FCC ownership rules

Three consent decrees entered into by public companies in recent months for, without prior FCC approval, moving station licenses among wholly-owned subsidiaries as part of corporate reorganizations, remind broadcasters that if they are making any change in their ownership where the chain of control changes, even if actual control remains the same, they still need prior FCC approval.

The FCC today took what it called “a historic and long overdue step” to increase ownership diversity in the radio industry. Specifically, it adopted requirements that will govern an incubator […]

Public broadcasters have asked the FCC to exempt noncommercial TV statiions from a regulation requiring them to broadcast using two different standards during rollout of the new ATSC 3.0 standard.

In a Des Monies Register op-ed, FCC Commissioner Jessica Rosenworcel bemoans the FCC’s relaxing of ownership rules and the proposed Sinclair-Tribune merger, saying “Washington should not be clearing the way for big companies to overwhelm local media markets.  Because local traditions — and local coverage — matter.”

In anticipation of a Dec. 14 vote, the FCC today released the draft of the rulemaking on whether the national ownership cap on TV stations should be “retained, modified or eliminated.” It makes no recommendation, although FCC Chairman Ajit Pai is seen as favoring loosening the cap or eliminating it. With the Sinclair-Tribune merger pending and possibly in mind, the draft asks whether station groups that exceed any new cap should be grandfathered.

FCC’s Ajit Pai: “For over four decades, the FCC has restricted the ability of broadcast media outlets to also own newspapers, and vice versa, in the same market, under what is known as the newspaper-broadcast crossownership rule. There’s ample evidence that the crossownership rule has led to less local reporting. Simple fairness is another reason to change the rule.”

Thirteen members of Congress ask FCC’s Pai to allow public comments on its plan to loosen station ownership rules.

The group of independent stations says the commission should to go further at its Nov. 16 vote on relaxing the ban against owning two Big 4 affils in a market. It also suggested that the FCC defer a final decision on the must-carry status of Next Gen TV signals.

Broadcasters have been expecting good things from new FCC chief Ajit Pai. And he didn’t disappoint with the agenda for next month’s FCC meeting. There was good news on two fronts. First was the plan to relax the local ownership rules. Then came word that the FCC will greenlight ATSC 3.0.

Thursday evening the FCC released details of its proposal to OK ATSC 3.0 and retrans plays a big role. Under the proposed rules, must-carry protection would apply only to a broadcaster’s ATSC 1.0 transmission, not its new 3.0 signal, at least during the simulcasting period the FCC is planning to mandate to protect consumers during the transition. But the proposed rules also make clear that broadcasters will be free to negotiate retrans consent deals for carriage of their 3.0 programming, even during the simulcasting period.

FCC Chairman Ajit Pai has told an opponent of Sinclair Broadcast Group Inc.’s proposed purchase of Tribune Media that the agency may review media ownership rules before ruling on the $3.9 billion deal, something that could delay a decision on the merger.

Preston Padden: “I have longtime friends who believe that the public interest requires the FCC to strictly limit the ownership of multiple TV stations. I genuinely understand and respect their opinions. But, my personal experience over 40 years in the industry suggests that TV ownership limits intended to enhance diversity may, in fact, prevent the creation of meaningfully diverse competitors.”

FCC Chairman Ajit Pai said that the agency is studying restrictions on media ownership, characterizing a number of the rules as “quite antiquated.” In an interview Monday with Variety, Pai said that an easing of such restrictions “is one of the issues that is under consideration. We haven’t made any firm determinations there, either.”

Whoever Donald Trump appoints to head the FCC, broadcasters figure they should be in much better shape than they have been with the outgoing Tom Wheeler, who provided no relief on the out-of-date ownership restrictions. With Wheeler’s departure, the Republicans will suddenly have a 2-1 majority, a three-person quorum necessary to do business and the power to set the agenda that comes with the chairmanship.

The trade group says the FCC’s ownership rules have “left broadcasters to labor under outdated and unnecessary restrictions … that harm their ability to compete and indeed survive in today’s digital media marketplace.”

The FCC commissioner sets forth his stance on reforming the commission’s media ownership rules. “Broadcasters and newspapers have much to contribute in terms of diverse, local content, but many have been left fighting, some for their very survival, with an artificially-narrowed range of options.  In general, they should be set free to compete on equal footing with all of their fellow content providers, not kept on an unnecessary and unfair regulatory leash.”

The FCC’s order makes it into the Federal Register, establishing deadlines for petitions for reconsideration and/or judicial review as well as the effective date of the underlying order — but what exactly will take effect on that date?

Congress on Friday sent President Barack Obama a bipartisan but deficit draining year-end budget package that includes language allowing broadcast joint sales agreements that were in existence at the time of last year’s FCC rule change to continue. NAB spokesman Dennis Wharton said: “NAB salutes the bipartisan leadership of both parties in correcting a punitive regulatory overreach that would have unfairly harmed millions of local television viewers. With this action, Congress sends an unmistakable message that it continues to value broadcasting as an indispensable source of news, entertainment and lifeline information every day across America.”

As part of a federal funding bill that’s expected to pass soon, joint sales agreements would be grandfathered until at least 2025.

The Wall Street Journal reports that TV broadcasters are on the cusp of turning back one of the toughest pieces of regulation to hit them in decades. The rule, put in place last year by the FCC, cracks down on sharing agreements between local TV stations, arrangements that have helped broadcasters grow without violating federal ownership limits. Journal subscribers can read the full story here.

The FCC ownership regulations have shaped (warped?) today’s broadcasting business in many ways and determined what kind of station deals can and cannot be done. For example, the 39% cap means many large groups can’t merge because they are at or near the limit. But it so complicates their ability to exit the business.

In comments on the FCC’s ownership review, the trade group submitted a study that found, among other things, that duopoly broadcast TV markets do not lead to higher ad rates. It also found no evidence that in markets where broadcasters are engaged in a joint sales agreement or shared service agreement are broadcasters able to charge higher advertising rates than in markets without these arrangements.

The Media Bureau chief tells a Hill panel that since TV and newspapers are still most powerful media, the commission needs to continue to regulate who controls them. Rep. Henry Waxman agrees, Rep. Greg Walden objects, saying: “Without relief, I fear that local broadcast and newspaper companies will continue to struggle against unregulated competitors whose business models are not hamstrung by decades-old regulatory assumptions.”

The House Energy and Commerce Communications subcommittee will hear Wednesday from a handful of media groups, coalitions and the head of the FCC’s Media Bureau about whether the existing rules have stood the test of time, especially as new forms of news and entertainment have taken hold online and on cable channels.

A U.S. regulator whose vote is needed to change television-station ownership rules that may force Sinclair Broadcast Group Inc. to sell assets is pushing to ensure smaller companies can win exceptions. Mignon Clyburn, a member of the Federal Communications Commission’s Democratic majority, said in an interview she wants “balance” as the agency tightens regulations for controlling more than one station in a market.

NAB says that any reconsideration by the FCC of its UHF discount should be done within the context of a holistic review of media ownership rules.