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FCC to Review TV Station Ownership Cap

Updated on
  • Pai asks FCC commission to consider scrapping 39 percent cap
  • Proposal may lead to more media mergers like Sinclair-Tribune

Federal Communications Commission Chairman Ajit Pai said the agency will consider altering and possibly killing a national limit on TV station ownership, in a move that may lead to more media mergers such as Sinclair Broadcast Group Inc.’s proposed purchase of Tribune Media Co.

Pai, a Republican, said he had asked fellow commissioners to begin examining changes to the cap set by Congress that limits any broadcaster to owning stations that reach 39 percent of the country.

A vote in favor at the agency’s Dec. 14 meeting would commence a months-long rulemaking.

“Ignoring federal law, it could open the doors to a single company reaching in excess of the 39 percent national broadcast audience cap set by Congress more than a decade ago,” FCC Commissioner Mignon Clyburn, a Democrat, said in an email Tuesday.

Under Pai, who was appointed chairman by President Donald Trump, the FCC already has reinstated a rule written for obsolete TV transmission technology that lets owners of some stations count just half their audience under that cap, the so-called UHF discount. That opened the way for Sinclair to propose purchasing Tribune -- a $3.9 billion deal that would leave it owning stations reaching more than 70 percent of the U.S. audience. With the discount it would be about 45 percent, meaning it would have to sell just a few stations to meet the limit.

How that UHF discount fits with the national cap would be part of Pai’s proposed inquiry.

“We would seek public input on whether to modify, retain, or eliminate the 39 percent national cap as well as the UHF discount," Pai said in an emailed statement.

Also at its December meeting, the FCC is to consider rolling back Obama-era net neutrality rules mandating fair treatment of web traffic.

Sinclair in October told the FCC it would need to sell stations in two markets to comply with the national ownership limit as the company completes the Tribune purchase, which remains under review at the FCC and Justice Department. The company also listed 10 markets where the proposed merger could run afoul of related rules that limit TV station ownership in localities. Pai’s FCC eased those local rules at its Nov. 16 meeting.

Congress set the cap and the FCC isn’t permitted to change it, three Democratic House members, including Minority Leader Nancy Pelosi, said in a letter Monday.

The lawmakers told all five FCC members including Pai that the agency can’t let Sinclair own stations with a reach exceeding 39 percent of the national audience. If the agency lets Sinclair exceed the cap, future commissions will be forced to order station sales, the lawmakers said.

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