No new combination between a daily newspaper and a TV or radio station in the same local market has been generally allowed since 1975.
But Federal Communications Commission chairman Kevin Martin is proposing to lift that ban, saying a weakening newspaper industry as a result of competition justifies some degree of consolidation.
Under the new rule, the FCC would allow the largest newspaper to buy a local TV station, provided that the transaction occurs in a top 20 market; the station is not among the top four in terms of ratings; and at least eight independent “major media voices” remain in the market.
Martin called the rule a “relatively minor loosening of the ban,” noting that the FCC failed in 2003 to relax the rule in 170 markets because a federal appeals court rejected it.
'COULD USE TIGHTENING’
Andrew Schwartzman, president of the Media Access Project, a public-interest law firm that helped scuttle the 2003 rule, said Martin’s proposal could use some tightening.
“It’s not as modest as Martin seems to be letting on,” Schwartzman said. “It greatly liberalizes the policy for granting waivers in all 210 markets in the U.S.”
A TV-newspaper combination today would need to demonstrate that one of the properties is a “failing” business in order to qualify for a waiver, Schwartzman said. Martin, he added, has proposed four factors that the FCC would consider when evaluating a waiver from the new rule.
Martin’s proposal would also allow a newspaper-radio station combination in a top-20 market but without the eight-voice or station-ranking tests.
FCC Democrats Michael Copps and Jonathan Adelstein have strongly opposed relaxation of media-ownership rules, especially if the FCC has not tried to enhance local and minority ownership of TV and radio stations.
“This is portrayed as a moderate proposal, but it is a wolf in sheep’s clothing. Don’t let the wool be pulled over your eyes. The proposal could repeal the ban in every market in America, not just the top 20,” the two Democrats said in a statement on Nov. 13.
Martin’s rule could help Tribune Co., which is awaiting FCC action on its sale to Chicago real estate magnate Sam Zell. Tribune has five newspaper-TV station combinations, including The Hartford Courant in Hartford, Conn.
“Hartford is outside the top 20,” Martin said in a press call Tuesday. “There would be a strong presumption against it.”
Martin’s proposed rule did not appease Sen. Byron Dorgan (D-N.D.), who has introduced a bill designed to postpone an FCC vote on Dec. 18.
“[Martin] has yet to make the case for why any further media consolidation is necessary. Indeed, he is relying on an assumption that newspapers are doomed and that cross-ownership is necessary to save them. I believe this is not the case,” Dorgan said in a statement.
The Newspaper Association of America, which supports total repeal of the newspaper-TV station rule, said Martin’s plan was “extremely limited and does not go nearly far enough to deal with the issues.”
CAN’T BE CLOSED
The newspaper-broadcast rule has a substantial loophole; Martin’s proposal would not close it.
The FCC does not have direct control over the newspaper industry. Thus, a TV station in any market can buy the largest newspaper and hold the property for up to eight years. When the station’s license comes up for renewal, the FCC can force the sale of the newspaper. But during the eight-year holding period, the TV station can use the time to lobby Congress and the FCC for a waiver.
“I would call it a shortcoming,” Schwartzman said.