In a landmark vote that could forebode a similar change to the U.S. radio ownership caps, the Federal Communications Commission has voted to eliminate the 39 percent ownership cap on broadcast television stations.
The vote marked the first time the rule has been modified in approximately 20 years and instead gives the FCC power to review each transaction that exceeds the caps on a case by case basis, to determine whether or not they are “in the public interest.”
The 2–1 vote on party lines, with Commissioner Anna Gomez dissenting, was applauded by broadcasters who have lobbied for decades to end the caps.
It is likely, however, to face lengthy legal challenges from opponents who argue the ownership limits can only be changed by Congress.
While there is no formal proceeding on the table to lift the local radio ownership rule, as Radio World has reported, radio groups have been stepping up lobbying efforts to move the issue forward, as part of the FCC’s quadrennial review.
Shortly after the vote on Thursday during the commission’s August meeting, the public interest group Free Press announced plans to file a lawsuit against the FCC, calling the order an “unlawful power grab,” arguing that only Congress has the authority to change the ownership caps.
FCC Chairman Brendan Carr framed the changes as a way to protect local news and help TV stations better compete in a media landscape dominated by big tech and large streamers like Netflix.
Carr stressed the importance of localism and the need to strengthen the economics of local news as reasons for approving changes in the ownership caps.
“I don’t want local broadcast TV to go the way of local newspapers, and yet the risk is real,” Carr said, adding that over the last two decades “more than 80% of local journalism jobs have vanished.”
He also said that the order would replace a “blunt instrument” of a 39% ownership cap with a nuanced case by case approach.
In a statement, NAB president and CEO Curtis LeGeyt applauded the move, saying “[t]he FCC’s decision to eliminate the outdated national television ownership cap marks a generational step toward strengthening local stations and ensuring they can compete in today’s media marketplace.”
Inviting further consolidation
As expected, Gomez, the lone Democrat commissioner, opposed the order, stating that the decision to eliminate the ownership cap “plainly violates the law” and exceeds the FCC’s authority while also overlooking “real-world consequences for the public we serve.”
“Even setting legality aside, eliminating the cap is bad policy,” Gomez said in her comments. “It invites further consolidation at a time when consolidation has consistently resulted in newsroom mergers, content duplication, fewer independent voices and higher retransmission consent fees passed directly to consumers.”
Gomez also cited a number of Republicans, including former House Majority Leader Tom Delay who helped pass legislation that included the 39% cap, who have argued that only Congress can change the cap.
But Commissioner Olivia Trusty, a Republican, said that the case-by-case review was “particularly appropriate,” so that the commission can review each proposed transaction on its individual merits, which include local market conditions.
“That approach is firmly grounded in long-standing Commission practice and well-established principles of administrative law,” Trusty said in her comments before casting the second vote needed to pass the proposal.
Comment on this or any article. Email [email protected].
