FCC opens review of 39% national television ownership cap

From left to right: Commissioner Brendan Carr, Commissioner Mignon Clyburn, Chairman Ajit Pai, Commissioner Michael O'Rielly and Commissioner Jessica Rosenworcel. (FCC)

The FCC has opened a public rulemaking review of the 39% national television ownership cap, which limits the audience reach of individual broadcasters. But the agency stressed it's simply a review and not a call for specific changes.

“Today’s Notice makes no tentative conclusions about whether the rule should be modified, retained, or eliminated. It asks questions about whether a cap is still needed and what public interest goals it would promote, where the cap should be set if still needed, and how compliance with the cap should be calculated, including the question of whether the UHF discount should be eliminated,” the FCC wrote in a news release.

Earlier this year, FCC Chairman Ajit Pai moved to reinstate the UHF discount—after the previous commission under Tom Wheeler eliminated the rule—but promised to revisit the UHF discount as part of a wider review of ownership rules.

Pai reiterated his beliefs that the ownership cap and the UHF discount are intrinsically linked and called out the FCC’s Democratic commissioners for voting against the new notice when they were in favor of eliminating the UHF discount in 2016 and were against bringing it back.

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“It’s also amusing that those who have repeatedly voiced their strong opposition to the UHF discount in recent months are now voting against seeking comment on eliminating it. Make no mistake: A vote against this Notice is effectively a vote in favor of keeping the UHF discount in place,” wrote Pai in a statement.

Commissioner Jessica Rosenworcel countered the proposed notice by reminding the commission that it is forbidden by law—under the Consolidated Appropriations Act of 2004—from allowing a single company to amass a reach exceeding 39% of the national audience.

“But somehow, someway, we have this rulemaking anyway. And somehow, we are still talking about the UHF discount—a concept that should have been retired nearly a decade ago when the introduction of digital television rendered it technically outdated and scientifically obsolete,” wrote Rosenworcel in a statement.

Pai’s work to review the broadcast ownership cap rules has been criticized as favoring Sinclair Broadcast Group, which is currently trying to buy Tribune Media. Sinclair said it would reach 72% of the national audience following the deal, but 45.5% if counting UHF stations at 50%, as allowed by the UHF discount.

Sinclair is said to be close to U.S. Justice Department approval for the acquisition but that it may have to divest 12 to 13 television stations to meet the requirements.