FCC Meets Court Deadline and Issues 3-2 Order in 2018 Quadrennial Review of Broadcast Ownership Rules

On the December 27^th court-ordered deadline for doing so, the FCC adopted a Report & Order in the long overdue 2018 Quadrennial Review proceeding.  The three Democrat-appointed Commissioners voted in favor, and the two Republican-appointed Commissioners voted against, issuing scathing dissents. The broadcast industry had strongly urged a relaxation of the media ownership rules given the changing media landscape, but to no avail.

In the end, the Order left all current broadcast ownership rules in place, but added some tweaks in how those rules will be interpreted and applied.  On the radio side of things, where broadcast groups had sought larger caps on radio station ownership in markets, the Order rejected any relaxation of the caps and left the current local radio ownership limits in place, while codifying the interim contour overlap method as the one to be used going forward to measure ownership limits in unrated markets.

On the television affiliation and ownership side of things, the Order retained the Dual Network Rule (73.658(g)) which prohibits common ownership of two or more affiliates of the Big Four broadcast networks in a market.  The Order also expanded that rule to prevent use of LPTV and digital multicast affiliations to circumvent the existing rule.

Finally, the Order adjusts the methodology used under the Local TV Ownership Rule (73.3555(b)(1)(ii)) to determine station ranking in a market, noting that a station’s audience share ranking in a DMA will now be calculated based upon “the combined audience share of all free-to-consumer, non-simulcast multicast programming airing on streams owned, operated, or controlled by [a] station as measured by Nielsen Media Research or by any comparable audience ratings service.”  This change will make it more difficult to own a second TV station in a market under the rule provision allowing such ownership only if the second station is not ranked in the top four stations in the market.

We believe the Order will likely be challenged in court. To what extent the new rules go into effect will turn on the scope and timing of that legal challenge.  The FCC can now turn its attention to the 2022 Quadrennial Review, begun a year ago, but so long as the FCC remains in a 3-2 Democrat majority, a change in the substantive media ownership rules is unlikely.