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Media Ownership Focus Turns to Democrats After High Court Ruling

April 1, 2021, 7:27 PM

Republicans are basking in the U.S. Supreme Court’s decision upholding a GOP rollback of media ownership restrictions—but now it’s the Democrats’ turn to put their stamp on the policy.

The Federal Communications Commission must review its media ownership rules every four years. The latest review, begun in 2018, languished while the legal challenge to the Republican policy was pending.

The high court’s decision in FCC v. Prometheus Radio Project frees the now Democratic-led FCC to jumpstart its review process. Both Democratic members have publicly backed more stringent rules that promote minority and women ownership.

“The good news is the Biden FCC, once it gains a working majority, can quickly get to work building a solid record to promote the public interest standard and media ownership diversity,” Cheryl A. Leanza, co-counsel against the FCC in the Supreme Court case and the United Church of Christ’s media justice ministry’s policy adviser, said in a statement.

Public interest groups were quick to call on Democrats to tighten the rules after the Supreme Court ruling.

“Fortunately, today’s Supreme Court decision also reaffirmed the right — indeed, the responsibility — of Congress and the FCC to create ownership rules that protect independent ownership and affirmatively promote diversity and localism in media,” Harold Feld, senior vice president of non-profit Public Knowledge, said in a statement.

UHF Discount

One option for Democrats could be removing a discount that enables station owners to exceed a rule that their stations collectively reach no more than 39% of U.S. households. Both agency Democrats — acting Chairwoman Jessica Rosenworcel and Commissioner Geoffrey Starks — have expressed support for undoing the discount, which allows owners to only count half of the households they reach for stations that broadcast on UHF frequencies.

“While I am disappointed by the court’s decision, the values that have long upheld our media policies—competition, localism, and diversity—remain strong,” Rosenworcel said in a statement. “I am committed to ensuring that these principles guide this agency as we move forward.”

It’s unclear what strategy the Democrats will pursue, or whether they will seek to revisit the rules at issue in the high court case. FCC spokeswoman Paloma Perez didn’t immediately respond to a request for comment on Rosenworcel’s plans.

The FCC has until the end of the year to complete its current quadrennial review, though it could avoid that deadline by merging the 2018 review with the one slated to begin in 2022, agency watchers say.

The high court upheld the Trump-era FCC’s repeal of a ban on owning a newspaper and TV station in the same market and easing of restrictions on owning local TV stations. The ruling is a victory for broadcasters that argue the restrictions were unnecessary given the competition they face from online streaming services and pay-TV providers.

Democrats will likely only be able to adopt other, more stringent ownership restrictions after President Joe Biden nominates and the Senate confirms a third Democrat to the agency, which currently consists of two Democrats and two Republicans.

The agency would also have to seek public comment on its changes and provide evidence that they would improve competition, localism,and viewpoint diversity.

“The commission would have to assemble a record that it currently doesn’t have,” Jack Goodman, a Washington-based broadcast attorney, said. “It doesn’t mean it couldn’t possibly, but it would face a vociferous challenge.”

Whatever changes the Democratic-led FCC makes are likely to face a legal challenge, as has been the case with all of the agency’s attempts to update media ownership rules in the last 17 years.

“The battle of media ownership policies is just going to continue on,” said Christopher Terry, assistant professor of media law at the University of Minnesota.

To contact the reporter on this story: Jon Reid in Washington at jreid@bloomberglaw.com

To contact the editor responsible for this story: Keith Perine at kperine@bloomberglaw.com; Jo-el J. Meyer at jmeyer@bloombergindustry.com

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