NAB to lead broadcast-industry effort seeking deregulation under Trump regime

Donald Trump
President-elect Donald Trump.

Broadcast ownership rules may be up for discussion under an FCC appointed by President-elect Trump.

The National Association of Broadcasters will help lead the reform effort, as reported by USA Today, and it hopes to relax some of the rules that some say prevent a kind of information echo chamber from forming.

Dennis Wharton, NAB's executive vice president of media relations, said he "is cautiously optimistic a Trump FCC will take a fresh look at reforming outdated local broadcast ownership rules,” according to USA Today.

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"Broadcasters are hopeful a Trump FCC will eliminate media ownership rules that have long outlived their usefulness," Wharton explained in an email to FierceBroadcasting. "The FCC has blessed massive mergers between AT&T and DirecTV, yet bars broadcasters from co-owning newspapers in a local market. Given the failing state of many newspapers, why shouldn’t broadcasters have a chance to partner with a newspaper and save journalism jobs? We believe having ownership regulations that reflect the 21st century would provide opportunity for local radio and TV stations to better serve our tens of millions of listeners and viewers."

The current rules were created in 1975, and the FCC voted 3-2 in August to keep them as written for another four years, according to USA Today. The rules stop media companies from owning both a newspaper and a TV station in the same local market, and companies also may not own more than one TV station with top-four ratings in any market.

"At a time when the newspaper industry is struggling, relaxing outdated media ownership rules could allow local TV and radio stations to invest new resources into producing local news and content, saving journalism jobs while serving the public interest," NAB's Wharton added.

Several other areas in media and telecom will also likely see significant policy changes in a Trump administration, including net neutrality and Title II regulation on wireline and wireless broadband service, according to a research note from Jefferies today.

Jefferies also said that, though Trump’s statements generally cannot be trusted, more mergers and acquisitions are expected.

“The industry has begun a significant consolidation phase, with T-TWX, CTL-LVLT, and WIN-ELNK recently announced,” the Jefferies research note states. “Though Mr. Trump has signaled his displeasure with the announced T-TWX transaction, it remains unclear whether that was just campaign rhetoric or a stronger view on large scale vertical integration. Nonetheless, we see an FCC that will be more accommodative to M&A, and our hope is that wireless M&A will finally bring about much needed changes in the competitive landscape; the industry is fraught with promotional aggression, and, in aggregate, diminishing cash returns, particularly when treating spectrum as capex.”

A research note from UBS concurred that the M&A environment will likely change. The firm added that “secular changes in technology and usage would lead to the convergence of the cable and wireless industries.”

Deregulation could mean “fewer reporters, viewpoints and choices,” said Craig Aaron, CEO of Free Press, according to USA Today. Free Press in part advocates against media consolidation.

“The last thing we need is policies encouraging more concentration,” Aaron said. “We need outlets competing with each other for scoops and viewers, not a single dominant voice.”