FCC ownership rules

A deal for Forum Communications Company to acquire Fox affiliates KVRR Fargo, N.D., and KQDS Duluth, Minn., has come undone. The deal failed to materialize as both Forum Communications and Red River Broadcasting awaited what is called a “Big Four waiver request” from the FCC. The waiver would have allowed Forum to acquire a second “Big Four” network affiliate in the Fargo market.

The FCC should conclude its long-overdue, congressionally mandated quadrennial review of whether its media ownership regulations are necessary in the public interest, NAB CEO Curtis LeGeyt told FCC Chairwoman Jessica Rosenworcel earlier this month, according to an FCC filing. A politically tied FCC is unlikely to approve reregulation of broadcasters and so far there has been no movement on a Senate confirmation vote on Gigi Sohn, the Democratic nominee who would break that tie.

It’s been four months since Comcast filed its FCC petition asking the agency to look at whether Nexstar is in violation of the 39% broadcast audience cap, and so far, it’s been crickets.

In a move that is a big blow to some big tech companies, Congress has voted to ban new equipment licenses for Chinese telecoms Huawei, ZTE and any other technology company the government concludes poses a national security threat, closing what one of the bill’s sponsors called a “dangerous loophole.”

In a first for an acquisition of a network affiliation, the FCC says Gray Television has “willfully and repeatedly” violated the commission’s prohibition on owning two of the top-four rated full-power TV stations in a market. The FCC has proposed a half-million-dollar fine. The commission said that the proposed fine stemmed from its acquisition of the CBS affiliation of KTVA — which went dark — when it already owned NBC affiliate KTUU, both in Anchorage, Alaska.

Republicans are basking in the U.S. Supreme Court’s decision upholding a GOP rollback of media ownership restrictions — but now it’s the Democrats’ turn to put their stamp on the policy. The FCC must review its media ownership rules every four years. The latest review, begun in 2018, languished while the legal challenge to the Republican policy was pending. The high court’s decision in FCC v. Prometheus Radio Project frees the now Democratic-led FCC to jumpstart its review process. Both Democratic members have publicly backed more stringent rules that promote minority and women ownership.

The United States Supreme Court yesterday released its decision upholding the FCC’s 2017 changes to its ownership rules in the FCC v. Prometheus Radio Project case. The practical result of this decision is that the newspaper-broadcast crossownership prohibition will end. We certainly do not think that any future FCC would try to reinstate the crossownership ban given the current state of the newspaper industry. Also abolished in 2017 and now formally ended are the radio-television crossownership restrictions.

Few rules in the Code of Federal Regulations have as tortured a history as 47 CFR § 73.3555 — the broadcast multiple ownership rules. The subject of court decisions too numerous to count, a brief review of FCC decisions revising (or deciding not to revise) these rules reveals a twisted mass of logic and rationales where parties fiercely argue even as to the very reason for their existence. Today, the Supreme Court released a unanimous decision reversing the Third Circuit’s ruling involving three ownership rules, noting simply that the FCC’s approach had been reasonable, and the fact that it made its decision based on the record before it rather than the record the Third Circuit wished for, was just the way government must function.

In a big victory for broadcasters, the Supreme Court has reversed the Third Circuit’s decision throwing out the FCC’s broadcast deregulation under former FCC Chairman Ajit Pai. Current acting chairwoman Jessica Rosenworcel had voted against the deregulatory move.

NAB President Gordon Smith says the organization is shifting into offense with the new Democrat-led FCC, pairing with newspaper publishers for an antitrust exemption in dealing with Big Tech along with pressing for a relaxation of antiquated TV ownership rules. Note: This story is available to TVNewsCheck Premium members only. If you would like to upgrade your free TVNewsCheck membership to Premium now, you can visit your Member Home Page, available when you log in at the very top right corner of the site or in the Stay Connected Box that appears in the right column of virtually every page on the site. If you don’t see Member Home, you will need to click Log In or Subscribe.

A recent study published by two FCC economists shows the agency’s local ownership regulations depress the amount of local news programming that could otherwise be produced. The FCC could immediately promote more local news production just by relaxing its outmoded rules.

On the final full day of the presidency of Donald J. Trump, his administration urged the Supreme Court to allow media ownership rules to change despite some who believe the move would hurt female and minority ownership of broadcast outlets. A high court with three Trump appointees could grant such wish, although the forthcoming decision figures to be prelude to more battles ahead.

Turns out Jan. 19 will be an inauguration day of sorts — inaugurating the Supreme Court’s first consideration of an appeal of the FCC’s media ownership rule deregulation. It will be the fourth oral argument of the January session, with one hour of argument scheduled, though that could spill over depending on how the arguments and Justices’ questioning goes.

Gray’s brief argues that the FCC’s modernized rules should finally be allowed to take effect because the agency issued them in full compliance with its obligations under Section 202(h) of the Telecommunications Act of 1996.

Broadcasters would welcome reformation of the outdated newspaper-TV crossownership rule, but the Supreme Court’s decision to hear an appeal of the Third Circuit decision doesn’t solve all the industry’s COVID-induced woes. The FCC still needs to eliminate the Top 4 rule and online video distributors need to be classified as MVPDs.

As we reported last week, the United States Supreme Court has agreed to hear appeals by the FCC and the NAB of a decision by the U.S. Court of Appeals for the Third Circuit that overturned a 2017 decision by the FCC attempting to relax its media ownership rules. So, what does this actually mean for the FCC’s ownership rules and the broadcast industry? Not surprisingly based on the history of this proceeding, the answer is not entirely clear.

The country’s top court has taken up a major case about media ownership rules that will have a far-reaching impact on M&A and broadcast regulation.

The U.S. Supreme Court said on Friday it will take up a long-running legal dispute over whether the FCC can loosen U.S. media ownership rules. A lower court has thwarted the FCC’s efforts to revise the rules since 2003 in a series of decisions.

“The FCC’s anachronistic ownership rules place local broadcasters at a decided disadvantage against other competitors in the complex, fast-evolving, highly competitive video marketplace,” the Big 4 affiliate groups told the Supreme Court.

The Solicitor General of the United States, on behalf of the FCC, has asked the Supreme Court to review a U.S. Third Circuit Court of Appeals decision overturning most of its media ownership deregulation decision, hammering the circuit for what the FCC suggested was serial obstruction of what it had concluded was in the public interest.

Why have the FCC’s decade-long efforts to liberalize the broadcast ownership rules been stymied by two judges and will that continue?

The FCC has reinstated its 2016 ownership rules, recognizing that the changes made in those rules in 2017 were no longer effective because the Third Circuit Court of Appeals had thrown out the 2017 decision. While the FCC may still try to appeal the Third Circuit decision to the Supreme Court, the Third Circuit’s mandate has issued, meaning that its order is effective even if a Supreme Court appeal is filed.

TV station owners are taking advantage of FCC rules to quietly take over small-town airwaves, but cable and satellite companies are crying foul to regulators. Broadcasters aren’t supposed to own more than one top-rated outlet in any market, but they are snapping up multiple stations anyway in small markets like Parkersburg, W.Va., and Greenville, Miss., as the broadcast TV market is challenged by changes in technology and advertising.

The FCC isn’t likely to loosen ownership restrictions anytime soon, said leaders from Nexstar, Gray and Meredith last week, but outside money is likely to continue coming into the industry while the ownership cap holds steady. L-r: Patrick McCreery of Meredith, Perry Sook of Nexstar and Pat LaPlatney of Gray. (Photo: Wendy Moger-Bross)

The federal court in Philadelphia said the FCC, in eliminating the newspaper-broadcast crossownership rule and relaxing the local TV duopoly rule, failed to ascertain the impact of the action on station ownership by women and minorities. FCC Chairman Ajit Pai blasted the ruling and the court, which has repeatedly blocked ownership dereg: “It’s become quite clear that there is no evidence or reasoning — newspapers going out of business, broadcast radio struggling, broadcast TV facing stiffer competition than ever — that will persuade them to change their minds.”

Gray Television’s deal to buy KDLT Sioux Fall, S.D., and create a precedent-setting affiliate duopoly in the market has been hung up at the FCC for 15 months without any explanation. For the sake of buyers and sellers, large and small, the FCC needs to act.

When it comes to those opposing modifications to the FCC’s media ownership rules, the National Association of Broadcasters is not holding back in its most recent comments. The organization wrote that comments submitted in opposition to reform are “fundamentally backward” in this new media marketplace.

FCC Chairman Ajit Pai put in a plug Wednesday for giving the FCC some fast track broadcast deregulatory authority. In a House Communications Subcommittee FCC oversight hearing, Pai said that the disconnect between a moving marketplace and the “stasis” of FCC rules was the fundamental issue the FCC had with its media ownership rules.

The cable trade association says the commission should not only retain its ban on the common ownership of two full-power Big Four network affiliates in the same market, but should also close a “loophole” that allows affiliates to double up by carrying Big Four programming on low-power stations and multicast streams. NCTA such deals give broadcasters an unfair advantage during retrans negotiations.

This Thursday and Friday, at a “workshop” in Washington, broadcasters get to make the case to the antitrust division of the Justice Department that TV stations compete not only with each other, but also with cable and digital media like Facebook and Google. It’s nice that Justice is giving broadcasters this opportunity to air their grievances, but I’m doubtful it will trigger a change in policy, at least not in the short term.

The FCC chairman tells the NAB Show that when it comes to the commission’s review, “we will not be deterred by those whose regulatory views are not guided by facts and reasons, but instead were set in stone in the era of Laverne & Shirley, Starsky & Hutch and The Captain and Tennille.”

FCC Commissioners Michael O’Rielly, Brendan Carr and Geoffrey Starks weighed in on localization and local broadcasters’ coverage of crises during an NAB Show panel session.

FCC chief Ajit Pai should finish what he started on local TV ownership reform by approving the precedent-setting station sale in Sioux Fall, S.D. Action is long overdue.

The FCC told a federal appeals court this week that it did gauge the impact of its 2017 broadcast deregulation on media ownership diversity and found it would have “no material impact.” That came in a brief to the U.S. Court of Appeals for the Third Circuit, which is hearing appeals by Prometheus and others of that media ownership deregulation.

Most of a dozen broadcast groups, including Nexstar and Tribune, told the FCC today in a filing since UHF is the stronger, more valuable, signal in the digital age, and an owner can, if it had only UHF stations, reach up to 78% of the national audience given the 50% UHF discount, making the cap a straight 78% across the board is the least the FCC should do.

Comments on the issues teed up by the FCC in its 2018 Quadrennial Regulatory Review of its ownership rules are due April 29 and reply comments May 29.

Lately, the Antitrust Division of the Department of Justice headed by Makan Delrahim has been undermining the FCC — and perhaps even Congress — and disrupting the broadcasting business as it struggles to ward off rivals for viewers and ad dollars on multiple fronts. I cannot remember a time when Justice has plunged so deeply into the nitty gritty of the broadcasting advertising marketplace and what kind of local station combinations should be allowed.

In a filing with the FCC, the station group says it will ask the agency for a waiver of the rule that prohibits common ownership of two top four stations in a market. Nexstar also acknowledges that it will have to exit markets to comply with the commission’s 39% ownership cap. As things now stand, the merger would swell Nexstar’s coverage to 47.1%.