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FCC to ease network rules
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May 30, 2000: 7:47 p.m. ET
New rule would allow Viacom to own both CBS Corp. and the UPN network
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NEW YORK (CNNfn) - The Federal Communications Commission said Tuesday it would propose a new rule allowing companies to own more than one television broadcast network, allowing Viacom Inc. to own both CBS Corp. and the UPN network.
The FCC said Tuesday that it would consider revising its dual ownership rule to allow the four major TV networks - ABC, CBS, Fox and NBC -- to own emerging TV networks, such as Viacom's UPN and WB, a unit of Time Warner Inc., the parent of CNNfn.
In a statement announcing its decision, the FCC said that allowing companies to own additional broadcast networks could help put them "on more equal footing with cable, satellite and other multichannel video programming distributors."
 The Viacom-CBS deal was approved May 3.
As a condition for FCC approval of the merger, the commission had said Viacom would have to divest its stake in UPN within 12 months because of rules prohibiting a network from reaching more than 35 percent of the total national audience.
The combined company currently reaches more than 41 percent of the audience, consisting of 35 television stations, reaching the 13 largest and 18 of the top 20 television markets in the United States.
Even with a change in the dual ownership rule, however, Viacom must still divest some stations to prevent it from capturing more than 35 percent of the market.
The FCC expects to recommend the changes to the dual ownership rules within the next 90 days.
Shares of Viacom (VIA: Research, Estimates) rose 4-3/4 to close at 60-5/8 Tuesday. 
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