FCC multiple ownership rules

Yesterday, a panel of judges from the US Court of Appeals for the Third Circuit decided by a 2 to 1 vote to overturn the FCC’s 2017 decision that made significant changes to its ownership rules (see the decision here).  The Court sent the case back to the FCC for further consideration.  The 2017 decision (see our article here) was the one which ended the ban on the cross ownership of broadcast stations and daily newspapers in the same market and the limits on radio-television cross-ownership.  The 2017 decision also allowed television broadcasters to own two TV stations in markets with fewer than 8 independent owners and made other changes to the radio and TV ownership rules.  Yesterday’s decision also put on hold the FCC’s incubator program meant to assist new owners to acquire radio stations (see our summary of the incubator program here).  All of this was done without any analysis whatsoever as to whether marketplace changes justified the changes to the ownership rules or of the impact that the undoing these rule changes would have on broadcasters and other media companies – including on radio companies hoping for changes in the radio ownership rules in current proceeding to review those rules (see our articles here and here).

What led the Court to overturn the decision if it was not the Court’s disagreement with the FCC’s determination that change in the ownership rules was needed?  This Court, in fact these same three judges, has overturned the FCC three times in the last 15 years, stymieing ownership changes because the Court concluded that the FCC had not sufficiently taken into account the impact that rule changes would have on diversity in the ranks of broadcast owners.  Here, again, the Court determined that the FCC did not have sufficient information on the impact of the rule changes on ownership diversity to conclude that the rule changes were in the public interest – and thus sent the case back to the FCC to obtain that information before making any ownership rule changes.  What led the Court to that conclusion, and what can be done about this decision?
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The FCC has extended the time for filing comments in its ownership proceeding.  While comments on the new Quadrennial Review of the ownership rules had been set to be filed by July 7 (see our article here), the Commission has now extended the deadline until August 6 at the request of the Coalition

While the FCC continues its series of public hearings on possible revisions to its multiple ownership rules, the issue of newspaper-broadcast cross ownership is now squarely before the FCC in a number of proceedings. For instance, in the applications proposing a transfer of control of the Tribune Company, waiver requests have been filed in the markets where the company owns both newspaper and broadcast properties.  These markets include some of the largest television markets in the country including Los Angeles, Chicago and New York.  As the current rules prohibit the ownership of a daily paper and either a radio or television station in the same market, Chicago, where Tribune owns radio, TV and newspaper properties and has done so for many years, asks for waivers for both stations.  The FCC just designated the application for transfer of control of the Tribune Company as a permit but disclose proceeding, meaning that parties can talk to the FCC decision makers about the case, as long as they file a written disclosure statement with the FCC for inclusion in the record of the case.

 Also, press reports note that the petitions to deny have been filed against applications for the renewal of Fox’s television stations in New York, arguing that the combination of  Fox’s television stations in the market with the ownership of the New York Post is not in the public interest.

Seemingly, the proposed purchase of the Wall Street Journal by News Corporation, the owners of Fox,  if it were to ever come to fruition, would at least be reviewed by the FCC, as the Journal is published in New York, where Fox owns television stations.  However, FCC precedent established when Gannett purchased a Washington, DC TV station, in the same market where USA Today is published, would seem to set a precedent for the treatment of a specialized national newspaper like the Journal. While published in New York, the Journal really is national in scope – and not focused on local news, sports, entertainment or advertisers in the same manner that a local newspaper would be. 


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