FCC May Allow More Media Consolidation

Posted by Sam Churchill on

The FCC today agreed to propose easing limits on one owner holding a television station and newspaper in the same city, reports Bloomberg. The FCC will take comments and no date has been set for a vote, according to an FCC official familiar with the situation.

“The consolidation of media assets in the same market would lower costs for these businesses and would make them more profitable,” Laura Martin, an analyst with Needham & Co. in Pasadena, California, said in an interview. “Consolidation would give them a better ability to compete” with the Internet, she said.

A U.S. appeals court in Philadelphia vacated on July 7 an FCC rule adopted in 2007 to let one owner hold a daily newspaper and a broadcast station in the largest markets. The court sent the rule back to the FCC for more consideration. CBS, Clear Channel Communications, Gannett, Media General and Cox Enterprises had challenged the 2007 FCC order for failing to relax the rule further.

The Newspaper Association of America, an Arlington, Virginia-based trade group, has argued that the media market has undergone “massive” changes because of the growth of the Internet, cable channels and satellite TV. It said the cross- ownership rule isn’t needed to preserve a diversity of voices.

NAB supports elimination of the broadcast/newspaper cross-ownership rules because we believe journalism jobs could be saved under that scenario, ” said NAB President Gordon Smith in a statement.

Consumer groups said today’s proposal would concentrate too much power in the hands of large companies and limit the number of voices in a community. Free Press, a nonprofit that promotes diverse and independent media, criticized the proposal as a mistake.

“The already dwindling number of smaller and independent media owners will be swallowed up by the same media giants that have crushed local journalism, killed local radio and left us with the same cookie-cutter content,” Craig Aaron, the group’s president and chief executive officer, said in a statement.

Posted by Sam Churchill on Thursday, December 22nd, 2011 at 1:20 pm .

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