Re-election reigns

Prexy politics overshadow media legislation as Republicans continue push for deregulation

WASHINGTON — Don’t expect anything but presidential politics to take center stage in the nation’s capital this year.

With lawmakers in an electoral daze, all but the most pressing media regulatory issues are sure to get shunted aside for confetti and balloon drops, endless debates and, yes, partisan sniping.

The race for the White House will attract most of the intrigue in Washington. Political analysts are bracing for a ho-hum contest for control of Congress in November. Democratic retirements in the Senate and GOP redistricting gains in the House have Republicans boasting about their prospects of holding their own or picking up seats in both houses.

The political net effect for media policy?

At least in the near future, Republicans will continue to maintain the upper hand in pushing through a deregulatory agenda. But with a contentious race for the White House, count on the Democratic presidential nominee to make sure the public knows all the details of each and every GOP effort to boost big media’s bottom line.

Although the TV industry will have a much shorter Washington lobbying list this year, the stakes are still high on a couple of high-profile issues, including federal limits on media companies’ growth, the NBC/Universal merger, the transition to digital TV and Federal Communications Commission rules regarding what channels cablers must carry.

Last year’s media ownership fracas was so messy and contentious that it’s still not resolved; that will be the first thorny media issue Congress must tackle later this month.

Right away in 2004, the stage is set for a battle pitting deregulators against opponents of media consolidation. The rhetoric is sweeping, and it’s still up in the air whether News Corp. and Viacom will be allowed to keep their current TV holdings.

Less restrictions

With President Bush’s blessing, the GOP-controlled FCC loosened restrictions in June on media companies’ expansion, boosting the limit on the number of TV stations one company can own and allowing companies to own newspapers, TV and radio stations in most markets around the country.

A bipartisan group of Senators and House members were so steamed that in late summer and early fall they successfully added legislation rolling back a key part of the media ownership regs to a must-pass spending bill in each chamber, despite a White House threat to veto any effort to undo the FCC’s new rules.

In late December, the White House managed to gain the upper hand by forging a secret deal with Republican lawmakers to modify the language in the House and Senate conference allowing Viacom and News Corp. to keep all of its TV and radio stations. (The earlier congressional action re-tightened the rules and could have forced the two nets to sell off some holdings.)

The House passed the bill with the new language but Senate Democrats flatly refused and forced GOP leaders to punt the issue until after the new year.

Democrats now are caught between a rock and a hard place. If they continue to hold up the spending bill, at least a half-dozen government agencies will be forced to operate at last year’s spending levels without even a small increase for inflation.

If Republicans get their way, Democrats and liberal activist groups, such as MoveOn.org, have pledged to make the sweetheart deal an election issue.

Democratic front-runner Howard Dean has already hammered the administration repeatedly for supporting the FCC’s decision to loosen media ownership rules, but Bush and Republican leaders are banking on the American public’s lack of interest in arcane media policy, especially with the Iraq situation, the economy and health care grabbing the headlines.

This month, the FCC will likely decide whether cablers should be required to carry all the channels created by a broadcaster or just the broadcaster’s signature channel, which federal law mandates they carry.

With the transition to digital technology, cablers have more space available to transmit multiple signals. Cablers and broadcasters have been locking horns for the last few months over the issue, filing their arguments with the FCC.

Most of the commissioners are leaning toward requiring the cablers to relay multiple signals, but last year FCC topper Michael Powell publicly acknowledged he still has more than a few legal and constitutional reservations about that kind of government mandate.

Industry insiders also expect the feds to approve NBC’s planned purchase of Vivendi Universal’s U.S. entertainment assets in the first half of the year, despite a recent second request for information by the Federal Trade Commission’s antitrust regulators.

If deal is approved, NBC Universal would become the world’s seventh-largest media and entertainment company, and FTC officials are concerned that the merged company could raise the fees cablers pay for NBC’s programming.

But on most fronts, the cable industry is breathing a sigh of relief, having dodged any new congressional regulations despite rumblings from a few prominent senators last year about the skyrocketing rates cablers charge consumers for even the most basic service.

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