As Expected, FCC ‘Modernizes’ Broadcast Ownership Rules

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The Weed whacker was put to action by a whipper snapper and two of his GOP colleagues at the Commission on Thursday, as the FCC voted 3-2 to eliminate its cross-ownership rules for newspaper and broadcast media and for radio and TV, respectively.


The “Eight-Voices Test” is also gone.

The FCC’s two Democratic Commissioners were vociferous in their opposition, but further action to stop the changes embraced by not only Chairman Ajit Pai but also the NAB, is now up to Congress or the Courts, as dissenting Commissioner Jessica Rosenworcel suggests.

While there’s little that the radio industry can rejoice about today’s actions at The Portals, TV industry C-Suiters and Wall Street investors are likely pleased; activity on Wall Street was largely positive across Thursday’s trading session.

Until today (11/16), the FCC’s broadcast ownership rules limited a single entity’s ownership of television, radio, and newspaper properties within a local market — rules codified and finalized when “The Hustle” was America’s favorite dance and Captain Fantastic and The Brown Dirt Cowboy was a best-selling LP for Elton John.

Per the Telecommunications Act of 1996, signed into law by President Clinton, the FCC is required to review its rules every four years to determine whether they remain “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.”

In August 2016, the Wheeler Commission adopted by a 3-2 Democratic vote a Second Report and Order that left the rules enacted in 1975 largely unchanged.

The Wheeler Commission also reinstated the television Joint Sales Agreement (JSA)
attribution rule, and the revenue-based eligible entity standard for ownership diversity purposes. It also required the disclosure of shared services agreements (SSAs) for commercial television stations.

Then came the election of Donald Trump as U.S. President, and a shift in FCC control to a 3-2 GOP majority. With that shift came a promise to modernize and reduce Commission rules and regulations, under the belief that this would help broadcast media against fervent competition in the digital space—something that barely existed in 1996, let alone 1975.

With that, the Pai-led Commission moved forward with an Order on Reconsideration of an NAB petition and a Notice of Proposed Rulemaking (NPRM) that would finally achieve what a host of pro-broadcasting industry groups and leaders have sought.

Their long-desired wishes will come true 30 days after the Order appears in the Federal Register. 

Merry Christmas, from your GOP friends at the Portals.

AN END TO POST-WATERGATE REGULATIONS

The 3-2 approval of the Order means that the only relevant “1975″ is an British rock band originating from Manchester, England.

In short, the Order does the following:

  • Eliminates the Newspaper/Broadcast Cross-Ownership Rule. The GOP majority says it is no longer necessary to promote viewpoint diversity and prevented combinations that would enable both broadcasters and newspapers to better serve the public interest.
  • Eliminates the Radio/Television Cross-Ownership Rule. Republicans say this is also no longer needed to promote viewpoint diversity in the modern media marketplace.
  • Removes the “Eight-Voices Test” from the Local Television Ownership Rule. Instead, the Commission will use a potentially Media Bureau-clogging “case-by-case review option in the Top-Four Prohibition to better reflect the competitive conditions in local markets.”
  • Erases the attribution rule for television JSAs. Why? The GOP leadership at the FCC believes they are “beneficial agreements that serve the public interest by allowing television broadcasters to better serve their local markets.”
  • Keeps the disclosure requirement for Shared Services Agreements involving commercial television stations.
  • Sees the FCC’s largely welcomed adoption of an incubator program allowing multicultural owners to seek opportunities. The NPRM sought comment on how the Media Bureau should structure the incubator program.

“We agree with [the NAB and United Church of Christ (UCC)] that adopting an incubator program would promote new entry and ownership diversity in the broadcast industry by helping address barriers to station ownership, such as lack of access to capital and the need for technical/operational experience,” the FCC said.


For more on this news story, visit the RBR.com homepage for fresh coverage and our extensive Archives for past coverage on the FCC’s Broadcast Cross-Ownership Rules.


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