Why the FCC Will Get Media Ownership Wrong Again

And What They Should Do to Get it Right

Mark Lloyd says the Federal Communications Commission will once again get media diversity regulations wrong. CAP will help them get it right.

In the summer of 2006, Zogby International conducted a poll demonstrating that Americans know more about the Three Stooges than the fundamental structure of our democracy. Seventy-three percent of Americans could name all three Stooges, just 42 percent could name the executive, legislative and judicial branches of government. The poll also showed that while 77 percent of the people can name two of the Seven Dwarfs, just 24 percent can name two Supreme Court justices.

Even though the Zogby poll was commissioned by television reality show producers, they are asking the right sort of questions. The same cannot be said of the Federal Communications Commission, which once again is failing to exercise its congressional mandate over media ownership rules in our country.

The Federal Communications Commission will complete its review of FCC media ownership policies this spring. All those concerned about the state of our democracy should be very worried, which is why the Center for American Progress early next week will unveil a new set of formulas that the FCC could use to measure the diversity available to all communities in local media markets across the country. But first, let’s outline the problem.

The last time the FCC engaged in an ownership review the Republicans in charge of the regulatory agency rammed through a set of rules designed to loosen restrictions on media concentration so that the big mainstream media conglomerates could further tighten their grip on public discourse in America. Once the public got wind of this, there were widespread howls of protest, causing both Congress and the courts to step in to undo some of the damage.

As the Third Circuit Court of Appeals said last year in the case that overturned the FCC’s first set of media ownership rules: “The FCC’s delegated responsibility to foster a robust forum for national debate is unique in administrative law and essential to the vibrancy of our deliberative democracy.” Yet the FCC, obliged by the court to review what it had originally proposed, continues to listen almost exclusively to the big broadcasters as they lobby to raise the ownership cap.

Case in point: Mark Mays, the president of Clear Channel Communications, which controls more than 1,200 radio stations across the country, argues that “free radio is at risk.” He insists “There’s room,for free radio companies to own more than eight stations” in a single market. Mays argues that the new kid on the block, satellite radio, is creating competition for broadcast radio and therefore the federal government needs to step in to protect “free radio” by allowing the giants to get even bigger.

That Clear Channel, which generated nearly $2 billion in revenue in 2005, is crying for government relief to allow it to acquire even more broadcast licenses should be laughable. But the FCC, particularly when dominated by Republicans, is peculiarly susceptible to these “market” arguments. Make no mistake, the FCC is listening.

Whatever happened to the FCC’s obligation to consider the public interest? Well, that depends on what the meaning of the public interest is. As long as the FCC defines the public interest as some sort of competition in media markets, then the FCC can assure Congress that letting Clear Channel get bigger is in the public interest. After all, they are just positioning themselves to compete with satellite radio.

Even though the FCC will occasionally acknowledge that the fundamental purpose of broadcast regulation is to further the informed discussion so necessary to a democracy, this is almost always immediately ignored. The world is so topsy-turvy at the FCC that the measure the agency used to justify loosening the media ownership rules in 2003, its so called Diversity Index, is actually based on something used to measure market concentration, the Herfindahl-Hirschman Index.

The HHI was developed as a tool to identify and curb antitrust violations; the latest approval of the merger between telecommunications giants SBC and AT&T shows how effective the HHI is at limiting monopolies. Still, the FCC deserves some credit for attempting to use modern tools to rationalize and explain why Big Media should get what it wants. The Third Circuit Court of Appeals accepted the Diversity Index in principle but rejected the way the FCC calculated it.

Unfortunately, the FCC has learned the wrong lesson and seems to want to avoid developing any sort of measurement tool the public or the courts could critique.

Instead, FCC Chairman Kevin Martin, with little input from his colleagues at the agency, has commissioned a small set of vaguely described studies that seem to focus on changes in the media market. The FCC gives no hint that it is even considering the impact local media will have on local democratic engagement in its second review of media ownership concentration rules. Index or no, the FCC cannot think outside the box of market considerations.

But what if the FCC did something that was really new? What if it defined the public interest in a way that actually seemed to coincide with what most of us think that means? What if the FCC defined the public interest to mean the best interests of a democratic public? What if the FCC created an index that could really show the relationship between media ownership and what local citizens know about government?

As a new Congress controlled by Democrats begins oversight of an FCC controlled by Republicans, it is crucial to begin asking why the agency repeatedly fails to ask the right questions before it tries to loosen media concentration rules. Congressional oversight, however, is not sufficient. An entirely new way of discerning media diversity in local American broadcast markets is clearly needed.

That’s why the Center for American Progress in partnership with Fordham University’s Donald McGannon Communication Research Center and a small group of media scholars

developed a way to measure local media diversity and its impact on local civic knowledge. Our Local Media Diversity Metrics is really a fairly straightforward count of all the independent local media (from newspapers to the Internet) that actually produce local news and public affairs programs in a given community. This new index is complemented by our new Civics Index, which is a measure of local civic literacy from sample communities.

In the development and testing of these metrics we identified a variety of problems about the way the FCC determines whether broadcasters are operating in the public interest. Most notably we found an over reliance on private data companies such as The Nielsen Co. and Arbitron Inc. for information about the activities of federally licensed broadcasters, and a failure to capture media owned and operated by women and minorities.

On Tuesday, Jan. 30, the Center will host an event in the Rayburn House Office Building on Capitol Hill to unveil our new Local Media Diversity Metrics and Civic Metrics. Rep. Xavier Becerra (D-CA) will deliver the opening address, after which the authors of the Center’s report will discuss their new methodology for the FCC to set local media ownership rules.

The work of determining whether our present or future media ownership policies promote democratic engagement and civic knowledge should not be left to private industry. We believe that the proposed measurement tools will help clarify the true impact of the FCC’s media ownership rules on our democracy.

Mark Lloyd is a Senior Fellow at the Center for American Progress.

For more information about the event on Capitol Hill or to come to the event please go to our Events web page.

To speak with Mark Lloyd about the new report please contact:

For TV, Sean Gibbons, Director of Media Strategy 202.682.1611 or
For radio
, Theo LeCompte, Media Strategy Manager 202.741.6268 or
For print
, Trevor Kincaid, Deputy Press Secretary 202.741.6273 or

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