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FCC Boss Wrecks Media Ownership Rules In Huge Gift To Sinclair Broadcasting

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While the FCC's Ajit Pai has been working hard to ignore the public outcry against the death of net neutrality, he's also been busy actively gutting media consolidation and ownership regulations solely, says Karl Bode of Techdirt, for the benefit of Sinclair broadcasting.

By Karl Bode of Techdirt

FCC boss Ajit Pai has been busy ignoring the public while he kills popular net neutrality rules. But he's also been working hard to weaken broadband deployment standards to obfuscate a lack of broadband competition, to gut programs that provide broadband to the poor, killing previous FCC efforts to improve cable box competition, to protect prison telco monopolies from oversight, and to make it easier for business broadband monopolies to rip off smaller competitors. All while proclaiming to be a stalwart defender of the little guy and a champion for bridging the digital divide.

But Pai has also been taking heat for his pursuit of another pet project: gutting media consolidation and ownership rules solely for the benefit of Sinclair Broadcasting, which is seeking approval for its $3.9 billion bid for Tribune. In the last few months, Pai has, as promised, been “taking a weed whacker" to rules intended to protect local reporting, media competition, and opinion diversity. That has included killing an 80 year rule intended to protect local competitors and journalism from unchecked monopoly control of a market, and taking an axe to some protections but bringing back others solely to Sinclair's benefit:

“On Tuesday, the FCC eliminated a requirement for broadcasters to keep a local studio. A day later, Pai called for easing ownership restrictions, potentially taking pressure off Sinclair’s $3.9 billion deal for Tribune Media Co.’s TV stations. Earlier, he had restored an obsolete rule, making the deal possible. On Thursday, the agency moved toward blessing a new broadcasting standard that may enrich Sinclair as it offers viewers sharper pictures."

As he prepares to axe yet more media consolidation protections over the coming months, Pai has trotted out the growing power of Google and Facebook as partial justification for eliminating rules he declares no longer necessary:

“The marketplace today is nothing like it was in 1975. Newspapers are shutting down. Many radio and TV stations are struggling, especially in smaller and rural markets. Online competition for the collection and distribution of news is even greater than it ever was. And just two Internet companies [Google and Facebook] claimed 100 percent of recent online advertising growth. Indeed, their digital ad revenue alone this year will be greater than the market cap of the entire broadcasting industry. And yet the FCC's rules still presume that the market is defined entirely by pulp and rabbit ears."

Obviously the argument that “Google and Facebook are big" and therefore media consolidation rules are unnecessary doesn't hold a whole lot of water. And while it's true that many newspapers and local news outlets are “struggling," that's more a failure of adaptation than a justification for gutting media consolidation restrictions that still aid smaller, regional news outlets. Unsurprisingly, fellow FCC Commissioners like Jessica Rosenworcel have called for an investigation into Pai's giant, sloppy kiss to Sinclair:

“It has reached a point where all of our media policy decisions seem to be custom-built for this one company," Jessica Rosenworcel, a Democratic FCC member, said Wednesday at a congressional hearing. “It’s something that merits investigation.”

This mindless obsession with mergers and consolidation (with little thought as to the impact on markets or competition) has been a hallmark of the Trump administration. But opposition to this growth-for-growth's sake has been increasingly bipartisan in nature, with many smaller Conservative outlets worried they'll be unable to compete with giants like Comcast NBC Universal, Sinclair/Tribune, and soon AT&T Time Warner. Smaller organizations like the American Cable Association (ACA) applauded and supported Pai's rise to power, now seem surprised as his policies focus almost exclusively on aiding the biggest and wealthiest companies:

“ACA urges the Federal Communications Commission to deny the Sinclair-Tribune transaction because it would violate existing FCC rules while at the same timing failing to meet the obligation to demonstrate it would serve the public interest. Even if the transaction were not per se unlawful, it would create a broadcasting behemoth with unprecedented control over both the national and local television markets,” ACA President and CEO Matthew M. Polka said."

Whether it's gutting net neutrality solely for the benefit of a few giant ISPs, or gutting media consolidation rules exclusively to aid one giant media empire, Pai's legacy at the FCC will be one of brutal myopia, obfuscated by tall tales about his relentless dedication to the little guys he seems blatantly intent on ignoring.

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