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Disney Considering Forming Rival to NAB

On the day The Walt Disney Co. quit the National Association of Broadcasters
over internal regulatory disputes, a Disney executive said it was possible that
the four major networks might create a rival organization designed to counter
charges that network-owned stations are less committed to their local
communities than independent affiliates.

"This would be an association of local stations, not networks," said Preston
Padden, Disney's executive vice president of worldwide government relations.
More precisely, he added, the group would consist of "local stations that happen
to be owned by the networks."

Disney's ABC was the last of the four networks to bolt the NAB in recent
years over various disputes with their affiliates, which control the NAB board
and have pushed for rules designed to constrain the networks' ability to own
more and more stations.

The affiliates pushed to retain a rule that limits a TV-station group to
reaching no more than 35% of TV households nationally. On June 2, the Federal
Communications Commission moved the cap to 45%. A bill restoring the 35% cap is
expected to clear the Senate Commerce Committee Thursday.

Padden -- who hand-delivered ABC's toughly worded resignation letter to NAB
president Edward Fritts Tuesday -- told reporters later that a few unnamed
affiliates were responsible for ABC's exit because they refused to bury the
hatchet at last week's NAB board meeting that reviewed the FCC's ruling.

"I argued as best I could for two whole days that we had to change direction
now that the FCC vote was behind us," Padden said. "Basically, there were two or
three firebrand affiliates that argued against it, coming back together. And the
large bulk of the board let those few firebrands run roughshod over the whole

Padden said he would like to name the new network-backed trade group
"America's Greatest Local Broadcasters." Talks with the other networks have not
gone too far, he acknowledged. "We've have had one brief, extremely preliminary
conversation," Padden said.

A News Corp. source said the idea of new group was worth talking about. The
four networks own 113 TV stations combined -- about 9% of all commercial

NAB spokesman Dennis Wharton said he regretted the loss of ABC, but the trade
group's clout in Washington, D.C., would not be diminished.

"Our effectiveness is based on the fact that local radio and TV stations are
located in virtually every city and hamlet and every congressional district in
America today," Wharton said.

Padden estimated that Disney's NAB's dues equaled about $1 million per year,
but Wharton said the amount was closer to $500,000.