Dear Susan, I’m very grateful for the time you and your staff spent with Terese Colling and me last week. We enjoyed hearing about the FTC’s “future of journalism” project, and I was happy to be able to relate some of Media General’s experience and thoughts on this subject. We enjoyed hearing about the FTC’s “future of journalism” project, and I was happy to be able to relate some of Media General’s experience and thoughts on this subject. Our industry definitely is in a transition phase, but we believe firmly that this is not the time for government prescriptions. The market is providing, and will continue to provide, appropriate answers. But, there definitely are some things the government can do to facilitate a more effective and efficient market response. The best current example I can provide of the market’s effective functioning is the Pulitzer Prize earned this past month by our newspaper, the Bristol Herald Courier, for public service reporting. The fact that a small, community newspaper – one with only seven reporters – could win not only a Pulitzer, but the most coveted Pulitzer, is a testament first and most importantly to the doggedness and skill of our 28-year-old reporter, Daniel Gilbert. It’s also a testament to Daniel’s managing editor and publisher, who gave him the space to write not only the eight attached stories that were recognized by the Pulitzer judges on the mismanagement of natural gas royalties owed to thousands of landowners in Southwest Virginia, but also another 22 (and still counting) follow-up stories that prompted remedial action by Virginia’s General Assembly during this past winter’s term. And, we believe, the prize also at least was facilitated by Media General’s resources, which allowed Daniel, in the middle of his writing, to take a necessary course on database reporting at the University of Missouri. Our converged operations in the Western Virginia/East Tennessee Tri-Cities market also meant that there were additional resources available to help cover the Tri-Cities market for our newspaper, broadcast and Internet platforms while Daniel was studying and, of course, while he was researching and writing his prize-winning stories. We strongly believe that our multi-platform approach is the right model for our industry. With it, we’re well-positioned to deliver our local news and information to consumers whenever and however they want it. Our experience shows that people often will utilize several platforms to access local information in on any given day: perhaps checking for breaking and developing news stories on-line during the day, watching our newscasts in the evening and then spending time the next day with our local newspaper gain the type of additional “what does it mean to me” perspective that newspapers deliver so well. This multi-platform approach also allows us to avoid the types of duplicative back-office local expenses (HR, finance, etc.) that would exist were each platform individually owned. Over the years, this additionally has enabled us to take these savings and increase our overall employee count in each of our cross-owned markets; in the last several years, when we’ve been reducing expenses to match available revenue in each of our markets, we believe our multi-platform approach has allowed us to keep more journalists on the street, and on our employment roles, than otherwise would have been the case. Thus, cross-ownership allows us to deliver better, faster and deeper local news, and we believe it’s helped us save journalists’ jobs. The problem, of course, is that the FCC in 1975 banned the common ownership of newspapers and television stations in the same market. We accordingly operate with a grandfathered arrangement in Tampa, and, after proving our case over many years and at great expense, we have secured “permanent waivers” for our commonly owned properties in the Tri-Cities, Columbus (Ga.) and Myrtle Beach-Florence. I mentioned last week that there were studies in the record at the FCC demonstrating that common ownership means more local television news. We’ve now been able to gather some of those studies, and they’re attached here. They include the following: FCC Media Bureau Staff Research Paper, September 2002 Know as “Spavins,” this study of television network affiliates says in the Executive Summary: Within the class of affiliates, there is clear variation in performance between affiliates that are owned in common with a newspaper publisher and all other network affiliates. Affiliates co-owned with newspapers experience noticeably greater success under our measures of quality and quantity of local news programming than other network affiliates. Lichter (2001) and Baumann (2006) Studies These are studies Media General commissioned. The Lichter study at Page 4 concludes: The main finding is that convergence is consistently associated with higher levels of non-entertainment programming. The Baumann study served as an update of Lichter. It observes at Pages 5-6: The data appearing in Table 1 indicate that in nine out of the eleven matched pairs the stations in the convergence market aired more non-entertainment programming than the stations in the paired non-convergence market. . . . When all eleven pairs are considered together, the cumulative average amount of non-entertainment programming in the convergence markets exceeds the amount in the non-convergence markets by 2.7 hours per station, which means that overall nonentertainment programming in convergence markets exceeded that in non-convergence markets by 5 percent. . . . As was true with the findings of the earlier study, convergence markets are associated with levels of non-entertainment programming that are, on average, five percent higher. This study also includes additional small and medium convergence markets of which we are aware and finds the same basic results. (I should point out that the FCC performed its own “peer review” of the Baumann study, and its 2008 ownership decision was critical of some of the Baumann methodology. We weren’t given an opportunity to comment on those observations, some of which we believe are incorrect, but this study still is illustrative of what makes sense intuitively and what we’ve in fact found “on the ground” in our cross-owned markets: when we increase the amount of television news in a cross-owned market (which we always have done), our key competitors also have raised the level of their game – precisely because they’re competing for ratings and the advertiser dollars that go with them.) Media General 2007 Comments The next attachment here is a set of 2007 Media General “Comments On Research Studies On Media Ownership,” submitted to the FCC during its last “Quadrennial Review.” These Comments contain an extended discussion of the issues discussed here. You’ll find the following, for example, in the “Summary” at Page iii: These latest studies demonstrate once and for all that the FCC lacks any empirical basis upon which it can rely to support continuation of the 32-year old ban on newspaper/broadcast cross-ownership. They also make it even more clear that the ban is harming the public interest by depriving communities of the increased production of news that would result from its repeal. The FTC no doubt (and understandably and appropriately) must be reluctant to make suggestions to another federal agency about matters clearly in that other agency’s jurisdiction. However, the matters we discussed last week and those mentioned here have been said, face-to-face, to Steve Waldman on numerous occasions -- both in connection both with his “Future of Media” proceeding and as part of the Commission’s current and most recent Quadrennial Review of its ownership regulations. (The last attachment here, for example, is a set of brief “Future of Media” comments we filed just yesterday evening.) As the FTC reflects on these matters and as it talks further with its sister agency, we urge you to make the point that the FCC should consider whether its existing and anachronistic ownership regulations in fact are impeding a natural market response and so are limiting the industry’s ability to adapt in the current transition. We believe the common ownership of newspapers and television stations provides more and better local news to communities of all sizes. We also believe that, because of its market efficiencies, common ownership can save journalism jobs during market downturns. We remain available to answer questions, or to come to see you, at any time. We very much appreciate your interest in what we have been accomplishing. Sincerely yours, George L. Mahoney Vice President, General Counsel, and Secretary Media General, Inc.