FCC Staff: Move Cap to 45%

Staff at the Federal Communications Commission is recommending raising the
national TV-ownership limit to at least 45 percent from the current 35 percent,
FCC and other sources said Monday.

Staff made the proposal three weeks before the agency's June 2 vote on
relaxing a host of broadcast-ownership rules that some fear will trigger a
mass-media merger wave, while others insisted that the FCC has been holding back
badly needed consolidation that would be beneficial to consumers.

Raising the cap to 45 percent -- strongly opposed by the National Association
of Broadcasters and its network affiliate members -- would help out Viacom Inc.
and News Corp., both of which are close to 40 percent right now. However, both
companies were pushing for total repeal.

Under the new rule, a TV-station group would be able to own stations with
off-air signals that reach 45 percent of TV households nationally.

Sources suggested that bargaining at the GOP-controlled FCC under chairman
Michael Powell might result in approval of a 40 percent cap -- or at least
something lower than 45 percent -- in order to pin down the support of one FCC
Democrat, mostly likely Jonathan Adelstein.

Sen. John McCain (R-Ariz.) is holding a hearing Tuesday in the Commerce
Committee, where Viacom president and chief operating officer Mel Karmazin is
scheduled to testify. Cable News Network reported Monday night that Powell was
also to appear, but the report could not be confirmed later with FCC sources or
McCain's spokeswoman.

Sources also said the staff is proposing to substantially repeal the
newspaper-broadcast cross-ownership rules.

Under one change, a single company could own up to three TV stations and one
newspaper in the country's largest markets, although it was unclear where
exactly the line would be drawn in terms of markets.