Representatives of think tanks and public interest groups gave straightforward answers when asked about their funding at a Wed. FCBA lunch. Ray Gifford, Progress & Freedom Foundation pres., said PFF is corporate-funded, sometimes a “perilous mechanism for a think tank.” PFF and kindred groups “need to have personal integrity and be willing to lose support” from financial backers to guard against moving from a “free market think tank to a corporatist think tank,” Gifford said. PFF occasionally has alienated supporters on specific issues, he said. Kenneth DeGraff, Consumers Union policy analyst, said CU is mainly subscriber-funded and, while not taking corporate money, will work on specific projects with corporations that share CU’s views. DeGraff said he likes the flexibility of working with Verizon one day and “blasting” the firm another. Andrew Schwartzman, Media Access Project exec. dir., said MAP is foundation-funded. Jerry Ellig, senior research fellow at George Mason U.’s Mercatus Center, said Mercatus separates its fund-raising and research; most funds come from individuals and foundations rather than corporations. Panelists described how they gauge their policy debate success. Emergence of “a diversity of perspectives” is a merit badge, especially if “agency proclivities can be altered by the record,” in other words where agencies or individuals with known positions on an issue “go the other way based on the merits,” Schwartzmann said. Ellig said success is when “decision makers are making better decisions because of what we've done.” That could happen when policy makers “think through issues differently” or “do something differently,” Ellig said. DeGraff said “getting our views out” and reflected in FCC orders and congressional actions is the ultimate success. “Success is if decision makers are treating issues as if ideas matter,” said Gifford. Asked if they strongly disagreed on specific issues, DeGraff criticized PFF for not backing municipal broadband and network neutrality. Gifford said both are “bad ideas.” He said studies show “no municipal broadband play is able to cover its costs” while at the same time such efforts drive off private capital. Network neutrality can do “long-term damage to the broadband converged future,” he warned. Perhaps good in a monopoly situation, amid competition it can discourage bundling, Gifford said. For example, it could discourage the offering of a family- oriented broadband package that blocks objectionable web sites, he said.

A fight against pending FCC limits on kid commercials was moved to the U.S. Appeals Court, Cincinnati, by D.C. judges. Parties to the lawsuit said it’s shaping up as a battle over regulation of Web addresses on children’s TV shows. The decision by the U.S. Appeals Court, D.C., to transfer Viacom v. FCC also denied Viacom’s bid to fend off rules set to take effect Jan. 1. While the new venue could still issue a stay of new rules stemming from the Children’s TV Act of 1990, broadcasters, including Viacom and Disney, are likely to try to return the case to D.C., participants in the case told us. Officials from the companies declined to comment on prospects for such a motion.

A fight against pending FCC limits on kid commercials was moved to the U.S. Appeals Court, Cincinnati, by D.C. judges. Parties to the lawsuit said it’s shaping up as a battle over regulation of Web addresses on children’s TV shows. The decision by the U.S. Appeals Court, D.C., to transfer Viacom v. FCC also denied Viacom’s bid to fend off rules set to take effect Jan. 1. While the new venue could still issue a stay of new rules stemming from the Children’s TV Act of 1990, broadcasters, including Viacom and Disney, are likely to try to return the case to D.C., participants in the case told us. Officials from the companies declined to comment on prospects for such a motion.

Broadcasters and cable, battling on a variety of fronts, agree on at least one issue: The FCC shouldn’t expand closed captioning requirements. In comments to the Commission, MPAA, NAB, NCTA, RTNDA and other groups said imposing standards such as technical benchmarks on captions would be an unnecessary burden, fixing a non- existent problem. Groups representing hard-of-hearing consumers and captioning firms are seeking some standards and better monitoring of caption quality.

Media activists are trying to block license renewals at 20 TV stations, including all major stations in the Chicago and Milwaukee markets, because they carried little state and local political news. The first petition of its kind, filed by Media Access Project (MAP) on behalf of local groups, said less than 1% of news broadcasts in the 2 markets focused on local political issues such as candidates and referendums in the 4 weeks preceding last year’s general election. “The amount of programming on state and local races of programming we monitored amounted to a rounding error,” said MAP Exec. dir. Andrew Schwartzman: “This is the first time that anyone has filed a petition like this one.”

Cumulus Media said it would acquire Susquehanna Pfaltzgraff’s radio operations in partnership with Bain Capital, the Blackstone Group and Thoms H. Lee Partners, for about $1.2 billion. The Susquehanna group includes 33 radio stations in San Francisco, Dallas, Houston, Atlanta, Kansas City, Cincinnati, Indianapolis and York, Pa. Cumulus will contribute its 2 FMs in Houston and 2 in Kansas City to the new partnership, in return for an initial 25% ownership. That could hit about 40% based on performance incentives. Cumulus also will be paid a fee to run the group, to be called Cumulus Media Partners. The partners will put up cash for the deal, with debt financing from 4 banks. Susquehanna separately agreed to sell the remaining 70% stake in its cable division for $540 million to Comcast, which already owned the other interest. The cable systems have 225,000 subscribers in Pa., N.Y., Me. and Miss. Comcast’s purchase of Susquehanna should be reviewed by the FCC along with its takeover of Adelphia with Time Warner, media reform groups said. The deal for Susquehanna would already have been subject to FCC review, said Andrew Schwartzman of Media Access Project. His group submitted the motion to hold in abeyance on behalf of Free Press, Center for Creative Voices in Media, Center for Digital Democracy and others. The price Comcast is paying for Susquehanna subscribers is less than some previous deals. The price of $3,260 per customer compares with Cox’s privatization last year, valuing the firm at $3,900, wrote Jefferies & Co. analyst Robert Routh in a research note. Comcast, along with Time Warner, is paying $3,400 for each Adelphia subscriber, Routh estimated. He expects “fears to be heightened based on the lower per subscriber value.”

Judge Samuel Alito may support media deregulation citing constitutional considerations including the First Amendment, if his nomination by President Bush is backed by the Senate, according to lawyers and a review of legal cases the judge has presided over. Alito hasn’t left much of a mark on media or telecom cases in his 15 years on the 3rd U.S. Appeals Court, Philadelphia. But a 2004 case involving student newspapers and a 2001 case on harassment policies indicate he may have a broad interpretation of what actions comport with freedom of speech. He participated in a 2003 case involving the former WorldCom’s accounting scandal, finding a lower court couldn’t dismiss a claim against the firm because it failed to file contracts with the FCC.

The FCC likely will review cable ownership attribution rules, and act on them before setting national ownership limits, Commission sources said. Separating the 2 items would help align broadcast TV and cable system rules on the thresholds for media properties to be considered owned by a media firm for antitrust purposes, a source said. There are some “slight” differences in considering attribution of cable systems versus TV stations, a source said.

As the FCC prepares its pay-to-play probe, fueled by N.Y. Attorney Gen. Eliot Spitzer’s recent payola investigation, music industry experts Tues. welcomed any reforms to level the playing field for lesser known artists to get their songs on the radio. Musicians and activists cited frustrations and personal stories about the major record labels’ dominance over the airwaves at the Future of Music Coalition summit in D.C.

As FCC Chmn. Martin and Comr. Copps visited the Gulf Coast Thurs., the Commission issued an agenda for its Sept. 15 open meeting devoted to “presentations” on Hurricane Katrina’s impact on communications. No action is expected.