PxPixel
Some Broadcasters to FCC: 50% Solution Is Too Weak - Broadcasting & Cable

Ion, Others to FCC: 50% Solution Is Too Weak

Analyst says arguments for raising cap actually back eliminating it
Author:
Publish date:

Ion, Trinity and Univision have weighed in at the FCC with supplemental evidence for what they argue is the need to roll back the FCC's 39% cap on a TV station group's national audience reach, and preferably all the way rather than raising it once again.

That came in a supplemental comment, which featured the economic analysis of Dr. Harold Furchtgott-Roth, an economist, law professor and former Republican FCC commissioner. He was analyzing a BIA report on the state of the marketplace that provided its own analysis for raising it to 50%.

FCC-Headquarters-Washington.jpg

His take on the marketplace buttresses the broadcasters' claims that the cap is outmoded due to dramatic changes in the marketplace and that 50% is not sufficient relief given the competition from cable and over-the-top and satellite providers with no national ownership constraints.

Furchtgott-Roth's major points, which were aligned with the BIA report, were that broadcasters have many competitors outside of broadcasting, the cap has been relaxed historically as the industry "growth prospects have diminished,"* the cap is focused on small companies that compete with larger ones that have no national cap.

He argues raising the cap to 50%, but without a UHF discount, as some have proposed, would be an "unprecedented" constriction of the cap. Ultimately, he says, the BIA report "provides no explanation for why a 50% cap would be superior to a higher cap or no cap at all."

Related: Nexstar Says 50% Cap Would Be Arbitrary and Capricious

The comments are on the FCC's inquiry into both the cap and the discount, which FCC chair Ajit Pai has long argued needed to be considered together.

The FCC under Pai reinstated the UHF discount (which made the Sinclair-Tribune deal possible), but said it would be considered in tandem with the cap, which the FCC is currently doing, and has said in the past the discount may need to go, though perhaps replacing it with a VHF discount.

The UHF discount, which counts only half of a UHF station's audience reach toward the 39% cap dates from analog days when UHF signals were inferior to VHF. That relationship was reversed in digital.

*The cap has gone from 25% to 35% to 39%.

Related