TV Station Transfers on Hold

The Federal Communications Commission (FCC) has temporarily halted ownership transfers of broadcasting stations.

The move came September 5 in response to a ruling the previous day by a three-judge panel of the US Court of Appeals for the Third Circuit, in Philadelphia, and just one day before the FCC's new liberalized ownership regulations would have kicked in. The appeals court upheld a challenge to the new ownership rules brought by the Prometheus Radio Project, a consumer advocacy group. The judges returned their ruling so quickly that few attorneys or lobbyists were present to hear it. Attorney Andrew Schwartzman, who successfully argued the case, heard the news on his cell phone while traveling back to his office.

The new rules would give media conglomerates a larger share of the television market, and would allow cross-ownership of TV stations and newspapers in the same markets. The changes were brought at the insistence of media conglomerates, which claimed that they need a bigger market share in order to remain profitable in an age of competition from cable and satellite services. The new rules were adopted June 2 without much public discussion, despite widespread protests from across the political spectrum.

The changes also have been greeted by stiff opposition from legislators from both parties. On September 4, the Senate Appropriations Committee approved legislation that would re-establish the cap on the national TV audience at 35%, a severe cutback from the 45% approved by the FCC in June. The House of Representatives has passed a similar resolution, added to a funding bill for the Commerce, Justice, and State departments.

President Bush has promised to veto any legislative attempts to restore the previous limits, a move that would put him in conflict with many members of his own party. A staffer from the office of Representative Billy Tauzin (R-LA), chairman of the House Energy and Commerce Committee, predicted a "showdown." Senator Ted Stevens (R-AK), a supporter of the old rules, said he doubted Bush would use the veto, despite a White House spokeswoman's statements that the threat still stands.

The judicial and legislative reaction to the FCC's altered rules has been widely interpreted as a blow to the power of FCC Chairman Michael Powell. In a normal year, the FCC completes ownership transfers for hundreds of TV stations and approximately 2000 radio stations.