As Sinclair-Tribune megamerger looms, groups ask FCC to block return of UHF discount

FCC Chairman Ajit Pai
FCC Chairman Ajit Pai voted to reinstate the UHF discount last month.

With the prospect of the Sinclair-Tribune megamerger on the horizon, groups are urging the FCC to block the return of the UHF discount in order to slow broadcast industry consolidation.

In a joint filing to the FCC, Free Press, United Church of Christ, Prometheus Radio Project, Media Mobilizing Project, Media Alliance, National Hispanic Media Coalition and Common Cause requested a stay of the reinstatement of the UHF discount, which would allow broadcasters to once again count UHF stations as 50% toward the national broadcast ownership cap.

The groups argued that the technical logic for the UHF discount is no longer valid.

“It is arbitrary and capricious to adopt a provision that lacks any independent technical or policy support, and which contravenes the statutory limit on national television ownership,” the groups wrote in the filing.

The groups also argued that news of the reinstatement is effectively triggering a new wave of broadcast industry M&A and allowing deals like Sinclair’s $3.9 billion bid for Tribune to move forward. The groups also said that a stay will benefit the public interest by maintaining more diversity in broadcasting.

RELATED: FCC reinstates UHF discount, likely opening broadcast TV M&A floodgates

“Maintaining a diversity of voices goes to the heart of the Commission’s mission to promote competition and diversity, and all Americans will benefit from the grant of a stay,” the groups wrote.

Last month, the FCC voted to reinstate the UHF discount.

The commission determined that last year’s action to eliminate the provision had the “effect of substantially tightening the national cap for companies without any analysis of whether this tightening was warranted given current marketplace conditions.” With today’s vote, the FCC will return to the “pre-August 2016 status quo in the marketplace” for broadcasters.

Later this year, the FCC pledges to take a more holistic approach to re-examining both the UHF discount and the 39% ownership cap placed on broadcasters. Back under the rules of the discount, broadcasters using UHF spectrum are allowed to count 50% of television households in their market when gauging compliance with the national cap.

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