FCC To Restore U Discount, Up Cap To 78%

FCC Chairman Ajit Pai says he wants to restore the national ownership cap's UHF discount at the FCC's April 20 meeting and he has the votes to do it. After that, he says in a blog post, "we’ll launch a comprehensive review of the national ownership cap ... later this year." Effect of restoring the discount would be to double the current limit to 78% of TV homes.

FCC Chairman Ajit Pai said today that he wants to restore the UHF discount of the national TV ownership cap at the FCC’s April 20 meeting, a move the would allow station groups to blow past the current limit (39% of TV homes). And, as part of the FCC’s 2-1 Republican majority, Pai gets what he wants these days.

Last fall, under FCC Chairman Tom Wheeler, the FCC eliminated the discount, which counts only half the coverage of UHF stations in calculating coverage under the 39% cap.

But on his blog today, Pai said it was time to “hit the reset button” and restore the discount.

“And then we’ll launch a comprehensive review of the national ownership cap, including the UHF discount, later this year.”

With the discount, the cap technically goes to 78%. Ion Media,which owns all UHF stations, could reach that level, but the actual cap for other groups would be somewhat lower depending on how many VHF stations they have in their station mix. Sinclair, for instance, would be effectively capped at 68%; CBS, at nearly 67%.

Comments (18)

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Hugh Haynie says:

March 30, 2017 at 3:11 pm

This is bad for American consumers.

    John Livingston says:

    March 30, 2017 at 7:10 pm

    This is a good that brings competition back to the broadcast stations the UHF discount is a good thing for media companies along with local viewers.

Rey Chavez says:

March 30, 2017 at 3:14 pm

WOW….. terrible news for people that like to get decent local news….. You’ll get the prepackaged Sinclair and Nexstar that airs in every market, delivered by the cheapest possible talent they can hire.

Gregg Palermo says:

March 30, 2017 at 3:16 pm

The bigger the better. Just like Hollywood studios.

Gene Johnson says:

March 30, 2017 at 3:58 pm

Is it a rational system where, due to the way most people watch television and the HDTV conversion the UHF discount has lost almost all meaning, that different owners can reach a different level on national audience penetration based on how many VHF stations they own? Do the Republican commissioners really think that’s what Congress intended when it established the 39% nationwide audience cap? Regardless of whether one thinks the current 39% national cap is good or bad, reinstating the UHF discount results in a truly irrational system.

Annie Wu says:

March 30, 2017 at 4:47 pm

With about 80% of TV being viewed over cable where cable channels can have 100% of the national audience, or social media channels which have no national limit on consumption based ownership this seem like clearing out antiquated controls and not a threat to consumers.

    Andrea Rader says:

    March 30, 2017 at 8:27 pm

    Amen. Broadcasters continue to be subjected to Depression-era regulations that have been rendered obsolete by cable channels and internet websites.

Cheryl Thorne says:

March 30, 2017 at 4:47 pm

Whats going to be the difference from The Local (soon to be gone) television model to a hedge fund???Nothing..It’s turning out to be just like what many media buyers wished and worse…Commodity Commodity Commodity. I hope a lot of the people in the local television business have other skills and exit strategies..When a company like Nexstar gets as big as it has you know the business is in trouble..

    Andrea Rader says:

    March 30, 2017 at 8:30 pm

    It’s not the government’s role to decide whether or not a communications company is making a bad business decision. The marketplace will hurt inferior operators where it hurts – in the wallet. If local TV isn’t getting the job done, there are plenty of other entities that will spring up to take its place.

Angie McClimon says:

March 30, 2017 at 4:58 pm

Nexstar and Sinclair are probably chomping at the bit to get more stations under their belts. But who are they going to go after? Quincy? Scripps? I know Sinclair has their eyes on Tribune (WGN would be screwed). Bigger is rarely ever better. Sinclair, Nexstar, Gray, and all the other big owners have sucked the soul from local television with their out-of-town one-size-fits-all corporate mandates that doesn’t work in all markets (and they get pissed when they realize it isn’t working). Consumers will lose handily with this. But our GOP congressional and FCC overlords don’t care. They are just helping their buddies in the 1%.

    Evan Ortynsky says:

    March 30, 2017 at 6:27 pm

    Don’t group Gray in with the Sinclair and Nexstar types.. Gray buys small market TV stations that are #1 or #2 in their market and infuse them with capital to make them even better. They help the station get the equipment they need but let each station operate locally. They are not overlords the way I have heard other groups are operated.

    John Livingston says:

    March 30, 2017 at 7:27 pm

    It’s not about left or right this is about competition which the UHF discount helps everyone even the little guy plus it’s called free market. But I guess you don’t get it and just want to say how bad Sinclair & Nexstar is which both companies own TV stations in the West Michigan market.

Brian Bussey says:

March 30, 2017 at 5:01 pm

someone please explain to me why any group should be able to reach 78% of all HH’s. I don’t know anyone who considers, uses, thinks, act or wants social media to replace broadcast television.

    Andrea Rader says:

    March 30, 2017 at 8:33 pm

    ABC, CBS, NBC, FOX and PBS reach almost 100% of households. How is that any different?

Shenee Howard says:

March 30, 2017 at 5:48 pm

All this will do enrich Nexstar, Sinclair and Raycom. The UHF discount is no longer relevenat in today’s broadcast industry considering 1) the switch to digital broadcasting eliminated any UHF technical deficiences (especially considering many DTV transmissions are on the UHF band for historical VHF stations), and 2) the high penetration of cable, sattelite, IPTV and alternate broadcast options. This is just wrong and is not in the interest of the public. Too often, these large operators come in, reduce staff (often laying off seasoned and trusted on air talent), cheapen operations, and pursue political agendas irregardless of local demographics (e.g. Sinclair).

Trudy Rubin says:

March 30, 2017 at 6:59 pm

That could backfire on stations groups. Get a new administration, new FCC, that ends the UHF discount, then the station group is force to sell the stations to get below the cap at a lost. It would better to change the cap and leave the UHF discount out of the equation.

    John Livingston says:

    March 30, 2017 at 7:17 pm

    The discount is good thing for competition for big players Nexstar, Sinclair along with the little guys as wellit helps doesn’t hurt. Tom Wheeler broke the rules by ending the UHF discount last fall at leas the new chairmen righted that wrong.

John Livingston says:

March 30, 2017 at 7:34 pm

I don’t get why people complain this is a bad thing which I don’t I think it helps everyone doesn’t hurt anyone. It is a good thing that UHF discount is back the FCC was wrong to get rid of it last fall which Tom Wheeler broke the rules on it at least FCC righted that wrong with the discount it helps competition even for the little guy it doesn’t hurt the little guy and is good for competition.