Rules implementing the Children's TV Act are a way to achieve program diversity. By contrast, rules such as the now repealed fairness doctrine were designed to promote voice diversity. Structural rules promoting outlet and source diversity, however, do not necessarily give us either voice or program diversity. For example, it may well be that if a network could own two stations in a given market, it would be more inclined to program children's TV on one of them, since counterprogramming seems to work well for cable channels. Yet outlet and source diversity were said to be key parts of the Commission's policies of separating broadcast networks from program producers.
Tremendous efficiencies can result from vertical integration between networks and program producers.
In this context, vertical integration can spread the risk of program development and reduces transaction costs. As a result, there is greater up-front investment in programming production and, as a result, better programming. I expect the Commission would have received a complaint that the arrangement violated the financial interest rules, as ABC's interest in the theme park might be viewed as a sort of interest in the eventual success of the Disney programming it received. PTAR is a classic example of the school of thought that believed that national broadcast networks were too big and that the networks wielded extraordinary bargaining power over their affiliates and programming producers. The Commission decreed that for one hour of prime-time each weekday, the networks would be forbidden from providing programming to their affiliates.