FCC moves to ease rules on TV station ownership

Federal Communications Commission Chairman Ajit Pai is moving forward with a controversial proposal to ease restrictions on the ownership of broadcast stations.

In a statement Tuesday, Pai said he is seeking comments on raising the cap on how much of the nation’s TV audience a single broadcaster can reach and on reinstating the so-called UHF discount, which allows owners to surpass that cap in some circumstances.

The UHF discount, originally created in 1985, allows broadcasters to exceed a cap that mandates that no single broadcasting company can have an audience reach above 39 percent of U.S. television households.

Pai wants both rules reconsidered.

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“A comprehensive review of the rule is warranted in light of considerable marketplace changes, such as technological developments and increased video programming options for consumers, since the cap was last modified in 2004,” Pai explained in a statement.

The move is certain to spark opposition from consumer groups and Democrats and comes as Pai’s FCC is already moving ahead to kill the Obama-era net neutrality rules in December.

The FCC, under former President Barack Obama, deemed the UHF discount outdated as broadcast television moved to digital frequencies.

The FCC reinstated the rule in April. 

When it was originally created, the UHF discount allowed broadcasters to exceed the 39 percent cap under the premise that UHF bands were weaker than VHF bands and should not be treated the same.

Accordingly, UHF bands’ reach were only counted as half of their actual reach when determining a broadcasters’ total potential audience.

Critics of Pai say that bringing back the UHF discount and raising the national cap will lead to more consolidation in broadcast ownership. They worry that will lead to less minority ownership and less diversity of viewpoints on the airwaves. They add that no one company should be able to gain too much access to American audiences.

The proposed change also come as the agency reviews the $4 billion merger between conservative-leaning Sinclair and Tribune Media.

Pai’s policy proposals could directly impact the merger. Sinclair is already the nation’s largest owner of television stations. If the merger goes through, the combined company would reach 72 percent of U.S. television households, far above the 39 percent cap.

For the merger to work under current regulations, Sinclair would need to divest from some of its holdings to get under the cap.

That could change if the national cap is expanded.

High profile Democrats like House Minority Leader Nancy Pelosi (Calif.) and House Energy and Commerce Committee ranking member Frank Pallone Jr. (N.J.) have argued against such changes and urged Pai to force Sinclair to sell off stations to get its merger approved.

This report was updated to clarify when the UHF rule was reinstated.