Regulation Policy

Spurring Mass Media Competition

Although much of the Telecommunications Act of 1996 addressed deregulation of telephone service, Congress also intended to spur competition in the video services market and reduce Federal Communications Commission mass media regulation.

The House Commerce Committee report on the 1996 act pointed out that the audio and video marketplace has undergone significant changes over the past 50 years "and the scarcity rationale for government regulation no longer applies."

The committee's report noted there are more than 11,000 radio stations and 1,100 commercial television stations -- a 30 percent increase over the past decade -- and during this time a fourth broadcast network was established and two other networks are emerging.

  • Traditional broadcasting also competes with cable television -- which serves 63 percent of television households.

  • And it competes with other technologies, such as wireless cable, low-power television, backyard satellite dishes, satellite master antennas and VCRs.

  • Finally, telephone companies are interested in providing video programming.

However, the FCC appears to view the 1996 act as an opportunity to expand its operations, says Robert Corn-Revere, an economist and lawyer. He notes the FCC has expanded the number of its employees and shifted resources from licensing and enforcement to writing new rules.

To encourage mass media competition, he recommends Congress consolidate mass media functions in the FCC, direct the agency to repeal its rule limiting newspaper-broadcast cross-ownership, require regulatory review and sunsetting, and eliminate the FCC's ability to adopt new regulations governing content.

Source: Robert Corn-Revere, "Mass Media Regulation and the FCC: An Agenda for Reform," Issue Analysis No. 65, October 20, 1997, Citizens for a Sound Economy Foundation, 1250 H Street, N.W., Washington, D.C. 20005-3908, (202) 783-3870.

For text http://www.cse.org/ia65-csef-telecom.htm

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