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Big Loss for Big Media and the FCC: Court Rejects Media Consolidation Push

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It's not every day that you can celebrate a win for the public over big media. But on Thursday a federal appeals court threw out an attempt by the FCC and industry titans to gut media ownership limits.

The decision by the U.S. Court of Appeals for the Third Circuit threw out a 2007 FCC rule change that would have allowed a single company to own a daily newspaper and several broadcast stations in one local market.

Such a change could have opened the floodgates to media mergers, leading to further layoffs in newsrooms while leeching diverse perspectives from local media.

The court also upheld the FCC's decision to retain its other local broadcast ownership restrictions, and instructed the agency to better consider how its rules affect broadcast ownership by people of color.

Sweeping Victory for the Public Interest

The decision is a sweeping victory for the public interest. The court rejected arguments made by broadcast and newspaper giants while exposing the FCC's repeated failures to rein in runaway consolidation.

"We won on almost every point," said Andrew Schwartzman, Senior Vice President and Policy Director of Media Access Project, who argued before the court against the FCC's rules.

"This decision is a vindication of the public's right to have a diverse media environment... Now that the Court has directed the FCC to make sure the public is not ignored, we can look forward to having a right to meaningful participation as the FCC looks at these questions again."

"The court wisely concluded that competition in the media - not more concentration - will provide Americans with the local news and information they need and want," said Corie Wright, Free Press policy counsel, who also argued the case on behalf of a coalition of public advocacy groups.

The case, Prometheus Radio Project v. FCC, is the second time the Third Circuit jettisoned FCC attempts to relax its media ownership rules. The first was in 2004, when the same panel of judges struck down then-Chairman Michael Powell's attempts to gut media ownership limits.

"I was there when Andrew Schwartzman and his colleagues put together their case for the people," said Hannah Sassaman, a longtime organizer at the Prometheus Radio Project who is now working with the New America Foundation. "The court threw out the FCC's rules because these incredible lawyers and the millions of people they represented proved that letting one company own too much media hurts our communities.

Big Media Lobby Rebuked

Large media corporations have repeatedly lobbied the FCC to lift its 35-year-old ban on "newspaper/broadcast cross-ownership". Had they been successful -- and these rules gone into effect -- a single company could have owned the main daily newspaper, eight radio stations, three television stations and a major cable provider in the same town.

The court decision vacated the FCC's plan to relax the ban on such common ownership, finding that the Commission's rule-making procedures were highly irregular and failed to give the public adequate notice and opportunity to weigh in.

The court also determined that record evidence supports the FCC's decision not to relax any of the other media ownership rules.

"Today the court confirmed that the FCC's media ownership rules are not only constitutional but necessary to preserve competition, as well as to promote diverse sources of news and information for the American people," said Wright.

The FCC's Diversity Problem

The court also blasted the FCC for repeated failures to consider the impact of media consolidation on broadcast license ownership by people of color.

Free Press research from 2007 exposed the FCC's failure to foster minority ownership of radio and television stations: racial or ethnic minorities own just 7.7 percent of all full-power commercial broadcast radio stations and just 3.26 percent of all TV stations, though they account for 33 percent of the U.S. population.

The court's findings come as the FCC embarks on yet another review of media ownership limits this summer. And while the court upheld the need for curbs, industry groups are still pushing the FCC to eliminate them, just as public interest groups are organizing against new and covert forms of media consolidation.

Now the FCC "cannot ignore the overwhelming evidence that existing media consolidation levels adversely impact the amount and quality of news from diverse sources," Wright said.