Senate Votes to Roll Back Ownership Regulations

In the latest turn of events spurred by the Federal Communications Commission's relaxed ownership regulations, the Senate on Tuesday voted to stick with the previous rules. The Senate approved, 55-40, a resolution introduced by Sen. Byron Dorgan, D-N.D. to slap down the rules with a congressional veto, a rarely used device that essentially reverses the FCC's action. The rules in question involve allowing a single network to own stations reaching 45 percent of the national audience, up from 35 percent; allowing a single company to own a newspaper, television station and several radio stations in a single market, whereas cross-ownership of media forms was prohibited before; and allowing one company to own more television stations in a single market. The previous rules, which the Senate's action, and a recent court ruling have effectively reinstated, were struck down two years ago by the U.S. Appeals Court in Washington, D.C. for lack of merit.

The congressional veto will next go to the House, where opposition is mounting, even though that body summarily struck down the 45-percent audience reach portion of the rules before its August recess. The new rules were adopted by the FCC in June.

Rep. Billy Tauzin (R-La.), chairman of the powerful House Energy and Commerce Committee is circling the wagons in support of the FCC and the Bush administration. In a statement issued after the Senate vote, Tauzin said, ". . . based on today's vote, there clearly is not enough support in the Senate to override a threatened presidential veto. It's time for Congress to move on. I will vigorously resist any attempts to revisit these issues this year."

Likewise, the Bush administration declared its position via the Office of Management and Budget with this statement: "Overturning the FCC's policy would negate "almost two years of careful study, detailed analysis and thorough review, creating significant regulatory uncertainty and preventing the implementation of important new rules which will improve the quality of local news and support free over-the-air broadcast television."

The embattled chairman of the FCC, Michael Powell, responded to the Senate vote with expected dismay.

"This resolution, if passed by the House and signed by the president, would only muddy the media regulatory waters," Powell said in a statement. "It would bring no clarity to media regulation, only chaos. It would create perverse results, such as a return to looser radio rules permitting greater consolidation. This is a harm the FCC's new media rules were designed to avoid. It would also reinstate ownership rules that were overturned by the courts. Under the terms of the resolution, the FCC would be forbidden from reissuing any substantially similar rules. In short the agency would be powerless to cure the infirmities identified by the court. What is most important is to have the best policies for the American people. I hope the House will take a more considered view of the public interest."

Elsewhere, certain media mogul types were placing odds on how the ownership debate would turn out. At a Morgan Stanley media and communications conference in Boston last week. Bloomberg reports that News Corp. Chairman Rupert Murdoch, who would benefit from the new relaxed regulations, gave them a 60-40 chance of standing, based on the weight of a presidential veto.

However, even a presidential veto would not be the final word. The 3rd Circuit Court of Appeals in Philadelphia has retained jurisdiction over the lawsuit brought by consumer groups challenging the new rules. The venue had been challenged by media lawyers, who favored a return to the more deregulatory D.C. Court.