********************************************************    
                         NOTICE
********************************************************

This document was converted from
WordPerfect to ASCII Text format.

Content from the original version of the document such as
headers, footers, footnotes, endnotes, graphics, and page numbers
will not show up in this text version.

All text attributes such as bold, itallic, underlining, etc. from the
original document will not show up in this text version.

Features of the orginal document layout such as
columns, tables, line and letter spacing, pagination, and margins
will not be preserved in the text version.

If you need the complete document, download the
WordPerfect version or Adobe Acrobat version, if available.

*****************************************************************





     March 12, 1998

    SEPARATE STATEMENT OF COMM. HAROLD W. FURCHTGOTT-ROTH

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 Communications Act


     I am pleased to support this Notice of Proposed Rulemaking.  It puts us on the right
track toward meeting our obligation under section 202(h) to assess the continued necessity of
our ownership rules in light of competitive developments since their adoption and, if they are
indeed unnecessary, to eliminate or modify them.   

     As an initial matter, I express my agreement with the separate statement of my
colleague Commissioner Powell.  Like him, and for the reasons he gives, I believe that a
reevaluation of our traditional regulatory goal of "diversity" is a critical part of this biennial
review.   As he observes, this sometimes amorphously-defined goal and the assumptions
upon which it rests must be clearly articulated and supported by facts, not conjecture, in
order to withstand judicial review.   Below, I set forth  the additional questions that I see as
relevant to our section 202(h) inquiry.

First Amendment As An Affirmative Basis for Ownership Rules

      I would like to make clear my belief that the First Amendment is no source of
affirmative authority to regulate mass media ownership, as parts of this item might be
construed to suggest.  For the time being, I would simply note that a quick refresher on the
text of the First Amendment should be enough to establish that proposition:  "Congress shall
make no law . . . abridging the freedom of speech," U.S. Const., Amdt. 1.  Phrased entirely
in the negative, this provision is by its terms a limitation on -- not an expansion of --
governmental power.   

Analysis Under Section 202(h)

     Although today's item does not spell out what it means to assess whether a regulation
is "necessary in the public interest as the result of competition," as the statute requires, it
seems to me that in analyzing that issue it would be useful for commenting parties to
consider: (i) the original purpose of the particular rule in question; (ii) the means by which
the rule was meant to further that purpose; (iii) the state of competition in the relevant
market at the time the rule was promulgated; (iv) the current state of competition as
compared to that which existed at the time of the rule's adoption; (v) and, finally, how any
changes in competitive market conditions between the time the rule was promulgated and the
present might obviate, remedy, or otherwise eliminate the concerns that originally motivated
the adoption of the rule.

      Such considerations are directly related to the language of the statute, which clearly
indicates that Congress wanted the Commission to consider the very real possibility that
competitive forces have eliminated or decreased the need for ownership regulation and that
our rules should keep pace, as near as possible, with the times.

Spectrum Scarcity

     The congressional goal embodied in section 202(h) of eliminating anachronistic
regulation, described above, brings me to my next topic.   Many, if not most, of the rules
under review in this proceeding are based upon a theory well known to those in the
communications world:  the "spectrum scarcity" rationale.  I believe the Commission is
obliged to review the factual underpinnings of this fifty-five year-old rationale to see whether
they hold true in today's day and age.  I accordingly encourage interested commenters to
address this issue.

     The empirical basis of the "spectrum scarcity" argument  has been roundly criticized
by some of America's most distinguished jurists and commentators, even by former members
of this Commission.  To be sure, the Supreme Court has not overruled its decisions that rely
upon the spectrum scarcity rationale in affirming the constitutionality of  FCC regulations,
see, e.g., Red Lion, 395 U.S. 367 (1969); FCC v. League of Women Voters of Cal., 468
U.S. 364 (1984), and of course it goes without saying that it is not the job of this agency to
make constitutional law or to question Supreme Court precedent.   But the underlying
premise of those judicial decisions is that, as a factual matter, communications outlets are
sparse.  The empirical validity of spectrum scarcity is something quite different than the
constitutional jurisprudence based thereupon.

      When it comes to empirical questions relating to an administrative agency's area of
expertise, courts have traditionally deferred to agency judgments on those matters.  See
Syracuse Peace Council v. FCC, 867 F.2d 654, 660 (D.C. Cir. 1989).  The flip side of  that
judicial deference,  however, is the agency's continuing responsibility to reexamine its
judgments as time goes by and circumstances change.  As the United States Court of Appeals
for the D.C. Circuit has explained:  "The Commission's necessarily wide latitude to make
policy based upon predictive judgments deriving from its general expertise implies a
correlative duty to evaluate its policies over time."  Bechtel v. FCC, 957 F.2d 873, (D.C.
Cir. 1992) (citation omitted); see also Geller v. FCC, 610 F.2d 973 (D.C. Cir. 1979) ("Even
a statute depending for its validity upon a premise extant at the time of enactment may
become invalid if subsequently that predicate disappears.  It can hardly be supposed that the
vitality of conditions forging the vital link between Commission regulations and the public
interest is any less essential to their continuing operation."); National Ass'n of Regulatory
Utility Com'rs v. FCC, 525 F.2d 630, 638 (1975) ("The [Federal Communications]
Commission retains a duty of continual supervision."), cert. denied, 425 U.S. 992.  

     Not only are we duty-bound to reexamine the facts upon which we have in the past
based our regulatory judgments about broadcasting, but the Supreme Court has clearly 
indicated that it might revisit its constitutional jurisprudence in this area if  the FCC
"signal[ed] . . . that technological developments have advanced so far that some revision of
the system of broadcast regulation may be required."  FCC v. League of Women Voters, 468
U.S. 364, 377 n.11 (1984); see also Telecommunications Research and Action Center, 801
F.2d at 509 n.5 (explaining that, in League of Women Voters, "the [Supreme] Court . . .
suggested that the advent of cable and satellite technologies may soon render the scarcity
doctrine obsolete.").  The D.C. Circuit recently ventured to say that the Court's
"suggestion" in League of Women Voters "may impose an implicit obligation on the
Commission to review the spectrum scarcity rationale."  Tribune Co.  v. FCC, 133 F.3d 61,
68 (1998).
     
     The biennial review required by 202(h) of the Communications Act provides the
perfect opportunity for us to carry out this duty.  Indeed, as the Tribune court observed upon
the heels of its comment about our "implicit obligation" to reconsider spectrum scarcity, 
Congress in section 202(h) "directed the FCC to review all of its media ownership rules."  
Id. at 69.  To my mind, the factual validity of spectrum scarcity is a critical element of the
analysis required by 202(h).  By its plain terms, that section mandates that we ask whether
changes in competition have obviated the "public interest" need for our regulations.  One of
the most fundamental ways in which the broadcast landscape may have changed is that, due
to increased competition, there are significantly more outlets for communication than there
once were.

      To be sure, a great deal of our existing regulatory scheme depends upon the validity
of spectrum scarcity.  That, however,  is no reason not to undertake a thoughtful review of
the matter.  If the world around us  has changed to such a degree that our past assumptions
no longer make sense, then we must acknowledge that truth.  We cannot stick our heads in
the regulatory sands, hoping that no one will notice the eroded foundation of our rules.