John Eggerton

The Federal Communications Commission got hammered by Democrats over diversity at the June 11 House Communications Subcommittee hearing on media ownership.

While most of the raised eyebrows over FCC action or inaction came from Republican members, the lack of diversity in broadcast ownership -- only four African American-owned TV stations, for example -- drew outright jeers from Rep Bobby Rush (D-IL).

Rep Rush said one of the reasons he had joined the Communications Subcommittee was to help increase media ownership diversity. He said he had been disappointed for a number of years, but that the current state of diversity was the worst it has been in his 21 years in Congress. He said he did not see a "vigorous commitment" from the FCC on diversity and that he was disappointed in the continual excuse-making.

Rep Rush questioned why FCC Chairman Tom Wheeler had pulled the plug on the critical needs study which was to help determine how ownership affected diversity of voices.

The National Conference of State Legislatures has asked the Federal Communications Commission not to eliminate its Sports Blackout Rule.

That rule backstops sports league broadcast blackout policies by preventing cable or satellite operators from carrying the blacked-out games to those local markets. The FCC has proposed scrapping the rule.

In a letter to FCC chairman Tom Wheeler, the conference said the rule "serve[s] the interests of states as well as the public by [helping to promote] economic activity, civic pride and the broadcast of professional football on free, over-the-air television."

The FCC rule helps promote attendance, the conference points out, and the stadiums, whose economic activity is boosted by getting fans in the seats, are often built partly with taxpayer dollars, they point out. "Thus, states share a stake in the continued use, success and vitality of sports facilities."

Former Time Warner Cable chairman and CEO Glenn Britt died of cancer on June 11 at his home in New York. He was 65.

“Glenn left us with a legacy of innovation, integrity and inclusion," said Time Warner Cable chairman Rob Marcus.

The newspaper unions and ownership are definitely of different minds on lifting the ban on newspaper-broadcast cross-ownership. That is according to testimony for a June 11 House Communications Subcommittee hearing on the Federal Communications Commission's media ownership rules.

While Newspaper Association of America (NAA) senior VP Paul Boyle tells the subcommittee that the ban is outdated and hurts investment in local journalism, Bernard Lunzer, president of the NewsGuild-CWA, asks Congress to "maintain the status quo on Cross Ownership between print and broadcast" and says that claims that combinations will allow for more coverage is "just not the case."

House Commerce Committee Democratic leaders have asked their Republican counterparts, who control the agenda, to hold hearings on the proposed Comcast/Time Warner Cable and AT&T/DirecTV mergers, and a Sprint/T-Mobile deal if that ever materializes.

That request came in a letter from Reps Henry Waxman (D-CA) and Anna Eshoo (D-CA), the ranking members of the full committee and Communications Subcommittee, respectively, and Rep Doris Matsui (D-CA), to full committee Chairman Fred Upton (R-MI) and Subcommittee Chairman Greg Walden (R-OR).

The Federal Communications Commission has told the US Court of Appeals for the DC Circuit that it must dismiss the National Association of Broadcasters petition for review of the FCC's "staff-level" public on how the Media Bureau will vet TV station deals involving sharing arrangements.

NAB says the guidance functions as a "categorical presumption" against such deals -- shared services agreements, joint sales agreements, and others -- which "adversely affects" NAB and its members by rendering such previously allowed deals invalid.

The FCC says the guidance is to give broadcasters notice that TV station sales involving sharing agreements with associated financial arrangements like an option to purchase a station or guaranteed financing would get heightened and likely time-consuming reviews in case they wanted to rethink those given that guidance. Commission lawyers argue that the Media Bureau guidance issued in the March 12 public notice is not a final order -- NAB argues it is a final agency action -- and since the court's jurisdiction over FCC decisions extend "only to final orders," the court does not have jurisdiction to review it.

“Congress did not intend that the court review a staff decision that has not been adopted by the Commission itself," the FCC said, quoting the DC court itself from a previous opinion. They also point out the appeals court has previously found that petitions for review filed after a bureau decision but before a final commission resolution are "incurably premature."

Federal Communications Commission Media Bureau chief Bill Lake says that the FCC has granted the sale of 36 full-power TV stations, representing 12 different deals, since mid-March, which it issued guidelines about deals with associated sharing arrangements.

That is according to Lake in prepared testimony for the June 11 media ownership hearing in the House Communications Subcommittee. Lake outlined various steps the FCC has taken regarding media ownership rules, including making TV joint sales agreements (JSAs) over 15% of ad time attributable as ownership interest, new processing guidance from the Media Bureau on processing TV station license transfers involving JSAs and other sharing agreements (broadcasters have sued the FCC over both those), and the decision to combine the congressionally mandated 2010 and 2014 media ownership quadrennial reviews into what will become a 2016 review -- June 30, 2016 is the target date for completion.

As to why the FCC has yet to produce a quadrennial review report to Congress years past the initial deadline, Lake pointed out that the FCC, under a previous chairman, had a media ownership item responsive to the review teed up in 2012 that could never get three votes needed for approval -- Republicans opposed it and some Democrats were concerned that the FCC had taken the action without sufficiently gauging its impact on ownership diversity. He said that the new timetable of June 2016 will allow for more input on how the market has changed since then.

The Federal Communications Commission should consider including pay TV (cable, satellite, telecommunications) and online video as relevant local market competitors to broadcasting.

That is according to media analyst David Bank, a managing director at RBC Capital Markets, in prepared testimony for the June 11 media ownership hearing in the House Communications Subcommittee. He says that with broadcast TV controlling only about a third of the primetime audience, "it’s clear to us that broadcast TV regulation should probably consider a framework in which pay-TV in total as an ecosystem is a competitor to Broadcasting. This is the case in small and big markets alike."

Then there is the Internet. "[T]he current regulatory framework was constructed in a media ecosystem that basically didn’t include the Internet. While it may have contemplated a broad PC-based Internet consumption environment, it certainly didn’t contemplate a Mobile application based ecosystem," he says.

The National Association of Broadcasters plans to tell Congress that the Federal Communications Commission has failed to determine whether its media ownership rules service the public, and needs to base its review of those rules on evidence, not "unsupported opinion."

That is according to the prepared testimony of NAB exec Jane Mago for the June 11 "Media Ownership in the 21st Century" hearing in the House Communications Subcommittee. Mago will argue that broadcasters are subject to old rules that distort competition, while less-regulated competitors like cable and satellite grab audience share and ad revenues.

Mago also points out that the FCC itself has previously found the newspaper-broadcast crossownership ban to be unnecessary -- a bipartisan trio for former chairs has also admitted it was still on the books for fear of upsetting Congress -- but yet the ban remains in place. The NAB is also unhappy that the FCC failed to complete its 2010 quadrennial rule review as required by Congress.

The House Communications Subcommittee Republican majority is clearly looking to deregulate broadcasters they see as competitively disadvantaged on the regulatory front.

That is according to a copy of the majority staff memo for the hearing on "Media Ownership in the 21st Century." "As broadcasters -- and newspapers -- face increasing competition for Americans’ attention, additional regulatory flexibility will permit them to increase efficiencies and compete against unregulated competitors," said the majority staff in the memo.

Among the topics of conversation will be the Federal Communications Commission's continued newspaper/broadcast crossownership ban. Among the ownership rules the memo suggests are on the table for discussion at the June 11 hearing are, in addition to the newspaper/broadcast crossownership ban: Local TV ownership limits (the duopoly rule); local radio ownership limits; the national cap (39%) on one TV station group’s percentage of households; diversity issues radio/TV crossownership rules, prohibitions on owning more than one broadcast network.

Some Republicans joined broadcasters in their unhappiness with FCC decisions to make most TV station joint sales agreements (JSAs, those over 15% of weekly ad sales) attributable as ownership interest, and the Media Bureau's guidance on how it will view sharing agreements with associated financial arrangements.