Washington

Rep. Walden: Old Regs Could Be Death Sentence For Local Outlets

House Communications Subcommittee gathers input on FCC regs 6/11/2014 01:43:00 PM Eastern

Communications Subcommittee chairman Greg Walden (R-Ore.) made it clear what he thought of the FCC's recent activity, and inactivity, on media ownership rules. "Pretending laws designed for an era before smartphones and the Internet will get the job done is an effective death sentence for many local media outlets," he said.

That came in opening statements on a hearing Wednesday on media ownership rules, part of the parent House Energy & Commerce Committee's ongoing review of communications regs, as well as a response to some current events like the JSA ruling and the decision to role the 2010 and 2014 quadrennial reviews into one targeted for mid-year 2016.

The inactivity was the FCC's split decision not to loosen the newspaper-broadcast crossownership rules—it is seeking more input—and not completing the 2010 quadrennial media ownership rule review mandated by Congress—it is seeking more input. The activity is recent decisions to make most joint sales agreements attributable under ownership rules and Media Bureau guidance issue in March that the FCC is taking a dim view of sharing arrangements that appear to be attempts to circumvent duopoly rules.

Walden was pushing for regulatory relief. "I fear that local broadcast and newspaper companies will continue to struggle against unregulated competitors whose business models are not hamstrung by decades-old regulatory assumptions," he said.

Walden said everyone was committed to the core values promoting localism, diversity and competition, but his view was that was best served by not hampering broadcasters ability to compete.

Rep. Anna Eshoo (D-Calif.), ranking member of the subcommittee agreed with those core values, but didn't see how allowing more consolidation was the answer. "Our goal should be to promote localism, competition and encourage diversity, not to roll back what few protections we have left," she said.

Eshoo also took aim at JSAs. "While some have criticized the FCC for cracking down on 'sidecar' deals before concluding its 2010 review"—Walden among them—"firmly believe that the agency has an obligation to enforce existing rules on the books, regardless of the outcome of its review."

Rep. Henry Waxman (D-Calif.) made a brief appearance, but long enough to say he thought the newspaper-broadcast crossownership rules served all those core values and should be preserved.

The FCC took plenty of heat from Republicans for not having completed the quadrennial review. Bill Lake, FCC Media Bureau chief, told the legislators it was not for lack of trying, and that chairman Tom Wheeler was committed to completing the review by mid-2016. But even the FCC's target June 30 date is only the date on which Lake said the FCC would "present recommendations to other commissioners."

NAB's Jane Mago argued that the FCC was making decisions based on speculation rather than real evidence, while Lake suggested the FCC was basing decisions on the market as it existed today. In the case of JSAs, he said, that was a market where the combination of joint sales agreements with "entangling" financial arrangements had been used to circumvent local ownership rules, something the FCC was looking to prevent with the new JSA rules, which he pointed out also had a waiver provision for the examples of beneficial JSAs–being offered up by Mago—and for failing stations—a concern of one Republican lawmaker.

Mago argued that the marketplace had been revolutionized by competition, digital and otherwise, while time had seemed to stand still at the FCC. She said broadcasters need a more level playing field, including rules that keep pace with market changes or are eliminated.

Eshoo asked what good consolidation had done for the public, rather than the financial markets. Mago said it was a way to preserve a vibrant and competitive broadcast marketplace. She said broadcasting was not in a bubble, and suggested the FCC needed to get out of its bubble and allow broadcasters to compete on a more level playing field.

Rep. Adam Kinzinger (R-Ill.), no fan of the FCC's ownership regs, pushed Lake on the FCC's promise of expedited review of waivers of its new JSA limits. The FCC has said that it would act on such waivers within 90 days, unless circumstances required additional review. Kinzinger asked just what circumstances those might be. Lake said it could be the need for more info, but said if that were the case the parties would be notified, and said he did not anticipate those happening very often. He said the goal was to meet that 90-day deadline.

Walden suggested in his opening statement that he recognized the FCC rules had been adopted with good intentions, but said he feared that laws "intended to ensconce our love of local media are loving them to death."

And what would a death reference be without an undead reference.

Witness Bernard Lunzer of Newspaper Guild-CWA, definitely no fan of consolidation said that it led to layoffs and outlets programming remotely. "We get to a situation where some broadcast stations are essentially zombies," he said, "places where broadcasting continues but there are few if any employees involved."

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