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Monday, October 4, 2010

The FCC’s Broadcast Media Ownership Rules

Charles B. Goldfarb
Specialist in Telecommunications Policy

The Federal Communications Commission’s (FCC or Commission) broadcast media ownership rules are intended to foster the three long-standing goals of U.S. media policy—competition, localism, and diversity of voices. The FCC has the statutory obligation to review these rules every four years to determine if they continue to serve the public interest or should be modified or eliminated. The Commission currently is undertaking that quadrennial review through a proceeding for which public comments already have been filed.

In December 2007, the FCC adopted an order that modified only one of its broadcast media ownership rules—the newspaper-broadcast cross-ownership rule—and left the other rules intact. Under the new rule, it would be presumptively “not inconsistent with” the public interest, in the 20 largest local markets, for an entity to own both a major daily newspaper and a single television or radio station, so long as the television station is not among the four highest-rated stations in the market and after the transaction there are at least eight independently owned and operating major media voices. Otherwise, in most situations newspaper-broadcast cross-ownership in a local market would be presumptively inconsistent with the public interest. Each proposed combination, however, would be reviewed on a case-by-case basis, and proposed combinations in smaller markets could be approved. Fifteen parties have appealed the new rule; the challenges have been assigned to the United States Court of Appeals for the Third Circuit. Implementation of the rule initially had been stayed by the court, but on March 23, 2010, the court lifted its stay.

In its previous quadrennial review, in June 2003, the FCC modified five of its broadcast media ownership rules, easing restrictions on the ownership of multiple television stations (nationally and in local markets) and on local media cross-ownership, and tightening restrictions on the ownership of multiple radio stations in local markets. Those rules have never gone into effect. Sec. 629 of the FY2004 Consolidated Appropriations Act (P.L. 108-199) instructed the FCC to modify its new National Television Ownership rule to allow a broadcast network to own and operate local broadcast stations that reach, in total, at most 39% of U.S. television households. In June 2004, the United States Court of Appeals for the Third Circuit, in Prometheus Radio Project vs. Federal Communications Commission, found that the FCC did not provide reasoned analysis to support its specific local ownership limits, and also that the FCC failed to address the impact of it new rules on minority ownership of broadcast stations, and therefore remanded portions of the new local ownership rules back to the FCC and extended its stay of those rules. Thus, the rules in effect prior to June 2003 remain in effect.

Date of Report: September 23, 2010
Number of Pages: 23
Order Number: RL34416
Price: $29.95

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