Of course the big Supreme Court news last week was health care, however, there was a bit of media news that came out as the Court wrapped up. The Court refused to review the FCC’s ownership limits. Broadcasters sought Supreme Court review on First Amendment grounds arguing that decades-old media ownership rules do not make sense in our cable/satellite television-Internet era. We turned to broadcast attorney John Garziglia for his analysis.
“The Supreme Court’s refusal to review the FCC’s ownership limits is a non-event for radio broadcasters. None of the radio ownership rules, save perhaps allowing for newspaper/radio group combinations, were directly at issue for radio.”
“Had the Supreme Court taken the case, broadcasters would have argued that the scarcity doctrine, that has served for decades as the basis for the FCC’s broadcast ownership restrictions, is now outmoded and cannot now be justified. Had such an appeal been successful, it is possible that most of the rationale for the FCC’s media ownership restrictions would no longer exist.”
“Radio broadcasters, in particular, should be careful of what they wish. In the past several decades, radio has moved from national ownership limits of seven stations in each service, with no-same-service area contour overlap and no more than three stations within 100 miles of each other, to the present scheme of no national ownership limits and up to eight stations in a market.”
“The loosening of ownership restrictions, while arguably allowing the radio business to hold its own against unregulated competitors, has resulted in sea changes to radio station operations.”
“FCC ownership restrictions can be thought of in the same way as zoning for real estate. For example, while un-zoned strip malls can be hugely profitable, they often are a community blight. Unregulated radio ownership could be analogous. Once ultimate radio consolidation occurs, it may completely alter local community bonds and rapport that up to now have been the core of radio’s exceptionality . The very nature of radio could be forever and irredeemably changed if all ownership restrictions were jettisoned.”
“For now, the policy question of radio ownership restrictions remains before the FCC where, in a never-ending story, every several years the FCC wrestles with the question of whether its broadcast station ownership limits remain good public policy. Sooner or later, either at the FCC or in the courts, the FCC’s ownership restrictions will once again change. This year, however, will not be that year as the Supreme Court has refused to take up broadcast station ownership limits.”