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TV Affiliates Ask FCC to Curb Networks

March 09, 2001|JUBE SHIVER Jr. and SALLIE HOFMEISTER | TIMES STAFF WRITERS

WASHINGTON — Escalating a long-simmering battle, 600 local television stations urged federal regulators Thursday to restrain the networks from controlling local programming and barring station owners from selling their properties to whomever they please.

The 43-page complaint by the Washington-based Network Affiliated Station Alliance asked the Federal Communications Commission to stop the networks from imposing financial penalties on local affiliates when they preempt network shows such as "ER" or "Survivor" with their own news specials or dramas. The local affiliates also urged the FCC to adopt rules preventing the networks from interfering with stations' sales.

The petition cited NBC, which drew headlines two years ago after it lost a bid to acquire KRON-TV in San Francisco and allegedly tried to retaliate by asking the new owners to pay the network $10 million a year for programming. NBC had paid the previous owners $7.5 million to carry its shows.

"We file this petition because of the disturbing trend in recent years by the networks to assume greater dominance in the relationship with affiliates," Alan Frank, chairman of the alliance, said in a statement issued Thursday. "We are partners with the networks, but we cannot stand by and let them control our local stations."

ABC spokeswoman Zenia Mucha called the complaint "wholly without merit." NBC issued a statement saying, "It's a shame this organization filed this request. We've made so much progress in terms of our relationship with our affiliates. We are confident the FCC won't find any merit to their claims."

The petition by the local stations reflects a deepening divide in the traditionally stormy relationship between local TV affiliates and their network partners as new media, such as the Internet and digital TV, offer new distribution outlets for television programming.

Unlike Los Angeles' KNBC-TV and several dozen other stations around the country that are owned and operated by the networks, these 600 affiliates are independently owned. They mix locally produced newscasts and independently acquired shows with daytime and prime-time fare supplied by their network partners.

But as network profits have thinned, the networks have increasingly looked to their affiliates for financial support. Mark Fratrik, a vice president at BIA Financial Network, a Chantilly, Va., research firm, compared the relationship between the networks and their affiliates to that of Firestone and its franchisees, in which the distributor maintains a network of franchise outlets but increasingly deals directly with customers.

"The same thing is happening in broadcasting," Fratrik said. "The entire level of competition has increased. It has upset the apple cart."

Concern among station affiliates over their vulnerability to the networks rose last week after a federal court threw out FCC rules that prevented cable operators from controlling more than 30% of the nation's pay-television market. Local stations fear the decision may lead to a relaxation of multiple-TV-station ownership rules, triggering a new round of consolidation.

The alliance of affiliates said in its petition that further industry consolidation "threatens to relegate America's local, universal and free [TV] service to second-class status."

The networks argue that rules preventing any one company from owning stations that reach more than 35% of the U.S. viewers are antiquated at a time when there are hundreds of cable channels and other sources of news and information. FCC Chairman Michael K. Powell has indicated a willingness to reexamine caps on multiple-station ownership.

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