more on Copps Blasts Media Review at FCC

[Dave Farber <dave () farber net>]

Jut for the recod, gerry has it right on FCC process. I have seen it happen
that way time and time. Nothing new.

Dave

------ Forwarded Message
From: "Faulhaber, Gerald" <faulhabe () wharton upenn edu>
Date: Tue, 29 Apr 2003 13:41:12 -0400
To: Dave Farber <dave () farber net>
Subject: RE: [IP] Copps Blasts Media Review at FCC

[for IP, if you wish]

My comment on the piece about Copps:

Copps is grandstanding on this.  The Commission always works like this; the
relevant Bureaus work on the Order, generally under the direction of the
Chairman's office, until they have something they are ready to circulate "on
the 8th floor."  While they are working on it, any Commissioner and any of
their staff can question the Bureau about the current state of play.  Also,
the public has a long comment period to make their views known (as Dave and
I have on several issues in the recent past).  But the Commissioners really
get their chance to play when the Order goes on circulation.  During that
period, the Commissioners and their personal staff do lots of bargaining and
lobbying of each other, and the final Order gets worked out.  This phase is
not supposed to be public; by this time, the public has had lots of
opportunity to comment, and the Order is required to respond to all the
comments.  However, Commissioners' offices love to "leak" parts of the rules
while it's on circulation, and I suspect Copps will do this.  When there is
"enough" agreement among Commissioners (i.e., a majority is assured), the
Chairman brings it to a vote.  If it must be postponed, the Chairman will
postpone it.

On the issue of media cross-ownership, there has been a huge amount of
public comment already.  Copps is simply grandstanding on this.

Comment on Capek's comments:

The proceeding gets to the heart of media diversity: what is diversity, how
can we measure it, and how much of "it" do we need?  For years, the
Commission had the rule that the more voices the better, except when we say
different.  There was no clear standard or measure of diversity, and so the
diversity flag could be waved whenever the Commission wanted to intervene
without any other clear policy goal.

The Courts have said this isn't good enough.  If the FCC insists on media
ownership restrictions, the FCC must be able to make a compelling
demonstration that such restrictions are necessary and operate in the public
interest.  Simply saying "more voices is better" is not going to hack it;
the FCC (and indeed advocates of "more is better") are being required to
prove their point.  No more hand-waving; it's time to get serious about what
diversity is and what are the demonstrable policy outcomes of
keeping/trashing ownership restrictions?

By analogy, economists were hard-pressed to come up with clear, numerical
standards to help measure if the economic concentration in a market was too
high, or was OK.  DoJ and FTC have developed an extensive Merger Guidelines
document that does just that, and uses a clear market concentration index
(called the HHI) to measure this.  It was recognized long ago that saying
"more competition is better" is just not good enough; economists were forced
to be empirical and precise about their statements.  It's time the advocates
of diversity are subject to a similar discipline.  And this is the issue
currently confronting the FCC.

To say that the media lobby Congress (as Capek mentions with alarm) is at
the very least naïve.  Everybody lobbies Congress; it's called
representative democracy and it's hardly news.

I think more hard thinking about this important issue is in order, and I
hope that's what the FCC is doing.  I would urge Mr. Capek to do the same.

[ second that .., djf]


Professor Gerald R. Faulhaber
Business and Public Policy Department
Wharton School, University of Pennsylvania
Philadelphia, PA 19104



-----Original Message-----
From: Dave Farber [mailto:dave () farber net]
Sent: Tuesday, April 29, 2003 10:49 AM
To: Faulhaber, Gerald
Subject: FW: [IP] Copps Blasts Media Review at FCC



------ Forwarded Message
From: Peter G Capek <capek () us ibm com>
Date: Tue, 29 Apr 2003 10:37:41 -0400
To: dave () farber net
Subject: Re: [IP] Copps Blasts Media Review at FCC





Dave --

I find the article reporting on Michael Copps' remarks to be incredible.

The Bush administration has achieved quite a reputation for secrecy, through
removing information from web sites, delaying declassification, and in a
variety of other ways.  That such a major and important issue as media
control should be managed as the FCC Chairman appears to be doing is
outrageous, and made even more so by the fact that the issue is crucial to
the media, who are
of course not reporting on it.   (A recent documentary -- I think it was
Frontline on PBS --discussed
this at length.)  So we have an environment where the media are known to be
heavily lobbying and contributing to Congress (cf. DMCA and its friends),
are undoubtedly doing the same at the FCC, and are failing to "cover" the
issue and make the public aware of it, and the importance of it.

The result is that we're likely going to end up with a very small number of
media entities controlling a very large fraction of the news that the public
sees, and even though free speech will not be prohibited, it will be much
less likely to be heard or to be effective.   This is not a new
observation, but I think it's only now becoming apparent
what a concerted effort is at work here.

We need to figure out quickly how to fix this.   I fear there'll be no
going back once it happens.

                  Peter Capek


------ End of Forwarded Message



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