FERREE SAYS FCC SHOULD CRAFT NEW MEDIA RULES BASED ON MARKET
LAS VEGAS -- Time has come for FCC to recognize its existing TV and radio regulations may be inhibiting free flow of information and “the delivery of programming to the public,” Kenneth Ferree, chief of newly created Media Bureau at FCC, said at legal forum lunch here Sun. on eve of NAB convention. He said new rules must be crafted to recognize new forms of media competition and to “promote a diverse and robustly competitive media market.” To accomplish that, he said, Commission must first complete “sweeping review” of current rules that “today rest on foundational assumptions about the market that are, at best, questionable and, at worst, patently invalid and adopted when conditions in media market “were quite different than they are today.”
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Process already has started, Ferree said, with establishment of Media Ownership Working Group by FCC Chmn. Powell. To accomplish its goals, group will “need to start with front shovels, trenchers and track loaders to dig deeply into the media landscape, and then backfill with information garnered… about how the media markets actually work today.” He said “inefficient rules reduce the incentives to invest in [TV and] reduce the ability of radio and television to compete against the growing number” of competing media.
Broadcasters must be permitted to use their spectrum “in new, efficient and compelling ways,” Ferree said, “and they must have the flexibility… to match advances in technology, the evolution in consumer preferences and changes in the competitive marketplace.” Thus, he said, it’s time “to see whether the broadcasting industry is adapting to the new information marketplace or whether it is being held back by restraints that were placed upon it when different market conditions prevailed.” For example, he said, FCC’s permitting certain broadcast-newspaper-cable combinations “that previously were unthinkable, licensees may realize operational efficiencies that produce higher quality programming.”
Discussing recent court remands of FCC ownership rules, he pointed to TV-cable cross-ownership decision in which U.S. Appeals Court, D.C., called Commission’s “reasoning ‘flimsy’ and ‘half-hearted.’ That stings and I've made a personal commitment not to have a case remanded on my watch with similarly dismissive language,” Ferree said.
In earlier panel of FCC and congressional staffers, Roy Stewart, chief of Media Bureau’s Office of Broadcast License Policy, also stressed need for Commission to determine how marketplace worked today before adopting new media rules, saying such knowledge was “critical.” House Commerce Committee Counsel Kenneth Johnson praised progress made in 3 meetings Committee members have held with cable, TV and set manufacturing officials on conversion to DTV. But, he said, “we're committed at some point to legislation” if that becomes necessary and “we're not going to let the FCC off the hook” in fulfilling its responsibilities on conversion issue: “We're closer today than we were yesterday… We are making progress.”
Asked about Powell’s proposed steps to speed transition (CD April 5 p1), FCC Chief of Staff Marsha MacBride said: “I do want to emphasize -- we do mean a voluntary plan.” She said Powell’s staff explored what all parties involved in transition should be doing, “and that’s what we came up with.” Johnson and Colin Cowell, media aide to Rep. Markey (D-Mass.), generally were noncommittal on reactions of members of Congress to Powell’s proposal, with Cowell saying “nobody believes” 85% DTV set penetration figure set in Telecom Act would be reached by 2006 as specified. He said court media ownership decisions discussed by Ferree gave “short shrift to diversity concerns.”
On subject of indecency and Comr. Copps’ appeal for FCC to be more active in area, FCC Gen. Counsel Jane Mago said agency looked at each complaint separately, citing “delicate balance” facing agency because of First Amendment concerns. McBride said there was need for new EEO rules (2 previous incarnations have been thrown out by court) to provide “opportunities… that’s all we're talking about” for minorities in broadcasting and cable.
Panel to discuss network-affiliate relationships lost its glitter when officials of CBS, Fox and Disney Co. canceled after program was printed including their names. Jonathan Blake, co-counsel in affiliates’ filing, asking FCC to investigate network practices, saying big question raised was “who controls the station” because of program clearance demands of networks and restraints placed on affiliate preemptions. Co-counsel Wade Hargrove said network restraints were “simply business decisions… These contracts violate the [Communications] Act, violate the Commission rules.” Because of provisions in network contracts, he said affiliates were “in danger of becoming passive conduits for national programming.”