Capital Watch - Broadcasting & Cable

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NAB Seeks More Minority Tax Breaks

The NAB unveiled two suggestions to the FCC that would make it easier
for small businesses, women and minorities to get a piece of spectrum-based
services like broadcasting and wireless communications.

The suggestions have the added benefit of helping big broadcasters as
well. For starters, NAB wants the government to restore tax breaks for
established broadcasters that sell stations to minorities or women. A similar
program was abolished in 1985 after abuses, but FCC Chairman Michael Powell and
Sen. John McCain (R-Ariz.) have argued that the time is right to bring it back.
NAB echoed the suggestion as part of an FCC inquiry into initiatives that might
boost ownership of communications properties by minorities, women and
small-business owners.

NAB also wants to relax a restriction that discourages broadcasters
from making partial investments in stations owned by minorities and others. The
restriction requires the FCC to count any stake greater than 33% in a station
as if the investor owned the entire station itself. The consequence for
investors: Stakes of one-third or larger will count toward national- and
local-ownership caps and reduce the number of stations owned by one group.

Revive personal-attack rules

Hoping to capitalize on last week's flap over Sinclair Broadcasting's
anti-Kerry documentary (see story, page 16), media activists are fighting to
resurrect the FCC's defunct personal-attack rules and the fairness doctrine.
The rules were once bedrock principles of TV news and required stations to give
individuals a chance to respond when they were attacked in a broadcast and to
present both sides of controversial issues.

Media Access Project head Andrew Schwartzman said his group, Common
Cause and others will ask the FCC to reinstate the personal-attack rule, which
was thrown out by the courts in 2000 after the FCC on several occasions failed
to justify why it was still on the books. The rule was an offshoot of the
fairness doctrine, which the FCC threw out in 1987.

Sinclair's plans to air at least part of an anti-Kerry documentary
weeks before the presidential election is proof, says Schwartzman, that the
public is harmed when one-sided views of public issues are aired.

Strippers and Whipped Cream May Mean Big Fox Fine

Fox Network stations face the biggest fine for indecent television
programming ever proposed by the FCC. Last week, the commission proposed a
$1.18 million fine against 159 Fox O&Os and affiliates for an episode of
Married by Americathat featured strippers
and whipped cream. The total levy is the largest ever proposed against a TV
program, although each station faces only the standard $7,000 indecency fine.
Previously, the largest proposed levy was the $550,000 against CBS for Janet
Jackson's Super Bowl breast baring.

Unlike the CBS fine, the FCC this time decided to fine affiliates as
well as network O&Os. CBS affiliates could not have anticipated the Super
Bowl incident, the FCC reasoned, but affiliates of Fox could have refused to
air the Married by America episode after
previewing the tape.

Deaf Urge Tougher Closed-Captioning Enforcement

Telecommunications for the Deaf and other groups want new compliance
and record-keeping requirements for TV stations and cable systems. Their
biggest complaints: Some networks provide captioning rife with errors that make
a show difficult to follow, and others don't offer the service at all.

In a petition to the FCC, the groups said "half measures" aren't
working and additional enforcement mechanisms are required. Specifically, they
want the FCC to maintain a database with updated contact information for
programmers; to create a complaint form that viewers could use to report
compliance problems; and to audit compliance. The National Cable &
Telecommunications Association countered that most closed-captioning problems
are caused by "technical glitches" rather than noncompliance.

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