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Capital Watch - Broadcasting & Cable

Capital Watch

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Planned Stationhood

Round one to the FCC, which delivered a TKO to Sinclair. The commission isn't ready to let big buyers gobble up local TV markets in a new round of mergers. The FCC will continue to enforce older, tighter restrictions on local broadcast ownership while federal judges review current ones.

By rejecting Sinclair Broadcasting's bid to buy five stations from Cunningham Broadcasting in markets where Sinclair already owns one, the FCC asserted its authority to block mergers. Congress settled things as far as the national cap goes, setting a broadcaster's U.S. reach at 39% of TV homes. But the musings of FCC Media Bureau Chief Ken Ferree persuaded Sinclair, which operates the stations under local marketing agreements, to seal the Cunningham deal.

Because the markets are too small to permit ownership of two stations under the old duopoly limit set in 1999, two previous tries were nixed. But Sinclair could get a rematch—if a federal appeals court relaxes duopoly limits set last spring.

XM Marks the Spot

Broadcasters' bid to stop local satellite radio channels won't get any traction if Commissioner Kevin Martin's views are any indication of FCC thinking. He told the NAB there's no reason to block XM Satellite Radio's locally targeted traffic and weather reports. "Just because there might be more interest in a channel in a particular city does not mean it can't be considered national programming," Martin said. Broadcasters complain that XM's local traffic and weather channels defy the fed's intent that satellite radio be a national service.

Last week, XM's local coverage targeted 15 markets: The Washington, D.C., channel kicked off Feb. 28. Two days later, channels debuted in New York; Los Angeles; Dallas-Fort Worth; Chicago; Houston; Detroit; Philadelphia; Phoenix; San Francisco:, Tampa and Orlando, Fla.; Baltimore; Pittsburgh; and St. Louis. Channels in six other markets will launch later this year. The traffic and weather services are offered via national satellite feeds available to all XM subscribers.

I Want My HDTV

Broadcasters once riled lawmakers with plans to air multiple standard-definition channels on their digital channels rather than going all HD. Now CBS affiliates are trying a different tactic: The network is threatening to abandon multicasting and go HDTV-only if cable isn't forced to carry all its digital channels.

Broadcasters "will opt for an all-HDTV strategy, which may be second-best in terms of service to the public," wrote Bob Lee, the president of CBS affiliates group and GM of WDBJ Roanoke, Va., and Ben Tucker, executive VP of Fisher Broadcasting, in their latest appeal for multicast carriage rights. Given Washington's preference for HDTV, is this a hollow threat? Not according to their Washington attorney, who says Congress has warmed to the idea that program flexibility allows broadcasters to best serve viewers.

Judgment Day

FCC chief Michael Powell is savoring his colleagues' bashing at the hands of judges. The federal appeals court in Washington struck down rules giving states more power over the telephone deregulation that was approved one year ago—despite Powell's objections. The coup by Republican Commissioner Kevin Martin and Democrats Michael Copps and Jonathan Adelstein last February was a major embarrassment for Powell and forced him to start bargaining with his FCC colleagues to prevent similar plots. In media ownership, for instance, Martin's vote was won with looser local TV/newspaper crossownership limits than Powell wanted.

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