Home » Competition »Consumer News »Public Policy & Gov't » Currently Reading:

GOP Majority at FCC Relaxes TV Station Ownership Limits; New Wave of Consolidation Likely

Phillip Dampier April 20, 2017 Competition, Consumer News, Public Policy & Gov't No Comments

Ajit Pai, Chairman of U.S Federal Communications Commission, delivers his keynote speech at Mobile World Congress in Barcelona, Spain, February 28, 2017. REUTERS/Eric Gaillard

WASHINGTON (Reuters) – The U.S. Federal Communications Commission voted 2-1 on Thursday to reverse a 2016 decision that limits the number of television stations some broadcasters can buy.

The decision could lead to a possible acquisition by Sinclair Broadcast Group Inc of Tribune Media Co, some Democrats in Congress said.

Tribune did not discuss any tie up, but said in a statement the FCC decision “will serve the important interest of localism by enabling broadcasters to better serve their communities.”

FCC Chairman Ajit Pai said he plans to take a new look at the current overall limit on companies owning stations serving no more than 39 percent of U.S. television households.

Democratic FCC Commissioner Mignon Clyburn called the vote a “huge gift for large broadcasters with ambitious dreams of more consolidation.” She said it “will have an immediate impact on the purchase and sale of television stations.”

Her concern was echoed by the top Democrat in the U.S. House of Representatives, who a day earlier urged the Federal Communications Commission to cancel the vote.

House Democratic Leader Nancy Pelosi warned that the changes could be harmful to consumers, hitting their wallets and their access to an independent media voice, as she cited press reports of a possible acquisition by Sinclair Broadcast Group Inc of Tribune Media Co stations.

Clyburn

In a letter, Pelosi and Representative Frank Pallone, who is the ranking Democrat on the House Energy and Commerce Committee, urged Pai to drop the plan, which could allow the Sinclair-Tribune tie-up.

“That would be bad news for consumers in Tribune’s markets in two ways: First, consumers would lose an independent voice in their media market; and second, consumers could see their cable bills go up because Sinclair charges cable operators more than Tribune for retransmission consent,” they wrote.

Another Democrat, Representative Anna Eshoo, wrote Pai asking him to drop the plan, saying that further consolidation “will ensure there are fewer independent news outlets serving as a counter-balance to misleading or inaccurate information.”

Meredith Corp spokesman Art Slusark said on Thursday the vote “may open up the opportunity for more acquisition opportunities … We are always interested in adding quality properties to our broadcast portfolio.”

Under rules adopted in 1985, stations with weaker over-the-air signals could be partially counted against a broadcaster’s ownership cap. But last year, the FCC under Democratic President Barack Obama said those rules were outdated after the 2009 conversion to digital broadcasting, which eliminated the differences in station signal strength. It revoked the rule in September.

There is a dispute over whether the FCC has the authority to amend the 39 percent ownership limit.

The 2016 decision did not require any company to sell existing stations, but could bar acquisitions. Twenty-First Century Fox Inc in September challenged the FCC rule in court.

Reuters reported in March that Sinclair had approached Tribune to discuss a potential combination, which would hinge on regulations being relaxed.

Pai said the FCC previously effectively tightened ownership rules and then companies previously below the national cap suddenly exceeded it. He said the FCC “did not examine whether the facts justified a more stringent cap.”

Pai, who was named by U.S. President Donald Trump to head the FCC in January, said it will begin a comprehensive review of the national cap this year. That could launch a new wave of consolidation in the broadcast television industry.

Clyburn cited comments from CBS Corp Chairman and Chief Executive Leslie Moonves in February that Pai would be “very beneficial to our business.” Moonves said the company would like to acquire more stations if the cap is lifted.

(Reporting by David Shepardson; Editing by Jonathan Oatis and Dan Grebler)







Search This Site:

Contributions:

Recent Comments:

  • BobInIllinois: My observation has been that Xfinity/Comcast will compete on speed if the local market is competitive. If they are the speed leader already, they won...
  • Josh: It's not where I am. There's a Fiber company available that's both way cheaper and way faster. I've wondered if they're trying to compete with that....
  • BobInIllinois: Xfinity must have goal to be fastest broadband speed in its markets....
  • john: So can they merge digi tier 1 and 2 together now and keep it at $12 since they are removing like 8 channels from it and it's basically just a crappy ...
  • Josh: Nice! It's about time we get some good news!...
  • tim: Predicted cost for cable next year by November: $74.50 ( for the basic package, and when ever your beginning trial period ends with in the year of sig...
  • JACQUELINE SKIPPER: I have this problem with Spectrum. I would have to cancel and wait 3 months and I would if I didn't need my internet and the sabres games. they alway...
  • BobInIllinois: Frontier offers VantageTV in the Bloomington-Normal, Illinois area. They are competing with Comcast and MetroNet (a fiber overbuilder from Evansville...
  • L Nova: The DOJ should force AT&T to either sell OR spin off the unwanted copper wireline assets....
  • EJ: Do these "institutes" really think they are fooling anyone? This song and dance political moves is sickening at best. Most of these companies have dug...
  • jason: poor former Brighthouse members in a week it will be a year since SPP prices started for them. That means no one will be on the legacy first year pr...
  • jason: spectrum is on pace to be the worst cable company when it comes to speeds soon. They had no reason to remove the 200mbps option twc had. They will al...

Your Account:

%d bloggers like this: