FCC Begins Review Of Media Ownership Rules

The FCC today adopted a Notice of Proposed Rulemaking commencing the 2018 Quadrennial Review of its media ownership rules. The commission is legally required to review certain broadcast ownership rules every four years to determine whether they “are necessary in the public interest as the result of competition” and to “repeal or modify any regulation [the Commission] determines to be no longer in the public interest.”

The rules subject to this quadrennial review obligation are the Local Radio Ownership Rule, the Local Television Ownership Rule and the Dual Network Rule. The Local Radio and Local Television Ownership Rules limit the total number of broadcast radio and television stations, respectively, that may be commonly owned in a media market. The Dual Network Rule prohibits a merger between or among the Big Four broadcast networks (ABC, CBS, Fox and NBC).

In this Notice of Proposed Rulemaking, the commission seeks comment on whether these three rules continue to serve the public interest or whether they should be modified or eliminated in light of changes to the media marketplace.

In addition, the notice seeks comment on three proposals relevant to promoting diversity in the broadcast industry. The statute specifically excludes the national television ownership cap from the quadrennial review.

FCC Chairman Ajit Pai released the following statement after the NPRM was released: “Many years ago, Congress required the FCC to conduct a review of certain media ownership rules every four years. Today, we kick off the 2018 quadrennial review of our Local Radio Ownership Rule, Local Television Ownership Rule, and Dual Network Rule. As Congress instructed, we’re seeking to determine whether these rules remain ‘necessary in the public interest as the result of competition.’

“Specifically, we’re teeing up a broad range of questions about these rules. We want to know whether, given the current state of the media marketplace, we should retain, modify, or eliminate any of them. We’re keeping an open mind as to what, if anything, should change, and we hope to develop a robust record to guide us on the best path forward.

“Our endpoints may be unclear right now, but the end goal is not: Our rules must keep pace with the modern media marketplace.

“The reforms that this commission adopted last year to do just that are already having a positive impact. For example, in 2017, we eliminated the outdated newspaper-radio cross-ownership rule. Thanks to that reform, the owner of Colorado’s Grand Junction Daily Sentinel was recently able to purchase a radio station group in Grand Junction. I recently met Jay Seaton, who runs the Daily Sentinel. He told me that this transaction will help him disseminate news across more formats and appeal more to advertisers (revenue from which can be poured back into the business). As he put it, ending the cross-ownership ban was ‘15 years overdue.’ And if anyone doubts the positive impact it makes in small markets in particular, ‘come out here and try running a newspaper sometime. It’s a real struggle.’

“Additionally, consistent with the commission’s commitment in the 2010/2014 quadrennial review order, we’re seeking comment on several diversity-related proposals that were offered in the record of that proceeding.

“Given that this Notice doesn’t include any tentative conclusions, I’m disappointed that we were unable to secure a unanimous vote for it. But unfortunately, our dissenting colleague [Democrat Jessica Rosenworcel dissented in part] requested edits that did not comply with the law. Specifically, we were urged to delete any discussion of the Dual Network Rule from the Notice. But the Dual Network Rule is one of our media ownership rules that we are required by statute to review every four years. Whatever one’s opinion of it, refusing to include it in our quadrennial review would have violated the law. As a result, a request to remove it from the Notice doesn’t constitute a good-faith attempt to reach consensus but rather gives the appearance of looking for an excuse to dissent for political reasons.”

NAB EVP of Communications Dennis Wharton commented: “NAB looks forward to participating in the FCC’s congressionally-mandated quadrennial review of broadcast media ownership rules. We are not seeking wholesale elimination of these regulations, but rather a modernization that reflects today’s fiercely competitive marketplace. We trust the commission will update these rules with an understanding that free and local broadcasting now competes head-to-head with powerful Internet, pay TV and audio companies that didn’t exist when many broadcast ownership rules were first written.”