FCC Quadrennial Review Order Likely To Resemble 2014 FNPRM

The FCC upcoming draft broadcast ownership quadrennial review order is expected to resurrect the commission’s vacated joint sales agreement rules and stick close to a 2014 Further NPRM on media ownership, said attorneys on both the broadcaster and public interest sides of the issues. They said in interviews this and last week that there may be some fluidity on the newspaper/broadcast cross-ownership rule that was specifically targeted in the 3rd U.S. Circuit Court of Appeals majority opinion that spurred the FCC to action. The item, planned to go on circulation by June 30 (see 1605250073), is expected to contain few surprises, several attorneys told us. The FCC declined to comment Tuesday.

The 2014 FNPRM proposed retaining rules against TV duopolies, but sought comment on eliminating newspaper/radio cross ownership. It didn’t go as far on newspaper/TV cross ownership, but contemplated a specific waiver process for allowing such combinations where it served the public interest. It also included the JSA attribution rule, and proposed requiring TV stations to disclose shared service agreements. Broadcast and public interest attorneys told us they expect most of the above to return in coming draft order.

An FCC proposal to eliminate the UHF discount, an idea from early in FCC Chairman Tom Wheeler’s reign, was also resurfaced in a Friday meeting between NAB and Media Bureau Chief Bill Lake, according to an ex parte filing posted Tuesday in docket 14-50. Eliminating the UHF discount without revisiting the national TV ownership cap would be “arbitrary and capricious,” NAB said in the filing.

By ruling against the JSA attribution rules on procedural grounds rather than on the substance of the policy, the 3rd Circuit left the door open for the FCC to reinstate them after conducting a proper quadrennial review, a broadcast attorney told us. That comment echoes Wheeler’s own statement the day of the 3rd Circuit’s ruling. Broadcast attorneys also pointed to the Media Bureau’s sticking to an anti-JSA stance in transactions, even after Congress expressed disapproval of the JSA rules, as evidence that Wheeler is likely to bring the policy back after following a more 3rd Circuit friendly procedure.

Broadcast attorneys and Commissioners Mike O’Rielly and Ajit Pai had speculated the agency might be more open to eliminating the newspaper/TV ownership limitations in the wake of the criticism of the rule in the 3rd Circuit majority opinion. An attorney following the proceeding told us that no longer seems as likely. A public interest attorney told us that broadcasters should view the waiver proposal from the 2014 FNPRM as a sufficient relaxation of the rule. Changing the rule may no longer matter, one attorney told us, since many existing newspaper/broadcast combos such as Gannett have spun off their print sides. The premise that broadcaster could prop up a failing newspaper has turned out to be untrue, the attorney said.

The FCC’s promise to the 3rd Circuit to circulate a draft order by June 30 may have “kept it in a box” and prevented it from departing substantially from the original FNPRM, a broadcast attorney following the proceeding told us. Since the agency had to deliver quickly, its options were limited, the attorney said. Georgetown Law Institute for Public Representation Senior Counselor Andrew Schwartzman has said he scoffs at the idea that the FCC’s time to work on the matter was limited, since the 2014 and 2010 quadrennial review orders are several years late.

One way the coming draft order likely will differ from the 2014 FNPRM is its incorporation of various proposals designed to increase ownership diversity championed by the Multicultural Media and Telecom and Internet Council, an attorney said. Media Bureau staff, aides to Wheeler and other commissioners have been regularly meeting with MMTC staff on the proposals, said recent ex parte filings. “The proposals were discussed with regard to their potential cost of implementation, timing, need for record-building, and the extent to which minority entrepreneurs and the public would benefit,” said an MMTC ex parte letter posted Tuesday.