A draft FCC order clears the way for a $26.7 billion takeover of Clear Channel, which the commission announced last Thursday was approved 5-0, agency officials said. The draft lets one of two leveraged buyout firms set to acquire the company keep stakes in two other media companies yet adhere to provisions of last week’s Clear Channel order relating to Univision, agency and industry sources said. They said the Thomas Lee firm can keep its investments in Univision and in Cumulus Media Partners. That lets Lee take part in buying Clear Channel without having to sell its stake in Cumulus, getting rid of a possible obstacle to completing the deal, said industry attorneys.

Broadcasters can better decide when to air public service ads on the DTV transition and how many spots to run than the FCC, Commissioner Robert McDowell said. A draft order from FCC Chairman Kevin Martin long circulating on the FCC’s top floor includes PSA requirements, but industry and some commissioners dislike the idea. The order has long had three votes and McDowell and Commissioner Deborah Tate are expected to vote soon so the document can be released (CD Jan 28 p2). The FCC should adopt NAB’s plan for broadcasters already participating in the group’s PSA campaign to be excused from DTV requirements, McDowell told a Multichannel News and Broadcasting & Cable webcast Wednesday. “We ought to give broadcasters a choice of doing what their own industry” plans to do or facing FCC mandates, he said. “There are some potential legal challenges otherwise, some potential First Amendment questions.” Requiring programmers to sell channels to cable operators on an a la carte basis, subject of an FCC rulemaking notice, seems an unwise idea, McDowell said. “I understand that the pricing of pay video services and all the inputs that go into it is really sort of a fragile ecosystem, and I don’t think anybody really understands it, so you have to be very careful” in changing it. “It could adversely impact consumer prices.”

The fact that many digital converter boxes won’t pass through signals by low-power stations still broadcasting in analog after Feb. 17, 2009, shows how the government may mangle the DTV transition, FCC Commissioner Copps said. Last week, NTIA Acting Director Meredith Baker said that of 32 box models her agency certified as eligible for $40 coupons only three have pass-through capability (CD Jan 25 p6). Talking to reporters in his office Tuesday, Copps said consumers may not know that many boxes have only digital tuners. He encouraged the CE and cable industries to agree on standards for two-way plug and play devices.

Digital-only cable for Comcast subscribers may not be far off, Executive Vice President David Cohen told lawmakers, but the company regrets how it handled a recent move of public-access channels from analog in Michigan. He apologized for the company’s failure to clearly inform people about requiring its approximately 450,000 analog subscribers in the state to get digital set-top boxes to keep watching the channels. House Telecommunications Subcommittee Chairman Edward Markey, D-Mass., and other legislators at a Tuesday hearing said cable operators and new video entrants such as AT&T must make public-access channels widely available in high quality.

The 700 MHz auction drew attention on Capitol Hill Tuesday. Lagging interest in bidding on the D-block is “discouraging,” said House Telecommunications Subcommittee Chairman Edward Markey, D-Mass. He and colleagues are “following very closely” the auction, Markey told a hearing on public access channels in video packages sold by Bells and cable operators. (See separate report in this issue.) Markey will work with FCC Chairman Kevin Martin to re-auction the spectrum if the reserve price is not met, he said. If that occurs, the committee also will review the public safety trust, Markey said. Rep. Jane Harman, D-Calif., said the committee will “be a partner in what happens next” with the auction, which she is “watching closely” for D-block bidding. “It is important that this committee be a player here and we prevent any change of rules in mid course should the bids not come in” as the FCC had hoped, she said. “I've written to Chairman Martin about this.”

Last week’s order containing the second-largest indecency fine sat on the FCC’s top floor for nearly two years before all commissioners voted for it, said agency sources. In a departure from regular practice, FCC Chairman Kevin Martin didn’t approve the nearly $1.5 million penalty against ABC (CD Jan 28 p1) when circulating the notice of apparent liability on the eighth floor in March 2006, said the sources. Martin likely hoped to defer action on the order until an appeal was resolved in a similar case, said industry lawyers.

FCC Chairman Kevin Martin has scheduled three more agenda meetings well in advance, fulfilling a goal he laid out to the other commissioners late last year and following concerns from some in Congress about insufficient public notice (CD Dec 31 p1). Meetings March 19, April 10 and May 14 meetings were set last week, an agency source said, and are listed on the FCC’s Web site. In December, Martin told his colleagues that he wanted to set dates for the first six meetings of 2008. Late that month, he scheduled the January and February meetings. Separately, Martin went to last week’s Davos conference of world political and corporate leaders, commission officials said. Among others who attended the World Economic Forum’s annual meeting in Davos were Microsoft co-founder Bill Gates, United Nations Secretary General Ban Ki-Moon and U.K. Prime Minister Gordon Brown. FCC Commissioner Deborah Tate stood in for Martin to speak at an NTIA meeting Thursday on DTV. Commission chairmen starting with Reed Hundt, who was the FCC’s chief 1993 to 1997, have gone to Davos, an agency source said.

An order requiring broadcasters to air public service ads on the digital transition (CD Dec 4 p6) has long had three votes and may pick up the next two within weeks, said agency officials. FCC Chairman Kevin Martin voted for it Oct. 16 when he circulated the order, which would also require cable and satellite operators to insert information on DTV in customer bills. Commissioners Jonathan Adelstein and Michael Copps have also voted for the order, said many sources. They said Martin has granted two extensions to give Commissioners Robert McDowell and Deborah Tate more time to consider the rulemaking.

The NTIA is increasing DTV education efforts by working with other federal agencies and private organizations such as AARP, officials said Thursday at the first meeting of the bodies working together. Representatives of 15 other agencies attended the gathering, said NTIA Acting Director Meredith Baker. They include the Veterans Administration, the office that runs food-stamp programs and the Department of Agriculture. Partners more often thought of in connection with DTV include the FCC and the EPA, which helps oversee an electronics recycling program that could include old analog TV sets.

Commissioners and broadcast executives disagreed over whether the FCC should encourage or even force industry to increase broadcasts of public service announcements, which a study concluded have been paltry. Commissioners Jonathan Adelstein and Michael Copps said the FCC must impose public- interest rules on digital broadcasting. They said new data showing that Big Four network affiliates in seven cities aired 18 seconds of PSAs an hour on average, most after midnight, show industry must do more. Executives and regulators spoke at a Thursday panel sponsored by the Kaiser Family Foundation, which did the study.