Gannett's Belo purchase prompts protests by cable industry
The Gannett Company's acquisition of Dallas-based Belo Corporation has prompted protests by other media organizations who are raising flags with the FCC.
Mediabistro reports that the American Cable Association, Time Warner Cable and DirecTV have all asked the FCC to block a portion of the deal because it stands to increase consumer and commercial costs.
Media nonprofit Free Press released a petition against the deal as well, citing problems with the newspaper-broadcast cross-ownership rule. "If approved, the transaction will lead to job losses and a considerable reduction in the quality of journalism for millions of television homes," the petition reads.
The petition is backed by the National Hispanic Media Coalition, Common Cause and the United Church of Christ, among others.
Gannett, which already owns USA Today, Detroit Free Press and Arizona Republic, announced plans to acquire Belo for $1.5 billion in June.
Belo Corp. owns WFAA in Dallas, KHOU in Houston, KVUE in Austin and KENS in San Antonio. (The deal does not include the Dallas Morning News, which has a different parent, the similar-sounding A. H. Belo Corp.)
Much of the concern over the deal has to do with Gannett's plans to transfer ownership of Belo stations in St. Louis, Phoenix and Tuscon to Jack Sander and Ben Tucker. Sander is a former Belo executive. Tucker is former head of the Fisher station group.
The Free Press petition characterizes the transfer as a disingenuous deal with a "shell company."
"These arrangements attempt to mask the true intent and effect of the transaction: to allow Gannett to simultaneously influence and control multiple media outlets in the same local market in a way that is contrary to the public interest and otherwise prohibited by the Commission’s rules," the petition reads.
"Even if they do not outright violate the rules, such sharing arrangements are not in the public interest because they reduce the diversity of viewpoints and reduce competition in the provision of local news and the sale of advertising."