Draft FCC Order Would Attribute JSAs, End Radio/Paper and Radio/TV Cross-Ownership Ban

Also circulated is a draft order allowing Tribune to transfer its broadcast licenses so it can exit Chapter 11 bankruptcy, as had been expected (CD Nov 5 p3), holding onto stations in five cities where it also owns newspapers, an FCC official said. The order would give the company a permanent cross-ownership waiver in Chicago, the official said. Tribune had owned those properties before there were such rules. In Hartford, Conn., Los Angeles, Miami and New York the company would get a one-year waiver, the commission official said. A company spokesman declined to comment. The bureau also released as expected (CD Oct 18 p2) a report containing data on the racial and gender makeup of owners of radio and TV stations. It found women and minorities as of Oct. 1, 2011, continued to own a low number of such properties relative to their share of the population and to men and whites.

The draft order to end the quadrennial media ownership review due under the Telecom Act in 2010 allows waivers of a ban on common ownership of a daily newspaper and radio or TV station within a top-20 market, FCC officials said. They said the draft would end a limit on cross-ownership of a TV and radio station in the same area, as also was proposed in the late 2011 rulemaking notice (http://xrl.us/bnuqfz). That document had asked about allowing radio stations to own dailies, though it hadn’t proposed it, and in recent days owners of both types of properties had lobbied the commission to end that cross-ownership ban.

The draft would “streamline and modernize media ownership rules,” and end “outdated prohibitions on newspaper-radio and TV-radio cross ownership,” an FCC spokesman said by email. “As the Commission recognized last year, while the media marketplace is in transition, broadband and new media are not yet available as ubiquitously as traditional broadcast media, and certain protections therefore remain important to promoting competition, diversity, and localism.” The order “promotes media diversity by retaining some of the consolidation limits, and through a number of measures that provide broadcast opportunities for small businesses,” the spokesman said.

JSAs would be attributable ownership stakes for TV stations, as they are now for radio, commission officials told us. That’s as some multichannel video programming distributors had sought (CD Nov 14 p24). To get a cross-ownership waiver to own a daily newspaper and TV station in a market, the station couldn’t be a top-four rated outlet and there would have to be at least eight other total TV stations and/or papers published most days of the week in the same market not owned by the cross-ownership group, an agency official said. The order presumes such waivers should be granted in the 20 largest markets, and unlike the last quadrennial review order adopted in 2007 under then-FCC Chairman Kevin Martin, the current draft doesn’t include additional criteria an applicant would need to meet to get an exemption, the official said. As with the Martin-era media ownership order that the 3rd U.S. Circuit Court of Appeals sent back to the commission in 2011 over the cross-ownership waiver and eligible entity rules, there’s a presumption against cross-ownership of a TV station and daily in markets smaller than No. 20, the FCC official said.

The draft would reinstate the eligible entity rule remanded by the 3rd Circuit, a commission official said. The rule now, as in a 2007 diversity order approved at the same time as the last quadrennial review, relies on the Small Business Administration’s definition, which is based on annual revenue for a TV and radio station (http://xrl.us/bnzo5g). The eligible entity rule now as constructed would help small businesses, and give them similar benefits as such entities got under the 2007 diversity order that the 3rd Circuit remanded, the FCC official said. Minorities owned 30 full-power TV stations, or 2.2 percent of the total, 237 AMs, or 6.2 percent of all, and 196 FMs, or 3.5 percent of the total, the Form 323 data reviewed by the bureau said.

There seems to be “gathering consensus supporting repeal of the newspaper/radio cross-ownership rule” limiting a company from holding a daily paper and radio station within a market, four owners of such properties wrote the FCC. “In the past few weeks, the Commission has heard from a growing number of representatives of the broadcast, newspaper, and public interest sectors in favor of a general relaxation of newspaper/broadcast rules and of the newspaper/radio cross-ownership prohibition in particular,” Bonneville International, Cox Media Group, Morris Communications and Scranton Times LP said in a filing posted to docket 09-182 Tuesday (http://xrl.us/bnzoju). The filing cited the Minority Media and Telecommunications Council. Free Press though isn’t among public-interest groups supporting such deregulation, Policy Director Matt Wood told us.

MMTC “said only that further cross-ownership could be acceptable if it doesn’t harm diversity,” Wood noted of the council’s Oct. 26 filing (http://xrl.us/bnzphc). “But all the data shows convincingly that consolidation takes away opportunities for ownership,” he said. “There’s simply no way that the FCC can make the case that these rule changes would promote opportunities for people of color and women.” The record “overwhelmingly demonstrates that the radio portion of the cross-ownership ban is the most antiquated and least defensible of the Commission’s cross-ownership restrictions,” the four companies said. The “alternative proposal” in December’s rulemaking notice (http://xrl.us/bnuqfz) seeking comment on whether to end or relax the newspaper/radio cross-ownership restriction was again supported by the companies.