Media Advocacy Groups Looking For Ways to Oppose Likely Dow Jones Takeover
Advocacy and public interest groups are looking for ways to stymie a possible takeover of Dow Jones by News Corp., even though the transaction presents no obvious avenues, source said. “We've been asked by lots of people to look into it and we think there may be some issues to raise at the commission,” said Media Access Project (MAP) President Andrew Schwartzman. “We're confident there is a basis to pursue things at the FCC. We're being asked to do it and we're giving due consideration to it.” It is unclear if the FCC has jurisdiction, since the deal would not require transfer of broadcast licenses (CD May 3 p5).
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Dow Jones’ board is prepared to approve a $5.5 billion sale to News Corp. if the company’s controlling Bancroft family agrees, it said late Tuesday. News Corp. said it is “grateful to the board… for its strong vote of support.” Dow Jones’ board reviewed drafts of a merger agreement and an editorial agreement governing its Wall Street Journal newspaper before issuing the statement, it said.
Media activists have slim chances of a successful FCC challenge to a News Corp.-Dow Jones deal; the commission has permitted broadcasters to own national newspapers since at least 1984, said two industry lawyers. The Cable Act, passed that year, specifically exempted the Wall Street Journal from cross-ownership rules, said Garvey Schubert Barer’s Erwin Krasnow and other lawyers. Since then, the FCC has approved several broadcast deals involving owners of national papers, including the Journal and Gannett’s USA Today, said the lawyers. In 1986, commissioners voted to approve sale of the Evening News Association, with a Washington-area paper, to Gannett, owner of WUSA in the city, said a second attorney. Commissioners are unlikely to try to block the Dow Jones takeover, said the lawyer.
The only avenue for an FCC challenge to the deal is the license renewal process, said the attorney, calling that an uphill battle. Krasnow, who handles broadcast deals, agreed. Even if the comment cycle has ended for an FCC license renewal review of News Corp.’s New York TV stations, he said, a party could claim standing to intervene. The trick will be persuading the commission that there is a rule violation. “It’s not hard for someone to say that this proposal violates the public interest because, and just fill in the blanks,” said Krasnow. “But the punch line has to be something that the commission is already concerned about, preferably something that is already in the rules.”
Advocacy groups are prepared to target license renewal proceedings if the Bancroft family allows the transaction to move forward, said a spokesman for Free Press. “It is incumbent upon the FCC to take stock of all the News Corp. holdings when they take stock of what do with, for instance, News Corp.’s long-standing waiver in the New York market,” he said. News Corp.’s two New York-area station licenses are up for renewal. The United Church of Christ and Rainbow Push Coalition asked the FCC not to renew those licenses, citing lack of local programming at WWOR-TV N.Y.-Secaucus, N.J., among other deficiencies (CD May 4 p11).
Groups may have to involve Congress if they hope to block the sale, the Free Press spokesman said. “There’s nothing in the regulations that would prohibit this deal,” he said. “Congress would have to take action.” That’s not an area MAP has looked into yet, Schwartzman said. “I'm really not sure what kind of legislative avenues there may be. That’s not something we've had any discussion about,” he said.”