Copyright 2001 Daily News, L.P. Daily News (New
July 26, 2001, Thursday SPORTS FINAL
SECTION: BUSINESS; Pg. 33 MEDIA BIZ
LENGTH: 602 words
HEADLINE: FCC RULES IN RUPE'S FAVOR News Corp. seen likely to
keep Post, 2 TV stations
BYLINE: By PAUL D.
COLFORD DAILY NEWS BUSINESS WRITER
BODY: The Federal Communications Commission's ruling yesterday allowing
Rupert Murdoch to buy WWOR/Ch. 9 appeared likely to leave the News Corp. mogul
in permanent control of the New York Post and two TV stations in New York.
In a 3-2 ruling, the FCC officially gave Murdoch two years
to decide the structure of his New York media empire.
The timetable probably means he will not be forced to unload the
money-losing tabloid because the agency is expected to eliminate the ban on
cross-ownership before the waiver expires.
two-year clock was built into the decision allowing News Corp.'s Fox Television
subsidiary to buy 10 TV stations owned by Chris-Craft Industries, including Ch.
Murdoch, who also owns WNYW/Ch. 5, won a permanent
exemption in 1993 from a rule that bars a company from owning a newspaper and TV
station in the same market.
The waiver allowed him to
take over the Post, which was in bankruptcy.
FCC said yesterday that the 1993 exemption did not apply to Murdoch's purchase
of Ch. 9, FCC chairman Michael Powell, who voted for the Chris-Craft deal, said
recently that he expects the agency to undertake a review of cross-ownership
regulation soon. That would allow Murdoch to keep the Post and the two New York
Indeed, in one of two dissenting opinions
yesterday, FCC commissioner Michael Copps said: "Certain of these are long-term
waivers that appear to be based on the anticipation that prior to the
termination of the waivers, the rules may be relaxed such that compliance need
Yesterday's FCC decision came nearly a
year after News Corp. announced plans to buy the 10 Chris-Craft stations in a
deal then valued at $5.35 billion. The sale is expected to close within days,
expanding Murdoch's reach to nearly 41% of the country's TV audience.
"We're very, very happy with the decision," News Corp.
spokesman Andrew Butcher said. "We think it's fair and consistent with previous
decisions by the commission."
Butcher said News Corp.
intends to comply with the terms of the two-year waiver, but added: "We would
hope that the rules will change."
Also favoring a
repeal of the cross-ownership ban is the Newspaper Association of America, which
represents more than 2,000 papers but does not count News Corp. among its
John Sturm, the group's president, said the cross-ownership ban, implemented in 1975 to protect diversity in
the media, is now "horribly outdated."
"The underpinning of the rule makes no sense anymore because of the huge number
of media outlets and view-point sources available in every town and community,
including ones that are much smaller than New York."
Christopher Day, a Washington lawyer who represented a number of
community groups that opposed the Chris-Craft deal on the grounds that it
threatened diversity, expressed disappointment with the FCC decision. "We feel
it opens a back door to getting rid of the [ownership] rules," he said.
In seeking a waiver from having to sell the Post
immediately, Murdoch's lawyers acknowledged that the tabloid had a "rocky
financial history" and accounted for "approximately only 4% of advertising
dollars spent on the top five daily newspapers" in the New York region. One Post
insider recently estimated the paper was losing $50 million a year.
One potential obstacle to Murdoch is a proposed bill that
would sharply limit the FCC's ability to loosen cross-ownership rules. Sen.
Ernest Hollings (D-S.C.), chairman of the Senate commerce committee and a foe of
media consolidation, is among those who introduced the measure last week.