FCC National TV Ownership Rules Are Focus of Senate Hearing

Last week, Senate Commerce Committee Chairman Ted Cruz (R TX) chaired a contentious hearing entitled “We Interrupt The Program: Media Ownership in the Digital Age." The hearing focused on the FCC’s National TV multiple ownership rules.  These rules limit the reach of commonly owned television stations to 39% of national television households.  UHF stations are considered to have 50% of the reach of a VHF station. 

NAB's CEO Curtis LeGeyt noted that the TV national ownership rules were drafted.  Big Tech has transformed the media marketplace.  He stated:

"These outdated rules unfairly skew today’s video and advertising markets.  None of the dominant competitors that shape what Americans watch face these limits.  Global streaming platforms, Big Tech video services and digital advertising giants can reach every household.  Broadcast television alone remains boxed in. ....

Digital technologies and the internet have completely transformed the video and advertising markets, making a broadcast-only ownership cap obsolete.  Global streaming platforms now account for roughly half of total viewing, yet broadcasters are still restricted from reaching TV households nationwide.  This means we cannot effectively compete for audiences, advertising revenues and premiere programming.  As a result, local stations’ most important public service – offering news, emergency information and valued entertainment and sports programming in local communities at no cost to the public – is in jeopardy."

A key focus of the hearing was whether the FCC had the authority to relax the 39% national cap.  Many Democrats on the committee argued that the 39% national cap was statutory and the FCC did not have the authority to change it.  LeGeyt, and former FCC General counsel Thomas Johnson, argued that the FCC had the authority to change or eliminate the national audience cap.

Chris Ruddy, CEO of Newsmax Media, argued that the national audience cap should not be raised.  He noted:

"Newsmax reaches more than 50 million Americans on a regular basis through our television channels, websites, social media, and other platforms.  Forbes has described Newsmax as a “news powerhouse,” and the Reuters Institute recently ranked Newsmax among the top 12 news brands in the United States."

Ruddy also noted that only Congress could change the cap and that the FCC lacked the authority to change it.  It’s worth noting that Newsmax is not subject to the FCC national ownership reach cap as the cap only applies to the national audience reach of broadcast stations. 

At its core, this issue is about preserving local journalism. Faced with increasing competition from Big Tech, stations must have the economic freedom to compete.  We no longer compete solely against each other.  Stations in the smallest markets now compete with Google and Meta.  Today, these companies garner more local ad revenue in NY that all the local radio and TV station combined.  Without changes in the FCC’s ownership rules, local stations will not be able to compete and provide quality local journalism.  Our communities lose because in many areas, broadcast stations are the only source of local news in the community.    

NYSBA will be lobbying this issue in Washington in March.  It is an important issue that will define journalism and media for the next decade.

You can see the hearing and access copy of all the written testimony here.