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Citizen Murdoch/UK BSkyB Under Investigation

Alex Constantine - May 13, 2008

OTR MurdochHead5 - Citizen Murdoch/UK" ... One veteran newspaper reporter recently joked that his child should qualify for a hardship exception when applying to college because 'I’m in a dying industry. ... "

May 11, 2008

By Elizabeth Wasserman, CQ Columnist

When you’re trying to make a mountain out of a molehill, it helps to have a bulldozer.

In the case of opponents of the Federal Communications Commission’s newly relaxed rules on owning newspapers and broadcast stations in the same city, the heavy machinery comes in the form of Rupert Murdoch.

In December, the FCC voted to loosen one of its pro-competition regulations, deciding that one company may own a newspaper and either a television or radio station in the same top-20 media market, with some limitations. It didn’t touch any of its other media ownership rules — unlike in 2003, when a wholesale shake-up of those rules prompted a political backlash and legal challenges that halted most of the changes.

In the five years since, of course, the decline of newspapers because of the rise of the Web has been the big media business story. Which is why the Newspaper Association of America and some media chains continued to press the FCC to ease the 33-year-old federal ban on owning a newspaper and a TV or radio station in the same metropolitan area. The goal was to extend a modest lifeline to a flailing industry. But it provoked strenuous opposition from public-interest groups and powerful voices at the Capitol, in the Senate especially. They argued that cross-ownership would hasten media consolidation, which would mean less diversity of opinion, fewer home-grown editorial voices and more difficulty for women and minorities who wanted to control printing presses and broadcast towers.

Still, the volume of the outcry seemed destined to fall short of the 2003 level — until a certain Australian-born media baron stepped in.

Murdoch’s News Corp. already owned the Fox Television network, the Fox News cable channel, the New York Post and two TV stations covering the city. Then last year it acquired Dow Jones, publisher of the Wall Street Journal, and launched the Fox Business Network cable channel. So when Murdoch put in a $580 million bid for yet another paper headquartered in metropolitan New York, Long Island-based Newsday, opponents of the FCC’s new rules had their poster child for the evils of media consolidation.

“We’re concerned that the new rule will turn a lot of towns into one-voice towns,” said Derek Turner, research director of Free Press, a nonprofit group working to involve the public in media policy making. While the FCC, which regulates only broadcast businesses, can’t stop anyone from buying a newspaper, Turner said the special waivers permitting News Corp. to own the Post as well as WNYW and WWOR in the New York market should be scrapped when the stations’ licenses come up for review. (Murdoch didn’t face regulatory challenges when buying the Journal because it’s considered a national paper.)

Two others with strong New York media roots are also bidding for Newsday (my previous employer), but the demonization has been all about Murdoch. “Be afraid ... be very afraid,” Ruth Hochberger wrote last month on The Huffington Post. “Remember Charles Foster Kane? The fictional newspaper publisher/editor in ‘Citizen Kane’ who ran his publications on whim, punishing his enemies and rewarding his friends?”

A Free Media Market

That comparison strikes some as outdated. Americans now have access to more news and viewpoints than ever because of the Internet, cable, and satellite radio and TV. “There is a real conflict of visions at work between those who believe the media marketplace is overly concentrated and owners have too much power, and those who believe it’s never been more dynamic and less concentrated,” said Adam Thierer of the free-market Progress and Freedom Foundation.

Byron L. Dorgan is in the former camp. “There may be more voices, but they’re controlled by the same ventriloquists,” he says. And the North Dakota Democrat, the last of the prairie populists in the Senate, leveraged his power on the Commerce Committee last month to advance a measure that would stop the FCC from relaxing the cross-ownership limit. Under an unusual procedure, his resolution may not be amended or filibustered, so all Dorgan needs to find are 50 other senators, and then a simple House majority, to take his side.

Back in 1975, when the cross-ownership rule was enacted, newspapers were wealthy and powerful voices in a community, and regulators feared they would become more dominant by gobbling up TV and radio stations. Now, papers are suffering historic circulation declines. The Internet allows most people to get an infinite amount of local and global news for free. And Internet and cable companies aren’t constrained by any ownership rules.

Turner said diversity of ownership needs to be maintained because most Americans still get their local news from broadcast stations and newspapers. But it takes money to pay those reporters, and many papers have instead opted for layoffs and buyouts.

One veteran newspaper reporter recently joked that his child should qualify for a hardship exception when applying to college because “I’m in a dying industry.” His implied point being this: If steelworkers can get relief from government, shouldn’t journalists? And so is easing a ban on cross-ownership a potential part of that assistance?

Elizabeth Wasserman is a Washington freelance writer. She can be reached at ewasserman@cq.com.

Ofcom combines BSkyB investigations
Tue May 13, 2008

LONDON (Reuters) - Media regulator Ofcom will combine two of its investigations surrounding pay-TV operator BSkyB and produce one joint finding, but at a later date than originally planned, it said on Tuesday.

Ofcom is conducting an inquiry into competition in the wider pay-TV market, which is dominated by Sky, and a separate review of plans by the satellite group to launch paid-for channels on the popular free-to-air Freeview service.

Ofcom said on Tuesday it intended to publish a further consultation on each subject simultaneously by the end of summer 2008. It had previously hoped to give an update in the spring.

Analysts said a final decision on whether the pay-TV market should be referred for further investigation was likely to be delayed until after 2009.

No one at BSkyB was immediately available to comment. Rupert Murdoch's News Corp owns 39 percent of BSkyB.


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