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The Federal Communications Commission’s effort to deregulate the media industry is turning into a test of wills — and political gamesmanship — between agency chairman Michael Powell and Sen. John McCain of Arizona. The Senate Commerce Committee chairman vowed Wednesday to revive congressional efforts to overthrow an FCC initiative that last year loosened limits on mergers among radio, television and newspaper companies. “This issue isn’t going away,” he said. McCain pledged to hold hearings on media consolidation later this year. McCain specifically criticized an amendment to a massive government spending bill that would would establish a 39 percent cap on the percentage of U.S. households any single TV company may reach. The FCC had sought to lift the cap to 45 percent from 35 percent. He also accused the FCC and lawmakers of buckling to pressure from the National Association of Broadcasters, a Washington-based lobbying organization, to scrap an FCC ban on one company owning a TV station and newspaper in the same market. The FCC eliminated this so-called cross-ownership provision as part of its broad rewrite of the media competition rules. “The National Association of Broadcasters didn’t want the cross-ownership prohibition in there, and it wasn’t in there,” McCain said. “That’s what we should be debating.” The cross-ownership restriction is an important tool to protect media diversity, he added, asserting that the NAB’s lobbying had persuaded the FCC to void the rule while leaving other media restrictions in place. In attacking the FCC’s media policy, McCain pledged support for a bill passed by the Commerce Committee in June that would restore the TV ownership cap to 35 percent, as critics of the media overhaul have demanded. The measure, S. 1046, also would reinstate in most U.S. markets the ban on companies owning a newspaper and TV station in the same city and impose a new restriction that could force big radio companies, including industry leader Clear Channel Communications Inc., to divest stations. Lawmakers could vote to wrap up work on the omnibus spending bill as early as today. Some legislative observers still contend that lawmakers could make changes to the TV ownership provision attached to the bill. Another congressional foe to the FCC media rules is Sen. Byron Dorgan. The North Dakota Democrat Wednesday reiterated his complaint that a September agreement between Senate Appropriations Committee Chairman Ted Stevens, R-Alaska, and the White House on a 39 percent TV cap was unfair. Dorgan, a member of the Senate-House conference committee on the appropriations bill, said Republican leaders had promised to restore the 35 percent cap in exchange for his dropping plans to introduce amendments to the spending bill voiding other aspects of the FCC’s media rules. Stevens’ deal with the White House violated that pledge, he said. Shortly after the conference committee meeting, in December, “none of it was on the level,” Dorgan said in the Senate Wednesday. Setting the TV ownership cap at 39 percent would protect News Corp. and Viacom Inc. from having to divest stations. Both companies reach roughly 38 percent of U.S. households. Dorgan also said he hoped the House will take up legislation that would void all of the FCC’s new media ownership rules. The Senate passed this legislation, known as a legislative veto, or congressional disapproval resolution, in September. The FCC adopted the new media limits in June, but a federal court in Philadelphia delayed their implementation until it rules on the regulations’ legality. �Copyright 2004, The Deal, LLC. All rights reserved.

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