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01.30.2005
Originally featured on BroadcastEngineering.com
Bush administration backs off media consolidation rules

Media companies hoping to expand their television station holdings and to own both TV stations and newspapers in the same markets suffered a setback last week when the Bush administration decided to abandon its challenge to a court ruling that blocked the relaxation of ownership rules.

The Justice Department will not ask the Supreme Court to consider a decision last year by a federal appeals court in Philadelphia that sharply criticized the move toward deregulation and ordered the FCC to reconsider its action, the New York Times reported.

The decision throws into question the future of newspapers and TV stations owned by the Tribune Company and Media General, which made acquisitions in anticipation of further deregulation. Tribune’s media acquisitions in Los Angeles, New York, Hartford and South Florida would violate the old rules, as would Media General’s in Florence, SC, and Panama City, FL. They would have to request exemptions from the FCC if they were to keep all of them.

Most of the broadcast television networks and many large media companies, including the News Corporation, Tribune, the Gannett Company and The New York Times Company, had advanced relaxation of the rules.

The networks wanted rules that would allow companies to expand the number of television stations they can own, giving them a greater share of the TV station business. Under a law passed by Congress last year in response to Powell’s proposal, one company can own stations that reach 39 percent of the nation’s homes. Powell wanted to increase that to 45 percent, from the old rule of 35 percent.

Big media companies want to expand the number of markets in which they can own both newspapers and TV and radio stations. In the last few days, some of those media companies, most notably the Tribune, pressed the Justice Department to challenge the appeals court ruling, lawyers involved in the case told the Times. Some of those companies said they plan to appeal the ruling.

Critics argue there has already been too much media concentration, leaving readers and viewers with fewer sources of news and information. They further contend consolidation would stifle creativity and lead to a decline in local news coverage.

The deregulation had been opposed by a broad coalition of Democrats and Republicans in Congress, as well as an unusual coalition of labor, consumer, religious, artistic and civil rights organizations. Some members of the coalition said they feared that further consolidation would increase the amount of indecent programming.

The Supreme Court had set Jan. 31 as a deadline for the initial filing of papers in the appeal.

One reason the administration decided not to seek Supreme Court review was that some lawyers were concerned the case could prompt the justices to review related First Amendment issues in a way that could undermine efforts by the FCC to enforce indecency rules against television and radio broadcasters, the newspaper said.

If the appeals court decision stands, it would return the rules to the FCC for further consideration.

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