FCC Doublespeak: Saying One Thing and Doing Another
The Telecommunications Act of 1996 specifies that the Federal Communications Commission (FCC) "shall" review its broadcast ownership rules every four years, "determine if” those rules are necessary in the public interest as the result of competition, and "repeal or modify” any regulation determined to no longer be in the public interest. Despite these statutory obligations, in April the FCC failed to complete its required 2010 quadrennial review, which actually began in 2009, failed to determine if its existing broadcast ownership regulations serve the public interest, or to "repeal or modify" any of those regulations. Instead, the FCC merged its prior quadrennial review into a new 2014 quadrennial review, avoiding its legal obligations.
This is one of the reasons why my company, Howard Stirk Holdings, LLC (HSH), has sued the FCC. As an African American licensee of two television stations, I believe that by refusing to complete its 2010 quadrennial review, the FCC has unlawfully withheld taking an action required by Congress and the law, and thus is arbitrarily and capriciously retaining burdensome regulations that are no longer in the public interest. Further, the FCC not only failed, after studying the matter for five years, to make any final determination about the need for its existing broadcast ownership rules, it also adopted a new rule restricting joint sales agreements (JSAs) between television broadcasters in the same market. Contrary to its decade-long policy and practice, the FCC determined that JSAs for more than 15% of a television station's weekly advertising time will now be attributable for purposes of the FCC's broadcast ownership rules.
This not only changes the rules in the middle of the game and without conclusion of the 2010 quadrennial review, but it effectively slams the door shut on an important gateway to enhancing localism, viewpoint diversity, and opportunities in broadcast television ownership by minorities and underrepresented groups. JSAs were shaped by the FCC and its staff to comply with the broadcast ownership rules, and have been a ubiquitous facet of the marketplace, as they are used by scores of stations in numerous markets. Just in January, the FCC approved Gannett Co.’s $1.5 billion acquisition of Belo Corp., and Tribune Company's $2.73 billion purchase of Local TV Holdings LLC. Both relied heavily on JSAs and other sharing agreements. At the same time, the direct competitors of local television–cable, satellite, and telecom companies–use their own JSA-like agreements, called “interconnects,” to sell local advertising with no percentage limit.