FCC releases new media rules

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Waivers to the Federal Communications Commission’s duopoly restrictions
will apparently be much easier to come by under new broadcast-ownership rules,
judging by an initial reading of the formal text released Wednesday.

The new rules, which significantly reduced local-ownership limits, were
approved June 2, but details have not been available.

The FCC announced last month that the new rules made it easier to own
two-station TV "duopolies" by replacing the old eight-station voice test with a
new rule that simply bans pairings among a market’s four top-rated stations.

The move effectively requires a market to have at least five commercial
stations if TV pairs are permitted. The limits also restrict TV "triopolies" to
markets where there are 18 TV stations.

The FCC had said waivers to the new restrictions would be permitted, but
the criteria were not revealed until Wednesday’s official order.

As with the old restrictions, waivers will be considered if one of the
stations has failed, is failing or for an unbuilt construction permit.

Now, however, sellers do not need to demonstrate that an out-of-town buyer
could not be found.

Where once the FCC held that an out-of-town buyer was preferable because a
separate voice would remain in the market, the commission now says an in-market
buyer is the most likely option.

"The efficiencies associated with operation of two same-market stations,
absent unusual circumstances, will always result in the buyer being the owner of
another station in that market," it concluded.

But wait, there’s more: Waivers of limits in markets with fewer than 11
stations will also be considered if:

  • The combined ratings of paired stations "reduce a significant competitive
    disparity" between the merged stations and the market’s dominant station.
  • At least one station is UHF
  • One of the merged stations could better complete the transition to digital
    transmission.
  • The owner documents that the merger is needed to preserve a local
    newscast.
  • The buyer certifies that increased news or other public-interest
    programming benefits will result.
  • Stations’ outer, or "grade-B" signal contours, don’t overlap and are not to
    the same geographic areas via cable or satellite TV.

At license-renewal time, the waived stations will have to demonstrate the
ongoing public-interest benefits of the waiver, including program-related
benefits. A simple showing of cost savings will not suffice.

Many broadcasters complained that the top-four restrictions would prohibit
duopolies in many small markets where scant ad revenue threatens the financial
health of nearly every station in the market.

Attorney for those operators were reviewing the order late Wednesday and were
not prepared to say whether the waiver criteria were sufficiently lenient to
assuage their worries.

Deregulation opponents renewed their calls for reregulation by Congress.

Sen. Byron Dorgan (D-N.D.) vowed to push for a "legislative veto" that would
block implementation of the FCC’s changes.

"These new rules are wrong-headed and will result in more consolidation and
less competition in broadcasting," Dorgan said.

FCC commissioner Jonathan Adelstein, one of the two who voted against the changes
(Michael Copps was the other), supplemented his June 2 statement with a 39-page
attack.

"Public outrage from all sides of the political spectrum continues to mount
against the FCC’s decision," Adelstein said. "We’ve now heard from nearly 2
million people, almost all opposed to the decision, an unprecedented outpouring
of public concern. Yet we march ahead with our new rules. I’m disappointed that my colleagues have
refused to suspend the effective date of the new rules despite the overwhelming
public reaction and ongoing congressional deliberations to overturn the
decision."

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