The FCC’s soft stance on shared ownership agreements...
The FCC’s soft stance on shared ownership agreements has led to a “wave of consolidation” in broadcasting, said Free Press in a new report released Monday (http://bit.ly/1a0npol). Two hundred eleven full-power TV stations have changed hands in the first eight…
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
months of 2013 -- “the highest level in more than a decade, and the fourth-highest year on record in terms of deal value,” said Free Press in a release (http://bit.ly/1a7Gl6L). The report calls Sinclair Broadcast Group the “spearhead” of the consolidation trend -- the broadcaster has grown from 58 to 160 stations in the past two years, Free Press said. “Sinclair controls or will control 46 stations nominally owned by a third party, with 40 of these stations’ licenses held by shell companies Sinclair created for the express purpose of evading the FCC’s ownership rules,” said Free Press in the release. The report also targets similar local ownership deals by Gannett, Media General, Nexstar and Tribune, said Free Press. “Under Securities and Exchange Commission rules, these shell companies and their parent corporations are considered one and the same,” said Free Press. “When Sinclair communicates with investors, it makes no effort to hide the fact that it’s the true owner of these shell companies and their stations, repeatedly referring to them as ‘our sidecar companies’ and ‘our stations,'” said the release. “The FCC should recognize that these shell companies and the outsourcing agreements that govern them are merely a legal fiction created by companies like Sinclair, Gannett, Tribune and Nexstar to evade the ownership rules,” said report author Derek Turner. The report asks FCC Chairman-nominee Tom Wheeler to deny the pending transactions involving sharing agreements and close the “loopholes” in FCC rules that allow them, the release said. Wheeler “has an opportunity to stop this consolidation by enforcing FCC rules that are already on the books,” said Free Press. “But if the FCC continues its head-in-the-sand approach, we will continue to see unbridled consolidation -- and the devastation of community-centered journalism."