Senate moves to tie up FCC on ownership rules


Key Senate Commerce Committee members are introducing legislation that would hinder the FCC's ability to scrap media ownership rules.

Senate Commerce Committee Chairman Fritz Hollings (D-S.C.) and Sens. Byron Dorgan (D-N.D.) and Daniel Inouye (D-Hawaii) are offering a bill that would require that the FCC look at any transaction in which crossownership rules are involved. For example, when Tribune bought Times Mirror last year, the FCC rules allowed that the commission did not need to look at the license transfers until the licenses came up for renewal, allowing Tribune to own TV stations and newspapers in the same markets without facing FCC review.

The bill also would require the FCC to report to the House and Senate Commerce Committees any possible changes the agency might make in media ownership rules and explain the public interest reason for making the change. Once the report was filed, the FCC wouldn't be able to make an official change for 18 months.

Hollings on Tuesday held a hearing on changing two media ownership rules: one that limits the number of TV stations a company can own to only as many as cover 35% of U.S. households; and another that forbids ownership of a TV station and newspaper in the same market. Speaking against changing the rules were Sens. Hollings, Dorgan, Max Cleland (D-Ga.) and Ron Wyden (D-Ore.). Speaking in favor of changing them were Sens. John McCain (R-Ariz.), John Kerrey (D-Mass.), John Breaux (D-La.), Peter Fitzgerald (R-Ill.) and George Allen (R-Va.).

Viacom President Mel Karmazin told Senators that the fate of free over-the-air television is at stake if they keep the rules. "The only way these stations will be successful is to grow the business. The only way you can grow the business is bigger audiences and better programming." Karmazin said the networks needed to own more money-making TV stations to be able to sustain the rising cost of programming on money-losing networks.

Post-Newsweek Stations President Alan Frank countered that lifting the 35% cap would threaten localism and diversity. Hollings and Dorgan agreed strongly with Frank, but Breaux said: "I think the argument on localism is a smokescreen. I think the real issue here is the buying power between the affiliates and the networks." Network lobbyists seemed encouraged by the hearing, even though Hollings is taking a strong stance against lifting any rules.
- Paige Albiniak