Saturday, February 24, 2007

The New York Times
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February 24, 2007

Record Fine Expected for Univision

WASHINGTON, Feb. 23 — When Univision began broadcasting a show three years ago about the misadventures of 11-year-old identical twin girls who swapped identities after discovering they had been separated at birth, it characterized the episodes as educational programming for children.

That decision is expected to cost Univision, the nation’s largest Hispanic network, $24 million in what would be the largest fine the Federal Communications Commission has ever imposed against any company. The penalty is also expected to send a strong signal to broadcasters that they will be expected to meet their required quota of shows that educate and inform children, after years of permissive oversight in this area.

The commission has decided to impose the heavy fine — disclosed by Kevin J. Martin, the chairman of the commission, in an interview — as a tough rebuke to Univision for claiming to meet its obligations to broadcast educational children’s programs by showing the Latino soap opera “Complices al Rescate” (“Friends to the Rescue”) and other so-called telenovelas.

The penalty, part of a settlement that will allow the company to proceed with a buyout deal, is nearly three times the previous record fine of $9 million, imposed against Qwest Communications for violating telephone interconnection rules in 2004, and significantly more than the largest indecency penalty, $3.5 million, levied against Viacom that same year for remarks by Howard Stern and other so-called shock jocks on the radio.

It also represents an unusually aggressive enforcement of the 1996 regulations that interpreted the Children’s Television Act. Those regulations, adopted after some broadcasters characterized cartoons like “The Flintstones” and “The Jetsons” to be educational programs, imposed more substantive requirements on the networks as they comply with the mandate to broadcast at least three hours a week of programs of intellectual value to young people.

Although some television critics say it is common for stations not to comply, only a handful of complaints have been filed. An even smaller number have resulted in modest penalties of several thousand dollars for stations found to have violated the rules.

Reflecting the views of many policy leaders in Washington who were appointed by President Bush, Mr. Martin said that he was committed to deregulation “and an environment where companies can be investing and competing and driving innovation.” But he also said that he was not driven simply by ideology, and that there remain important areas where thorough regulation plays a valuable social role.

“I generally think consumers are better served by less regulation, not more,” he said in an interview. “But I also think the commission has a key role to play in some areas, such as children’s television, and I take those obligations seriously.”

The agency under Mr. Martin adopted new rules last year to make the children’s television programming requirements apply to new digital television stations.

The $24 million fine, along with a plan to show more programming that would comply with the rules, are part of a consent decree that Univision has tentatively agreed to that would resolve complaints by viewers. It covers violations at 24 Univision stations over a 116-week period from 2004 to early last year.

Mr. Martin has already signed onto the decree. Once the full commission approves it, as expected, Univision will be able to complete its $12 billion sale to a consortium of private equity firms. Those investors include Providence Equity Partners, where a senior executive is Michael K. Powell, the former F.C.C. chairman, and Haim Saban, a wealthy investor who built a major business on the Mighty Morphin Power Rangers action figures.

Lawyers representing Univision before the commission declined to comment about the case.

The fine was applauded by some Democrats in Congress who have long been dissatisfied with the agency for failing to press broadcasters to provide higher- quality programming for children.

“As the prime House author of the Children’s Television Act, I am pleased the commission is pursuing serious and vigorous enforcement of violations,” said Representative Edward J. Markey, the Massachusetts Democrat who heads the House subcommittee on telecommunications and the Internet. “This is a particularly egregious case and the level of the proposed fine reflects it. Rather than giving kids programming that is educationally nourishing, Univision elected to give them the Spanish-language equivalent of a soap opera..”

The case dates to the summer of 2005, when the United Church of Christ raised concerns about Univision’s programming lineup, complaining that it was failing to provide adequate children’s programs. The network claimed it was meeting its obligation by repeatedly rebroadcasting the same episodes of the telenovela. The commission’s staff found that 24 stations had violated the programming guidelines over a two-year period.

Angela J. Campbell, a telecommunications expert at Georgetown University Law Center who represents the church, appeared stunned by the decision.

“Assuming it’s true, I’m pleased to see the commission finally taking action and I hope they will take action soon on other petitions we have filed in this area,” Professor Campbell said. “Broadcasters need to know that they have to take these obligations to children seriously.”

Univision had maintained that it satisfied its programming obligations for children by broadcasting several telenovelas, including “Complices al Rescate”

“A significant purpose and key educational objective of this program is to illustrate how friendship, love and kindness can help overcome life’s adversities,” the network’s lawyers said in their brief before the commission. “ ‘Complices al Rescate’ follows the lives of two 11-year-old girls, Silvana and Mariana, who have both experienced sadness, loss and injustice in their lives. Throughout the shows, the girls learn to appreciate that happiness is not found in popularity and money, but in true friendship, good will towards others and love.”

But Mr. Martin said the commission found little merit to that argument, and critics said the show, with complex subplots and occasional adult themes, had little value for young children.

In an affidavit accompanying the United Church’s complaint, Federico Subervi, a media consultant to such shows as “Dora the Explorer” and “The Misadventures of Maya and Miguel” said that “Complices” contained many adult plots and complex themes that were hardly suitable for young children.

As further evidence that the program did not comply with the rules, Mr. Subervi noted that 80 percent of the advertising during the show was geared toward adults.