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FCC votes to ease media ownership restrictions

WASHINGTON (Reuters) - The Federal Communications Commission voted on Tuesday to loosen media ownership restrictions in the 20 biggest U.S. cities, despite objections from consumer groups and a threat by some U.S. senators to revoke the action.

The FCC voted 3-2, along party lines, to ease the 32-year-old ban on ownership of a newspaper and broadcast outlet in a single market.

In addition, the FCC action exempted 36 newspaper-broadcast ownership combinations that had been grandfathered under the previous rule. It also exempted six ownership applications that were pending before the agency.

The FCC’s Republican chairman, Kevin Martin, called the move a “relatively minimal loosening of the ban” and said it “may help to forestall the erosion in local news coverage.”

The vote came over the objections of the FCC’s two Democratic commissioners and in the face of opposition from lawmakers in Congress.

“The FCC has never attempted such a brazen act of defiance against Congress,” said Democratic Commissioner Jonathan Adelstein. “The law does not say we are to serve those who seek to profit by using the public airwaves.

“The law says we are to serve the public interest,” Adelstein continued. “And the public has repeatedly told us they are not interested in further media consolidation.”

Existing FCC rules ban ownership of a newspaper, and a television or radio station in the same market, unless the FCC grants a waiver.

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Critics of easing the ownership rule say it will lead to more consolidation in the industry, eliminate independent voices and degrade local news coverage.

They also argue it will unleash a wave of mergers going beyond the top 20 markets.

The vote came a day after a group of 25 senators sent a letter to Martin warning they would “move legislation to revoke the rule and nullify the vote” if the FCC went ahead with the ownership rule changes.

The group, including Senate Commerce Committee Chairman Daniel Inouye, a Democrat from Hawaii, and the panel’s top Republican, Ted Stevens of Alaska, said the FCC had not spent enough time studying the issue and seeking public input.

On November 30, the three Republican commissioners approved an order temporarily waiving the ownership restrictions for media group Tribune Co, allowing the company to proceed with its planned leveraged buy-out.

Tribune shares were up 3.2 percent to $33.32 in afternoon trading on the New York Stock Exchange.

Reporting by Peter Kaplan, editing by Tim Dobbyn