it's about competition."

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