Communications Firms Back Provision

Friday, October 27th 2000, 12:00 am

By: News On 6

WASHINGTON (AP) â€” An alliance between commercial broadcasters and public radio has won congressional support to undercut an administration plan to create hundreds of new low-power radio stations.

A provision in a spending measure passed by the House Thursday would significantly scale back the Federal Communications Commission initiative to create a micro-radio service for churches, community groups, and schools.

President Clinton has threatened to veto the bill â€” covering the State, Justice and Commerce departments â€” for other reasons. In a letter to lawmakers, the president also urged them to drop the provision that would curtail the new low-power radio service.

The National Association of Broadcasters has fought the administration's plan, saying it would interfere with existing FM radio. And National Public Radio has argued that the new low-wattage stations could disrupt reading narration services for the blind carried by its members.

The two groups backed a provision which would only allow the FCC to license a limited number of stations so that an independent entity could study potential interference.

FCC Chairman William Kennard railed against corporate interests lobbying Congress behind closed doors to curtail the plan.

``Public interest should always prevail over special interest,'' he said Thursday.

Another provision in the spending bill would offer satellite, cable and wireless companies $1.25 billion in federal loan guarantees to beam local TV signals to rural areas where millions can't get them now.

Under the guarantees, administered by the Agriculture Department, the federal government would promise to cover 80 percent of the loans if the borrower defaults.

But some lawmakers and consumer groups argue that cable companies could use the loan guarantees to upgrade or expand systems they already own, rather than to bring new services to underserved markets.

``Cable monopolies are looking for taxpayer support to provide local channels in communities they are already supposed to wire,'' said Gene Kimmelman of Consumers Union.

As Congress winds down, communications companies continue to lobby for other last-minute goodies.

AT&T, the nation's largest cable operator, is still pushing lawmakers to alter rules that limit how many subscribers a single cable company can control. A change in how cable holdings are counted toward the federal cap would help AT&T hold on to cable assets it must otherwise shed by next year.

Some lawmakers warned that the change could enable AT&T and other cable company could vastly increase their holdings.

``This would result in a tremendous increase in media concentration, far in excess of the ownership levels allowed under current law,'' said Rep. John Dingell of Michigan, ranking Democrat on the Commerce Committee. With the changes, AT&T could own a 50 percent stake in every cable system in the country, he said.

The White House said it opposes the legislative efforts that would allow AT&T to get out of merger conditions set by the FCC when the company bought cable giant MediaOne this summer.

``It would be a bad precedent,'' said spokesman Elliot Diringer.

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On the Net:

Federal Communications Commission: http://www.fcc.gov