Justice Department Pushes FCC to Take a Closer Look at Sharing Arrangements
On Thursday, the Justice Department sent a letter to the Federal Communications Commission noting that broadcast-television station-sharing arrangements harm competition and deserve a far closer degree of scrutiny.
Last October, Free Press released a comprehensive report on how the use of these arrangements on the part of conglomerates like the Sinclair Broadcast Group are driving a historic wave of broadcast consolidation. Press reports indicate the FCC is expected to crack down on the use of Joint Sales Agreements to evade ownership rules, while seeking further comment on the use of other sharing arrangements. The agency may vote on this item as early as March.
Free Press Policy Counsel Lauren Wilson made the following statement:
"This Justice Department filing reiterates what the Securities and Exchange Commission has long known and what the FCC has so far refused to scrutinize: The sharing arrangements Sinclair and other broadcasters use are often nothing more than a legal fiction designed to evade the FCC's ownership rules and harm competition.
"The DoJ rightly recognized that the alphabet soup of arrangements — the JSAs, SSAs, LNSs, and whatever other clever monikers that broadcasters dream up — destroy competition when they place two or more stations in a market under common control. Yet, as the DoJ notes, the FCC has failed to review these arrangements and broadcast deals in the same way that it has evaluated cellular, telco and cable transactions.
"The FCC must stop taking broadcasters and their lawyers on their word that these agreements are in line with the law. Instead, as the DoJ suggests, the FCC should examine each arrangement and determine whether it complies with the ownership rules.
the Commission made the appropriate inquiries, it would have found a host of illicit transfers over the course of 2013's unprecedented wave of consolidation. Instead, it has allowed that wave to go forward, and has sacrificed the public interest in the process. Community interests shouldn't be subordinate to broadcasters' profit margins.
The Department also rightly notes that the FCC's analysis of these agreements should examine not just competition but also localism and diversity. When power is concentrated in the hands of just a few owners, it’s impossible to promote any of these goals. We urge the Commission to heed the DoJ's calls to require transparency from broadcasters and carry out the proper reviews to safeguard the public interest."
