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FCC to relax rules on media ownership in US

The US Federal Communications Commission is set to take the first step toward relaxing media ownership rules that News Corp, Viacom Inc, Tribune Co and other companies say hinder their growth.

The commission is scheduled today to begin rethinking six rules that govern how many television and radio stations and other news outlets a company may own overall and in a single market.

Consumer advocates and some lawmakers say consolidation of station ownership stifles the diversity of news, information and entertainment. Tribune, News Corp and other TV station owners say the rules hobble them in competing with cable TV, the Internet and other viewer choices.

"The ability to have economies of scale to compete against other video delivery platforms is crucial," Tribune lobbyist Shaun Sheehan said.

Current rules limit the number of radio stations a company may own in one market, the number of TV stations a company may own across the US, and ownership of radio and TV stations in the same market. They also ban a company from owning two of the four largest TV networks, a broadcast TV station and newspaper in the same city, or two TV stations in any except the largest markets.

A federal court ordered the agency to review its limit on the number of TV homes that one company may reach with its own stations, currently 35 percent of the US total. The court also ordered a review of the ban on owning two TV stations in midsize markets. The court said the FCC failed to justify either rule.

FCC Chairman Michael Powell has said the current rules are outdated in a world with multiple news and entertainment outlets, such as cable, satellite and the Internet. Analysts, lobbyists and communications lawyers expect him to back the elimination or loosening of the rules.

"What he's setting out to do is very ambitious and would potentially remake the map of media ownership," said Andrew Schwartzman, president of Media Access Project, a nonprofit law firm representing Consumers Union and other consumer groups.

"It's a very big deal indeed. Democracy can die a death of a thousand cuts from the loss of access to diverse perspectives."

Tribune already has benefited from sharing resources between a TV station and newspaper in the same market, Sheehan said.

Tribune is subject to the "cross-ownership" rule on owning a newspaper and TV station in both New York and Los Angeles, though the ban won't take hold until the stations' licenses come up for renewal in 2006 and 2007.

When the World Trade Center and Pentagon were attacked last year, Tribune's WPIX-TV in New York harnessed the reporting power of Newsday, the Long Island newspaper also owned by Tribune, to bolster the station's news programming.

By contrast, regulators had forced Tribune to operate separately its WBZL-TV station in Miami and its Sun-Sentinel newspaper in south Florida. The station, a WB affiliate, runs a half-hour of news from the local NBC station, which immediately switched to NBC network news after the attacks, stranding WBZL, Sheehan said.

"When the crisis occurred last year, our television station didn't have a news aspect to go to," he said. "We fell between the cracks."

The Federal Communications Commission last month lifted the Florida restriction, pending the outcome of the rule review.

News Corp lobbyist Maureen O'Connell praised the agency for moving forward with the rule review. Viacom spokesman Carl Folta declined to comment. Both companies currently exceed the cap on TV ownership, with stations that reach more than 39 percent of US TV households, under waivers granted after the court ruling.
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