Holding out little hope that the Republican majority of the FCC will have a sudden conversion on June 2, activists in favor of retaining limits on media ownership are formulating new strategies on how to challenge the FCC’s expected vote. Meanwhile, Commission sources said those activists probably were accurate in their assumptions that the Commission would adopt the proposals sent to the 8th floor in their original form. “All the cuts that [FCC Chmn.] Powell wanted are sticking,” one source said. Our sources say the Commission is likely to push the national ownership cap to 45% from 35%, that duopoly rules will be loosened considerably, that the newspaper-broadcast cross-ownership ban will be eliminated in most markets and that the TV/radio cross-ownership rule will be similarly loosened.

When AOL wanted to merge with Time Warner back in 2000, critics feared the marriage of such a large content company with an Internet service provider would put a stranglehold over a relatively new communications technology -- Instant Messaging (IM). The federal govt. agreed then, placing as one of the conditions on the merger a requirement that the new company work toward developing interoperability for IM that would allow other companies to provide IM services that would let their customers communicate with AOL’s IM customers.

FCC Chmn. Powell was heavily criticized by his 2 Democratic colleagues on the Commission and consumer groups for deciding to move forward with a June 2 vote to overhaul the country’s media ownership rules (CD May 16 p4). “This rush to judgment means that we will not fully understand the impact of the specific proposals on our media landscape before we are forced to vote,” Comr. Copps wrote in a statement.

Officials close to News Corp.’s proposed acquisition of DirecTV said the companies planned to submit their proposal to the FCC in the next few weeks. They said they couldn’t discuss details but planned to put into writing their intent to treat distributors fairly in terms of programming. Their Hart-Scott-Rodino antitrust filing is expected about the same time, with Justice Dept.’s Antitrust Div. taking the lead in that review.

Relaxation of the FCC’s restrictions on broadcast ownership “may be imperative if we want to preserve free, over-the-air television,” FCC Chmn. Powell told the Media Institute Thurs. in Washington. The Commission, he said, needs to replace existing ownership restrictions with “a coherent set of rules… to reflect the massive changes [in] the media landscape.” He cited “a virtual explosion of diverse and varied content” of electronic media since the rules were adopted.

With a group of senators asking the FCC to seek public comment on any proposals it formulates for media ownership rules, some sources inside and outside the Commission are beginning to think those rules, which had been expected in late spring, could be delayed. Other FCC sources are adamant that the rules will not be put off.

Although the biennial review report issued late Fri. by the FCC focused on telephone issues (CD March 17 p1), many media analysts are reading a lot into the decision, trying to divine what it means for the pending media ownership proceeding. That’s because the language dealing with the public interest is very similar in both areas of communications law.

After presentation by Parents TV Council (PTC) Co- founder Brent Bozell in which he equated sex, violence and indecency on TV with concentration of media ownership, Comrs. Powell and Abernathy questioned Commission’s ability to regulate public’s tastes and popularity of TV shows. Exchange came in FCC’s day-long, en banc hearing in Richmond, Va., Thurs.

FCC officially repealed section of its media rules dealing with cross-ownership of cable systems and broadcast TV stations. Comr. Copps said in separate statement that he reluctantly supported order issued Wed. because U.S. Appeals Court, D.C., in Fox TV Stations v. FCC had “left us no option.” But, he said, FCC still should be addressing issue in its biennial review of media ownership rules, which it wasn’t doing.

FCC released agenda for its en banc hearing Thurs. on media ownership, saying event would be divided into 3 panels focusing on diversity, localism, competition. Agency said panel members were selected with goal of making groups “balanced and informative.” They include representatives of consumer groups, industry and academic institutions. After each panel, members of public can make comments during “open microphone” sessions. Attorney Thomas Krattenmaker of Washington office of Mintz, Levin, Cohn, Ferris, Glovsky & Popeo will moderate. He specializes in telecom transactions and antitrust issues. Before joining firm, he was dir.- research in FCC’s Office of Plans & Policy under then-Chmn. William Kennard. After comments from commissioners, morning session on diversity issues will include Brent Bozell of Parents TV Council, Robert Corn-Revere of Hogan & Hartson, Jay Ireland of NBC TV stations, Alfred Liggins of Radio One, Victoria Riskin of Writers Guild of America-West, Andrew Schwartzman of Media Access Project, Wendy Thompson of Telemundo. Afternoon session on competition will include Linda Foley of The Newspaper Guild-CWA, Ed Munson of WAVY-TV and WVBT Va. Beach TV stations in Norfolk, Va., Jonathan Rintels of Center for the Creative Community, James Winston of National Assn. of Black-Owned Broadcasters. Final panel on localism will include Frank Blethen of The Seattle Times, Thomas Herwitz of Fox TV Stations, Mark Mays of Clear Channel, Deborah McDermott of Young Bcstg., Chris Powell of Journal Inquirer, John Sturm of Newspaper Assn. of America, Jenny Toomey of Future of Music Coalition.