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Free Press: FCC Was Willing Accomplice to Destruction of Local Journalism

Media Consolidation Paper Takes Aim at Big Deals, Joint Sales, Services Agreements 10/21/2013 10:33 AM Eastern
 
Free Press research director Derek Turner wasn't afraid to give away the ending, titling his analysis of media consolidation, "Cease to Resist: How the FCC's Failure to Enforce its Rules Created a New Wave of Media Consolidation.
 
According to Turner and Free Press, who are releasing the report Monday Oct. 21, local broadcast journalism has been suffering from the "rampant media consolidation" over the past two decades, and it isn't getting any better. He points a finger squarely at deregulatory FCC policies, saying that the FCC has been a "willing accomplice to this destruction of local journalism."
 
He concedes the FCC's long-standing court battle to maintain ownership limits, but said at the same time it signaled it was not going to examine covert consolidation agreements. Turner is talking about the joint sales and services agreements that are within the FCC rules but that Free Press and a number of cable operators and MVPDs have to negotiate retrans opposite those broadcasters argue are a way to skirt/circumvent/subvert the FCC's local ownership caps.
 
Turner says the "convenient lie" of "covert" consolidation is part of runaway media concentration that has led to the control of 85% of  the top four affiliated TV stations in the top 25 markets by 13 companies.
 
"The U.S. broadcast television industry is in the midst of a wave of consolidation, which one longtime industry insider described as “the biggest wave ... in the history of television," Says Turner in the executive summary.
 
He says the trend is driven by a combination of factors, including FCC apathy, improving local ad markets, particularly political spending and the promise of more in a post Citizens United world. Then there is the increasingly attractiveness of retrans revenues.
 
Sinclair gets special mention for leading the consolidation charge, growing from 58 to 160 stations and 22% coverage of the U.S. to 38.8% if the FCC approves all its deals. But he also sites deals involving Gannett/Belo; Media General/Young, and Tribune/Local TV deals.
 
Turner/Free Press want incoming FCC chair Tim Wheeler to block those deals and take other steps, including counting sharing agreements against local ownership caps and get rid of the UHF discount, which the FCC has tentatively voted to do.
 
In fact, Free Press argues the FCC should no longer allow ownership of more than one station in a market given that broadcasters are allowed to multicast on several digital sub-channels in a market already: "If companies like Sinclair want to air multiple stations, they can use multicasting technology with a single over-the-air license. To do otherwise wastes our scarce public airwaves."
 
Under then chairman Julius Genachowski, the FCC raised the issue of counting joint sales agreements toward ownership caps as they are in radio, but did not take any action on modifying ownership rules, in part because of pushback over what diversity advocates said was a lack of court-ordered review of the impact of any changes, tightening or loosening rules, on diversity of ownership.
 
Under Acting FCC chairwoman Mignon Clyburn, the FCC did vote to eliminate the UHF discount, which only counts half a UHF station's audience toward the cap. That dates from the analog days when UHF signals were inferior to V's. In the digital age, the reverse is true.
 
An FCC spokesperson was unavailable for comment.
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