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Keep that cap on!

Cox exec's defense of maintaining ownership limits 9/03/2000 08:00:00 PM Eastern

More than 60 years ago, as television-broadcast technology was emerging, American policymakers made a careful and deliberate choice: They allocated TV frequencies locally so that the United States would not be limited to a handful of national voices. As a result of this wise and considered policy, American television has become a system of more than 1,550 local stations that reflect a unique diversity of voices and commitment to localism.

In contrast, other countries worldwide have developed purely national TV broadcast facilities. Pluralism is at the heart of the American social and economic fabric, and it is well-served by this country's unique structure of television networks and local network affiliates.

In addition to the structural diversity embedded in American broadcasting, the view has always been that the relationship between the TV networks and their affiliates should be balanced so that neither could dominate the other. This has required that the affiliate-network relationship be less like serf-to-vassal and more like partner-to-partner, with each able to secure its own economic well-being and programming integrity.

I believe that local affiliates have lived up to this partnership bargain. While the cable industry was emerging as an economic competitor in television, affiliates recognized the need for their national networks to strengthen themselves.

They supported the network campaign to have direct financial interest in programming and to syndicate programs. And in 1996, affiliates, notwithstanding serious reservations, accepted an increase in the national audience cap from 25% to 35%. Moreover, they agreed to permit the ownership of any number of stations subject only to the higher national cap.

Affiliates understood that these measures not only would strengthen the national networks vis-à-vis cable, but would shift the balance of power away from themselves. In a cooperative partnership, sometimes giving up a little self-interest for the good of the whole is necessary.

And the television networks have indeed gotten much stronger. They have cut costs, diversified their programming content into cable as well as broadcasting, moved onto the Internet, and cut or eliminated affiliate compensation. Today, their balance sheets are the rage on Wall Street.

So now it's time for networks to slow down the expansion of their economic power over their affiliates.

As long as there has been television, Cox has been in the business. Cox is in for the long haul. However, if the networks continue to strengthen themselves at the expense of their affiliates, the economic health of affiliates will erode dangerously.

Having so recently succeeded in raising the national audience cap, the networks now want to make a gigantic leap to 50%. This will intensify the imbalance.

Under such a scheme, programming decisions will be steadily centralized into the hands of the few national networks. Profligate expansion of the national cap is a slippery slope. Once multiple bites of the apple have been devoured and half the apple is gone, where does it stop?

A network without healthy affiliate stations to exercise independent programming judgments is not a network in the great American tradition of media diversity. It's nothing more than a powerful syndicator.

In a world of media giants, it's time for a breathing spell in the consolidation of broadcast network television. And it's time for TV affiliates and networks to explore how to leverage their partnership in ways that are mutually beneficial.

March