FCC approves Disney radio buy, others

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WASHINGTON -- As if it meant to make up for lost time, the FCC on Thursday approved a dozen policy items that included the $3 billion sale of 24 radio stations by the Walt Disney Co. to Citadel Broadcasting and an inquiry into what has become known as network neutrality.

While most of the decisions came without a "no" vote, they were not without controversy as Democrats on the panel had sought to have the government stake out bigger public-interest territory, particularly in regard to net neutrality.

In a 5-0 vote, with Democrats agreeing only reluctantly and filing concurring opinions, the commission agreed to launch a "notice of inquiry" into the market for broadband services. An NOI, as it is known in the telecommunications field, is the commission's lowest form of action. It ends in a government report or a series of recommendations. For the report or recommendations to become a rule, the commission then has to start up a "notice of proposed rule making," or NPRM.

Democrats contend that the Republican majority on the five-member panel is stalling because they don't want to do anything to prevent such big network companies as Comcast or Verizon from turning the Internet into their own personal amusement park.

"History shows that notices of inquiry like this have a way of disappearing into the regulatory dustbin, putting off decisions that need to be made now," commissioner Michael Copps said. "Taking another year or two to decide if we want to keep it that way shortchanges the technology, shortchanges consumers and shortchanges our future. I will not dissent from the one small step forward we take today, but I do lament our not making a Neil Armstrong giant leap for mankind."

FCC chairman Kevin Martin demurred, saying Democrats are seeking a solution to an imaginary problem.

"Although we are not aware of any current blocking situations, the commission remains vigilant in protecting consumers' access to content on the Internet," he said. "At the same time, I believe that it is useful for the commission, as the expert communications agency, to collect a record about the current practices in the broadband marketplace."

At the same time the commission agreed to begin the net neutrality inquiry, it agreed to classify wireless broadband services as an "information service." While that classification guarantees a light touch from government, Democrats charged that it also shortchanges consumers by allowing services like Internet protocol phones to avoid paying into the universal service fund -- a fund designed to ensure telecommunications services to the poor and rural areas.

Again, the Democrats concurred in the voting on the classification issue.

"The goal of this declaratory ruling is ostensibly to promote wireless broadband deployment," commissioner Jonathan Adelstein said. "It is hard to fathom how it is likely to make much difference in the near term considering that no party bothered to ask us to formally consider it. It is hard to see how clarifying the regulatory classification will promote deployment when nobody was saying it was ever an impediment."

The Republican majority again took exception to the Democratic complaints.

"Today's action to classify wireless broadband Internet access service as an information service creates regulatory parity," responded commissioner Robert McDowell. "Our determination, which the commission has previously taken for Internet access over cable modem, wireline and power line facilities, will maximize innovation and consumer benefits by ensuring that the market-driven framework established by Congress is fully realized as wireless services continue to flourish and evolve."

Less rancorous was the commission's decision to approve the sale of the 24 former ABC Radio stations by Disney to Citadel. The sale is valued at slightly less than $3 billion.

As a condition of the purchase, Citadel agreed to sell 11 of its stations in seven markets across the country and to attempt to sell them to new owners who are minorities or women. Citadel also has entered into a proposed consent decree with three other major station groups to settle payola charges.

The FCC also took actions to:

  Make it easier for cable, phone and satellite companies to get access to apartment buildings and condominiums to compete with a resident service provider;

  Open the airwaves to 76 new noncommercial educational FM stations;

  Adopt final rules for digital radio stations. The digital audio service rules take the thousands of digital radio stations out of the "experimental" category, officially recognizing the state of play in the industry.
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