House Subcommittee Votes to Stop FCC Media Ownership Rule

WASHINGTON -(Dow Jones)- A House subcommittee voted Tuesday to block the Federal Communications Commission's rule allowing cross-media ownership in the country's 20 largest media markets.

The provision is part of a spending bill that provides funds to the FCC and would deny the agency any funding to implement the rule.

The Senate in May passed a bill to rescind the FCC rule. House leaders aren't ready to take up the Senate bill, but the action in the House Appropriations Financial Services Subcommittee would achieve the same result.

Blocking the FCC rule could affect several news organizations such as News Corp. (NWS), Gannett Co. (GCI) and Media General Inc. (MEG) that own several local newspapers and broadcast stations.

Until the FCC's action last year, single companies were barred from owning both a newspaper and a radio or TV station in the same market.

FCC Chairman Kevin Martin faced criticism last year when he announced his plans for overhaul of the media-ownership rules, which haven't had any significant changes in more than 20 years. He lifted restrictions only on one rule governing a company's cross ownership within a media market. Critics said his actions would lead to a sharp decline in the number of independent media voices across the U.S.

Subcommittee Chairman Rep. Jose Serrano, D-N.Y., said Tuesday that he believes the loosening of the media consolidation rules by the FCC "is detrimental to the goals of diversity in ownership and viewpoints."

The subcommittee approved the spending bill on a unanimous vote. But Rep. Ralph Regula, R-Ohio, the ranking Republican on the subcommittee, said he is concerned about the FCC provision. The Internet, he said, has given consumers wide and diverse access to news.

The full committee is scheduled to vote on the spending bill next week, but the final measure likely will be wrapped into a large year-end spending bill covering virtually all federal agencies. At any point in the process, lawmakers could remove the FCC provision.

-By Fawn Johnson, Dow Jones Newswires; 202-862-9263; fawn.johnson@ dowjones.com

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