That’s an awfully nice merger you have there, it’d be a shame if anything to happened to it

by on February 28, 2007

On the podcast last week I mentioned that if Kevin Martin’s FCC approves the XM-Sirius merger, one of the conditions it could impose is that the new entity accept indecency regulation that satellite radio is not currently subject to. Adam called this “regulatory blackmail,” and now I’m seeing a pattern.

The WSJ reports that Spanish-language broadcaster Univision agreed to pay $24 million fine for violating the Children’s Television Act, which requires broadcasters to show three hours of educational programming a week. “In exchange, the FCC will approve Univision’s sale to a consortium of private-equity groups for $12.3 billion.” The fine is by far the largest the FCC has ever assessed. Not only does Univision have no choice but to accept the fine if it wants its sale to go through, but it seems like the commissioners don’t have a choice either.

The $24-million fine was negotiated by Mr. Martin’s staff, not the five-member FCC board. Several senior FCC officials, including at least one FCC commissioner, said they learned of the fine by reading the New York Times on Saturday. Despite some discomfort about the unusually high amount of the fine, the full FCC board is likely to vote for it. It would be politically difficult for FCC members to vote against enforcing children’s programming standards and the company has apparently agreed to pay the fine to clear the way for its sale.

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