Monday, June 21, 2010

FCC asks: Do media ownership limits make sense?

"Even the news industry's free fall probably will not be enough to wipe out complicated federal rules designed to restrain the power of media companies," is the conclusion of an Associated Press analysis of the forthcoming FCC's mandated quadrennial review of its ownership regulations.

Although the legacy media companies are "no longer the almighty players that they were when the ownership rules were first enacted, only modest changes are likely to be enacted because "the agency is also under pressure from public interest groups that support strong limits."


On the one hand, says the article "Newspaper readers and advertisers have migrated to the Internet, where a lot of content is free and advertising costs less. As a result, newsrooms have shrunk and newspapers have sought bankruptcy protection or shut down. Television broadcasters are suffering. too as cable, satellite TV and the Internet splinter audiences and siphon ad dollars - forcing stations to seek new revenue streams and even raising questions about the future of free, over-the-air TV."

On the other hand, there is the position of groups such as the Free Press and the Media Access Project that is summarized by Georgetown Law professor Angela Campbell, who represents several public interest groups defending strong ownership limits. She "fears more consolidation would lead to newsroom layoffs as media companies combine operations and feed the same content to different outlets."

The FCC has still not resolved the objections of the Third Circuit Court of Appeals, which threw out the FCC's rules loosening cross ownership rules that followed its 2002 review. The landscape of the media industry has changed dramatically since then, with large newspaper chains disaggregating (e.g., Knight-Ridder), cable networks eating into the old broadcast networks, printing less than daily (e.g., Detroit Free Press and News), or going through bankruptcy (e.g., Philadelphia Inquirer, Tribune Co.). The trend of falling advertising revenue, seen in the accompanying chart, preceded the recession and falling circulation of newspapers has been a decades-long process. TV evening viewership not only declined in 2009 from 2008 but is about half of its peak even though there are more households today.