The moderator is Jerry Kang from the UCLA LAw School, a visiting prof. at Harvard.

Kang: The FCC wants to maximize competition, diversity and localism. So, what do they do?

Horizontally, they decide how many TV stations a single firm can own in a local market. In 1996, the FCC decided that a single company could own two stations, with some restrictions. In the Sinclair case (2002), you can own more than 2 if it’s one of 18 big markets. Similarly for radio. Nationally, in 1996, the cap on how many stations a single company can own was enlarged. Recently, the FCC reset it to 45%, Congress tried to keep it at 35%, but Fox and Viacom benefitted from the current bump up to 39%.

Vertically, there have been complicated rules about whether a single company can own both TV and radio stations, and more rules about owning a newspaper. Now the FCC has a “diversity index,” weighting ownership of TV, radio, newspapers, etc. At the end of the day, they said that there are three types of markets: at risk, small to medium, large ones. In large market, there are no cross-market media ownership limits. In small ones, the old bars are in effect: a TV station can’t buy a radio station, etc. The medium size ones has mixed rules.

Mark Cooper (Dir of Research, Consumer Federation of America) says that the diversity index is dead in the courts. There has been very significant media consolidation. There’s a grassroots rebellion on media ownership because the FCC has taken a very narrow view of the First Amendment, what with its talk of views of “equal value.” [Sorry, but he’s talking quickly and I’m lacking many of the concepts needed to grasp this fully. Durn lawyers :-)]

Ben Compaine (MIT’s Program on Internet and Telecoms Convergence) says that there’s more competition and options on TV than ever. 30% of America used to watch Marcus Welby on ABC. Now, if you add together all the Disney channels, including ABC, Disney gets only about 12%. Further, the government’s tinkering trying to create diversity actually decreased diversity, and when the rules were withdrawn, we got more diversity. Don’t focus on what people choose to watch but on how many choices they have. [I.e., if everyone watches the same crap, so long as there’s lots of other crap on, the system works.]

Adam Clayton Powell III (USC Annenberg School of Journalism) says that there are more choices than ever: Internet radio, XM and Sirius, towns the size of Albany with two 24-hour news stations… “One person’s concentration is another person’s favorite program.” NPR now has 2 or 3 stations in many towns but no one talks about too much concentration about NPR. The new liberal talk network is paying Black and Hispanic stations to dump their programming, yet no one talks about concentration.

Cheryl Leanza is Deputy Director, Media Access Project, a non-profit law firm promoting the public’s right to hear and be heard on electronic media. She says we protect speech rights not so people can speak to themselves but so we can talk in public. The best way to preserve diversity is to separate content from distribution because then the distribution people couldn’t stop people from speaking.

David Oxenford (Shaw Pittman) is a lawyer for broadcasters. The real importance is on the rules governing consolidation at the local level. We have to look at this practically, not academically. What’s the alternative to five companies owning 80% of the media outlets? When you go to Jackson, Miss., where there’s only a $35M pot of money from advertisers, you can’t operate a station if you have 1% share. You have to consolidate. The FCC has it backwards: it lets NYC stations consolidate because it’s a huge market, but they won’t let Jackson consolidate even though it needs it. Radio is a little different because it’s cheaper. Besides, by the time we break up the ClearChannels, 85% of cellphones will be wifi enabled and thus able to pick up Internet radio.

Kang: Some questions/oppositions:

1. Broadcasters who want deregulation still want their “property rights” (spectrum) to stay regulated; they want the government to go after “radio pirates.”

2. On the practical level, do you more fear the state or private sector’s power over speech?

3. What counts as neutrality or intervention? Some who want deregulation of ownership still want regulation in content: obscenity, children’s programming, v-chip, adult ratings, etc.

4. Is the argument over consolidation an empirical dispute? Or is it normative?

Overall: Must we deregulate to enable broadcasting to survive? And must we get the government out to allow freedom?

Cooper: Compaine only talked about our ability to watch, not to speak. And he talked about variety, not diversity. And, no, they won’t go dark if they’re not allowed to merge: No one has given back a broadcast liense. [Powell and Oxenford shake their heads. Kang says some radio stations have gone dark.] He wants to regulate the structure of ownership, not content. We want to avoid content regulation.

Compaine: People are upset that they can’t get onto ABC News; they cry they don’t have access. [Let ’em eat blogs!] You have to start with empirical numbers. First, if you have multiple news networks, there’s a greater chance that more people will be heard. [Yeah, just like adding a second-place winner means more people have a chance to win the Megabucks lottery.] If you have lots of different outlets and proviers, you get more viewpoints. And we can’t ignore the potential Dean found in the Net.

Kang: Ben Compaine, where are your normative commitments? What about possibly pathological cases such as the Dixie Chicks, MoveOn not being allowed to advertise, etc.? Do these things bother you?

Compaine: As long as you have choices, let them take the Dixie Chicks off and maybe someone else will pick them up because now they are worth less. The Chernillo [?] thing is good.

Oxenford: Empiricism has nothing to do with it. It has to do with political and economic power. How do you get freedom of speech in broadcast? Do you turn them into common carriers so that everyone gets to speak? But then who’d watch it.?Why should the government parcel it out?

Kang: It’s already been parcelled out. How about cognitive radio? Give out spectrum and let people use it…

Oxenford: I think it’s great. It means there’s less and less need for the structural regulations.

Powell: Most interventions have unintended consequences. E.g., digital tv. The main thing to do is make sure that we all have open access to broadband.

Kang: Why aren’t there unintended consquences for supporting the status quo?

Powell: Make no law…

Kang: So you’re ok with hard-core porn on broadcast stations?

Powell: Yes.

Leanza: The status quo is not an open market.And when the Dixie Chicks are pulled off of ClearChannel, CC has an enormous share of the country western market, so in reality the local Top 40 station isn’t going to pick them up.

Q: The first amendment is about willing speakers finding willing listeners. If people choose to listen to what you don’t like, the first amendment is still working.

Compaine: Exactly. People wanted more networks, but they got Fox and they were horrified that it was “Married with Children,” not opera.

Kang: You have to look at where preferences are formed. The media forms it, at least in part.

Me: Suppose the open and free market produced a total homogeneity of viewpoint, would you then favor some form of regulation?

Powell: That won’t happen.

Compaine: That won’t happen.

Leanza: Your unwillingness to address this as a thought experiment speaks volumes. [Thank you!]

Cooper: The founders of the republic would be horrified.

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