The Federal Communications Commission’s recent vote to change media ownership regulations could mean that a single company is allowed to own a broadcast station and a newspaper in a local market, among other changes. The new rules eliminating media cross-ownership may be challenged in court, but if they survive, they could lead to more mergers and further consolidation of media properties.
According to an article published by Variety, the new FCC changes come after Sinclair Broadcast Group announced its intention to buy Tribune Media. FCC Chairman Ajit Pai advocated for new measures and said regulations “should match the media marketplace of 2017.” According to The Verge, “Pai has been a commissioner at the FCC since 2012, when he was appointed by then-President Obama and confirmed by the Senate.” President Trump elevated him to chairman. Opponents of the changes are worried that these rules will stunt the growth of new companies, including those owned by women and minorities.
The Variety article says the new rules, passed in a 3-2 vote, will allow for:
- “Common ownership of a newspaper and a broadcast station in the same market.” While many public interest groups are skeptical of the new rules, the legislation to remove ownership restrictions has gained bipartisan support on Capitol Hill.
- “Common ownership of two of the top four TV stations in the same market, subject to a ‘case-by-case’ review by the FCC.” Stations are no longer required to show that after a merger has occurred, at least eight independently-owned outlets are located in the local coverage area.
- “Greater leeway for joint sales agreements.” Applicable to local broadcasting stations that have agreements to sell more than 15% of the advertising time of another outlet in a common market. These stations won’t have to count those deals when calculating if they are within national TV ownership limits.
- “Restored the ‘UHF discount.’” The UHF (ultra-high frequency) discount means that broadcast companies can count half of the coverage area reach of their UHF stations, allowing companies to purchase outlets and still fall within a national ownership cap.
- “Eliminated rule requiring that broadcast stations have a main studio in their local coverage area.” Opponents of the change believe the new rule will prompt more media companies to consolidate while those in favor say it will allow smaller stations to save money, as they will not be forced to maintain a physical presence in their coverage area.
Will the new rules survive?