Capital Watch - Broadcasting & Cable

Capital Watch

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Analog TV Fees Proposed

The White House again wants to levy a spectrum fee on broadcasters. This time, the Bush administration is calling on TV stations to pay an "annual lease" totaling $500 million and beginning in 2007.

The fee would apply only to analog spectrum users and is being proposed to "encourage" television broadcasters to vacate analog spectrum after 2006 "as required by law," according to the White House 2004 budget plan. Stations would be exempt from the fee after converting to digital and returning analog spectrum.

Spectrum fees are almost always included in White House budgets and have always been defeated. Still, the White House is pushing the idea again under pressure to make TV spectrum available for wireless and other services.

Responding to the proposed fee, NAB President Eddie Fritts said, "Congress has wisely rejected spectrum taxes on broadcasters for the past several years because lawmakers recognize the timetable for the transition to digital television will be determined by consumer acceptance and not by arbitrary government dictates."

GAO Wants End to Turf Tussle

Congress should establish an independent commission to determine whether reform is needed for spectrum management now done by the FCC and the National Telecommunications and Information Administration, the General Accounting Office said last week.

GAO, the investigative and auditing arm of Congress, recommended legislative action because neither the FCC nor NTIA "specifically agreed" to an independent commission after being notified of the GAO proposal. The two did agree last Friday to cooperate when making spectrum-use policies and to meet at least biannually for joint planning sessions. If the GAO report is any gauge, however, that may not be enough.

GAO said disagreements over how and whether to increase market-based methods of doling out spectrum, such as auctions, have stalled reform.

Budget Cuts Noncom DTV Dough

The Bush administration's new budget, which must be approved by Congress, eliminates Commerce Department grants that have helped public stations construct their digital facilities. The budget suggests that, instead, $100 million of the Corporation for Public Broadcasting's already enacted 2004 funding be designated for digital buildouts. A number of groups representing public broadcasters said that enacting the president's budget would "seriously compromise" public stations' ability to deliver programming and other current services.

Clear Channel Wins One

Spanish Broadcasting's antitrust suit against Clear Channel has been dismissed by a federal district judge in Miami. Spanish had alleged that Clear Channel interfered with its public offering in 1999 and with some sales relationships and also scuttled negotiations that could have led to a merger between it and Hispanic Broadcasting. Officials for Spanish said they will appeal and believe that their claims will be reinstated. Clear Channel Chairman Lowry Mays said the decision shows that his company has "risen above the chatter and proven that we are a good company, with ethics, integrity and sound business practices."

Ownership-rewrite Deadline Challenged

Like Julius Caesar, FCC Chairman Michael Powell may have to create a new calendar. That's what some say he will need to meet his late-spring deadline for revising ownership rules. Media Access Project President Andrew Schwartzman (above) predicts the rewrite will last through summer, if not through fall. Two weeks ago, Powell put the deadline at "very late spring," prompting one Washington source to respond: "Very, very, very late spring." Powell media aide Susan Eid stuck with late spring and threatened to "kill myself" if the review drags on.

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