Deborah D. McAdams /
09.26.2013 02:54 PM
FCC Opens Docket on Ending UHF Discount
May grandfather in groups exceeding national cap a la Sinclair
WASHINGTON— The Federal Communications Commission has  initiated a proceeding to consider eliminating a provision that gives special treatment to UHF channels under its national television ownership cap.

The UHF discount was adopted nearly 30 years ago when UHF signals were regarded as technically inferior to VHF signals in analog television broadcasting. The broadcast television ownership rule prohibits a single entity from owning stations that reach in the aggregate more than 39 percent of total television households nationwide. The UHF discount allows stations broadcasting in UHF to count toward that cap only 50 percent of the television households in their Designated Market Areas, as opposed to the 100 perceent requirement for VHF stations.

With the transition of full-power stations to digital broadcasting in 2009, the technical inferiority of UHF appears to be a thing of the past. Therefore, the technical justification for the UHF discount no longer seems to exist. With today’s action, the commission seeks to ensure that its rules reflect the current state of television broadcasting technology. The proceeding also furthers the commission’s mandate to evaluate its rules to make certain they continue to serve the public interest.

Specifically, the Notice of Proposed Rulemaking seeks comment on the following tentative conclusions and proposals:

The commission has the authority to modify the national television ownership rule, including the authority to revise or eliminate the UHF discount.

The UHF discount should be eliminated from the national television ownership rule because the historical justification for the discount no longer exists.

Should the commission consider adopting a VHF discount at this time?

If the UHF discount is eliminated, grandfathering should be accorded to existing broadcast station ownership groups that exceed the 39 percent national cap by virtue of the elimination of the discount, and to proposed station combinations that would exceed the 39 percent cap if an application is pending with the commission or the commission has approved the transaction but it is not yet consummated when the NPRM is released. (This would apply to Sinclair Broadcast Group.) Grandfathered ownership combinations subsequently sold or transferred would be required to comply with the national ownership cap in existence at the time of the transfer.

The docket is No. 13-236.

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