[ Text Version ]


JUNE 3, 1997

(As Prepared For Delivery)


Last week, I sent a letter to President Clinton, asking him to begin the process of selecting my successor as chair of the FCC. I told him that I intend to remain in my post until he has completed that process. I told him it was a high honor to serve as chairman of the Federal Communications Commission, but that it was high time for me to spend more time with my family.

There was a piece in the New York Times yesterday -- I happen to have 70 or 80 copies with me, so ask me if you want one for yourself -- that talks about our legacy of a "focused agenda and energetic leadership." Everyone on our team was very flattered. I feel like Tom Sawyer watching his own funeral and enjoying every minute of it even more due to the fact that he was still alive.

I love the Times. Now more than ever. And I want to talk to you today about how TV news could be a little more like print news -- detailed, rich, informative, and occasionally with editorials I agree with -- particularly if government did a better job creating clearer rights and a context for self-regulation in the development of TV journalism.

Before I get into that, being like Tom Sawyer still alive and on the job, let me mention a few current events. We have a lot left to do, including in the area of broadcast ownership and attribution, the V-Chip, a Notice of Inquiry on the public interest obligations of broadcasters -- all important and pressing issues.

And Monday's Wall Street Journal reported that in the anticipation of my departure hard liquor companies "already are laying the groundwork to expand the nation's current trickle of TV ads for spirits."

Reportedly, Seagram, Allied Domecq, and International Distillers & Vintners are making plans for bringing ads for their brands onto the airwaves. This week is one year after the hard liquor industry started this fight. They aren't quitting yet. Our staff at the FCC has prepared a Notice of Inquiry on the introduction of broadcast hard liquor advertisements, and I hope we can find common ground among Commissioners to find out the facts and see if the broadcast commitment not to carry hard liquor ads is truly widespread.

The issues raised by the introduction of broadcast hard-liquor ads demand serious attention. At the FCC, we can provide a public forum to allow all interested parties to weigh in with the facts and with their responses to the many proposals we've already received. The FCC has been given the obligation to ensure that the public airwaves are used in a way that is consistent with the public interest. Our proposed notice of inquiry is nothing fancy -- just about 9 pages setting forth some background, asking for interested parties to give us the facts and to give us their views on the proposals we've received, as well as anything else they'd like to comment on.

A huge number of parties, including the President, numerous States and dozens of Congressmen, have asked us to take action.

At the least we should give them a report, pursuant to this notice.

This is consistent with the agenda for the last three years.

Generally, for the last three and half years our decisions on media issues at the Commission have fallen into two categories: we have promoted competition in all communications markets, and we have promoted family values where we thought market values weren't delivering specific and necessary benefits to American parents and children.

So we have eliminated Fin-Syn and PTAR and reduced huge backlogs in license transfers in order to deregulate the broadcast business. And we have passed rules requiring educational TV from broadcasters because we didn't think that deregulation on the commercial side of the business would guarantee that community interests in free education on television would be served.

We have auctioned off a DBS license to increase competition while conducting a proceeding to quantify the public interest obligation of all DBS licensees.

We have been, in short, eager to promote true competition in all media markets but skeptical that marketplace competition is all that is necessary to serve the interests of parents, families and communities.

The policy goal of free, over-the-air TV is at its core a public interest idea. There is no way to know if true, unfettered marketplace competition would guarantee free, over-the-air TV in every community. This country has never wanted to conduct that experiment. Instead it has wanted the FCC to assure that this public good of free TV would be available everywhere.

That's the reason why this Commission fought for and won the must carry case in the Supreme Court. Must carry, as the Court held, supports the public policy goals of free TV. It is obviously an intrusion on the marketplace. Indeed it is just about the most regulatory action taken by the Commission in any marketplace since I've been Chairman.

The fundamental justification for must carry is that broadcasting serves family values as well as market values.

This justification is what lies behind another blow this Commission delivered against unfettered competition, at the behest of Congress: namely, the grant of spectrum to broadcasters for digital television.

Congress decided and we voted to give DTV licenses to today's broadcasters in order to command today's broadcasters to carry the model of free, over-the-air TV into the digital age.

One of the principal reasons for this very challenging migration from analog to digital is to make sure that free TV, in a digital world, provides an easy and universally available source of news.

What will be the nature of that news? Will it give us the kind of broad, important, impartial, and detailed news coverage that is the pride of our print journalism? Will it use the Internet to give deep and rich background to those who want to travel past Must See TV through Web TV and on to the WWW?

The tremendous importance of this issue stems from the fact that this is the most well informed nation in history because of TV. More than 2/3 (69%) of Americans gets their news from television, compared with 37% for newspapers and 14% for radio.

Television is considered to be the most credible news source by 53%, compared with newspapers at 23%, radio at 7%, magazines at 4%, and that new entrant as a source of news and information, the Internet/on-line services at 1%.

And television news is popular. While viewership is flat for national network evening news programs, the newsmagazine format is booming. Network prime-time will include an unprecedented 10 hours of newsmagazine shows this fall. Shows like 60 Minutes, 20/20, PrimeTime Live and Dateline finished in the top 20 prime-time shows this year, ahead of programs like Roseanne and Coach.

There's been a lot of attention devoted to television news in recent years. The content of television news, its quality, and the integrity of reportage have garnered much comment -- and it's not so good.

For example, this May the Rocky Mountain Media Watch put out its "Baaad News, Local TV News in America" report, which analyzed 100 local TV newscasts in 55 markets in 35 states, taken from a single day -- February 26, 1997. This report made some provocative conclusions about the dominance of crime and violence stories, the amount of time devoted to "soft news" and celebrity news, the amount of commercial time, promos, and PSAs, and gender and ethnic diversity in the news.

The University of Miami did a similar study, examining "Content Analysis of Local News Programs in Eight U.S. Television Markets." The main findings of that study concerned the trend of a decline in coverage of government affairs and a predominance of crime and violence stories.

And events, like the decision of a Chicago station to hire talk-show host Jerry Springer, and the subsequent resignation of long-time anchor Carol Marin and Ron Magers, also gave rise to a great deal of discussion and comment about TV news.

Some media researchers decry what's been called the "if it bleeds, it leads" approach of TV news. They argue that TV news, by emphasizing violence, exotica, and fluff, is presenting an increasingly false picture of life. Some argue that news coverage doesn't reflect what's important, or what the public should be learning about. Some suggest that stations are particularly inclined to air sensational stories during sweeps months of November, February, or May, when ratings are critically important. Joe Saltzman, a journalism professor at U.S.C., has identified what he calls the "George Clooney-ing" of local news -- i.e., stories with tie-ins to network prime time programming.

On the other hand, Saltzman and former RTNDA President David Bartlett also believe that another reason why crime coverage has increased over the last 30 years is the democratization of news -- i.e., the coverage of murders of residents of low-income neighborhoods, rather than solely "rich white people." This seems a good thing.

Now Mr. Bartlett, with whom I went to high school I should add, is a firm believer in the merits of the marketplace. So am I. But I note that on the print side two glories of our country are the Washington Post and the New York Times and in each case the owning families balance market values with a strong sense of responsibility to the country.

They have an ethic.

Indeed print journalism generally has a richly developed sense of ethics.

It has letters-to-the-editor and ombudsman and sedulous editors and other traditions that generally support the strong First Amendment protection given to print media.

The broadcast business on the other hand has few of these traditions --- not none, but few -- and it has less First Amendment protection. Wouldn't we all be better off if broadcast news was a lot more like print journalism in both these respects?

I wonder if we don't need now and in the digital future a stronger and more well developed set of industry-led principles for the means and methods of broadcast news and a stronger and more well articulated set of First Amendment principles for broadcast news.

In other words, because of the extraordinary importance and influence of television news, isn't it appropriate that we hold it to the same ethical standards that we expect from print journalism? And, in order to get the quality of journalism we expect, shouldn't we protect TV journalists to the full extent of protection that the First Amendment can afford?

We also need a clear and absolute commitment that government should never reward or punish any broadcaster for the content, point of view or opinions that the broadcaster expresses.

Yet at the same time should governmental policies attempt to assure that news is broadly and in some sense fairly communicated through the electronic media?

I am troubled when government figures advocate that certain news channels get on the air. And I am concerned when government figures criticize the politics of news anchors or news shows. And I worry when government makes a practice of announcing or labelling the politics of TV journalists.

But behind these developments is the fact that the public is concerned when it does not think the news is presented fairly. Indeed various rules at the FCC passed in times past speak to this issue. At one time the FCC enforced the Fairness Doctrine. We will soon be taking up review of the personal attack and political editorial rules. These were all aimed at furthering the public interest by ensuring that a balance of opinion was maintained with some kinds of material.

Whether or not the rules have served that purpose, wouldn't we all benefit if there were some way to assure the public that news on TV will be impartial and that opinions on TV will be balanced?

One way to encourage more impartial and aggressive news coverage is to make sure that government stands up to protect threats to the ability of TV journalists to gather and report the news, free from liability.

Don't we need to think about what structures and rules would afford them appropriate protection?

There has been an increase in the cost of libel verdicts. In 1996, juries awarded an average of $2.8 million in each libel verdict against the media. This is an increase of $1.6 million average award in each of the two previous years, according to the Libel Defense Resource Center. For example, in Houston, a jury gave a $5.5 million libel award to a Texas state representative who was running for mayor after a local station charged that he had engaged in an insurance scam.

One problem is that libel suits are very costly -- even though damages are vacated on appeal in almost half the cases. Such suits puts news organizations through an ordeal which can be hard for any but the largest news organization to bear.

And in addition to traditional libel-type claims, plaintiff are using new strategies to avoid the hurdles that stand in the way of a successful libel suit, in order to bring pressure onto the news media.

In one example, in Greensboro, North Carolina, in December of 1996, a jury found that ABC News magazine PrimeTime Live had defrauded and illegally trespassed on Food Lion supermarkets. PrimeTime Live sent undercover producers to get Food Lion jobs. The producers faked resumes, were hired, and once inside used hidden cameras to document their story. In the first verdict, jury awarded Food Lion $1,402 in actual damages, but imposed $5.5 million in punitive damages -- though Food Lion asked for $1.9 billion. Food Lion chose not to charge ABC with libel, which would have required that Food Lion prove the broadcast was false, but rather to charge them with fraud in the reporting process. This approach sent a shock through the ranks of reporters.

In one controversial episode, in December of 1995, CBS news executives initially pulled a 60 Minutes segment on the tobacco industry that featured an interview with Jeffrey Wigand, a former Brown & Williamson tobacco executive. CBS explained that it pulled the interview out of fear of potential liability for tortious interference with contract, because of Wigand's non-disclosure agreement with his former employer -- of which 60 Minutes was aware. CBS did not pay Wigand but agreed to indemnify him if he were sued for libel.

This incident gave rise to intense discussions about whether CBS would indeed be susceptible to suit.

A week after CBS decided not to run the story, the Wall Street Journal reported that "the nearly universal opinion of commentators in the past week has been that wimpy network lawyers, fearful of a huge lawsuit, used an arcane legal theory as a pretext for caving in to the tobacco industry."

That might be nice language for the print media, but it's not comforting for the broadcast executives who had to cope with that exact prospect of a huge lawsuit.

Where was government here? Some commentators say that the tort of interference with contract should not be applicable to print or TV journalists. Shouldn't government speak up for this argument?

In the news context, the public interest is in getting certain information out in the open, while the private interest of one of the parties to the original agreement is interested in keeping that information hidden.

Should it be the case that, at the very least, First Amendment principles should protect routine reporting techniques like asking questions and getting voluntary answers -- including about confidential or restricted information -- so that newsgatherers need not fear contract tort actions?

What about other claims that plaintiffs use to evade the common-law and constitutional hurdles that protect the press from libel actions? NBC News settled a possible libel suit for Tom Brokaw's on-air statements about Richard Jewell, who for a time was a suspect in the Olympic bombing case in Atlanta. CNN later settled as well. Jewell's lawyer also intended to argue that intense press surveillance amounted to an "intrusion upon seclusion."

Such incidences have led some scholars and journalists to predict that newsmakers may avoid tough stories in favor of celebrity and feel-good stories. They fear that claims like those made by Food Lion and Richard Jewell might lead the news media to make decision to avoid liability, but that would diminish the amount of hard-edged news that the public receives.

While journalists have not won a blanket privilege from the Supreme Court, or a national protective statute from the Congress, they have not gone unprotected. Twenty-nine states have enacted laws to protect journalists from having to answer every subpoena. These "shield laws" can protect journalists from the duty to testify or produce materials obtained in confidence. Fifteen of the remaining twenty-one states without shield laws offer state court protection for journalists.

Do we need to think about how shield laws could be strengthened better to protect

journalists? The lack of strong shield laws may have a chilling effect on the freedom of the press. Newsgatherers might be less aggressive and cease to pursue confidential sources or information. Whistle-blowers and other sources could be left without any legal protection from discovery.

Do we need to think about how First Amendment protection should be applied to cover the way that news is gathered in addition to what news is published?

To be vital and active, journalists must be free to conduct responsible investigations of newsworthy stories, with meaningful protection. Do we need to think about how to formulate a framework for tort liability that is constrained when its application might diminish the public interests that the First Amendment is intended to safeguard?

Perhaps Congress or the FCC should hold hearings on the topic of how we could buttress the protection of TV journalists, to ensure that they go about their business without being chilled by the threat of litigation.

But, at the same time we seek to protect journalists, we should continue to expect the highest standards of integrity from them. Journalism, as a profession, is based on ethical standards and a reputation for truth-telling and accuracy. We should protect vigorously the First Amendment rights of the press, but at the same time, shouldn't the press hold itself up to high standards in its practices in information-gathering and reporting?

Television news occupies a distinct place in the media. The unique power of television, and the immediacy it permits, are tremendously valuable.

This special feature of TV means that television journalists face the same dilemmas that other journalists face, and then some. For example, they must think about what their policy should be regarding the use of hidden cameras, such as were used in the Food Lion case, or the practice of "ambush interviews."

And they face the question of whether or not to air footage that some of their viewers might consider offensive -- such as the repeated showing of the dead bodies of the members of Heaven's Gate.

And sometimes events occur beyond their control, as with live coverage, which can lead to the airing of graphic footage, unedited. For example, in Sacramento in 1991, viewers who expected to watch Cheers and Cosby instead witnessed six people shot to death during live coverage of a hostage situation in an electronics store. This is something that print journalists need never consider.

Perhaps it's because of some of these issues that one poll revealed that 65% of those surveyed believe there are times when the press should be barred from publishing or broadcasting certain things.

In the near future these issues ought to be examined openly and candidly by government and by TV news as an industry.

Some steps plainly could and should be taken by the TV news business as a matter of self-government. Other steps may need legislation, such as better or clearer shield laws.

Television is the single source for news on which most Americans rely. We should expect the best from TV journalists, and make it possible for them to give us the best.

We at the FCC have so much to do. My news of future retirement has been so well covered that I've been reminded of Mark Twain's famous cable from Europe to the Associated Press: "The report of my death was an exaggeration."

However, the Telecommunications Act of 1996 may yet be the death of me.

Since the passage of the 1996 Telecommunications Act, we've seen a tidal wave of mergers among communications and media firms -- and even more are rumored to be in the wind. The FCC approves or disapproves each depending on whether it's in the public interest. The public interest test has always been very broad: it includes traditional antitrust concerns of not permitting too much consolidation among existing competitors in a market; and it also includes consideration of potential and possible competitive circumstances in the future, in the wake of market-opening laws and rules. For example, in order to promote the public interest, we have adopted rules to limit aggregation of spectrum, prohibited cable and local telephone incumbents from obtaining broadband LMDS licenses, and imposed conditions on joint ventures between foreign and domestic carriers.

In many communications markets, the proposed mergers don't involve firms in mature or established positions of rivalry. Instead they often involve firms that might well be incentivized or encouraged to compete in new markets -- markets from which they historically were barred by law or by the absence of procompetitive rules.

These kinds of mergers may include those among telephone companies or between long distance and local telephone companies or between cable and telephone companies or between holders of different spectrum licenses.

These kinds of mergers almost always call upon reviewing agencies to make projections into the future of competition. Much of antitrust precedent is of little use here, where competitors previously were precluded by law or by lack of pro-competitive rules from entering relevant markets. Perhaps a different standard is advisable. It might be good to talk about whether the proposed merger benefits potential competition instead of whether it harms competition.

It is also important to recognize that the advisability of a particular merger may depend on the way a recently opened market develops. But if the merger is approved before that is known, the market will develop differently.

These considerations counsel government to take an extremely cautious and wary approach toward approving proposed mergers involving markets from which potentially formidable competitors have been effectively precluded by law or by the absence of procompetitive rules that facilitate entry.

Government should also be aware that if it fails to develop clear and predictable guidelines, it will send a message of tolerance to those firms that wish to test the limits of merger policy in newly opened or changing markets. It would be better if firms that had little or no chance of persuading government to approve their proposed mergers could be certain of this likelihood. Then they might spend less time together in their boardrooms discussing cooperation and more time apart in their separate warrooms discussing competition.

I remember in the movie "Yellow Submarine" there was a character who ran around saying "Ad hoc, quid pro quo, so little time so much to know."

This was in fact modelled after a friend of mine on my college faculty, who knew almost everything. In the last three and half years I have wished I did. But I don't. I haven't wanted to admit that before, but I'm willing to say it now.

Nevertheless, we haven't tried to be ad hoc at the FCC in the last three years. And goodness knows we've not negotiated quid pro quo deals with anyone, to almost everyone's annoyance from time to time. But we have always been crushingly aware that there's so little time to get things right and so much to know to try to meet that goal.

I've enjoyed learning from you all and working with you all in order to try to learn what we've needed to help set the policies that will make the communications revolution work for all Americans. There wasn't never enough time and I apologize for the abruptness of virtually every conversation I've had with anyone for my term. Still I and my whole team have enjoyed your good spirit, your good debates, your good will, and your great contributions to the country many thanks.