Murdoch’s bid for Newsday draws opposition

updated 7:06 p.m. ET April 24, 2008

NEW YORK - With Rupert Murdoch closing in on owning his third New York-area newspaper, opposition is emerging from consumer groups to potentially more concentration of ownership in the nation’s media capital.

Murdoch’s News Corp. media conglomerate is close to acquiring Long Island-based Newsday for around $580 million from Tribune Co., which is seeking to sell assets just four months after being saddled with a debt load of $8.2 billion as part of a going-private transaction.

The fate of Newsday isn’t decided yet, however. According to a person familiar with the situation who asked not to be named, real estate developer Mortimer Zuckerman, who owns the New York Daily News — bitter rival to Murdoch’s New York Post — is planning to put in a formal proposal to buy Newsday on Friday.

Long Island-based cable TV provider Cablevision Systems Corp., which owns a local cable news channel, has also been reported to be considering a bid along with Jared Kushner, owner of the New York Observer, a highbrow weekly newspaper in Manhattan. Representatives of both Cablevision and Kushner declined to comment.

The acquisition is being watched particularly closely because — in addition to the feisty tabloid Post — News Corp. owns two New York-area TV stations and Dow Jones & Co., parent company of The Wall Street Journal.

For several consumer advocacy groups, the mere prospect of Murdoch getting another New York media outlet is unacceptable.

Susan Lerner, executive director of Common Cause in New York, called the potential acquisition “a step back that will hurt our democracy,” and Consumers Union, publisher of Consumer Reports, has also come out against it.

News Corp. spokeswoman Teri Everett declined to comment.

Chairman Kevin Martin of the Federal Communications Commission declined to comment directly on the deal Thursday, saying the commission doesn’t have any transaction before it.

“The commission will apply its rules on media ownership as they currently are, including the reforms we made in December, to any of those transactions,” Martin said. “I think we’ll follow those rules very closely.”

Martin said the FCC does not issue a “newspaper license.” Media ownership decisions take place at the time of license renewal, he said.

Both stations’ licenses apparently expired in June. Martin had no comment on when the agency will act on the applications for renewal.

News Corp. also owns a huge array of media assets around the globe, including the Fox network, Twentieth Century Fox, and newspapers in the United Kingdom and Australia.

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