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The Federal Communications Commission could introduce a proposal to revise controversial limits on media mergers as soon as mid-July, people close to the agency said. The Supreme Court’s June 13 decision not to hear an appeal of a ruling that overturned the commission’s 2003 relaxation of media-ownership rules brought the issue back to the agency and into the hands of FCC Chairman Kevin Martin. Under pressure from large media companies hoping to make acquisitions that current regulations prohibit, Martin hopes to introduce the proposal by the agency’s July 14 public meeting, the people said. If the proposal is adopted, the agency will begin an extensive review that is expected to promulgate new, deal-friendly rules as early as the first half of 2006. Two years ago, the FCC approved an omnibus measure loosening six media-ownership regulations, prompting protests from consumer groups who claimed that resulting consolidations would stifle democratic discourse. The proposed changes would have expanded the number of TV and radio stations a company may own in a single market, while repealing a prohibition on “cross-ownership” of newspaper and TV assets in the same market. The 3rd U.S. Circuit Court of Appeals in Philadelphia effectively gutted the measure in early 2004, rejecting the rules and sending them back to the agency for better justification. One thing that could delay revision of the rules is the unsettled composition of the FCC itself. Martin became FCC chairman in March, reducing the number of commissioners to two Republicans and two Democrats, rather than the usual 3-2 split. As now constituted, the commission is likely to deadlock over the rules. Still, people close to the agency said the two Democratic commissioners are likely to support the introduction of the proposal as long as it calls for addressing concerns not examined in 2003. Among other things, the Democratic commissioners would like to see the agency complete studies regarding the impact of the rule changes on communities, as well as the effect of consolidation on the availability of independent programming, content not produced by the networks and their media groups. A dispute on approach could also stymie progress on the revision. Martin may try to tackle the regulations one at a time rather than as a package and to make repeal of the 1975 cross-ownership ban his first order of business. But Democratic Commissioner Jonathan Adelstein wants the rules considered collectively. “The rules are interrelated and should be treated as such,” he said recently. After the proposal is introduced, the agency will allow companies and consumer groups 45 days to file comments, followed by 30 days for response before adopting a rule. In dispute is whether the agency will immediately adopt the rules at the end of the review period or publicly disclose the specifics for further review. Republican and Democratic lawmakers chastised the agency in 2003 for not disclosing the particulars of the rules for public examination before adopting them. “I see no legitimate purpose for casting our votes in a shroud of secrecy except to insulate the FCC from public scrutiny,” Commissioner Michael Copps said at the time. The agency’s new media bureau chief, Donna Gregg, is expected to collect data and develop a stronger rationale for whatever rules the agency proposes. An FCC spokeswoman did not return calls seeking comment. The agency will need to re-examine the data it used as a basis for the 2003 rules. The 3rd Circuit, which is likely to retain jurisdiction over the matter, was particularly critical of a controversial index the FCC developed to measure media diversity. Copyright �2005 TDD, LLC. All rights reserved.

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