An FCC reconsideration order that would relax broadcast ownership rules is still expected in September or October, attorneys and industry officials told us (see 1707190054). The item, an order on reconsideration of the 2014 quadrennial review, is expected to make it easier for the Sinclair/Tribune deal to be approved without divestitures. Industry officials and attorneys said it's widely expected to roll back newspaper/broadcast cross-ownership rules and rules on joint sales agreement (JSA) attribution, and may also relax or change the eight-voices test and top-four network rule. The American Television Alliance met with FCC officials last week to urge the commission not to eliminate the top-four network rule.
An apparent increase in FCC announcements of pirate radio enforcement action partially stems from a minor procedural change, but is also the result of increased commission action against pirates, said industry and agency officials in interviews. The FCC and Chairman Ajit Pai have been “appropriately stepping up pursuit of pirate radio broadcasters,” Commissioner Mike O’Rielly told us. O’Rielly has vocally supported increased pirate enforcement (see 1707280046).
A shortage of experienced broadcast tower crews to do the work required for the post-incentive auction repacking likely means the FCC's deadline won't be met, tower company executives and broadcast equipment manufacturers told us. Though equipment manufacturers such as Dielectric and GatesAir told us they were able to ramp up production to be ready to meet the heavy demands of repacking broadcasters, there’s no practical way to create more experienced tower workers required to install that equipment on the tallest TV towers, they said. Combined with challenges of upgrading existing towers and concerns about the weather, industry officials are skeptical the repacking can be accomplished in the 39-month time frame laid out by the FCC. “I think it will take more like five to seven years,” said Kevin Barber, CEO of Texas-based tower company Tower King II.
By combining companies and associations with more expected merger opponents like Public Knowledge, the new Coalition to Save Local Media may succeed in blocking the Sinclair/Tribune deal at an FCC widely seen as likely to approve Sinclair's Tribune buy, public interest and broadcast industry attorneys told us Tuesday.
The LPTV Spectrum Rights Coalition is pushing a plan to solve the “vacant channel war” by partnering with a tech company, buying up low-power TV stations and seeking service waivers from the FCC to allow LPTV spectrum to provide a home for unlicensed use. Some low-power industry officials are skeptical, according to interviews. “Waivers are a heavy lift,” said attorney Michael Couzens, who represents low powers and translators. “We take the energy being directed at having this war, and are redirecting it to a solution in which everyone wins,” said coalition Director Mike Gravino. The coalition pitched the plan as a “truce” (see 1708020041), without support from other entities.
Lack of investor interest in the radio industry is affecting Entercom joining with CBS Radio, attorneys and analysts said in interviews Wednesday. Though its revenue has grown, unlike much of the industry, Entercom stock slid 35 percent this year, causing CBS shareholders to have doubts about the deal, said Justin Nielson, senior researcher for S&P Global Market Intelligence. Wells Fargo analyst Marci Ryvicker called the situation “messy” in an email to investors. The sliding shares stem from a perception the radio industry is shrinking, exacerbated by looming likely restructurings of the industry’s two largest companies, Cumulus and iHeartMedia, attorneys and analysts said. The lack of clarity about the future of those companies is causing uncertainty for the industry, said Fletcher Heald broadcast attorney Dan Kirkpatrick.
Some opponents of Sinclair buying Tribune argue in petitions to deny posted by the FCC Tuesday that the new company would have unprecedented ability to drag the post-incentive auction repacking to a halt, and would want to do so because of its massive investment in ATSC 3.0. “Sinclair’s ‘all-in’ posture on ATSC 3.0 gives it a strong self-interest in using whatever leverage it has to promote the adoption of this standard,” petitioned T-Mobile. A delay in repacking would give Sinclair more time to lobby the commission to devote more reimbursement funds to paying for stations to buy 3.0 equipment, said the filing in docket 17-179.
The Sinclair/Tribune merger deal should be rejected by the FCC and can’t be made more palatable with merger conditions, said an ‘informal coalition” of Dish Network, Common Cause, the American Cable Association, the Competitive Carriers Association, Computer and Communications Industry Association and One America News Network, in a press call Monday.
The FCC should allow radio boosters to originate programming so radio stations will be better able to target advertisers, said numerous companies in replies in the media deregulation docket 17-105 Friday (see 1707060060). Allowing radio broadcasters to compete with other industries that can geo-target ads cheaply “could significantly increase radio revenue, said Monroe Capital. Similar comments were filed by CSREM, Geo Broadcast Solutions, Spanish Broadcasting System, Edgewater Broadcasting and others. The Campaign for Commercial-Free Childhood and the Center for Digital Democracy opposed requests in the docket to loosen children’s TV rules and advertising restrictions. “The proposals by industry commenters to relax the advertising limits and children’s program requirements would harm children by exposing them to excessive and unfair marketing and depriving them of quality programming,” the groups said. Reynolds Technical Associates, like many broadcasters, backed loosening the rural radio rule, and said the FCC’s use of reference coordinates led to “extortion.” Rules allow some owners to demand fees in exchange for consenting to a change in reference numbers, RTA said. The Multicultural Media, Telecom and Internet Council supported proposed changes to rules governing equal employment opportunity forms and public filing requirements, but said the FCC should leave in place rule that motivates broadcasters to seek employees at “entitlement sources.” In broadcasting, “most hiring is done face-to-face and is based on relationships,” MMTC said. “Entitlement sources should be embraced as a window into these relationships -- an opportunity to facilitate diverse hiring in the digital age.”
The FCC Media Bureau denied requests from the American Cable Association, Public Knowledge and Dish Network for more time to comment and more information on Sinclair's buying Tribune Media (see 1707250045), said an order released Friday in docket 17-179. The bureau agreed with Sinclair and Tribune arguments that the requests for more information and third-party data should properly be filed as part of a petition to deny, during the time frame for such petitions. The motion for additional information is “misplaced,” the bureau said. “Movants do not need access to the wide-ranging and highly confidential information movants request the Commission to demand in order to file a petition to deny.” The movants and Sinclair/Tribune conceded it's up to commission staff to issue information requests in the merger proceeding, so the motion for more information is dismissed, the order said. Because of the dismissal, the bureau didn’t consider whether a previous case on confidential documents in a deal, CBS v. FCC, applies to this matter. ACA, PK and Dish also didn’t establish a basis for an extension of time, the order said. Though they had asked for the extension to have more time to go over the additional information requested, the denial of that request makes the time extension moot, the bureau said. Several other entities had filed in support of the request, including Common Cause and NTCA. A spokesman for ACA said the movants were "disappointed but not surprised." Commissioner Mignon Clyburn indicated with a tweet she hadn't been informed 48 hours ahead of the decision to deny the request. "I've asked about the @FCC majority’s policy of providing 48 hours notice but it doesn’t seem to apply here," Clyburn said of the order. "The 48-hours policy does not apply to requests for extension of time, which are routinely handled at the Bureau level," an FCC spokeswoman emailed. "That said, the offices were given notice." Representatives from Dish, ACA, Common Cause, the Computer & Communications Industry Association and other supporters of the motion plan a news-media call Monday on their opposition filings to Sinclair/Tribune, said a news release: "As a group, these representatives will call for the Sinclair-Tribune merger to be rejected."