House Minority Leader Nancy Pelosi (D-Calif.) and Rep. Frank Pallone (D-N.J.) are urging the FCC not to take an action on Thursday that will enable more mergers of major station groups, and they singled out one possible combination in particular.
On Thursday, the FCC is scheduled to vote on a proposal to restore the the so-called “UHF discount.” That allows station groups to count their UHF station holdings at just 50% of their coverage area.
Last year, the FCC did away with the discount, as then-chairman Tom Wheeler characterized it as a relic from an era when UHF stations were unable to get the same audience reach as VHF channels. That disparity disappeared with the conversion to digital TV.
But station groups balked at the change, as the discount allows a number of media outlets to fall within the FCC’s cap on media ownership, in which no entity can own stations with a reach more than 39% of the country.
They have been pressing the FCC to revisit the rule. Chairman Ajit Pai, presiding over a GOP majority at the agency, wants to reinstate the discount and revisit the issue later this year, along with a possible increase in the media ownership cap.
“We are concerned, in part, because of press accounts that Sinclair is waiting for the UHF Loophole to be restored so it can buy Tribune Broadcasting’s stations,” Pelosi and Pallone wrote in their letter to Pai. “Without the phony math created by the UHF Loophole, that transaction would increase its audience share beyond the statutory 39% cap.”
“That would be bad news for consumers in Tribune’s markets in two ways: first, consumers would lose an independent voice in their media market; and second, consumers could see their cable bills go up because Sinclair charges cable operators more than Tribune for retransmission consent,” the letter continued.
Sinclair Broadcast Group had no comment. It is one of the largest station groups in the country, with 173 stations that it owns, or has agreements in place to provide shared services.
Pelosi and Pallone also wrote in their letter that the FCC doesn’t have the authority to modify the ownership cap — only Congress does.
“There is no justification for the FCC to restore the UHF Loophole,” they wrote. “The UHF Loophole is unfair to the public because it treats UHF stations differently only for one purpose — to let big station conglomerates own more stations across the country.”