A three-part petition was filed in December 1974 with the Federal Communications Commission (FCC) which presented the first serious threat to public broadcasters' exemption from the FCC's multiple-ownership rules. The petition requested a revision of the rules that permit multiple ownership of noncommercial educational stations within a single market and a "freeze" on all applications for reserved educational channels made by government-owned and controlled groups and by religious schools and institutes. This paper traces the evaluation of the FCC's multiple-ownership rules and the issues surrounding the application of these rules to public broadcasting. The paper concludes that, since the FCC decided to allow public broadcasters to continue to receive preferential treatment through the duopoly exemption, and if this exemption is vital to the future development of public telecommunications, it is time to explore the maximum use of existing second channels. (JM)