Before the

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                 | * | File Nos. BALCT-20000918ABB, |
|                                  | * |                              |
| the Applications of              | ) | ABC, ABD, ABF, ABK, ABL,     |
|                                  | * |                              |
| UTV of San Francisco, Inc., KCOP | * | ABM, ABN, ABU, ABY, ABG,     |
| Television, Inc.                 |   |                              |
|                                  | * | ABH, ABI, ABJ, ABO, ABP,     |
| UTV of San Antonio, Inc., Oregon | * |                              |
| Television, Inc., UTV of         | ) | ABQ, ABR, ABS, ABV, ABW,     |
| Baltimore, Inc., WWOR-TV, Inc.,  | * |                              |
| and                              | * | ABX, ABZ, ACA, ACB, ACC,     |
|                                  |   |                              |
| UTV of Orlando, Inc. and United  | * | ACD, ACE                     |
| Television, Inc.                 | * |                              |
|                                  | ) |                              |
| (Assignors)                      | * |                              |
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| and                              |   |                              |
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| Fox Television Stations, Inc.    | * |                              |
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| (Assignee)                       | * |                              |
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| For Consent to the Assignment of |   |                              |
| Licenses                         | * |                              |
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| for Stations KBHK-TV, San        | ) |                              |
| Francisco, CA;                   | * |                              |
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| KCOP-TV, Los Angeles, CA;        |   |                              |
| KMOL-TV,                         | * |                              |
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| San Antonio, TX; KPTV-TV,        | ) |                              |
| Portland, OR;                    | * |                              |
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| WUTB-TV, Baltimore, MD; WWOR-TV, |   |                              |
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| Secaucus, NJ; WRBW-TV, Orlando,  | * |                              |
| FL;                              | ) |                              |
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| KMSP-TV, Minneapolis, MN;        | * |                              |
| KTVX-TV,                         |   |                              |
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| Salt Lake City, UT; KUTP-TV,     | * |                              |
| Phoenix, AZ                      | ) |                              |
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**MEMORANDUM OPINION AND ORDER**

**Adopted:** July 23, 2001 **Released:** July 25, 2001

By the Commission: Chairman Powell and Commissioner Abernathy approving
and issuing separate statements; Commissioners Tristani and Copps
dissenting and issuing separate statements.

1.  The Commission has before it for consideration the applications to
    assign the licenses of the ten television stations held by
    subsidiaries of Chris-Craft Industries[^1] to Fox Television
    Stations, Inc. (FTS). A petition to deny was filed jointly by the
    Office of Communication, Inc. of the United Church of Christ,
    Academy of Latino Leaders in Action, Black Citizens for a Fair
    Media, Center for Media Education, Consumer Federation of America,
    Consumer's Union, New York Metropolitan Association of the United
    Church of Christ, Rainbow/PUSH Coalition, and Valley Community
    Access Television (Petitioners).[^2] For the reasons stated below,
    we deny the petition to the extent discussed below and grant the
    applications subject to conditions to ensure compliance with our
    multiple ownership and cross-ownership rules.

# Introduction

2.  On September 18, 2000, FTS and Chris-Craft filed applications
    seeking Commission consent to the assignment of ten television
    broadcast licenses held by Chris-Craft.[^3] FTS is the licensee of
    24 television broadcast stations. FTS is a wholly-owned subsidiary
    of Fox Television Holdings, Inc. (FTH). An entity called Fox
    Entertainment Group (FEG) owns 100% of the common stock of FTH. FEG
    also has a 24% voting interest in FTH and all of the equity except
    for \$760,000. Rupert Murdoch owns 100% of the preferred stock,
    controls 76% of the votes and has a \$760,000 investment with a
    fixed 12% annual return in FTH. Mr. Murdoch is also chairman and
    chief operating officer of FTH. Following the transaction, FEG will
    be owned approximately 85.25% by FEG Holdings, Inc. and 14.75% by
    public shareholders. The News Corporation Limited (News Corp.), an
    Australian corporation, owns 100% of FEG Holdings.[^4]

    **II. THE TRANSACTION**

3.  The parties seek to structure the transaction as a tax-free
    reorganization.[^5] Chris-Craft will be merged into News Publishing
    Australia Limited (NPAL), an acquisition subsidiary of News Corp. At
    the time of the mergers, NPAL, through intermediate subsidiaries,
    will transfer essentially all of the acquired broadcast assets to
    FEG, in exchange for shares of FEG stock. As set forth in the
    attached Exhibit B, those assets will be held by a newly formed
    subsidiary of FEG, Newco. The station licenses will be assigned to
    FTS. Newco will perform the day-to-day operations of the station
    pursuant to an operating agreement. On January 25, 2001, the
    applicants filed a draft of an amended operating agreement
    (Operating Agreement) that set out the respective rights and
    responsibilities of FTS and Newco regarding the stations'
    operations.[^6]

4.  Under the Operating Agreement, FTS has "authority, power, and
    control over the management and operations of the Stations" and is
    responsible for setting policy regarding programming, personnel, and
    finances. FTS has the right to approve all programming, including
    the power to direct the scheduling of any programming and to direct
    Newco to acquire, produce, pre-empt or discontinue any programming.
    FTS shall select and employ two employees, one management-level, at
    each station. FTS shall select the general manager of each station,
    who shall report directly to the chairman of FTS or an FTS employee
    designated by the chairman. In addition, the department heads of
    each station shall report to the respective department heads of FTS.
    FTS will direct the preparation of all budgets for the stations,
    have the right to approve specific equipment purchases, and direct
    purchases by Newco. FTS also will have the contractual right to
    cause the sale of the licenses and the assets of the stations
    without the approval of Newco as long as the sale is an arms-length
    transaction at fair market value.

5.  The Operating Agreement vests responsibility for the day-to-day
    operations of the stations in Newco. Subject to the ultimate
    authority and control of FTS, Newco has the right to enter into
    programming contracts. Except for those individuals who work
    directly for FTS, Newco shall employ all personnel, subject to the
    control and approval of FTS. Newco will purchase all equipment,
    subject to the FTS approved budget and will pay all expenses and
    capital costs. All receipts will be deposited in Newco's accounts
    established for the respective stations for the benefit of Newco and
    FTS. Newco will receive 95% of all net income and pay 95% of all net
    losses, while FTS will receive 5% of all net income and pay 5% of
    all net losses. In the event of the sale of a station, Newco shall
    receive 95% of the profit and FTS shall receive the remaining 5%.

6.  As a result of the transaction, television duopolies will be formed
    in the New York, Los Angeles, Phoenix, and Salt Lake City Designated
    Market Areas (DMAs). The applicants have made showings that these
    television duopolies will comply with our local multiple ownership
    rules, except in the case of Salt Lake City. There, the applicants
    have asked for a temporary waiver to come into compliance with our
    rules. The applicants have also requested a temporary waiver to come
    into compliance with our national ownership cap, which the combined
    company will exceed as a result of the proposed transaction.
    Finally, the proposed transaction would result in the common
    ownership of two television stations and the *New York Post*
    (*Post*) in New York City*.* In their showing, the applicants argue
    that the television/newspaper combination would comply with a waiver
    the Commission previously granted permitting the common ownership of
    one television station and the *Post*. In the alternative, the
    applicants request an interim waiver permitting the proposed
    combination pending the outcome of a rulemaking to re-examine the
    television/newspaper cross-ownership rule.

7.  The Petitioners oppose the application on the grounds that the
    proposed transaction would violate the limits on alien ownership of
    broadcast licensees. The Petitioners also argue against the creation
    of the television duopolies in Phoenix, New York, and Los Angeles,
    and against allowing FTS the requested time to comply with the local
    multiple ownership rules in Salt Lake City. The Petitioners further
    oppose granting a waiver to permit Fox to come into compliance with
    the national ownership cap and oppose permitting the common
    ownership of two television stations in New York City and the
    *Post.*

# ALIEN OWNERSHIP AND CONTROL

8.  *Background.* Under Section 310(d) of the Communications Act, the
    Commission may grant its consent to a proposed transfer only if it
    determines that "the public interest, convenience, and necessity
    will be served thereby." The Commission generally considers whether
    the proposed transaction will be consistent with the Communications
    Act and the Commission's rules and, in addition to complying with
    those rules, whether the transaction would otherwise serve the
    public interest. Where broadcast licenses are concerned, the effects
    of a proposed transaction on the diversity of voices and economic
    competition in a given market have long been core considerations in
    determining whether a transaction serves the public interest,
    convenience, and necessity.

9.  As we recently determined in *Deutsche Telekom/VoiceStream*,
    non-governmental alien ownership and control issues, such as those
    presented, in this case are governed by Section 310(b) of the
    Communications Act.[^7] The alien ownership interests here are
    indirect as shown on Exhibit B and, therefore, we apply the alien
    ownership limits set forth in Section 310(b)(4) of the
    Communications Act, which prohibits granting a license to:

    \[A\]ny corporation directly or indirectly controlled by any other
    corporation of which more than one-fourth of the capital stock is
    owned of record or voted by aliens, their representatives, or by any
    foreign government or representative thereof, or by any corporation
    organized under the laws of a foreign country, if the Commission
    finds that the public interest will be served by the revocation or
    refusal of such license.[^8]

10. In *Fox Television Stations, Inc.* (*Fox)*,[^9] the Commission held
    that the News Corp.'s interest in Twentieth Holding Corporation
    (Holdings)[^10] exceeded the 25% benchmark established in
    §310(b)(4). As illustrated in Exhibit B, Holdings was the immediate
    parent of FTS. Even though News Corp. owned shares of Holdings
    representing only 24% of the voting rights, the Commission found
    that News Corp. contributed over 99% of the capital invested and was
    entitled to virtually all of the economic incidents of the
    operation.[^11] However, the Commission also found that Mr. Murdoch,
    by virtue of his controlling voting interest in Holdings, exercised
    *de jure* control over Holdings and, thereby, FTS.[^12] The
    Commission also found that Mr. Murdoch was in charge of Holdings'
    day-to-day operations and dominated its corporate affairs.[^13]
    Therefore, even though FTS and Holdings were subsidiaries of News
    Corp. for financial reporting purposes, the totality of the evidence
    demonstrated that Mr. Murdoch exercised *de facto* control of the
    company. The Commission ordered FTS to submit a showing as to why
    its ownership structure served the public interest or to explain how
    it intended to bring that structure in line with the statutory
    benchmark.[^14]

11. In its subsequent decision in the matter,[^15] the Commission found
    that the ownership structure was in the public interest. The
    Commission based its decision on the unique equities of the case,
    including what it found to be FTS's good faith understanding of the
    statute.[^16] The Commission also observed that the capital gains
    liability could be between \$200 million and \$720 million if FTS
    were required to restructure by selling a large portion of its stock
    to investors other than News Corp.[^17] The Commission weighed these
    equities and costs against the statutory interest in limiting
    foreign participation in broadcasting. It concluded that the
    inequity and expense of requiring corporate restructuring outweighed
    the statutory interest in limiting alien ownership in the unique
    circumstances present there, particularly because an American
    citizen exercised *de jure* and *de facto* control of the licensee
    and there was no reason to believe that Australian investment
    implicated national security concerns.[^18]

12. The Commission then went on to consider future acquisitions by FTS,
    finding that "it would disserve the public interest to confine our
    decision to stations FTS already owns, for doing so would
    unnecessarily hinder the company's ability to expand and frustrate
    its reasonable expectations of doing so."[^19] The Commission
    therefore concluded that "FTS, as presently structured may,
    consistent with the public interest, acquire additional broadcast
    stations (up to the allowable maximum set forth in our ownership
    rules, see 47 C.F.R. §73.3555)."[^20]

13. In 1998, the staff granted a short form assignment (1998 Assignment)
    of the stations then licensed to FTS and its subsidiaries. The
    applicants stated that the stations would be transferred to a new
    FTS; FTS would be renamed Fox Television Holdings (the current FTH);
    and Twentieth Holdings Corporation would be renamed Fox
    Entertainment Group (FEG). See attached Exhibit B. The applicants
    further stated that, following the *pro forma* reorganization,
    approximately 18% of FEG's stock would be publicly traded while the
    rest would continue to be ultimately owned by News Corp. The grant
    of the 1998 Assignment resulted in a reduction of the total alien
    equity interest in FEG.

14. The applicants argue that the proposed transaction is in compliance
    with the requirements of *Fox II* because FTS will have control of
    the station licenses and complete access to the operating assets of
    the stations. They argue that FTS, and thereby Mr. Murdoch, will
    have *de jure* and *de facto* control of the licensees, in
    accordance with *Fox II*. In contrast, the Petitioners contend that
    the structure proposed here is not the same as permitted in *Fox II*
    and requires us to conduct a new public interest analysis. The
    Petitioners contend that Newco, not FTS, will be in control of the
    Chris-Craft licenses, which they contend would violate
    §310(b)(4).[^21] Petitioners also claim that FTS has failed to
    demonstrate that grant of this transaction would be in the public
    interest.

15. *Discussion*. We agree with the applicants that the proposed
    structure complies with the Commission decision in *Fox II*. They
    are therefore entitled to rely on the holding of that case, and no
    additional public interest analysis under section 310(b)(4) is
    required under the circumstances here. The licenses will continue to
    be held by FTS and all of the stock of that entity will continue to
    be owned by FTH. Petitioners focus appropriately on whether Mr.
    Murdoch, an American citizen, will maintain *de jure* and *de facto*
    control over the licenses. The continuance of that control was the
    critical aspect of the structure that made possible the staff's
    approval of the 1998 Assignment. The same control of the licenses by
    Mr. Murdoch, through his control of FTS, continues in the structure
    proposed here.

16. This conclusion is not altered by the fact that the stations'
    operating assets will be held by Newco, rather than FTS, because FTS
    will control the operations of the stations. The Commission's
    analysis of the station's locus of control generally rests on three
    factors: programming, personnel and finances.[^22] Here, under the
    first factor, FTS has the power to approve all programming, direct
    its scheduling and overrule any Newco programming decisions. FTS may
    require Newco to acquire, produce, pre-empt or discontinue any
    programming. Although Newco may enter into programming contracts and
    regularly schedule programming, all of its activities related to
    programming are subject to the approval and control of FTS, giving
    FTS control over station programming.

17. In regard to the second factor, personnel, the general manager, who
    is selected by FTS, and all of the department heads of each station
    report to FTS. Two employees at each station, including one
    management--level employee, are directly employed by FTS. Any
    personnel employed by Newco are subject to the control and approval
    of FTS. By having its own employees working at the station,
    including at least one manager, by having all of the department
    heads and the general manager report to FTS, and by subjecting all
    Newco personnel to the control and approval of FTS, the Operating
    Agreement gives FTS ultimate control over station personnel.

18. Under the third factor, finances, FTS retains control over the
    budget process. Although Newco can purchase equipment and make
    capital expenditures, it can only do so according to the budget
    prepared by FTS, making its financial actions subject to the control
    of FTS. Finally, FTS has the contractual right to cause the sale of
    the stations without Newco's consent, provided the sale is at
    arms-length.

19. We conclude that FTS has established that it will maintain the
    required control over the stations being acquired. In maintaining
    this control, FTS has complied with the mandate of *Fox II* that it,
    and thereby Mr. Murdoch, maintain *de jure* and *de facto* control
    over the licenses. Furthermore, the level of alien equity
    contribution has not increased. We find, therefore, that the
    proposed corporate structure complies with *Fox II* in all material
    respects, and thus no additional public interest analysis under
    Section 310(b)(4) is necessary.

# IV. National Ownership Cap {#iv.-national-ownership-cap .unnumbered}

20. On November 7, 1996, we granted transfer of control applications
    that resulted in FTS owning stations having an aggregate national
    audience reach of 34.82 %.[^23] Due to population changes within the
    respective DMAs and the addition of communities to two DMAs in
    Alabama, FTS's current aggregate national audience reach has
    increased to 35.352%. FTS states that following the merger with
    Chris-Craft it will control 34 television stations licensed to 29
    DMAs having an aggregate national audience reach of 40.91%.

21. The Telecommunications Act of 1996 directed the Commission to amend
    its ownership rules to prohibit the grant, transfer or assignment of
    any television license to any entity if it would result in that
    entity having a cognizable interest in television stations with an
    aggregate national audience reach exceeding 35%.[^24] Because FTS's
    aggregate national audience reach following the merger would exceed
    the cap by 5.91%, it has asked for 12 months to reduce its national
    audience reach to its current level of 35.352%. FTS argues that the
    12-month temporary waiver would serve the public interest by
    permitting orderly divestiture while avoiding disruptions in
    programming and service to the respective communities, and would be
    consistent with Commission precedent.

22. The Petitioners maintain that a 12-month waiver should not be
    granted because viewpoint diversity and economic competition will be
    unduly compromised during the waiver period, and because FTS has not
    justified the need for a 12-month waiver in this instance. The
    Petitioners further contend that FTS's motive in requesting a
    12-month waiver is to delay compliance in order to avoid it
    altogether. Alternatively, the Petitioners argue the Commission
    should order FTS to disclose their specific divestiture plans, and
    should only grant a 6-month temporary waiver of the national
    television multiple ownership rule, expressly conditioned upon
    divesting a sufficient number of television stations to reduce the
    national audience reach to 35%.

23. The Commission has determined that in multiple-station transactions
    the overall benefits of allowing time for an orderly divestiture
    will outweigh any temporary impact on diversity and competition from
    common ownership during a reasonable period following grant of the
    application.[^25] In *Shareholders of CBS Corporation*, we granted a
    12-month temporary waiver where CBS/Viacom's post-merger aggregate
    national audience reach was slightly more than 41%, which is
    slightly greater than the national audience reach that would exist
    immediately following the acquisition of the Chris-Craft stations by
    FTS.[^26] We believe that a similar length of time to come into
    compliance with the national audience reach cap is warranted in this
    proceeding. Given the size of the proposed transaction, the
    practical difficulties of divesting the necessary stations, and our
    policy of avoiding forced sales, we conclude that the advantages of
    granting a 12-month temporary waiver of the national ownership cap
    in this instance will outweigh any temporary impact on diversity and
    competition and is in the public interest.[^27]

24. We will permit FTS to decrease its aggregate national audience reach
    to its current level of 35.352%, which will preserve the *status quo
    ante*. A group owner whose station acquisitions have been approved
    by the Commission will not be required to divest if the aggregate
    national audience reach subsequently exceeds the national ownership
    cap due solely to market changes.[^28] Even though FTS's aggregate
    national audience reach currently exceeds the 35% national ownership
    cap, divestiture is not required because the increase from the
    original 34.82% to the current 35.352% was not the result of a
    station acquisition. Requiring FTS to divest the necessary stations
    to return to its current audience reach of 35.352% will not,
    therefore, result in a reduction of diversity and competition
    nationwide from its current level and is thus a fully sufficient
    remedy. We further believe that this approach is a logical extension
    of our existing policy regarding the effects of market changes on a
    licensee\'s national audience reach.

25. In *Fox Television Stations, Inc. v. FCC*, Dkt. No. 00-1222, *et
    al.* (D.C. Cir. 2001), the United States Court of Appeals for the
    District of Columbia Circuit recently stayed the portion of our
    order in *Shareholders of CBS*, 15 FCC Rcd 8230 (2000), which
    required CBS to divest some of its television stations in order to
    comply with the national television ownership cap. The validity of
    the national television ownership cap is at issue in *Fox Television
    Stations* and the Court stayed the divestiture requirement until the
    resolution of that proceeding. In light of these developments, we
    believe it is appropriate to delay the effectiveness of our
    condition requiring FTS to come into compliance with the national
    ownership cap until the *Fox Television Stations* case is resolved.
    Accordingly, FTS will be afforded a period of 12 months following
    the entry of a final decision in *Fox Television Stations*, that is
    no longer subject to judicial review, upholding the national
    broadcast television ownership cap, or any other order dismissing
    the issues raised therein, to file any application or applications
    that may be necessary at that time to come into compliance with the
    national ownership limits.

# V. LOCAL TELEVISION OWNERSHIP RULE {#v.-local-television-ownership-rule .unnumbered}

26. *Background and Standard.* The transaction will result in FTS owning
    two television stations in the New York, Los Angeles, Phoenix, and
    Salt Lake City DMAs. In the *Television Ownership Order*, we
    modified our rules to allow common ownership of two television
    stations in the same DMA, if eight independently owned and operating
    full-power commercial and noncommercial television stations will
    remain in the DMA post-merger, and at least one of the two stations
    to be commonly owned is not ranked among the top four in the DMA
    based on the most recent all-day (9:00 a.m. -- midnight) audience
    share as measured by Nielsen Media Research or any comparable,
    professional, accepted audience ratings service.[^29] FTS has
    submitted a showing that the newly created television duopolies in
    the New York, Los Angeles, and Phoenix markets will comply with our
    modified television duopoly rule.[^30] FTS has stated that the newly
    created duopoly in Salt Lake City will not comply with our rules and
    has requested a 12-month temporary waiver of the television duopoly
    rule to come into compliance.

27. The Petitioners argue that creation of the four television duopolies
    is inconsistent with the public interest. With respect to the
    Phoenix market, the Petitioners argue that the Phoenix DMA does not
    represent actual viewing patterns, citing arguments made in their
    Petition for Reconsideration of the *Television Ownership Order*.
    The Petitioners assert that, of the 11 independently owned and
    operating television voices licensed to communities within the
    Phoenix DMA, two are not actually available over the air in the
    Phoenix metropolitan area, and a third does not have a recorded
    market share in the Phoenix DMA. Petitioners contend that, if these
    three stations are excluded as voices, then the combination will not
    comply with the voice count prong of the television duopoly rule.
    With respect to the proposed television duopolies in New York and
    Los Angeles, the Petitioners argue that the *Television Ownership
    Order* did not contemplate VHF-VHF combinations in these markets.
    The Petitioners further contend that, even if the proposed
    television duopolies in New York, Los Angeles and Phoenix are
    consistent with the television duopoly rule, they violate "core
    diversity concerns." Finally, the Petitioners argue that the
    Commission should grant at most a six-month temporary waiver of the
    television duopoly rule in the Salt Lake City market since the
    proposed duopoly would result in excessive market concentration.
    [^31]

28. *Discussion*. In our recently released *Memorandum Opinion and
    Second Order on Reconsideration*, we denied the Petitioners'
    Petition for Reconsideration broadly challenging the geographic
    scope of the duopoly rule, and thus reaffirmed our conclusion that
    DMAs generally reflect actual viewing patterns by defining "the
    'market' in a manner that is widely accepted and used by the
    advertising and broadcasting industries." We did grant, however,
    partial reconsideration and modified the duopoly rule such that
    "\[i\]n counting the number of independently owned and operating,
    full-power stations in a market for purposes of our rule, we will
    count only those stations whose Grade B signal contour overlaps with
    the Grade B contour of at least one of the stations in the proposed
    combination."[^32] In refining the duopoly rule, we did not extend
    this modification to exclude as voices those stations that fail to
    register a market share in the Nielsen Media Research all-day (9:00
    a.m. -- midnight) audience share report for the DMA. We noted that
    "assignment of a broadcast station to a particular market, and its
    continued success as a going concern, demonstrates that a station is
    a source of viable competition and diversity in a market, and
    therefore should be counted."[^33] Consequently, even excluding the
    two stations whose Grade B contours do not overlap the Grade B
    contours of either station in the proposed combination, FTS's
    duopoly will still comply with the television duopoly rule in
    Phoenix. Having reviewed the showing submitted by the parties, we
    find that the television duopolies created by the merger of Fox and
    Chris-Craft in the Phoenix, New York, and Los Angeles DMAs will be
    in compliance with the television duopoly rule. As set forth in the
    *Television Ownership Order* and modified by the *Memorandum Opinion
    and Second Order on Reconsideration*, the Phoenix DMA, after the
    proposed merger, will include at least 8 independently owned and
    operating commercial and noncommercial television stations as
    identified by the modified voice count prong of the television
    duopoly rule. Additionally, at least one of the two commonly owned
    television stations is not among the top four-ranked stations.

29. With respect to the VHF-VHF combinations proposed in the Los Angeles
    and New York markets, the Commission received several comments in
    the broadcast television ownership proceeding advocating a
    limitation or ban on VHF-VHF or VHF-UHF combinations. Rather than
    limit or ban such combinations, we adopted a measured relaxation of
    our duopoly rule that consisted of a voice count and market rank
    component.[^34] Accordingly, the VHF-VHF nature of the television
    duopolies created by the instant merger in New York and Los Angeles
    affords no basis for further inquiry here.

30. *Waiver Request.* Following the merger, FTS will own the licenses of
    KSTU(TV) and KTVX(TV), Salt Lake City, Utah, both of which are tied
    for first in audience share in the Salt Lake City DMA according to
    the most recent all-day (9:00 a.m. -- midnight) data published by
    Nielsen Media Research. FTS acknowledges that common ownership of
    KSTU(TV) and KTVX(TV) would violate the television duopoly rule
    because the stations' Grade B contours overlap, and both are ranked
    within the top four in the Salt Lake City DMA in terms of audience
    share. FTS, however, requests a temporary waiver of 12 months from
    consummation of the merger to make such divestitures as are
    necessary to come into compliance with the television duopoly rule
    in Salt Lake City. FTS argues that the Commission typically grants
    temporary waivers to accommodate multi-station transactions. FTS
    also asserts that a twelve-month temporary waiver is appropriate in
    this instance given the magnitude of the total divestiture required
    to comply with both the television duopoly rule and national
    audience reach cap.

31. As noted above, the applications here involve the assignment of ten
    television stations. As FTS has noted, several of our past decisions
    have found temporary waiver of our multiple ownership rules
    appropriate in order to facilitate multi-station transactions,
    especially when the waiver was incidental to the larger
    transaction.[^35] We continue to weigh requests for temporary
    waivers against our underlying goals of diversity and competition in
    the broadcast marketplace.[^36]

32. After a careful review of the record, we conclude that allowing FTS
    a limited period of time following consummation of the transaction
    to come into compliance with the television duopoly rule in the Salt
    Lake City market will not disserve the public interest. The stations
    to be commonly owned will represent only a small portion of this
    relatively large transaction. In addition, the temporary waiver's
    effect on competition and diversity is somewhat less consequential
    given the level of competition and diversity that already exists in
    the Salt Lake City market. Ten independently owned and operating
    commercial and noncommercial television stations, and a total of 30
    broadcast media voices, will remain within the Salt Lake City market
    post-merger during the short period of common ownership of KSTU(TV)
    and KTVX(TV). Our conclusion here comports with previous decisions,
    in which the Commission granted temporary waivers of the television
    duopoly rule in markets where a similar number of voices remained
    during the period of common ownership.[^37]

    33\. In previous multiple station transactions involving temporary
    waiver requests, we have attempted to avoid any forced sale of
    station assets that could unnecessarily restrict the value of the
    stations to be divested and could artificially limit the range of
    potential buyers.[^38] Though FTS requests one year to come into
    compliance with the television duopoly rule, it cites no cases
    involving only television station divestitures where we have granted
    more than a 6-month temporary waiver to come into compliance with
    that rule. We generally eschew granting 12-month waivers in such
    circumstances. Moreover, FTS has provided no evidence that either
    prevailing market conditions or FTS's own financial condition are
    such that providing 6 months to come into compliance with the
    television duopoly rule would result in a forced sale.[^39]
    Consequently, we will deny FTS's request for a 12-month temporary
    waiver, and instead grant a 6-month temporary waiver of the
    television duopoly rule. We believe that a 6-month temporary waiver
    better balances our intention to avoid a forced sale with our
    concern for diversity and competition in the Salt Lake City market.
    We will also prohibit FTS from divesting the station to any party
    whose acquisition of FTS's station would require waiver of the
    television duopoly rule.[^40]

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VI. **VI. TELEVISION/NEWSPAPER CROSS-OWNERSHIP RULE**

    34\. *Background.* As discussed above, FTS, the licensee of
    WNYW(TV), New York, New York, seeks to become the licensee of
    WWOR-TV, Secaucus, New Jersey, which is in the New York City
    DMA.[^41] This combination, by itself, is in accord with our eight
    voice/top four-ranked standard for permissible television
    duopolies.[^42] FTS and Mr. Murdoch also hold a permanent waiver of
    the broadcast/newspaper cross-ownership rule[^43] which authorized
    the common ownership of WNYW(TV) and the *New York Post*.[^44] FTS
    does not request the issuance of another permanent waiver permitting
    common ownership of WNYW(TV) and the *Post* but instead argues that
    the permanent waiver, combined with our recent decision relaxing the
    duopoly rule in certain contexts,[^45] permits it to acquire WWOR-TV
    without the need for an additional waiver. In the alternative, FTS
    argues that it should be granted an interim waiver of the
    broadcast/newspaper cross-ownership rule pending the outcome of a
    rulemaking regarding the revision or abolition of that restriction.
    FTS contends that failure to grant a waiver for any lesser period of
    time will create uncertainty in its relationships with subscribers,
    advertisers and unions that could further undermine the financial
    viability of the *Post.* The Petitioners claim that FTS has failed
    to demonstrate that its existing waiver automatically encompasses
    the second New York station that it seeks to retain or that an
    interim waiver would serve the public interest.

    35\. In 1985, Mr. Murdoch, as the controlling principal of the News
    Corp. subsidiary News America Television Incorporated, acquired
    WNYW(TV) in connection with a multi-station, multi-market
    transaction by which 7 full-service broadcast television stations
    were acquired from Metromedia Radio and Television, Inc. At that
    time, Mr. Murdoch controlled the *Post*, which had been acquired
    in 1976. As a condition to the grant of the application, Mr. Murdoch
    was required to divest his interest in the *Post* within two years
    in order to conform to the requirements of the broadcast/newspaper
    cross-ownership rule.[^46] In March 1988, News Corp complied with
    the condition, selling its interest in the *Post* to a company
    controlled by real estate developer Peter S. Kalikow. Following his
    personal bankruptcy, Mr. Kalikow was unable to support the *Post*'s
    operations as he had planned with funds from his real estate
    holdings. As a result, Mr. Kalikow made several unsuccessful
    attempts to secure alternate funding for the *Post*. After these
    attempts failed, Mr. Kalikow placed the *Post's* parent company in
    bankruptcy. During the bankruptcy proceeding, Mr. Murdoch agreed to
    assume management of the paper conditioned upon obtaining a
    permanent waiver of the cross-ownership rule and his making an offer
    to purchase the *Post's* assets. Subsequently, Mr. Murdoch sought a
    waiver from the Commission that would permit a News Corp. subsidiary
    to acquire the *Post* and allow FTS to retain the license of
    WNYW(TV).

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36. Mr. Murdoch based the request for permanent waiver of the
    television/newspaper cross-ownership rule on two grounds. First, he
    argued that he was the only "viable" purchaser who demonstrated a
    willingness to undertake the financial burden of stabilizing and
    revitalizing the *Post*. Mr. Murdoch stated that his commitment to
    the *Post* involved infusing up to \$350,000 in cash per week, as
    well as providing managerial, technical and editorial skills
    necessary to operate the *Post* in the highly competitive New York
    market.[^47] He contended that a strict application of the
    television/newspaper cross-ownership rule would disserve the
    underlying policy of diversity by eliminating an important voice in
    the New York market. Second, as support for his contention that
    permitting common ownership of the *Post* and WNYW(TV) would not
    unduly impact diversity in the New York market, he noted that the
    New York City area of dominant influence (ADI) contained "20
    television stations, 97 AM and FM radio stations, 62 percent cable
    penetration and cable systems providing at least 56 different
    satellite-delivered program services, 36 daily newspapers with an
    average aggregate daily circulation of 4.5 million, and 338 weekly
    newspapers."[^48] Given the size and competitive nature of the New
    York market, Mr. Murdoch maintained that common ownership of
    WNYW(TV) and the *Post* would preserve diversity by rescuing "an
    important competitive voice and source of viewpoint diversity,"
    without resulting in either excessive media control or competitive
    advantage to Fox.[^49]

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33. The Commission analyzed the waiver request by examining the "special
    circumstances" under which the proposed combination was to be
    formed, and by assessing the diversity and competitiveness of the
    New York City market. The Commission concluded that the request had
    been amply justified, "comporting with the high burden necessary to
    warrant grant of a waiver" of the television/newspaper
    cross-ownership rule.[^50] With respect to the "special
    circumstances," the Commission looked to the financial condition of
    the *Post*, whose bankrupt status threatened the existence of a
    media voice in the New York market.[^51] The Commission stated that
    the substantial funds necessary for capital improvements and for
    continuing operating losses raised an issue as to whether any
    alternative buyer would be willing to risk future liabilities of
    such magnitude in order to preserve the *Post* as an alternative
    voice. Consequently, the Commission concluded that Mr. Murdoch's
    involvement with the *Post* may have been "pivotal to the
    newspaper's survival."[^52]

34. With respect to diversity and competition, the Commission found that
    any cost to diversity resulting from common ownership of WNYW(TV)
    and the *Post* would be outweighed by the benefit to diversity that
    would result from preservation of the *Post* as a viable voice.[^53]
    The Commission further found that "\[g\]iven the wide array of
    voices in New York City, any detriment to diversity caused by common
    ownership of two media outlets would be negligible," even were one
    to consider only full-service television stations and the four daily
    newspapers then serving the New York market.[^54] In addition, the
    Commission determined that the proposed combination would not result
    in undue market concentration as the addition of the *Post* would
    only add 1% to FTS's 5% share of the combined television-newspaper
    advertising market.[^55] The Commission, therefore, concluded that
    grant of the waiver would not disserve the twin purposes of the
    television/newspaper cross-ownership rule, diversity and
    competition.[^56] In deciding to grant a permanent rather than a
    temporary waiver, the Commission concluded that failure to do so
    would hamper the *Post* in its attempts to attract advertisers and
    readers and to negotiate with labor unions, suppliers, and
    distributors. The Commission believed that only a permanent waiver
    could provide the degree of certainty that was necessary to
    revitalize the bankrupt *Post*.[^57]

35. *Discussion.* Section 73.3555(d)(3) of the Commission's rules
    provides that "no license for \[a\] ...TV broadcast station shall be
    granted to any party (including all parties under common control) if
    such party directly or indirectly owns, operates, or controls a
    daily newspaper and the grant of such license will result in" the
    Grade A contour of that television station encompassing the entire
    community in which such newspaper is published.[^58] Though FTS has
    a permanent waiver for its WNYW(TV)/*New York Post* combination, the
    proposed transaction will result in FTS owning a second New York
    television station, WWOR-TV, whose Grade A contour will also
    encompass the entire community in which the *Post* is published. FTS
    is not requesting an additional permanent waiver, but instead
    contends that its existing permanent waiver is adequate to permit
    the new combination. In the alternative, FTS contends that it is
    appropriate and consistent with past practice for the Commission to
    issue an interim waiver permitting common ownership of WNYW(TV),
    WWOR-TV, and the *Post* until conclusion of a proceeding to consider
    relaxation of the broadcast/newspaper cross-ownership rule.
    According to FTS, "examination of a renewed permanent waiver request
    now would be an inefficient use of the Commission's limited
    resources given that the cross-ownership rule ultimately may be
    relaxed to permit the cross-ownership in question."[^59]

36. The original waiver was based on the particular combination of
    WNYW(TV) and the *Post* under the control of Mr. Murdoch and News
    Corp. The original waiver did not contemplate the addition of a
    second New York DMA television station to that combination. We agree
    with the Petitioners that the original waiver is not adequate to
    allow the combination requested here. As we recently noted in our
    ownership proceedings, a waiver granted under market conditions that
    exist at a given place and time is not automatically extended to
    cover new combinations several years later under potentially changed
    market conditions.[^60] By adding a new television station to the
    existing combination of WNYW(TV) and the *Post*, the proposed
    transaction clearly would create a new television/newspaper
    combination not contemplated at the time the original waiver was
    granted. Therefore, a new waiver of the television/newspaper
    cross-ownership rule is necessary in order to permit the combination
    requested here.

37. With respect to the requested waiver pending the outcome of any
    future television/newspaper cross-ownership rulemaking, FTS cites
    one instance involving the Tribune Company where it contends that
    the Commission provided a similar waiver of the television/newspaper
    cross-ownership rule.[^61] In the Tribune proceeding, the Commission
    deferred consideration of the waiver until after the outcome of the
    Commission's review of the television/newspaper cross-ownership rule
    in the 1998 biennial review of the ownership rules. In the *Biennial
    Review Report*, we extended the waiver until the conclusion of the
    television/newspaper cross-ownership rulemaking.[^62] That decision
    was predicated on the unusual circumstances that led to extension of
    the waiver; in particular, the fact that the Commission had not
    clearly articulated its policy on interim waivers prior to that
    time. In a subsequent Tribune proceeding, however, we cautioned
    future applicants that it "should now be clear that the mere
    initiation of a proceeding stating that the rule would be examined,
    or merely the fact that such a proceeding was on the horizon, would
    not be sufficient to warrant an interim waiver."[^63] Consequently,
    we will not grant FTS an "interim" waiver as requested.

38. Although we believe that neither a permanent nor a
    rulemaking-conditioned waiver is warranted in this case, we do
    believe that a temporary waiver of the television/newspaper
    cross-ownership rule is appropriate. In multiple-station,
    multiple-market merger transactions, such as presented here, it is
    not uncommon for the combined properties of the merged entity to
    create violations of the Commission's ownership rules in some
    markets. In these circumstances, the Commission has granted
    temporary waivers of its rules, including the television/newspaper
    restriction, to permit an orderly disposition of assets and avoid
    forced sales.[^64] We have concluded that such transactional
    accommodation serves that public interest by promoting the free
    alienability of broadcast properties.[^65] In evaluating the
    propriety and nature of such waivers, we assess the need for the
    waiver and the harm to the goals underlying the relevant rule as a
    result of the waiver. The rule barring the common ownership of
    broadcast stations and newspapers grew out of our twin goals of
    maximizing diversity, while preventing undue concentration.[^66]

39. With respect to diversity within the New York market, standard
    industry sources indicate that the New York market is made up of
    6,918,600 households, with 6,874,900 television households spread
    out across 29 counties in parts of four states.[^67] If we permit
    the requested common ownership of WWOR-TV and WNYW(TV), the New York
    DMA will still have at least 19 independent television voices.[^68]
    Over 120 commercial and noncommercial radio stations are licensed to
    communities within the New York DMA, with over 65 independently
    owned and operated radio station groups. New York's cable
    penetration rate is 74%, with at least 8 independent cable operators
    providing service in the market.[^69] Finally, according to FTS, 25
    daily newspapers are published in the DMA, as well as hundreds of
    local weeklies.

40. Of the 5 major daily newspapers in New York ranked by circulation,
    the *Post* ranks last. The *Post* covers 5.3% of New York households
    on any given day and accounts for less than 4% of advertising
    revenues among the top 5 newspapers. By contrast, the top-ranked
    *New York Daily News* covers 9.9% of households and receives 18.2%
    of advertising revenue and the second-ranked *New York Times* covers
    9.4% of households while receiving 45.3% of advertising
    revenue.[^70] FTS represents that in response to the competitive
    pressures from these other papers, the *Post* cut its newsstand
    price from \$.50 to \$.25 in September, 2000. As evidence of its
    commitment to the *Post*, in spite of its apparently weak
    competitive position, News Corp. notes that it has committed to
    further investment in the paper, including building a \$250 million
    printing facility in the South Bronx.

    45\. As a result of the diverse nature of the New York market,[^71]
    the clearly non-dominant position of the *Post* in that market, as
    well as the *Post's* unique history of significant financial
    difficulties,[^72] we conclude that it would be in the public
    interest to grant FTS a temporary 24-month period within which to
    come into compliance with the television/newspaper cross-ownership
    rule in the New York market, to the extent compliance has not been
    waived by the existing waiver permitting common ownership of
    WNYW(TV) and the *Post*. A temporary loss of diversity, if any, in
    the New York market during this period will be outweighed by the
    benefits of permitting an orderly sale to a qualified buyer
    committed to preserving the *Post* as a media voice.[^73] We note
    that grant of a 24-month temporary waiver here is consistent with
    our treatment of the television/newspaper combination created when
    Mr. Murdoch originally acquired WNYW(TV).[^74] We further believe
    that the competitive position of the *Post* may be vulnerable and
    thus any shorter period of time to come into compliance would run a
    substantial risk of a forced sale. Under these circumstances, the
    24-month period afforded FTS will commence from the date of
    consummation of the instant transaction.

# VII. Administrative Matters

46\. We have reviewed the proposed merger and the related pleadings and
find that the applicants are fully qualified and that grant of the
assignment of the licenses controlled by Chris-Craft to Fox Television
Stations will serve the public interest, convenience, and necessity.

47. Accordingly, IT IS ORDERED, That the Motion to Dismiss Application
    filed by the Office of Communication, Inc. of the United Church of
    Christ, Academy of Latino Leaders in Action, Black Citizens for a
    Fair Media, Center for Media Education, Consumer Federation of
    America, Consumer's Union, New York Metropolitan Association of the
    United Church of Christ, Rainbow/PUSH Coalition, and Valley
    Community Access Television IS DENIED, and That the petition to deny
    is GRANTED IN PART, and DENIED IN ALL OTHER RESPECTS.

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41. IT IS FURTHER ORDERED, That the request for 12 months to come into
    compliance with the national television ownership cap, Section
    73.3555(e), IS GRANTED, and THAT within 12 months of the issuance of
    a final order in *Fox Television Stations, Inc. v. FCC*, Dkt. No.
    00-1222, *et al.* (D.C. Cir. 2001), that is no longer subject to
    judicial review, upholding the national broadcast television
    ownership cap, or any other order dismissing the issues raised
    therein, Fox Television Stations is directed to file any application
    or applications that may be necessary at that time to reduce its
    aggregate national audience reach to its pre-merger level.

42. IT IS FURTHER ORDERED, That the request for 12 months to come into
    compliance with the television duopoly rule, Section 73.3555(b), in
    the Salt Lake City market IS DENIED, however, we GRANT a temporary
    6-month period from the date of consummation of the instant
    transaction for Fox Television Stations to file the application
    necessary to bring it into compliance in the Salt Lake City market.

43. IT IS FURTHER ORDERED, That from the date of consummation of the
    instant transaction, Fox Television Stations IS GRANTED a temporary
    24-month period within which to come into compliance with the
    television/newspaper cross-ownership rule, 47 C.F.R. §73.3555(d)(3),
    insofar as it is necessary under our rules at that time, and to the
    extent compliance has not been waived by the existing waiver
    permitting common ownership of WNYW(TV) and the *Post*.

44. Accordingly, IT IS ORDERED, That the applications for consent to the
    assignment of the Chris-Craft broadcast station licenses,
    applications BALCT-20000918ABB-ABD, ABF, ABK, ABL-ABN, ABU, ABY and
    BALTT-20000918ABG-ABJ, ABO-ABS, ABV-ABX, and ABZ-ACE, ARE GRANTED.

### FEDERAL COMMUNICATIONS COMMISSION {#federal-communications-commission .unnumbered}

Magalie Roman Salas

Secretary

EXHIBIT A

FULL-SERVICE STATIONS TO BE ASSIGNED

> KBHK-TV, San Francisco, California Facility I.D. 69619
>
> KCOP-TV, Los Angeles, California Facility I.D. 33742
>
> KMOL-TV, San Antonio, Texas Facility I.D. 69618
>
> KPTV(TV), Portland, Oregon Facility I.D. 50633
>
> WUTB(TV), Baltimore, Maryland Facility I.D. 60552
>
> WWOR-TV, Secaucus, New Jersey Facility I.D. 74197
>
> WRBW(TV), Orlando, Florida Facility I.D. 54940
>
> KMSP-TV, Minneapolis, Minnesota Facility I.D. 68883
>
> KTVX(TV), Salt Lake City, Utah Facility I.D. 68889
>
> KUTP(TV), Phoenix, Arizona Facility I.D. 68886

EXHIBIT B

OWNERSHIP STRUCTURE ORIGINALLY APPROVED IN *FOX II*

76% of voting stock

\<1% of equity

24% of voting stock

CURRENT OWNERSHIP STRUCTURE OF FOX TELEVISION STATIONS, INC.

(FOLLOWING COMMISSION APPROVAL OF *PRO FORMA* REORGANIZATION)

76% of voting stock 76% of voting stock

\<1% of equity

80% to 85% of equity

15% to 20% of equity

\>99% of equity

24% of voting stock

100%

OWNERSHIP STRUCTURE FOLLOWING ACQUISITION OF CHRIS-CRAFT STATIONS

76% of voting stock

\<1% of equity

85.25% of equity

14.75% of equity

\>99% of equity

24% of voting stock

100%

100%

L

**July 25, 2001**

**STATEMENT OF CHAIRMAN MICHAEL K. POWELL**

Re: *Assignment of Broadcast Licenses Held by Subsidiaries of
Chris-Craft Industries, Inc., to Fox Television Stations, Inc.*

Today the Commission approved the assignment of certain licenses from
Chris Craft Industries, Inc. to Fox Television Stations, Inc., finding
the assignment to be in the public interest. The Commission conditioned
its approval on the divestiture of various assets in order to bring the
company into compliance with our broadcast ownership rules. I write
separately to highlight the basis upon which the Commission found the
transaction to be in the public interest; and, to challenge the
suggestion by the minority that the Commission has somehow abandoned its
public interest obligation. To the contrary, today's decision affirms
the fact that Commission rules and long standing Commission precedent
guide our public interest deliberations.

**I. THE PUBLIC INTEREST STANDARD**

The Commission is required to examine a license transfer (often in the
context of a merger) and must affirmatively find that the transfer is in
the public interest.[^75]

In the context of mass media transactions, the Commission\'s analysis is
simplified by the extensive structural ownership rules Congress and the
Commission have promulgated. The benefits of these prophylactic rules
are that they are clear and provide some certainty to marketplace
participants. They have the additional benefit of administrative
efficiency in reviewing combinations.

The extensive rulemaking proceedings used to develop the broadcast
ownership rules take full account of the Commission\'s diversity goals
and concentration concerns. These rules squarely embody the Commission's
public interest goals of limiting the effect of market power and
promoting diversity of viewpoints in the market.[^76] A transaction that
complies with structural rules designed to advance the public interest
(when they exist), should not be subject to further ad hoc review;
otherwise the exalted benefits of such rules would be eviscerated.

In other areas, Congress and the Commission have not set out strict
structural rules. As a result, the Commission reviews these transactions
in a more case specific manner. This is the case with telephone mergers.
In this area there are no rules on the number of lines or central
offices that a company may own. As a result, the Commission developed a
four-prong test to guide its review in such cases. The analytical
framework suggested by the minority would have the Commission overlay
this four-prong test, or some other equally ambiguous standard, on top
of our structural rules, to determine if the transaction would
"*otherwise* serve the public interest." I fail to see the wisdom of
this redundancy, applying two bodies of law designed to achieve the same
basic objectives.

### II. PUBLIC INTEREST FINDINGS

This transaction contravenes three of the Commission's broadcast
ownership rules; the national ownership cap,[^77] the local television
multiple ownership rule,[^78] and the television/newspaper
cross-ownership rule.[^79] The Commission *specifically* conditioned its
approval on the licensee's compliance with these rules. Consistent with
long-standing Commission precedent, the *Order* gives the licensee a
reasonable amount of time to divest assets in order to comply with our
rules. In so doing, the *Order* conducts a public interest test under
each rule; weighing the request for a temporary waiver against our
underlying goals of diversity and competition in the broadcast
marketplace.[^80]

For example, with regard to the national ownership cap, the *Order*
finds; "The Commission has consistently determined that in multiple
station transactions the overall benefits of allowing time for an
orderly transition will outweigh any temporary impact on diversity and
competition from common ownership during a reasonable period following
grant of the application."[^81] The *Order* further notes that "given
the size of the proposed transaction, the practical difficulties of
divesting the necessary stations, and our policy of avoiding forced
sales, ... the advantages of granting a ... *temporary waiver* ... will
outweigh any temporary impact on diversity and competition and is in the
public interest."[^82] In regard to the duopoly in Salt Lake City, the
fact that ten independent commercial and non commercial stations and 30
broadcast media voices will remain in the market post merger, provided a
basis for the *Order* to find that a six month waiver from the duopoly
rule would not "disserve the public interest." Furthermore, in granting
the temporary waiver of the television/newspaper cross-ownership rule,
the *Order* points out that the New York market would still have 19
independent TV voices, over 120 commercial and noncommercial radio
stations, 25 daily newspapers and hundreds of weekly papers.[^83]

Given these findings, one is left wondering why the minority so
mischaracterizes the *Order's* grant of compliance periods as somehow
constituting "permanent waivers of the Commission's rules." As is
highlighted above, granting parties a reasonable period of time for
divestiture of assets to satisfy our rules is a long-standing and
well-settled Commission principle**.** *See Shareholders of CBS
Corporation*, 15 FCC Rcd 8230, 8236 (2000) (Commission grants 12 months
for company to comply with the national ownership cap)*; AT&T/MediaOne*,
15 FCC Rcd 9816 (2000) (Commission grants slightly under 12 months for
company to divest assets to comply with the cable horizontal ownership
cap). The Commission is not unique in this regard. In its antitrust
review of mergers, the Department of Justice and the Federal Trade
Commission typically provide parties with a reasonable amount of time
for divestiture in order to come into compliance with the antitrust
statutes. I find it fantastic that the minority would characterize these
divestiture periods as deviations from our rules in order to approve the
transaction.

**III.** **FOREIGN OWNERSHIP**

The Commission takes seriously the statutory limits placed on certain
transactions. Under Section 310(b)(4) of the Communications Act,
Congress prohibits the grant of a license to "any corporation directly
or indirectly controlled by any other corporation of which more than one
fourth of the capital stock is owned of record or voted by aliens ... or
by any corporation organized under the laws of a foreign country, if the
Commission finds that the public interest will be served by the
revocation or refusal of such license."[^84]

In 1995, the Commission, pursuant to the requirements of Section
310(b)(4), found that, although News Corp.\'s interest in Twentieth
Holdings Corporation (the parent of Fox Television Stations ("FTS" or
"Fox")) exceeded the 25% benchmark established in Section 310(b)(4), the
ownership structure was in the public interest.[^85] The Commission also
held that, "it would disserve the public interest to confine our
decision to stations FTS already owns, for doing so would unnecessarily
hinder the company's ability to expand and frustrate its reasonable
expectations for doing so."[^86] The Commission concluded that, "FTS, as
presently structured may, consistent with the public interest, acquire
additional broadcast stations."[^87] As the Order discusses in detail,
the corporate structure present here is consistent with our previous Fox
decision.[^88] The claim that News Corp/Newco, rather than FTS, controls
the stations is simply not consistent with Commission precedent.

The Commission's analysis of the station's locus of control generally
rests on three factors; programming, personnel and finances. FTS will
have the ultimate control and decision making authority in each of these
three areas: all of its programming activities are subject to the
approval and control of FTS; the general manager and all of the
department heads of each station report to FTS; and FTS controls the
budget process.[^89] The Office of General Counsel and the Mass Media
Bureau found that the proposed ownership structure complies with the
Commission's 1995 Fox decision; thereby concluding that no additional
public interest analysis is necessary under Section 310(b)(4). I have
the highest confidence in the independent legal analysis and judgment of
the Commission staff in reaching this conclusion.

The minority's strained effort to distinguish the corporate structure
presented in this transaction from the prior Fox decision is not
persuasive. By elevating "form over substance," the minority essentially
presents the Commission with two alternatives. We could undo the 1995
Fox decision, that created for the first time in the history of
television, a competitive fourth network that provides a uniquely
diverse voice in American political discourse; or turn the clock back to
1995 and freeze the company forever as it existed at that time in an
environment in which its competitors are not similarly restrained. One
is left to wonder why anyone who places a high value on diversity of
voices and competition in the media marketplace would find either result
serves the public interest.

### IV. CONCLUSION

In short, where there are clearly applicable structural rules,
reflecting the Commission\'s or Congress\' diversity and concentration
judgments, I believe a license transfer to be in the public interest if
the parties satisfy the rule. As is the case here, in multiple-station,
multiple market transactions, it is common for the combined entity to
create temporary violations of our ownership rules. Consistent with
Commission precedent, however, the *Orde*r balances the grant of a
compliance period, against any potential harm to the goals underlying
the rule. Beyond this detailed analysis, engaging in an additional, more
subjective, evaluation using some ambiguous standard is unnecessarily
complex and redundant. This additional burden places more weight on a
review process that is already laboring under the demands of a
fast-paced, innovation-driven marketplace.

Finally, on behalf of the agency, I feel compelled to address
Commissioner Tristani's assertion that; "the decision also shows the
lengths the Commission will go to avoid standing in the way of media
mergers." While we may have a respectful disagreement over the public
interest standard and the rote application of the four-prong test in
license transfers, this sweeping assertion is not only offensive, but
absurd. If the majority was on the crusade she suggests, then the
Commission would have granted permanent waivers of our rules, which it
clearly did not.

**SEPARATE STATEMENT OF COMMISSIONER KATHLEEN ABERNATHY**

***In re: Transfer of Control of Broadcast Licenses Held By Subsidiaries
of Chris-Craft Industries Inc. to Fox Television Stations Inc, File nos.
BALCT-20000918ABB, et al (rel. July 25, 2001).***

I support today's decision to grant the applications of Fox and
Chris-Craft to transfer certain broadcasting authorizations. I write
separately to briefly express my views on a few aspects of today's
decision.

The issues presented by this transaction were by no means frivolous.
Indeed the transfer, absent the conditions imposed today, would run
afoul of our existing national ownership cap, local television ownership
rules, and the television/newspaper cross-ownership rule. While some
have expressed significant doubts about the continued utility of some of
these rules, an adjudication is not the appropriate venue for revisiting
these rules. When that day comes, I have no doubt all interested parties
will whole-heartedly engage in the debate. In the interim, we have an
obligation to enforce our rules as written.

Today's item does enforce our rules, while also balancing the business
needs of the parties to have an orderly transition for the new company.
In this regard, I believe the size and scope of today's marketplace
demands the flexibility afforded by temporary waivers of our rules that
allows companies a grace period to come into compliance post-closing.
Any other approach would needlessly require parties to engage in fire
sales prior to closing in hopes that their government will ultimately
approve the transaction. Having been on all sides of these transactions
-- as an FCC employee, a businesswoman, and a private attorney -- I do
not believe a forced restructuring prior to government approval best
serves the public interest.

As the dissenters note, this transaction also presented issues regarding
the nature of the foreign ownership structure of Fox under Section 310
of the Act. The Commission initially approved the ownership structure of
Fox in *Fox Television Stations Inc.,*10 FCC Rcd. 8452 (1995). I believe
the Fox ownership structure set forth in today's item is consistent with
that decision.

The Commission's 1995 precedent does not require that every element of
the exact structure of Fox remain set in stone for eternity in order for
additional stations to be added. That approach ignores the reality of
today's changing marketplace and would unnecessarily tie the hands of
this robust and relatively new competitor. Since the structure of Fox
after this transaction is consistent with the essential elements of our
1995 Fox decision, it is not necessary to revisit that analysis here

I also write separately to emphasize the importance of the Commission
acting on these types of applications quickly. Today's marketplace is
extremely dynamic -- delays of ten months simply will not do. Such a
delay means ten months of uncertainty, delayed investment, and untold
transaction costs. The American people and the parties to this
transaction deserve better service from their government. Regardless of
the outcome, the Commission owes it to its customers to provide prompt
and clear answers to regulatory questions -- regardless of how
difficult. I look forward to working with my colleagues to ensure that
future applications move through the Commission with considerably more
dispatch.

July 24, 2001

**Dissenting Statement of Commissioner Gloria Tristani**

*Re: Transfer of Control of Broadcast Licenses Held by Subsidiaries of
Chris-Craft Industries, Inc., to Fox Television Stations, Inc.*

I dissent from today's decision to permit Fox to acquire ten television
stations from Chris-Craft. The transfer of these television station
licenses violates the Communications Act and raises serious concerns
regarding the ongoing concentration in the ownership of television
stations and other media. This decision also shows the lengths the
Commission will go to avoid standing in the way of media mergers.

Moreover, the majority ignores the effect of the Fox/Chris-Craft merger
on one of the Communications Act's fundamental purposes -- maintaining a
diversity of viewpoints and voices. Preserving and promoting a diverse
media is essential to our democracy. Today's decision further diminishes
the marketplace of ideas.

There are several significant problems with the majority's decision.
First, today's decision effectively eliminates the requirement that
merger applicants demonstrate to the FCC that their license transfer
would serve the public interest. The majority fails to identify a single
public interest benefit resulting from this merger. The Communications
Act, however, directs the FCC to permit a broadcast license to be
transferred *only* if "the public interest, convenience, and necessity
would be served thereby."[^90]

In the context of license transfers, the Commission has required merger
applicants to pass a four-part test.[^91] In the application before us,
however, the Commission discusses only two of those four factors, the
facts of which are not in dispute:

> \(a\) **Does the transaction violate the Communications Act?**
> [Answer:]{.underline} Yes, it allows a single company to own
> television stations that will reach more than 35% of the national
> audience, in violation of the 1996 Telecommunications Act.
>
> \(b\) **Does the transaction violate the Commission's rules?**
> [Answer:]{.underline} Yes, in three ways. The transaction violates the
> FCC's newspaper-broadcast cross-ownership proscription, the national
> television ownership cap, and the local television ownership limits.

Even using the Order's own incomplete version of the public interest
test, the transaction clearly should not be approved. The decision finds
that the newly-merged Fox/Chris-Craft will violate the Communications
Act and the FCC's rules, and the decision identifies no offsetting
benefits. Yet the majority deems this transaction to be in the public
interest and proceeds to grant waivers of our most significant
television ownership rules so that Fox can close its transaction.

The scope of today's decision should not be obscured by the piecemeal
nature of the waivers Fox has received. Today's decision grants Fox
waivers of three of the most critical broadcast ownership limitations --
the national ownership cap, the television-newspaper cross-ownership
restriction, and the local duopoly rule for ownership of television
stations. Collectively, the grant of these waivers -- and they are
waivers, no matter how else they might be characterized by others \--
signals that no matter how many rule violations would result from a
proposed broadcast transaction, this Commission will find a way to let
the deal go through. In fact, the newspaper-broadcast waiver issued
today shows how far the Commission will go in order to avoid scuttling
the sale of televisions stations. In seeking a waiver of the
newspaper-television cross-ownership ban for New York City, Fox put
forth two rationales, both of which the Order rejects. But the majority
then goes on to supply reasoning Fox never even proposed and grants the
waiver![^92]

The Chairman's proposition in his separate statement that the public
interest is demonstrated by compliance (or in the case of
Fox/Chris-Craft*, expected future compliance*) with existing FCC rules
is misplaced. The public interest requirement is an independent one that
permeates, and is embodied in, the Communications Act. It is not vague
or ambiguous as the Chairman suggests but is a standard that must be
satisfied by every broadcast licensee that seeks to transfer its
license. Section 310(d) states that "No construction permit or station
license ... shall be transferred ... to any person except upon
application to the Commission and upon finding by the Commission that
the public interest, convenience, and necessity will be served
thereby."[^93] Had Congress intended to permit license transfers upon a
mechanical showing of compliance with existing rules, it would have said
so in the Communications Act.

The public interest requirement is also an independent one in the
context of telephone mergers. There are specific pro-competition rules
that are just as fundamental to the telephone industry as the ownership
rules are to the broadcast industry, yet the FCC has consistently
required more than mere compliance with these rules in order for
telephone mergers to be approved. For example, in the Qwest-U S WEST
merger, the FCC conducted an exhaustive analysis on the record to ensure
that the merged entity would not violate the restriction on Bell Company
provision of in-region long distance service prior to receiving 271
approval.[^94] That analysis was the beginning, rather than the end, of
the public interest analysis in that merger. The Commission then went on
to identify specific public interest benefits to that merger.[^95]
Consequently, I cannot agree that mere compliance with existing rules
satisfies the public interest.

Second, this Order allows a foreign corporation to control ten
television stations in the United States, in violation of Section 310(b)
of the Communications Act. That provision prohibits a corporation that
is more than 25% foreign-owned from holding an FCC-issued broadcast
license unless the FCC determines that such ownership would serve the
public interest. In a pair of 1995 decisions that serve as a backdrop to
today's decision, the FCC found that News Corp, a foreign-owned
corporation, should be permitted (through its subsidiaries) to own U.S.
television stations because: (1) Rupert Murdoch himself was an American
citizen and would, through Fox Television (FTS), his majority-owned
company, control the stations; and (2) because the tax consequences of
not allowing News Corp to own the stations would be significant.[^96]

In seeking to acquire Chris-Craft, Fox has created a new subsidiary
(Newco) that is 85% owned by a foreign company, News Corp. Fox had
initially planned to let Newco own the Chris-Craft stations and run them
on a day-to-day basis. After receiving indications from Commission staff
that the proposed structure might result in the Chris-Craft stations
being under the control of the foreign-owned Newco, Fox restructured the
proposed relationship in an attempt to show that Murdoch/FTS, not News
Corp/Newco, would control the Chris-Craft stations.

However, the record continues to demonstrate that the Chris-Craft
stations will, as a practical matter, be controlled by the foreign-based
News Corp/Newco rather than by Murdoch/FTS. First, Newco controls all
the assets of the 10 television stations except the bare licenses, earns
85% of the profits from those stations, and bears 85% of the economic
risks. Second, Newco will perform the day-to-day operations of the
stations, including making programming decisions, purchasing equipment,
and employing the stations' personnel.[^97] It is difficult to see how a
company such as Newco that bears virtually all the economic risk of
owning the television stations and that runs the stations on a
day-to-day basis can be said not to control those stations. But that is
what the majority concludes, and in so doing, permits foreign-owned News
Corp/Newco to effectively control ten U.S. television stations without
identifying a single public interest benefit.

The Fox/Chris-Craft decision confirms that this Commission will no
longer give meaningful consideration to the public interest when parties
wish to transfer television broadcast licenses. According to the
majority, even when a proposed transaction would result in sweeping
noncompliance with the Communications Act and our rules *and* where the
Order itself identifies no public interest benefits resulting from the
transaction, the Commission stands ready to approve the license transfer
and will grant as many waivers as it takes to allow the deal to go
forward. The result is another unwarranted reduction in viewpoint
diversity and the marketplace of ideas. I cannot see how this result
serves the public interest. For these reasons, I dissent.

STATEMENT OF COMMISSIONER MICHAEL J. COPPS

Re: *Applications for the Assignment of Chris Craft Television Licenses
to Fox Television Stations, Inc.*

I must respectfully dissent from the approval of this license transfer.
This transaction presents a number of unique and troubling questions. In
the final analysis, I cannot support the grant of an application that
stretches the statutes, denies operative Commission rules and omits
critically important consideration of the public interest.

As I review this and future transactions, I bear in mind my
responsibility to faithfully implement Congressional mandates. The
principal statutory inquiry that we must undertake in any license
transfer is whether the "public interest, convenience, and necessity
will be served by the granting of such application."

In this case, the Applicants claim that, so long as the transfer
complies with the Communications Act and the Commission's rules, "there
is no requirement that applicants make a public interest showing." We
need not even reach that question here, because these license transfer
applications require waivers of operative rules. I recognize that, in
some instances, short-term waivers may be necessary to effectuate a
license transfer that is otherwise in the public interest. But in
approving this transfer, the Commission is granting waivers of three
different ownership rules. Certain of these are long-term waivers that
appear to be based on the anticipation that prior to the termination of
the waivers, the rules may be relaxed such that compliance need
***never*** occur. Sound decisions should not be premised upon
subjective conjecture about how future actions by the courts, Congress
or the Commission may change the law or alter the rules under which we
are instructed to operate.

I am further troubled by today's decision permitting foreign ownership
in circumstances generally proscribed by the Act. The Act expressly
provides that an additional public interest finding is required for a
transfer to a corporation "that is directly or indirectly controlled by
any other corporation of which more than one-fourth of the capital stock
is owned of record or voted by aliens." In its 1995 decision regarding
the acquiring company, the Commission stated that "Section 310(b) was
intended to safeguard domestic station licenses from undue foreign
influence and control." The Commission found that this Congressional
intent, and the national security interests that underlie it, have
"effectively created a presumption in the broadcast area that, absent
special considerations that outweigh the statutory concerns, the public
interest will be served by denying licenses to entities with alien
ownership above 25 percent."

In the same 1995 decision, however, the Commission approved a
transaction and found that for the purposes of the foreign ownership
rules, Fox may continue to acquire television stations "consistent with
the public interest" subject to the same ownership structure. Rather
than explain how the instant transaction would serve the public
interest, or even how the denial of the grant of these applications
would not serve the public interest, Applicants rely entirely on the
going forward approval of the ownership structure in the 1995 Commission
decision. Had I been on the Commission at the time of that decision, I
would not have accepted such an open-ended provision. Accepting the
precedent in this instance, it nevertheless does not appear to me that
this transaction is consistent with the ownership structure that the
Commission approved in 1995 and ratified by a short form assignment and
minimal restructuring in 1998. Although the Applicants have gone to
great lengths to design agreements so that another company technically
holds the station licenses transferred here, that company will not by
any indicia own these stations. Indeed, the ownership and control
schemata underlying this Applicant grow murkier and more Byzantine with
each new iteration.

More fundamentally, today's decision, taken *en toto*, does not even
consider the public interest benefits that could counterbalance the
failure to comply with Commission rules and the granting of waivers.
Some of the waivers at issue here are close calls, and, were they backed
by a showing of the public interest, I might be able to support their
grant. The record of this proceeding, however, is deafeningly silent
when it comes to laying out the benefits to the American people of this
proposed transaction.

I hope that in the future, parties making application to the Commission
will take seriously the provisions of the Communications Act that
require us to evaluate whether a grant serves the public interest. It is
a responsibility that I take with the utmost seriousness and it will
continue to be the critical determination in my decisions on this
Commission.

[^1]: The Chris-Craft subsidiaries involved are: UTV of San Francisco,
    Inc., KCOP Television, Inc., UTV of San Antonio, Inc., Oregon
    Television, Inc., UTV of Baltimore, Inc., WWOR-TV, Inc., and UTV of
    Orlando, Inc. and United Television, Inc., which will be
    collectively referred to as Chris-Craft.

[^2]: The Petitioners also filed a Motion to Dismiss Application,
    arguing that the application is materially incomplete and contains
    inconsistent information. The Petitioners further assert that
    because FTS's application is allegedly incomplete and inconsistent,
    it raises a substantial and material question of fact regarding lack
    of candor. Having reviewed the application in its entirety, we
    conclude that the application is materially complete, and thus we
    are capable of rendering a determination pursuant to Sections 309
    and 310 of the Communications Act of 1934 based on the information
    before us. Having found that the application is materially complete
    and consistent, we reject the Petitioners' assertion that FTS's
    disclosures raise a substantial and material question of fact
    concerning lack of candor.

[^3]: A complete list of the stations to be assigned is attached as
    Exhibit A.

[^4]: Charts describing the corporate structure of the subject companies
    before and after the proposed transaction are attached in Exhibit B.

[^5]: On March 21, 2001, the Internal Revenue Service issued a private
    letter ruling approving the transaction as a tax-free
    reorganization.

[^6]: *See* Amendment to Assignee's Portion of the Application dated
    January 25, 2001, Exhibit No. 1. This amendment was filed in
    response to a letter dated December 21, 2000 from Roy J. Stewart,
    Chief, Mass Media Bureau, to counsel for the applicants (FCC
    Letter). Because the draft Operating Agreement attached to the FCC
    Letter has not been executed, any grant of the instant applications
    will be conditioned upon execution and filing of the final Operating
    Agreement consistent with Commission rules. 47 C.F.R. §73.3613.

[^7]: *VoiceStream Wireless Corporation, Inc., Powertel, Inc.,
    Transferors, and Deutsche Telekom AG, Transferee*, Memorandum
    Opinion and Order (IB Docket No. 00-187), FCC 01-142 (2001), at ¶41.

[^8]: 47 U.S.C. §310(b)(4).

[^9]: *Fox Television Stations*, 10 FCC Rcd 8452 (1995).

[^10]: Holdings was the parent of FTS. As discussed in ¶13, *infra*, in
    a 1998 reorganization, Holdings became FEG, FTS became FTH and a new
    FTS was formed.

[^11]: *Id*. at 8456.

[^12]: *Id.*

[^13]: *Id*. at 8457.

[^14]: *Id*. at 8524.

[^15]: *Fox Television Stations*, 11 FCC Rcd 5714 (1995) (*Fox II*).

[^16]: *Id*. at 5723.

[^17]: *Id.* at 5724.

[^18]: *Id.* at 5725.

[^19]: *Id.* at 5728.

[^20]: *Id.*

[^21]: Even if Newco is not in control of the licenses, Petitioners
    claim that the assignment to FTS would constitute a transfer of
    "bare licenses." However, it is well established that the Commission
    will consider the entirety of the proposed transaction to determine
    whether it involves a bare license. *Douglas County*, 10 FCC Rcd
    10429 (1995). Here, the physical assets are being assigned to a
    related company expressly to be used in the operation of the
    stations. The parties to the Operating Agreement are contractually
    required to transfer the physical assets along with the licenses if
    the stations are subsequently transferred. Therefore, no bare
    license issue is present. *See BBC License Subsidiary*, 10 FCC Rcd
    7926, n.1 (1995).

[^22]: *See, e.g., WGPR, Inc.,* 10 FCC Rcd 8140 (1995), *remanded and
    vacated on other grounds*, *sub nom,Serafyn v. FCC*, 149 F.3d 1213
    (1998); *Choctaw Broadcasting Corporation*, 12 FCC Rcd 8534 (1997).

[^23]: *NWCG Holdings Corp.*, 11 FCC Rcd 16318, 16324 (1996).

[^24]: Telecommunications Act of 1996, §202(c)(1); 47 C.F.R.
    §73.3555(e).

[^25]: *See, e.g., Shareholders of CBS Corporation*, 15 FCC Rcd 8230,
    8236 (2000).

[^26]: *Id.* at 8235.

[^27]: We will not require FTS to submit a specific divestiture plan.
    The Commission does not "infer, in the absence of evidence to the
    contrary, that \[a party\] will not faithfully carry out its
    representations." *News International, PLC*, 97 FCC 2d 349, 356
    (1984), *citing*, *KCOP Television, Inc.*, 71 FCC 2d 1430, 1433-34
    (1979).

[^28]: *Amendment of Section 73.3555 of the Commission's Rules Relating
    to Multiple Ownership of AM, FM and Television Broadcast Stations*,
    100 FCC 2d 74, 92 n. 52 (1985).

[^29]: *Review of the Commission's Regulations Governing Television
    Broadcasting (Television Ownership Order)*, 14 FCC Rcd 12903,
    12932 - 12933 (1999).

[^30]: All of the audience share statistics are based on the July 2000
    Nielsen Ratings, the most current statistics available at the time
    the parties filed the assignment applications.

[^31]: Petitioners also state that FTS's acquisition of Chris-Craft
    stations affiliated with UPN "might spell the end of the UPN
    network." The Petitioners do not offer any evidence in support of
    this speculative claim and we will not further consider it here.

[^32]: *Review of the Commission's Regulations Governing Broadcasting,
    Memorandum Opinion and Second Order on Reconsideration*, MM Docket
    No. 91-221, FCC 00-43, ¶9 and ¶17 (released January 19, 2001).

[^33]: *Id.* at ¶44.

[^34]: *Television Ownership Order*, 14 FCC Rcd at 12931.

[^35]: *See, e.g., The Providence Journal Company*, 12 FCC Rcd 2883
    (1997); *Argyle Television, Inc.*, 12 FCC Rcd 10737 (1997).

[^36]: *See LINT Co.*, 15 FCC Rcd 18130, 18133 (2000); *Shareholders of
    CBS Corporation*, 15 FCC Rcd 8230, 8243 (2000).

[^37]: *See, e.g., LINT Co.*, 15 FCC Rcd at 18133 (temporary 6-month
    waiver granted where 13 independently owned and operating commercial
    and noncommercial television stations, and a total of 27
    independently owned broadcast voices remained during period of
    common ownership).

[^38]: *Multimedia, Inc.*, 11 FCC Rcd 4883, 4885 (1995).

[^39]: *Id.*

[^40]: *See LINT Co.*, 15 FCC Rcd at 18130.

[^41]: *See* ¶ 22, *supra*.

[^42]: *See* ¶ 25 *supra*.

[^43]: *See* 47 C.F.R. § 73.3555(d).

[^44]: *Fox Television Stations Inc.*, 8 FCC Rcd 5341 (1993) (*Post
    Waiver*).

[^45]: *Television Ownership Order*, 14 FCC Rcd at 12932.

[^46]: *Metromedia Radio and Television, Inc.*, 102 FCC 2d 1334 (1985),
    *aff'd*, *Health and Medicine Policy Research Group v. FCC*, 807
    F.2d 1038 (D.C. Cir. 1987).

[^47]: *Post Waiver*, 8 FCC Rcd at 5345

[^48]: *Id.*

[^49]: *Id.*

[^50]: *Id.* at 5353.

[^51]: *Id.* at 5349.

[^52]: *Id.* at 5350.

[^53]: *Id.* at 5352.

[^54]: *Id.* at 5351.

[^55]: *Id.* at 5352.

[^56]: *Id.* at 5350.

[^57]: *Id.*

[^58]: 47 C.F.R. §73.3555(d)(3). *See, also, Amendment of Sections
    73.34, 73.240, and 73.636 of the Commission's Rules Relating to
    Multiple Ownership of Standard, FM, and Television Broadcast
    Stations, Second Report and Order*, 50 FCC 2d 1046 (1975) *(Multiple
    Ownership Second Report and Order)*, *recon.*,53 FCC 2d 589 (1975),
    *aff'd sub nom.* *FCC v. National Citizens Comm. For Broadcasting*,
    436 U.S. 775 (1978).

[^59]: *Application of Fox Television Stations for Assignment of
    Licenses Controlled by Chris-Craft Industries, Inc.*, Exhibit 4,
    Section III, page 27 (September 18, 2000).

[^60]: *Review of the Commission's Regulations Governing Television
    Broadcasting, Memorandum Opinion and Second Order on
    Reconsideration*, MM Docket Nos. 91-221, 87-8, FCC 00-431 (released
    January 19, 2001).

[^61]: *Stockholders of Renaissance Communications Corp.*, 13 FCC Rcd
    4717, 4718 (1998).

[^62]: *1998 Biennial Regulatory Review -- Review of the Commission's
    Broadcast Ownership Rules and Other Rules Adopted Pursuant to
    Section 202 of the Telecommunications Act of 1996*, 15 FCC Rcd
    11058, 11109 -- 11110 (2000) (*Biennial Review Report)*.

[^63]: *Id.*; *Stockholders of Renaissance Communications Corp.*, 13 FCC
    Rcd at 4718.

[^64]: Indeed, this is precisely the type of waiver granted to FTS and
    Mr. Murdoch in connection with the purchase of broadcast television
    stations owned by Metromedia Radio and Television, Inc. *See* ¶34,
    *supra*.

[^65]: *Multimedia, Inc.*, 11 FCC Rcd at 4885; *Stockholders of CBS,
    Inc.*, 11 FCC Rcd 3733, 3755 (1995).

[^66]: *Multiple Ownership Second Report and Order*, 50 FCC 2d at 1074.

[^67]: *Broadcasting and Cable Yearbook 2000* at B-211.

[^68]: *BIA Research*, New York, NY Market Overview as of 1/05/2001.

[^69]: *Id.*; *Broadcasting and Cable Yearbook 2000*, at C-4.

[^70]: *Circulation 2000*; Nielsen Media Research AdViews for 1999.
    Figures for the *New York Times* are for the local edition.

[^71]: In the *Biennial Review Report*, we noted that "there may be
    circumstances in which the \[broadcast/newspaper cross-ownership\]
    rule may not be necessary to achieve its intended public interest
    benefits." *Biennial Review Report*, 15 FCC Rcd at 11105. We,
    therefore, determined to institute a rulemaking considering whether
    to tailor the rule accordingly. *Id.*

[^72]: *See Post Waiver*, 8 FCC Rcd 5341.

[^73]: We note that we are not directing the sale of the *Post*. FTS and
    Mr. Murdoch also have the option of selling either of the two
    subject television stations. We are simply requiring that FTS be in
    compliance with our television/newspaper cross-ownership rule within
    24 months from the consummation of the transaction, to the extent
    compliance has not been waived by the existing waiver permitting
    common ownership of WNYW(TV) and the *Post*. If our rules should
    change during that period to permit the proposed combination, then
    FTS and Murdoch will not need to divest the *Post* or one of the
    television stations to come into compliance.

[^74]: *Metromedia Radio and Television, Inc.*, 102 FCC 2d at 1353.

[^75]: Section 310(d) of the Communications Act provides, in pertinent
    part, that the Commission may only grant a proposed license transfer
    if it determines that \"the public interest, convenience, and
    necessity will be served thereby.\" 47 U.S.C. § 310(d).

[^76]: *See, e.g.,* In the Matter of Review of the Commission\'s
    Regulations Governing Television Broadcasting, Television Satellite
    Stations Review of Policy and Rules, MM Docket Nos. 91-221, 87-8,
    FCC 99-209, *Report and Order*, 14 FCC Rcd 12903, ¶¶ 1, 15 (1999)
    (\"ultimate objectives of \[the Commission\'s\] ownership rules are
    to promote diversity and to foster economic competition. . .\"); In
    the Matter of 1998 Biennial Regulatory Review---Review of the
    Commission\'s Broadcast Ownership Rules and Other Rules Adopted
    Pursuant to Section 202 of the Telecommunications Act of 1996, MM
    Docket No. 98-35, FCC 00-191, *Biennial Review Report*, 15 FCC Rcd
    11058, ¶¶ 5-6 (2000); *Time Warner Entertainment Co. v. United
    States*, 211 F.3d 1313, 1320 (D.C. Cir. 2000) (government responded
    \"the promotion of diversity in ideas and speech, as well as the
    preservation of competition, are important governmental interests. .
    .\").

[^77]: Telecommunications Act of 1996, § 202(C)(1); 47 C.F.R. §
    73.3555(e).

[^78]: Review of the Commission's Regulations Governing Television
    Broadcasting (Television Ownership Order), 14 FCC Rcd 12932-12933
    (1999).

[^79]: 47 C.F.R. § 73.3555(d)

[^80]: *See LINT Co.*, 15 FCC Rcd 18130, 18133 (2000); *Shareholders of
    CBS Corporation,* 15 FCC Rcd 8230 (2000).

[^81]: *Shareholders of CBS Corporation,* 15 FCC Rcd at 8236.

[^82]: *Order* at para. 23. (emphasis added)

[^83]: *Order* at para. 43.

[^84]: 47 U.S.C. § 310(b)(4)

[^85]: *Fox Televisision Stations*, 11 FCC Rcd 5714, 5723 (1995)

[^86]: *Id.* at 5728.

[^87]: *Id*.

[^88]: *Order* at para. 19.

[^89]: *Order* at para. 16-18.

[^90]: 47 U.S.C. § 310(d).

[^91]: Just six months ago, the Commission reiterated its four-part
    public interest inquiry for license transfers: (1) whether the
    transaction would result in a violation of the Communications Act;
    (2) whether the transaction would result in a violation of the
    Commission's rules; (3) whether the transaction would substantially
    frustrate or impair the Commission's implementation or enforcement
    of the Communications Act; and (4) whether the transaction promises
    to yield affirmative public interest benefits*. Applications for
    Consent to the Transfer of Control of License and Section 214
    Authorizations by Time Warner Inc. and America Online, Inc.,
    Transferors, to AOL Time Warner., Inc., Transferee,* Memorandum
    Opinion and Order, FCC 01-12 (rel. Jan. 22, 2001).

[^92]: Order at paras. 39-42.

[^93]: 47 U.S.C. § 310(d).

[^94]: *In the Matter of Qwest Communications International, Inc. and US
    WEST, Inc, Applications for Transfer of Control of Domestic and
    International Section 214 and 310 Authorizations and Application to
    Transfer Control of a Submarine Cable Landing License*, Memorandum
    Opinion and Order, FCC 00-91 (rel. Mar. 10, 2000).

[^95]: *Id.* at paras. 56-62.

[^96]: *Fox Television Stations*, 10 FCC Rcd 8452 (1995); *Fox
    Television Stations*, 11 FCC Rcd 5714 (1995).

[^97]: Letter from John Quale and Marvin Diamond, Counsel for
    Chris-Craft Industries, Inc. and William Reyner, Counsel for Fox
    Television Stations, Inc. to Magalie Roman Salas, Federal
    Communications Commission (Jan. 25, 2001) at 10-14.