Broadcasters Say Media Ownership Rules Are Detrimental to Competition, Diversity

WASHINGTON — Regulations governing the ownership of broadcast radio and television stations harms broadcasters’ ability to compete in the marketplace, stymies service to local communities and fails to promote diversity in ownership, the National Association of Broadcasters said in a lengthy filing delivered to the Federal Communications Commission on Friday.

According to the broadcasters, local radio and television stations operate under antiquated media ownership rules that failed to reflect the realities of the 21st Century marketplace.

As a result of being hidebound by these rules, which the association says date back to the “analog era” broadcasters are no longer able to “viably operate” in a competitive market or “effectively serve the public interest.”

In its comments, the NAB argued that, 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. 

These news gathering ventures require high capital and operating costs, which could be alleviated by leveraging economies of scale.

However, the FCC’s media ownership rules prevent broadcasters from achieving the scale necessary to sustainably provide local journalism to their communities of service, NAB said. 

The commission’s rules have failed to account for increased competition from giant technology platforms for advertising revenue. In addition, with the COVID-19 pandemic continuing to affect advertising and changing Americans’ content consumption habits, it is imperative for the FCC to update media ownership rules to allow broadcasters to create an economically feasible future for local journalism, the association said.

“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.”

The association went on to assail the agency, saying its current rules discourage investment in station ownership and prevent more women and people of color from becoming owners themselves.

“The imposition of heavy regulatory burdens on broadcasting – including restricting the size and scale of a station group – discourages potential entrants” the NAB said.

The broadcasters urged the FCC to:

• 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 NAB also recommended that the FCC no longer retain 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 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,” the broadcasters said. 

“The American public cannot afford for the FCC to remain asleep at the regulatory wheel.”