House Slaps Powell's Hand

Federal Communications Commission (FCC) Chairman Michael Powell has been rebuffed twice recently by the US House of Representatives.

On July 24, Congressmen Reps. Rich Boucher, (D-VA) and Lee Terry (R-NB) introduced the "Consumer Access to Digital Television Enhancement Act of 2003," intended to force the FCC to impose a 30-day deadline for mandating so-called "plug'n'play" standards for cable television interfaces and new versions of cable-ready television sets and related equipment.

The Boucher-Terry bill would codify an agreement reached by cable providers and consumer electronics manufacturers months ago, but not yet imposed by the FCC, which has been criticized for not moving fast enough on the issue. The bill would insure that consumers could hook up new TV equipment directly to cable outlets and receive digital programming without the need for set-top converter boxes (STBs). It would also guarantee that any TV purchased anywhere in the US would work on cable systems anywhere else in the US. The agreement was signed by 14 manufacturers and eight cable providers, and is strongly supported by the Consumer Electronics Association (CEA), as is the bill introduced last week.

"Your legislation takes a reasonable, targeted and common-sense approach in step with the commendable efforts being undertaken at the FCC, to maximizing both cable and off-air consumers’ access to digital television," said David Arland, Thomson’s director of worldwide public and trade relations in a letter to Representative Terry.

On July 23, the House of Representatives gave Powell his biggest defeat yet, almost breaking a record for a congressional over-ride of the FCC. By a 400 to 21 vote, the House chose to overturn a recent FCC decision that would have liberalized ownership restrictions on television stations, newspapers, and other media outlets. In June, the FCC voted 3–2 to lift the previous ownership cap from 35% of the viewing market to 45%, and to ease restrictions on ownership of newspapers and television stations in the same markets. The House bill would restore previous limits for at least one year.

Critics charged that Chairman Powell was overly influenced by the interests of media conglomerates in pushing through the changes, and he was widely criticized for not accommodating public opinion in the review process. The House vote, and a similar bill now pending in the Senate, would restore the 35% cap, and could force some large broadcasters such as Viacom and News Corp. to sell some stations to meet the limit. Senators and congressmen were overwhelmed by correspondence from outraged constituents demanding that the FCC ruling be overturned.

On July 24, the House Judiciary Committee announced that it would hold hearings on the agency's media ownership policies. In altering the regulations, the FCC might have undermined "the localism and consumer choice that are central to a vibrant marketplace of ideas," said Lamar Smith (R-TX). "While I intend to conduct a hearing on this subject in the near future, it is my hope that the considerable antitrust experience (of the Justice Department and Federal Trade Commission) is not ignored during these critical proceedings," Smith stated, speaking for committee chairman James Sensenbrenner (R-WS), who couldn't attend Thursday's hearing.

President Bush has said he would veto Senate and House bills, at the risk of alienating the many Republican legislators who support them. Some Washington insiders say Bush likely will not use his veto power, but instead "will hang Powell out to dry." The 400–21 House vote was only two votes shy of the biggest FCC reversal in congressional history. Some reports have rumored that Powell plans to resign this fall.