Top White House officials have intervened on the side of Hollywood film producers in their intense regulatory battle with television networks over control of TV programming, preventing the Office of Management and Budget from supporting the networks' position, sources said.
OMB had planned yesterday to file comments with the Federal Communications Commission supporting repeal of a 12-year-old rule that bars the networks from owning the lucrative rebroadcasting and syndication rights of hit programs.
But the OMB report was withheld following meetings between top Reagan aides Edwin Meese and Michael Deaver, and representatives of the Hollywood groups, including former Federal Communications Commission chairman Dean Burch and Nancy Reynolds, a one-time Reagan aide in California, and now a lobbyist with Wexler, Reynolds, Harrison & Schule Inc.
OMB officials refused public comment on the matter. Ed Dale, OMB's spokesman, said he did not know if or when his agency would submit comments to the FCC. "It just isn't something we'd want to talk about," Dale said. The deadline for filing comments was yesterday.
OMB was expected to support the television networks' campaign to lift the FCC regulation, known as the Financial Interest and Syndication Rule. The rule prevents the three major commercial networks from owning most of the programming they show and from any role in the syndication market.
Both the television networks and their public relations and lobbying representatives and the committee and its allies have stepped up lobbying for their positions at federal agencies, within the White House and on Capitol Hill.
The networks say repeal of the rule is vital in maintaining their ability to compete in the new world of video technology. Claiming repeal of the rule is consistent with the FCC's deregulatory view, CBS Inc. said in its filing yesterday that the "private economic interests of Hollywood studios, syndicators and other parties participating in this proceeding do not constitute a valid basis for agency regulation."
On the other hand, Alan Horn, chairman of Tandem Productions, and a spokesman for the Hollywood committee, said repeal of the rules "would be an unmitigated disaster for the production and artistic communities and for American television viewers." The players on Horn's side of the issue say repeal of the rule would only strengthen the three networks' control of television programming.
FCC action to repeal the rules would still leave another hurdle for broadcasters. In 1980, the Justice Department and three networks signed consent decrees including the essence of the FCC regulations. Those decrees would have to be altered before the networks could begin major efforts to sell syndication rights for popular new programs, a primary goal of the television companies.
The Departments of Justice and Commerce agreed with the bulk of the networks' position and filed papers opposing the Hollywood effort, a position that OMB was planning on taking, sources said.
Burch, lead attorney for a coalition of studio and production company interests, said the purpose of the White House visits was to brief White House and OMB staff members on a new study commissioned by his client, the Committee for Prudent Deregulation.
The lobbying group represents the major Hollywood studios, independent broadcasters, and production companies like Lorimar Productions and MTM.
Anne Wexler, a White House staff member in the Carter administration, would not say precisely who she and Reynolds spoke to within the Reagan White House, although sources said Reynolds and Deaver met Monday before the decision was made to block the filing of the OMB document.
"We tried to point out to the White House and other executive branch agencies that it would be useful since we were in the process of filing a half-million-dollar economic study to withhold any decision until they looked at the study," Wexler said.