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Editorial: Commission: Impossible?

Rafael Nadal and Novak Djokovic played some of major tennis’ most prolonged rallies during the U.S. Open championship last week, and CBS was all too glad to accommodate. But they have nothing on the game that has been played between the Federal Communications Commission and the Third Circuit Court of Appeals, with media ownership rules as the ball. Rather than appreciating a skillful back and forth, frustrated broadcasters are quite ready for that one to come to an end. So are we.

The Third Circuit has denied broadcasters’ full court appeal of the three-judge decision overturning the FCC’s loosening of the newspaper broadcast cross-ownership rules; this leaves the ball back in the FCC’s court. We disagree with that decision, but it paves the way for the FCC to finally weigh in after years of delay.

The Third Circuit did not tell the FCC it couldn’t revise or even lift the cross-ownership rules, instead saying that the FCC had not given the public enough opportunity to vet the change before it was made. That notation came despite close to 10 years of back and forth with the Third Circuit, and more than a year of hearings, before the FCC’s 2007 decision to loosen— not lift—the ban.

That decision made nobody happy. Media consolidation foes said any change was too much, even though the FCC refused to lift or loosen any multiple-ownership regs, and took affirmative steps to help boost minority ownership participation. Broadcasters were not happy with the light touch as they faced the hefty competition from more lightly regulated opponents, such as cable operators that are free to program to adult audiences without facing the FCC’s indecency police; and the Web, where audiences can go for just about anything.

Both sides sued, so everybody had a hand in keeping the issue in the courts. But the court has ruled once again, and enough is enough.

The FCC should loosen ownership regs on broadcasters— no matter what the Third Circuit had to say—and scrap the ban on cross-ownership. But it may be hard to get the FCC to focus on helping the medium remain competitive when it is currently trying to reduce its footprint and promote broadband as its medium of choice.

If the commission is serious about wanting to leave behind a viable broadcasting service in the wake of the S.S. Wireless, as FCC Chairman Julius Genachowski has continued to profess, it could demonstrate that by “personing” up and getting rid of the cross-ownership regs. The regs are an artifact of another century, a time before cable, satellite and the Web exploded the myth of scarcity and made ludicrous the idea that broadcasters have a corner on viewers or markets—except when the FCC wants to regulate their content, in which case broadcasters are cited as (cue the deep-voice narrator) a uniquely powerful and pervasive voice that must be regulated.

All we needed to know about why the cross-ownership rules are still around we learned from those three former FCC chairs, Democrats and Republicans, who told a C-SPAN audience a while back that they all thought the regs should be scrapped, but did not do so—with knowing smiles all around— due to political pressure from Congress.

The FCC is currently vowing to deliver on a long-overdue quadrennial review of its ownership regs, a congressional mandate that is in legal limbo due to the Third Circuit appeal. We’re not sure how much good loosening the rules will do. How many stations and newspapers are clamoring to get together?

But the FCC is trying to promote more local news coverage in small markets. Broadcasters remain the major source of local news, and small markets are the ones most hurting and in need of the kind of economic support a combined operation could provide. Yet those are the stations the FCC is now barring from such combos, save in dire circumstances where the help may come too late.

One condition in the Comcast/NBCUniversal deal held that stations should get together with hyper- local Web operations to produce better news. Why shouldn’t stations be encouraged to team up with newspapers in small towns to do the same thing? Or does that somehow cross the foul line?

Our big fear is that the FCC will take half-steps again, nobody will be happy again (except the lawyers billing for their time) and this will go back to the courts…again.

This is not a way to run a regulatory regime, but it is a way to run broadcasters ragged and, eventually, into the ground. We hope that is not anyone’s intention.