Powell Rips Tristani's Merger Views

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The Federal Communications Commission approved Rupert Murdoch's purchase of
10 TV stations with conditions Wednesday, but the merger led to a rather harsh
exchange between Republican chairman Michael Powell and Democratic commissioner
Gloria Tristani.

Claiming that the merger violated federal communications law and should have
been rejected, Tristani said in a prepared statement that the approval 'shows
the lengths the [FCC] will go to avoid standing in the way of media
mergers.'

Powell, writing in support of the deal, called Tristani's views 'not only
offensive, but absurd.'

In a 3-2 vote along partisan lines that found that the deal did not violate
foreign-ownership rules, the FCC allowed Fox Television to acquire 10
Chris-Craft Industries Inc. stations but required the new entity to dump a TV
station in Salt Lake City within six months in order to comply with local
duopoly rules.

The deal put Fox at 41 percent of TV households, exceeding the FCC's 35
percent cap. Fox has 12 months to get down to 35 percent, but that mandate is on
hold until the court addresses the legality of the 35 percent cap. If the court
vacates the cap, Fox may be allowed to remain at 41 percent.

The FCC also found that the merger violated the newspaper-broadcast
cross-ownership ban in New York, where Fox parent News Corp. will end up owning
two TV stations and the New York Post tabloid newspaper.

News Corp. chairman Murdoch, who had a waiver to keep the Post and one
TV station, was given 24 months to limit his ownership to one newspaper and one
TV station.

The FCC is planning to review the newspaper-broadcast ban with an eye toward
relaxing it. It may turn out that Murdoch won't have to comply with that merger
condition if the rule is changed.

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