A Weary Powell Gets Thumped on Dereg
But he tells Senate panel that critics' tales are 'melodramatic'
By Bill McConnell -- Broadcasting & Cable, 1/19/2003 7:00:00 PM
Bristling at the suggestion that he would let one media company "own everything in town," Michael Powell admitted last week, perhaps a bit belatedly, that radio consolidation may have gone too far, but he harbors no intention of pushing wholesale elimination of industry ownership limits.
"Candidly, I am troubled" by the massive wave of radio consolidation in the last seven years, he told senators. His attempt to stem the rhetoric aimed against him comes as opponents of industry concentration raise alarms across the country over his sweeping review of all media-ownership restrictions.
"I am skeptical that some of the more melodramatic versions of what's coming out of the commission are accurate," he said during a Senate Commerce Committee hearing. He predicted the FCC would construct a "meaningful filter of undue concentration." (Meanwhile, the National Association of Broadcasters proposed to the commission that, in some instances, television triopolies might make sense. See story, page 6.)
Later in the week, consolidation foes such as artists' unions and consumer advocates hosted the first of two private-sector hearings on the FCC's review. Powell attended the hearing with three of his fellow commissioners at Columbia University in New York. Another is scheduled in Los Angeles Feb. 18 at the University of Southern California.
Powell these days appears more than a little frustrated that the critics ignore his repeated pledge not to eviscerate ownership limits. Instead, he says he simply wants new types of restrictions that comply with court decisions, congressional orders and changing industry economics.
For instance, because the 35% cap on one company's TV-household reach is often upheld as a way to preserve localism, he suggested a simpler approach might be to limit properties that can be owned locally.
Still, Powell isn't expecting his critics to be happy with all the eventual rules. He conceded: "I'd be disingenuous to say you're going to love everything when we're done."
Despite Powell's assurances, several lawmakers said they feared the FCC would go too far. "We're headed in exactly the wrong direction," said Sen. Byron Dorgan (D-N.D.) who complained that the increase in types of media outlets, or "voices," is meaningless if one company owns most in any one market. "When you're talking about more voices, are you talking about more voices from one ventriloquist?"
Similar sentiments were expressed by Sens. Ron Wyden (D-Ore.), Kay Bailey Hutchison (R-Texas) and Olympia Snowe (R-Maine).
Sen. John McCain (R-Ariz.), the committee's new chairman, did not indicate whether he is rethinking his longstand- ing preference for ownership deregulation. Consolidation foes hoping to sway McCain take heart that he has scheduled a hearing on radio consolidation for late January or early February.
The FCC certainly has a diversity of voices on thie subject too. Democratic Commissioner Michael Copps, for one, warned last week that changes to only a few rules could cause dramatic consequences.
"To do away with something like newspaper-crossownership restrictions would create some pretty far-reaching opportunities," he said. In fact, the restrictions on ownership of broadcast stations and newspapers in the same market appears to be on the way out. That's because federal judges have indicated strong hostility to any prohibitions on ownership across different media.
After several lawmakers persisted in criticizing the FCC's media-ownership review, Powell noted that the radio consolidation wave was launched not by the commission but by Congress when it lifted the cap on national radio ownership as part of the 1996 Telecommunications Act.
Since that time, the country's largest group, Clear Channel, has grown from roughly 40 stations to more than 1,200 and many of those markets are dominated by one or two owners.
He also pointed out that his broad review of nearly all media-ownership limits was ordered when judges found the FCC hadn't fulfilled its obligation to justify the restrictions every two years.
"If I didn't care about media ownership I'd do nothing because the court will vacate everything," the FCC doesn't justify, Powell said.
In radio, it seems some belt tightening is all but certain. Powell pledged to tighten loopholes in radio market measurement that allow companies to own more stations than normally would be permitted. "That problem we've teed up to address," he said.
Ostensibly, radio ownership rules allow the control of eight stations in the largest markets and fewer in smaller ones. But measurement loopholes allow some owners to control eight stations in very small markets such as Yankton, S.D.
Powell noted that his staff has ordered seven radio mergers, each likely to result in heavy concentration of local ad revenues, to undergo public interest hearings. Six of those mergers are Clear Channel purchases.
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