Michael J. Copps, a Democrat commissioner who has led a nationwide effort against relaxing the media ownership rules, called the new FCC ruling a shiny gift for big media and a lump of coal for the rest. “Happy holidays,” he said, adding that the change won’t pass muster with either Congress or the courts.
“In the final analysis,” he said, “the real winners today are businesses that are in many cases quite healthy, and the real losers are going to be all of us who depend on the news media to learn what’s happening in our communities and to keep an eye on local government.”
Democrat commissioner Jonathan Adelstein said the FCC “has never attempted such a brazen act of defiance against Congress. Like the Titanic, we are steaming at full speed despite repeated warnings of danger ahead. It might yet sink. We should have slowed down rather than put everything at risk.”
Adelstein said three out of five unelected bureaucrats should not be able to overrule the American people, whom, he added, weighed in passionately in public hearings against consolidation. “They danced, they sang, they read us poems,” he said, as well as providing expert opinions.
Although FCC chairman Kevin Martin appears to have won a high-stakes battle over some of the most significant policy decisions of his tenure, he has expended significant political capital and made political enemies of powerful industry groups and influential lawmakers.
Consumer groups criticized the change in newspaper cross-ownership. “We’re disappointed that he relaxed the rule,” said Gene Kimmelman, the senior lobbyist in Washington for Consumers Union. “But the new language creating a high hurdle in the small markets, if appropriately implemented, could significantly limit the number of mergers that get through, minimizing the danger to competition and diversity in local news.”
Josh Silver, executive director of Free Press, issued the following statement: “FCC chairman Kevin Martin is ignoring the public will and defying the U.S. Senate. His decision to gut longstanding ownership rules shows once again how the largest media companies — with their campaign contributions and high-powered lobbyists — are corrupting the policymaking process at the expense of local news coverage and independent voices.”
Newspaper companies, who had fought hard for the rule change five years ago, showed less interest in it this time because of changing market conditions in the television business. In the past, newspapers saw the high profits of television stations and envisioned significant cost-saving synergies between the properties. But that strategy was crippled by the rise of Internet video, which ate away at newspaper readers, television viewers and the revenue of both mediums.
The Newspaper Association of America offered mild applause to the cross-ownership ruling. It is “a baby step in the actions needed to maintain the vitality of local news, in print and over-the-air, in all communities across the nation,” John F. Sturm, president of the association, said.
A increasingly large group in Congress has been deeply critical of Martin and repeatedly requested that he delay action on the media ownership vote. On the day before the vote last week, 25 senators led by Sen. Byron Dorgan, D-ND, sent Martin a letter in which they vowed to take legislative action to revoke any new rule or nullify Tuesday’s vote.
The cable television industry accused Martin of once again imposing unfair regulations on it.
Robert M. McDowell, a Republican commissioner, was sharply critical of the cable restrictions. “The cap is out of date, is bad public policy and is not needed in today’s public market,” he said. He called the cable rule “archaic industrial policy” that would surely be struck down by an appeals court, as a similar rule was six years ago.
David L. Cohen, an executive vice president of Comcast, said it was “perverse to see the commission approving huge mergers by the Bell companies while now telling cable companies, who compete toe-to-toe with the Bells, that they may not also grow larger and achieve the same efficiencies.”
Both the newspaper-broadcast ownership rule and the cable rule are certain to be reviewed by federal appeals courts. Three years ago, a federal appeals panel in Philadelphia struck down a series of deregulatory measures proposed by Martin’s predecessor, Michael K. Powell, including one that loosened the cross-ownership rules.