The FCC shouldn’t take up a proposal to give broadcasters expedited waivers of media ownership rules in exchange for their promises to reduce retransmission consent rates by 50% over three years, said Free State Foundation Senior Fellow Andrew Long in a post Monday. The proposal, from Cincinnati Bell Extended Territories and Hawaiian Telcom Services Co., was filed in the FCC’s “Delete” docket in June. It amounts to “forward-looking, government-imposed pricing mandates” on retransmission consent rates “that could persist for a decade or more,” Long wrote. The proposal would also use administrative contracts that couldn't be reviewed in court and would bind broadcasters and MVPDs, he said. “These so-called voluntary ‘social contracts’ would impose enforceable, multiyear pricing constraints -- effectively, rate regulation -- while circumventing judicial scrutiny.”
Social contracts with cable operators could offer "a measured approach" toward easing TV ownership restrictions, according to altafiber and Hawaiian Telecom. In docket 25-133 Friday, they laid out the basics of such social contracts, which involve cable operators getting flexibility in setting rates for regulated product tiers and services, and, in exchange, the cablers agreeing to benefits, including negotiated rates, limited future regulated rate increases and free services to schools and libraries. Earlier in June, altafiber and Hawaiian Telecom pushed in meetings with FCC staff for social contracts for broadcasters in the event of changes to the broadcast-ownership cap, with the contracts including such agreements as reductions in retransmission consent rates that broadcasters charge MVPDs.
FCC Chairman Brendan Carr said Thursday that he's “open-minded” about the result of the agency’s proceeding on modifying the national broadcast-ownership cap (see 2506180082), while Commissioner Anna Gomez denounced it as “a sweeping effort to tip the scales even further in favor of a handful of powerful corporations.” Gomez said she knows broadcasters are facing economic pressures and the FCC may need to provide relief, “but this is where we need a scalpel, not a chain saw.” Broadcast officials told us that keeping the ownership cap in place only for network-owned stations -- as the public notice suggests -- could make the rule change more vulnerable in court.
The FCC Media Bureau’s move to seek comment on relaxing national broadcast ownership limits just a day after the confirmation of incoming Commissioner Olivia Trusty is an indication that the agency will act quickly to enact Chairman Brendan Carr’s agenda now that he has a majority, industry officials told us. That agenda likely “picks up some pace” in the next couple of months as Carr can move on items he couldn’t advance with a 2-2 FCC, said former Commissioner Mike O’Rielly. The FCC is likely to swear in Trusty as a commissioner on Monday or Tuesday, a former Republican FCC aide told us.
The U.S. Supreme Court handed down a ruling Friday that likely means less certainty for FCC actions and those of other federal agencies under the Hobbs Act. The decision comes a year after SCOTUS overruled the Chevron doctrine, which had required courts to give deference to agency decisions, in the Loper Bright case (see 2406280043). The latest from the court was Friday's 6-3 decision in McLaughlin Chiropractic Associates v. McKesson, a much-watched case on the Telephone Consumer Protection Act (see 2506200011).
Industry officials expect Chairman Brendan Carr to circulate an NPRM Wednesday evening on relaxing the national broadcast ownership cap, they told us after Breitbart reported on the proposal. Carr has repeatedly said he believes the FCC has the authority to change the cap, and he wants to empower local broadcasters to reduce the power imbalance between station owners and national networks (see Ref:2505160064]). The current rules limit a single company from owning stations that reach more than 39% of U.S. TV households. With Wednesday’s confirmation of incoming FCC Commissioner Olivia Trusty, Carr is seen as having the votes to relax the rules. Opponents of broadcast deregulation have said the FCC doesn’t have the authority to alter the ownership limit, and any FCC action to change it is certain to draw a legal challenge.
The FCC Media Bureau issued a public notice late Wednesday seeking comment on eliminating or modifying the national broadcast-ownership cap. The item sought comment about changing the cap, modifying the UHF discount and treating ownership of non-top-four affiliate stations differently under the rules. If the FCC “retains a national audience reach cap, should common ownership of stations that are not affiliated with major national broadcast networks (i.e., ABC, CBS, NBC, or FOX) be excluded from the cap?” the notice asked.
A broadcaster who executed a sham transfer of his radio and TV stations to his 17-year-old niece and falsely certified that he was a U.S. citizen doesn’t have the character to be an FCC licensee, ruled FCC Administrative Law Judge Jane Halprin in an order in Monday’s Daily Digest (see 2504090035). Antonio Guel is barred from future broadcast ownership and must pay a penalty of $188,491, and any broadcaster that uses him as a consultant is required to attach a copy of Halprin’s decision against him to all their FCC filings, the order said. The Media Bureau designated Guel and his company Hispanic Christian Community Network’s 2010 sale of stations to Guel’s niece for hearing in 2023.
FCC Commissioner Nathan Simington is right that broadcast ownership restrictions need modernization, but his call for streaming platforms to be subject to MVPD-like regulation (see 2505270054) is economically flawed, International Center for Law & Economics senior scholar Eric Fruits wrote Friday. That would extend an outdated regulatory framework over more technologies, he said. Streaming began and grew because streamers weren't subject to the heavy-handed rules that traditional linear providers were, and expanding legacy rules to streaming platforms could discourage technological experimentation, he said. Instead, the commission should revisit the broadcast industry's national cap and "offer the MVPDs the same light-touch rules that streamers currently enjoy."
FCC Commissioner Anna Gomez said at a listening session and panel discussion hosted Wednesday by Free Press that she doesn’t expect the agency to “liberally” use a good-cause exception to notice-and-comment rules or delegated authority when it takes action on the “Delete” docket. “I am hopeful that, in fact, a lot of these rules will come up to vote,” she said at the Los Angeles event, which was part of her “First Amendment Tour” (see 2504240064).