Broadcasters Don't Expect Big Shifts From Biden FCC but Eye SCOTUS Ruling

The Supreme Court wouldn’t have taken the broadcast ownership case if the justices didn’t have an appetite to in some way reverse the 3rd U.S. Circuit Court of Appeals, said James Winston, president of the National Association of Black Owned Broadcasters, which is a party to the case. Some broadcaster officials also see the possibility of FCC action on the UHF discount and radio subcaps, though it's not clear if either would move forward. Broadcasting isn’t expected to be a primary focus of the next commission, attorneys and broadcasters said. “I don’t see any FCC pushing hard to get back into nitty-gritty broadcast rules,” said Wilkinson Barker broadcast attorney David Oxenford.

A Democratic-controlled FCC will be the one to grapple with any SCOTUS ruling, but broadcasters and attorneys don’t expect FCC Democrats to spend much time seeking to re-regulate broadcasters. The ownership rules that the court could knock down -- newspaper cross-ownership, the eight-voices test -- aren’t seen as strongly affecting broadcast deals, said attorneys and broadcasters. As competition from other media companies intensifies, the arguments for those rules erode, said Oxenford: “The cat is way out of the bag.”

The Prometheus decision will determine the shape of the 2018 quadrennial ownership review, which is expected to be stalled until that ruling happens, attorneys said. That could be a vehicle for eliminating radio subcaps, broadcast attorneys said. A Biden FCC is seen as less open to ownership deregulation, but it's possible it could approve removing subcaps for at least AM stations, Oxenford said. Commissioner Jessica Rosenworcel, considered a potential chairman pick, expressed support for lifting subcaps for AM (see 1812120054).

Potential FCC action on the UHF discount is considered one of the drivers of the Scripps/Ion deal (see 2011050024), and Scripps CEO Adam Symson recently urged Chairman Ajit Pai to approve the deal promptly (see 2011120041). Barr told us she wouldn't be surprised to see the FCC take up the matter. Both Rosenworcel and Commissioner Geoffrey Starks decried the current UHF discount last year in their dissents over the Nexstar/Tribune deal (see 1909160065). When discussions about the discount arose in 2019, broadcasters were divided over how the FCC should proceed, with some favoring eliminating the discount but raising the ownership cap. NAB and others floated a rebranded discount that would apply to all TV stations. “There is not a broadcast engineer in the country who could say with a straight face that continuing to honor the UHF discount makes any technical sense,” Rosenworcel said in comments on the Nexstar deal.

Broadcast officials expect the discussion of increased regulation of internet companies to continue into the next FCC and Congress, they said. Many broadcasters are also large digital content providers and compete with digital media companies for advertising, Oxenford said. A Biden DOJ could have a different view of broadcaster arguments about local ad competition, broadcast attorneys said. The current DOJ’s interest in possible changes to music licensing consent decrees isn’t seen likely to carry over to the next administration, Oxenford said.

The specific commissioners who make up the next FCC are considered likely to influence how much attention it pays to broadcast measures. Outgoing Commissioner Mike O’Rielly’s focus on pirate radio is considered unlikely to be replicated in the next commission, several broadcast attorneys said. Starks, formerly of the Enforcement Bureau, has been vocal about enforcement matters and repeatedly expressed interest in revising the agency’s equal employment opportunity rules.

Former senator and NAB CEO Gordon Smith worked with Biden extensively in the Senate, Smith told NAB members in a video address after Election Day. “I know I’m going to have the chance to make NAB’s case to the president-elect when and if that should become necessary,” he said. He said competition with Facebook, Amazon, Netflix and Alphabet and additional COVID-19 relief are broadcaster priorities. Asked if the association will hire different lobbyists for the Biden administration, an NAB spokesperson said NAB “has a long tradition of effective bipartisan advocacy.” The association’s lobbying effort “will remain strong” despite recent financial difficulties because of a call for additional funds from members (see 2010290064), the spokesperson said.

​​​​​​​America’s Public Television Stations CEO Patrick Butler said not having to begin each year’s budget discussion with a zeroed-out line item from the White House will help public TV: “It is so much better to have a White House that is supportive of our efforts.” Biden is a longtime supporter of public TV, Butler said. APTS made overtures to the incoming administration about an expanded role for public stations to assist with remote learning and public information and help address the digital divide, Butler said. Similar proposals to the Trump administration weren’t taken up, he said.

​​​​​​​Winston said the likelihood of a Republican-controlled Senate could make things difficult for NABOB’s push for a minority tax certificate bill in 2021, but Biden’s win could help: “We’ve got a White House that might be favorably inclined -- that changes the dynamic."