John Kerry (D-MA) and Chuck Grassley (R-IA) have sent a letter to FCC Chairman Julius Genachowski asking for a probe into the use of shared services agreements (SSAs) in local television markets, sparked by reports of the Raycom/MCG Capital agreement in Honolulu.
The duo note that such agreements lead what were once rival network affiliates to combine news operations, resulting in fewer voices on the airwaves and less choice for consumers.
They did not limit their attention to Honolulu. “Unfortunately, some broadcast companies have taken advantage of a sympathetic FCC over the last eight years to gain multiple television stations in a given market,” they wrote, according to an article in Honolulu Advertiser.
The SSA in Honolulu is a bit more robust than most, creating relationships between three stations – most such agreements involve only two. It brings together Raycom’s NBC KHNL-TV and MyNetworkTV KFVE-TV with MCG’s CBS KGMB-TV. Two of the stations have since flipped identities.
According to the Advertiser, the letter was dated 11/2/09. The FCC has already been looking into the SSA, which was protested by a Honolulu watchdog organization. Raycom executives have maintained that there is ample precedent for the arrangement and that it is completely legal.
Kerry sits on the Senate Commerce Committee and is chair of its key Subcommittee on Communications, Technology and the Internet.
RBR-TVBR observation: We knew that SSAs were going to come under scrutiny as part of the quadrennial review of ownership regulation which the FCC undertakes next year and which has already been set in motion. Now, don’t be surprised to see this topic on the agenda of Kerry’s subcommittee at some point.
If you are involved in an SSA, and you’d like to keep it intact, the time to start preparing a case is right now, because it’s looking more and more like the question is not if you’ll have to defend it, but when.