Cable Ownership Limits Not in FCC Media Proposal, Say Sources
FCC Chmn. Martin’s broad media ownership proposal doesn’t address cable ownership limits remanded to the Commission in 2001 by U.S. Appeals Court, D.C., said industry sources. The item moving on the 8th floor (CD June 1 p2) likely addresses broadcast rules, including lifting a ban on newspaper and TV station cross-ownership and boosting the number of markets where a firm can own multiple stations, they said. Broadcast rules including cross ownership were sent back to the FCC by U.S. Appeals Court, Philadelphia, in 2004.
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For now, Martin is punting on controversial caps on national cable system ownership, last set at 30%, while he focuses on getting a new majority-Republican FCC to tackle ownership issues broadcasters call crucial to their survival. Cable rules won’t be ignored, only sidelined, said sources. Industry officials have been less vocal about ownership limits than broadcasters, as Comcast is the only operator near the 30% limit. Many TV station owners stand to benefit from an easing of the anti-duopoly rule, said industry sources.
Owning multiple stations in the same market would benefit stations as they move to digital broadcasts because it would allow for more dynamic spectrum management, said Lin TV’s D.C. counsel Greg Schmidt. Stations can cut 40%-60% of operating costs in markets where they have a sister station, he said. Another major station owner group has historically supported relaxing the ownership rules, but the issue won’t be on its front burner until the Commission begins to act on it, an industry official told us: “We need a notice before we can really focus on it.”
Recent TV-station sales that created duopolies in certain markets don’t signal a flood of similar sales without rule changes at the FCC, said BIA Financial Vp Mark Fratrik. This year, 6 station sales have created duopolies; in all of 2005, 11 duopolies were created, Fratrik said. “I'm a little surprised to see six for this year so far. But I think there will be few and far between unless there’s some relaxation,” of the ownership rules, Fratrik said. Loosening the rules would be a “real shot in the arm” to broadcasters, he said. “It’s really a way to promote revenue growth and cut expenses,” he said.
A cable rulemaking may not be needed, since the FCC already sought public comment on setting new limits, Media Access Project Pres. Andrew Schwartzman said: “The record is complete, it’s teed up, the Commission can do it at any time. It’s long overdue for a final decision.”
Cable isn’t likely anytime soon to face FCC rules on downconverting digital signals sent to analog subscribers, despite speculation to the contrary, said sources. Martin is trying to get commissioner support for an item, which he wants to discuss at next week’s meeting, examining industry duties to carry analog signals after the 2009 DTV transition, Multichannel News reported late Mon. Both FCC and industry officials said they hadn’t heard of such an item.