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Media Ownership Rules Are Detrimental to Competition, Localism and Diversity, NAB Says

FCC seal
(Image credit: FCC)

WASHINGTON, D.C.—In a filing with the FCC, the National Association of Broadcasters is arguing that the regulatory framework governing ownership of broadcast radio and television stations harms broadcasters’ ability to compete in the marketplace, impedes localism and fails to promote diversity in ownership. 

"In assessing competition, the FCC can no longer maintain the fiction that broadcast stations compete only against other broadcast stations,” said NAB in its comments. “Given the record evidence…the FCC must conclude that its local ownership rules are no longer necessary in the public interest as the result of competition.”

NAB made the comments as part of the FCC’s 2018 quadrennial review of broadcast ownership rules and reiterated its longstanding view that local radio and television stations operate under outdated media ownership restrictions dating back decades to the analog era.  

The outdated rules, which have failed to account for changes in the marketplace, no longer enable broadcasters to effectively operate in a competitive market or effectively serve the public interest, are in urgent need of reform, NAB said.

Those rules also hurt localism and diversity, the NAB maintained. 

With the decline in the newspaper industry, broadcast radio and television stations are among the few entities still capable of producing local news, weather, sports and emergency journalism, the NAB noted. 

These newsgathering ventures require high capital and operating costs, but the outdated rules prevent broadcasters from achieving the scale necessary to sustainably provide local journalism to their communities, NAB said. 

In addition, the FCC’s rules have failed to account for increased competition from giant technology platforms for advertising revenue. 

“[E]ven if capital were more accessible, the FCC’s continued insistence on heavily regulating broadcasters – including through outdated ownership rules – is a clear disincentive to investment and new entry,” said NAB in its comments. “In a world where investors and new entrants have countless other media and communications options, the Commission itself is a major impediment to increased diversity in the broadcast industry.”

In its comments, NAB urged the FCC to adopt proposed media ownership reforms offered by NAB in 2019. 

Those proposals ask the FCC to get rid of per se restrictions that ban combinations among top-four rated TV stations, regardless of their audience or advertising shares, and that prevent ownership of more than two stations in all markets, regardless of their competitive positions.

The FCC is also recommending that the Commission eliminate caps on AM ownership in all markets; permit a single entity to own up to eight commercial FM stations in Nielsen Audio 1-75 markets, with the opportunity to own two more FM stations through successful participation in the FCC’s incubator program; and remove restrictions on FM station ownership in Nielsen markets 76 and lower and in unrated areas. 

“The FCC should act now to fulfill both [its] deregulatory mandate, and Congress’s even longer-standing goal of a competitively viable broadcast service capable of serving local communities, by modernizing its local radio and TV ownership limits,” said NAB. “The American public cannot afford for the FCC to remain asleep at the regulatory wheel.”

George Winslow

George Winslow is the senior content producer for TV Tech. He has written about the television, media and technology industries for nearly 30 years for such publications as Broadcasting & Cable, Multichannel News and TV Tech. Over the years, he has edited a number of magazines, including Multichannel News International and World Screen, and moderated panels at such major industry events as NAB and MIP TV. He has published two books and dozens of encyclopedia articles on such subjects as the media, New York City history and economics.