Changes To FCC Media Rules Unlikely To Produce Merger Mania

CHANGES TO FCC MEDIA RULES UNLIKELY TO PRODUCE MERGER MANIA
[SOURCE: DowJones, AUTHOR: Shira Ovide]
Changes to Federal Communications Commission media ownership rules that would allow media companies owning a newspaper and TV station in the same market are unlikely to open the floodgates to media deals as most companies have given up on benefits from the strategy. "Cross-selling of advertising has been elusive and is not widely believed in at this point," said Leland Westerfield, an analyst with BMO Capital Markets. The failure of cross-ownership is borne out by the struggles of Tribune. Tribune bought Times Mirror in 2000 in part to reap benefits from combining big-city newspaper like the Los Angeles Times and Chicago Tribune with TV stations in the same cities. But Tribune's decision to go private earlier this year was seen widely as an admission of the merger's failures. At the same time, technology marches on. Media companies say the rules are irrelevant at a time when the Internet gives consumers diverse sources of news and information and erodes the stranglehold of newspapers and TV stations over local news and entertainment. Internet outlets and newspapers aren't regulated by the FCC.
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