The Federal Communications Commission is poised to propose new media ownership rules that will allow media companies to own newspapers, television and radio stations in the same city, according to media watchdog groups.

The proposed rule would dissolve a longstanding policy that prohibited corporations from owning a television station and a daily newspaper in the same market. The "cross ownership" rule, promulgated in 1975, was enacted to ensure media diversity.

Individuals close to the Commission say the FCC will propose relaxing media ownership rules, possibly as soon as June 15 when the Commission next meets, the media watchdog Free Press says.

"All indications are that the next time the FCC meets – now that they have a full commission – we expect to see media ownership come up, and we think it will be the cross ownership rule as well as rules on how many TV stations companies can own in a single market," Free Press spokesman Craig Aaron said.

A third Republican joined the FCC after Senate confirmation Friday. The Commission was deadlocked 2-2 along party lines in recent months and the new commissioner gives Republicans a 3-2 majority. FCC commissioners and the Commission's media office did not respond to repeated requests for comment.

Common Cause, another political watchdog, believes cross-ownership will be a key focus when the commission meets.

"We've haven't heard anything official from the FCC yet [but] we had expected that media ownership would come up as soon as they had a fifth commisioner on board," said Common Cause director of media research Dawn Holian. "Chairman Martin has indicated that newspaper broadcast cross ownership would be one of the first issues he wanted to deal with."

FCC Chairman Kevin Martin told publishers at the Newspaper Association of America's meeting in April that he was committed to overturning the ban on same-market cross ownership. He argued that the ban is unfair to newspaper publishers in light of other communications ownership rules which allow businesses to own two TV stations and up to six radio stations in the same market.

"A lot has changed since those days of disco and leisure suits," he said. "Newspapers are the only medium specifically prohibited from owning a single broadcast station in its own market."

The FCC overturned the cross-ownership ban in 2003 but its implementation was blocked by an appellate court. At the time, both the House and Senate also criticized the decision to overturn the rule.

Watchdogs praise rule, conservatives split

Aaron painted a scenario in which he envisioned "media company towns." Large media companies could "trade" newspapers and television stations in key markets, allowing companies to consolidate their newspaper and television operations and cut staff. A recent example in the alternative press – which is not bound by ownership rules – occurred when the Village Voice shut down a paper in Cleveland in exchange for another company killing their paper in L.A., giving both companies a monopoly in their respective markets.

"You're seeing it happen somewhat on the alternative side but it's a lot more threatening when you see a company owning your major newspaper, a major broadcast outlet, two or three channels and eight radio stations," Aaron said. "That could be Sinclair, that could be News Corp., that could be the New York Times."

"That might be good for the bottom line of these big corporations but its obviously bad for local voices, bad for the quality of news and information and its bad for an informed democracy," he added.

A Pew Research poll conducted in 2003 when the FCC last debated cross-ownership showed that Americans who knew about the rule were roughly ten to one against diluting it. 57 percent who had heard "little" about the proposal opposed it, and of those who heard nothing of the rule, 40 percent were against.

"Last time three million people contacted Congress and the FCC to oppose these rule changes," Aaron said, "and of the comments received, 97 out of 100 were against letting big media get even bigger."

Conservative organizations are divided. In 2003, the National Rifle Association came out in opposition to relaxing the rules; in a "Media Monopoly Alert" letter to members, NRA Executive Vice President Wayne LaPierre dubbed the companies pushing for the change "gun-hating media giants."

Others disagreed.

"Rather than media monopolies, consumers face a bewildering and unprecedented amount of choice," the pro-business Heritage Foundation's James Gattsuso wrote in 2003. "Instead, the real danger to Americans is that outdated and unnecessary FCC restrictions will limit improvements in media markets and technologies, limiting the benefits that they can provide."

Both Common Cause and the Free Press say the FCC should listen to "public voices" when considering any change.

"I think that its important to remember that in 2003 two million Americans wrote into the FCC and objected to the rules that would have allowed for more consolidation," Common Cause's Holian remarked. "The FCC I hope will this time listen to the public's voices and [hold] more hearings than in 2003 when the public was really left out of the debate."