A penchant for secrecy

Introduction

When the Federal Communications Commission decides on June 2 whether to dramatically loosen restrictions on media ownership, it will be relying largely on analyses based on proprietary databases not freely available to the public.

The FCC‘s reliance on non-government, private data is so ingrained that when public interest groups asked for access to data underlying a series of media ownership reports last fall, the FCC relented only after issuing a quasi-judicial “protective order” meant to keep the information secret.

While the FCC has a legal responsibility to protect proprietary data it buys from other sources, an investigation into the data it does acquire raises the question of whether relying so heavily on that information is such a good idea in the first place.

When the Center for Public Integrity was constructing its database of media companies, staff researchers were repeatedly referred by FCC staff to private companies for basic information on ownership, audience reach and cable subscribers. Getting market share information, which is key when reviewing whether broadcasters are within existing FCC regulations that limit the number of households any one owner can reach, was all but impossible without going outside the agency.The agency argues that, in some cases, Congress itself specifies what data should be used to conduct certain studies and that it doesn’t make economic sense to collect information already available in the private sector.

Mark Cooper of the Consumer Federation of America creates his own databases to keep track of what’s going on in the marketplace. “To me the outrage is that on an ongoing basis they don’t do a very good job of making it user friendly,” he said. “It’s there, but it’s almost impossible to find.”

The Center was able to construct a database of radio and television stations as well as cable and telephone companies, but the process took months, and the information gleaned from FCC documents was often out of date and incomplete. To make the information useful required hundreds of hours of additional research. (See “How We Did It.”)

Constructing a simple list of radio and television stations was challenging. But far more daunting for the research team was trying to compile a list of cable television systems.

The FCC’s Media Bureau makes cable information available to the public through its Cable Operations and Licensing System, known as COALS. The data is available for download via the FCC’s Web site and is updated nightly, according to the site.

Among the most useful statistics tracked by the agency is a count of cable subscribers by community. After downloading a number of tables, linking them together and totaling subscribers, the Center discovered that the total was about 7.5 million fewer than the FCC lists in its most current cable industry report. The source for that report was Kagan World Media Inc., a private research firm.

An analyst in the Media Bureau told the Center she did not know much about COALS or why total subscribers in that database were so much lower than the total cited in the most current FCC report. She referred the Center to Kagan (and provided a contact person).

A programmer said the subscriber information was not supposed to be in the COALS database and told Center researchers that the FCC stopped collecting it after “deregulation” of the industry in 1994.

In short, the agency was posting nine-year-old data on its site and listing it as current.

(After being told about the problem with its subscriber numbers, the FCC told the Center that the cable subscriber totals had been stripped out of COALS.)

But that experience pales in comparison to the fight over 12 studies the FCC commissioned to examine the issue of broadcast media ownership.

In November 2001, FCC Chairman Michael Powell created the Media Ownership Working Group to help the commission in its review of broadcast rules. The group commissioned 12 studies examining the media marketplace, which were released Oct. 1, 2002.

Watchdog groups said some of the studies were biased in favor of deregulation and asked that data used in them to reach conclusions about the marketplace be released. Four of those studies used proprietary data to reach their conclusions.

On Nov. 4, 2002, Media Bureau Chief Kenneth Ferree agreed to make the data available, but only if those who viewed it agreed to an agency-prepared “protective order.”

The data sets were to be made available only to “authorized representatives” of the viewing parties, or anyone “designated by the commission in the public interest.” To see the data, the reviewing party had to swear, in writing, not to share it with any unauthorized persons. Viewing parties were also able to view the data only at FCC headquarters and were not allowed to make copies.

“The protective order business is truly bizarre,” said Andy Schwartzman of the Media Access Project. “We ultimately got to see everything we needed to see and got access to data sets and everything, although there were a lot of controls placed on how we could do it.”

He estimated that it took about six weeks from the time the order was issued until his organization was actually able to review the information. This was a critical lag for public interest groups, as time was limited for them and other concerned parties to make their case on whether the rules should be revised before a comment deadline.

FCC Commissioner Michael Copps at the time released a statement, criticizing the commission’s handling of the information.

“The FCC is required to seek public participation before it eliminates these rules. The commission recently released a dozen studies for the public to review as part of this process. It withheld the data used in these studies, however, until releasing parts of it today,” he wrote.

“Public commenters complained that the comment period allowed by the FCC denied them the ability to participate meaningfully. Just as unreasonable, according to these commenters, is the fact that the clock on the comment period has been running even while the underlying data was unavailable.”

The FCC official told the Center that protective orders are not unusual with federal agencies, especially in proceedings dealing with large mergers.

Federal law requires the FCC to regulate the publicly owned airwaves with the public’s interest in mind. The 1996 Telecommunications Act requires the commission in its biennial review of the rules to “repeal or modify any regulation it determines to be no longer in the public interest.”

Court decisions require the commission’s review to be based on “a solid factual record and a consistent analytical framework.” Powell has made that clear in remarks addressing the ownership rule-making issue.

Schwartzman says that the FCC is collecting a lot less data now that it ever did, and he and some public interest groups worry that with the increase in deregulation and the decrease in information available, the public will find it that much harder to have access to the information it needs.

“When the agency deregulates, and stops collecting data, they say we’re going to rely on marketplace forces and public complaints to make us aware of problems,” Schwartzman said. “Then the commission takes away the means of members of the public to do that monitoring.”