Has deregulation helped or hurt radio? The answer to that question could have profound implications outside the world of AM and FM. That's because some of the nation's largest television station owners, as well as newspaper publishers, are lobbying Congress for the same type of sweeping deregulation radio got in the Telecom Act.

Many of the provisions currently eyed by TV station owners and newspaper publishers, such as allowing broadcasters to own stations and newspapers in the same market, as well as a lifting of the cap on the number of individual TV stations one company can own, were part of the original telecom bill. But they were taken out at the last minute to appease the White House's objections about unfair media concentration. (At the time, Clinton told aides that if the Arkansas Democrat-Gazette, which did not support him, had been allowed to own TV stations as well, he never would have been elected governor.)

Now, five years later, and with a new Republican administration signaling its eagerness to usher in further media consolidation, those exact same deregulatory provisions are back on the table on Capitol Hill and at the Federal Communications Commission.

If successful, the current deregulation push would represent "the most aggressive media consolidation initiative ever taken by a democracy," says Reed Hundt, appointed by President Clinton to the position of FCC chairman. Hundt served during the time of the telecom's bill passage and was opposed to lifting radio's ownership caps.

Some analysts and regulators suggest that before any further ownership relaxation occurs in TV, the effects of radio deregulation need to be closely examined.

"Deregulation without reasoned justification is nothing more than deregulation for its own sake. We have already been down that road and we have seen the troubling results in the radio marketplace," wrote Sen. Fritz Hollings, D-S.C., and Sen. Byron Dorgan, D-N.D., in a recent Washington Post Op-Ed piece. "Let us not repeat the mistakes that led to the rapid consolidation in radio in the marketplace for TV programming."

Additionally, in contrast to 1995, when the National Association of Broadcasters lobbied strenuously in favor of radio deregulation, a major internal rift now divides TV broadcasters on the question of whether ownership caps should be lifted. Basically, the networks and the larger station groups, with an eye to owning more profitable affiliates, badly want the caps lifted. The medium- and smaller-sized broadcast companies do not. (Most, as a rule, are highly profitable, offering a sharp contrast to the position of independent radio stations in the early '90s.)

The NAB has sided with the smaller broadcasters; and NBC, CBS and Fox have quit the trade group in protest over the issue. But the smaller broadcasters are alarmed by what they see in the radio insustry.

"Radio is the ultimate example of what can happen if you change the ownership caps," says Jerry Waldron, an attorney representing a group called Network Affiliated Stations Alliance (NASA), which opposes lifting ownership caps.

Former FCC chairman Hundt agrees. "Radio is the model. That's the harbinger for what's going to happen to TV."

According to the Telecom Act, broadcast companies are allowed to own television stations that reach 35 percent of the American viewing audience, but no more. For instance, Paxson Communications operates smaller-market stations, and owns 60 TV signals, according to BIA. CBS, NBC and ABC, though, whose owned-and-operated affiliates are in major markets, have just 16, 13 and 10 stations, respectively. The Telecom Act increased the maximum viewing-audience percentage from 25 to 35 percent. The deregulatory push now is to raise that cap again, to at least 50 percent.

NASA station members oppose raising the cap for two main reasons: They're afraid of losing local control of programming to national networks, and they're afraid of being bought up by larger competitors. "That debate is falling on more receptive ears on Capitol Hill," says Mark O'Brien, executive vice president of BIA. "Whenever you invent something you hypothesize what's going to happen, [as was done with] radio deregulation. When you do it the second time [with TV], it's a matter of looking at what happened the first time."

Hollings, chairman of the Senate Commerce, Science, and Transportation Committee, is scheduled to hold a hearing on media consolidation during the third week of July. Thanks to the recent party switch of Sen. Jim Jeffords, I-Vt., those hearings will have a much different tone than they would if the former chairman, a fierce media deregulatory proponent, Sen. John McCain, R-Ariz., were overseeing the proceedings.

Nonetheless, new FCC chairman Michael Powell (whose Senate patron is McCain) has expressed support for lifting the cap beyond 35 percent, recently couching the issue in a freedom-of-speech context. "There is something offensive to First Amendment values about that limitation," he told an audience of NAB members. (However, Powell's commitment to the First Amendment is somewhat contradictory -- earlier in June, the FCC startled some music industry executives, not to mention First Amendment activists, when it fined a pop radio station in Colorado $7,000 for playing an edited, or cleaned-up, version of an Eminem rap song.)

For now, the question of ownership caps is before the U.S. Court of Appeals for the District of Columbia. There, Viacom is contesting a similar ownership cap for cable companies. In the spring, the court ruled that the 30 percent cap for cable was arbitrary and seemed to have been "plucked out of thin air." Hearings for that case begin in the fall, with a possible ruling by year's end. Powell has signaled he'll await the outcome of that case before proceeding with any FCC action on TV ownership limits.

NASA members insist that the very notion of locally controlled television is at stake in that case. In a blistering complaint filed with the FCC, NASA detailed how time and again networks have tried to hamper independently owned affiliates from breaking away from network programming, even for additional local news, a presidential debate or a charity telethon. (According to the Muscular Dystrophy Association, virtually none of the networks' owned-and-operated local affiliates air the association's telethon.)

Network executives at ABC, CBS and NBC declined to discuss the ownership cap issue.

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