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FCC adopts media ownership rules
Proposal passed by party-line vote allows networks to reach 45% of national audience.
June 2, 2003: 1:19 PM EDT

NEW YORK (CNN/Money) - The Federal Communications Commission narrowly approved new media ownership rules Monday, allowing television broadcasters to expand their reach, despite fears the move may reduce the variety of viewpoints available to consumers.

The Republican-led government agency voted 3-2 to allow the broadcast networks to own television stations that reach a combined 45 percent of the national audience, up from 35 percent.

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Gene Kimmelman, senior director with the Consumers Union, talks about what the FCC ruling means for the consumers.

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Citing a need to update the decades-old rules to reflect new sources of entertainment, information and news, the FCC also voted to lift a ban that prevents a company from owning both a newspaper and a television or radio station -- except in the smallest markets.

Companies could own two television stations in most markets as long as they are not both in the top four, based on ratings. Additionally, a company could own three stations in markets where there are at least 18 stations, like Los Angeles.

"I have heard the concerns expressed by the public about excessive consolidation," FCC Chairman Michael Powell said ahead of the vote. "They have introduced a note of caution in the choices we have made."

"Keeping the rules exactly as they are, as some so stridently suggest, was not a viable option," Powell added. "Without today's surgery, the rules will assuredly meet a swift death."

But the two Democrats on the FCC opposed easing the regulations, arguing that the changes would concentrate ownership in the hands of a few, reduce the diversity of viewpoints and stifle reporting of local news.

"Today the Federal Communications Commission empowers America's new media elite with unacceptable levels of influence over the ideas and information upon which our society and our democracy depend," said Commissioner Michael Copps.

Click here to watch FCC's meeting on media ownership rules

Critics of the changes argued that it will stifle different voices from being heard on American airwaves. They point to the consolidation of ownership of radio stations after rules on ownership in that sector were modified as an example of what will happen under the new rules.

Supporters of the plan said the current rules are out-of-date relics of an era when most people had access to only three major networks and a handful of independent or public television stations. Today, about 89 million households have access to dozens of channels with cable or satellite television service, or about 83 percent of households with televisions.

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CNNfn's Greg Clarkin reports on the Federal Communications Commission vote to expand media ownership limits.

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The major broadcast networks argue their network business is only marginally profitable at best and to compete with cable networks they need to own more of the profitable affiliates that carry their programming.

Owners of the major networks include Viacom (VIA.B: Research, Estimates), which owns CBS and UPN, News Corp. (NWS: Research, Estimates), which owns a majority of Fox (FOX: Research, Estimates), Walt Disney Co. (DIS: Research, Estimates), which owns ABC, General Electric Co. (GE: Research, Estimates), which owns NBC, and AOL Time Warner Inc. (AOL: Research, Estimates), the parent company of CNN/Money, which owns the WB network.

The new rules would allow the nation's networks to own stations reaching about 45 percent of the nation, rather than the 35 percent allowed under current caps. It also would open more markets to allow the same company own two television stations. And it also would open the door for joint ownership of a newspaper and a television station in more markets than allowed under current rules.  Top of page




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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.