UPDATED, with comment from Nexstar and Newsmax, others: FCC Chairman Brendan Carr is proposing a repeal of the national ownership cap, which restricts broadcasters from amassing stations that cover more than 39% of TV households.
He set a vote of August 6 on the proposal. Republicans hold a 2-1 majority on the commission.
Carr is proposing that the cap be replaced with a case-by-case review, in what he said would be fore deals that “promote the public interest.”
In an op ed on Brietbart.com, Carr wrote, “Today, the cap is not protecting local broadcasters, it is preventing them from gaining the same scale that their competitors are free to enjoy. In other words, the national cap is now doing the exact opposite of what the FCC intended.”
A case-by-case review raises the prospect that local station groups would be treated differently than broadcast network owned and operated stations, as Carr has been critical of the influence of national programmers.
He wrote, “When it comes to broadcast news, our country could do with a little less Hollywood and a little more local reporting from communities across the country. The FCC’s plan to switch from a national cap to a case-by-case review allows exactly that and shifts the focus back to the American people and the local communities they live in.”
Nexstar’s proposed acquisition of Tegna exceeds the ownership cap, but it received a waiver from the FCC’s media bureau in March to allow the transaction to go through. But the merger has been on hold, with a federal judge granting an injunction to state attorneys general and DirecTV in their challenge to the transaction. Nexstar is appealing, with no date set yet for oral argument. The judge’s ruling was tied to antitrust law, not the FCC ownership cap, so the agency’s repeal may have limited impact.
The FCC’s action also is likely to be challenged, with opponents, including Commissioner Anna Gomez, arguing that only Congress could lift the cap. Chris Ruddy, the CEO of conservative network Newsmax, told a congressional hearing earlier this year that he was prepared to challenge an FCC action in court.
Ruddy said via text on Wednesday, “The FCC plan is in direct violation of federal law that bans any station group from owning stations that reach more than 39% of U.S. households. Multiple FCc chairs have agreed the law is clear cut. It is shameful that Brendan Carr is seeking not just to circumvent the law, but will do so on the basis he will decide which groups can violate the law.”
The repeal of the cap has been a long goal of the National Association of Broadcasters. Its CEO, Curtis LeGeyt, said in a statement, “This reflects the understanding that decades-old ownership restrictions that apply only to broadcasters – and none of our competitors – are out of step with today’s media marketplace. Eliminating the broadcast ownership cap will empower local stations, ensuring they can better compete, invest and serve their communities with the most trusted and freely available news and information, premier sports and entertainment.”
A Nexstar spokesperson praised the announcement as “a welcome and long-overdue step toward bringing broadcast regulation into the modern media marketplace.”
Nexstar has said that consolidation is needed as tech giants and streamers have gained traction in the industry, siphoning off local ad markets.
“Modernizing these outdated regulations will help ensure broadcasters can continue investing in local journalism and providing the free, trusted news and information that communities across America rely on every day.”
An FCC move to repeal the ownership cap has been expected, as the agency under Carr opened up a proceeding last year to gather comment on the cap.
Gomez, the sole Democrat on the FCC, called the FCC’s plan an “unlawful effort to hand control of the public airwaves to billionaire buddies of this administration.”
“The Commission cannot waive away that limit simply because these corporate behemoths want to get out from under it,” she said. Her office noted that Congress cited the specific number in federal law in 2004.
Michael Hartman, chief legal officer of DirecTV, said in a statement, “There is no doubt that the media landscape is changing rapidly. But the evidence shows that broadcaster consolidation leads to higher prices for consumers.”
Andrew Jay Schwartzman, senior counselor at the Benton Institute for Broadband and Society, called it a “highly dubious position” that the FCC had the authority to repeal the cap. He also pointed to the impact of the Supreme Court’s 2024 decision that overturned the so-called Chevron doctrine, which gave deference to federal agencies in their interpretation of vague laws passed by Congress.
With the plan for the FCC to review ownership on a case-by-case basis, much will depend on who is controlling the commission, and whether they favor consolidation or are against it, Schwartzman said.
