Recent FCC commentary and review of broadcast ownership rules has opened the door to bigger questions about the public interest standards that broadcast license holders are held to. Now, one economic think tank scholar says those mandates belong in “the trash pile.”
In a commentary, International Center for Law & Economics senior scholar Eric Fruits argues that legacy broadcast rules like spectrum allocations, ownership caps, and must-carry requirements all trace back to an outdated notion of scarcity that no longer reflects today’s market. His conclusion: if broadcasting were invented now, these obligations would never exist.
“In our thought experiment, imposing a ‘public interest’ standard on newly invented broadcast stations would be illogical,” Fruits writes. “What public interest is served by forcing a broadcaster to air specific types of content when consumers can already access a boundless supply of that content online?”
Fruits frames the “public interest” mandate as the root of regulatory asymmetry. Broadcasters must provide children’s programming, follow political ad rules, and maintain public service files, while streaming platforms and podcasts face no such burdens. “Viewed through this ‘clean slate’ lens, these regulations appear not as necessary safeguards for the public, but as historical artifacts that solve problems of technological scarcity that no longer exist,” he writes.
That critique extends to spectrum policy. Fruits points to the FCC’s 2017 incentive auction, when broadcasters sold frequencies that mobile carriers eagerly paid nearly twice as much to acquire. To him, assigning vast tracts of valuable spectrum to linear broadcasting in an era of nearly universal broadband “forces this resource into a lower-value use.”
Ownership limits also collapse under his clean-slate analysis. He notes that consumers today are overwhelmed by choice, not starved for it, making caps on station consolidation obsolete. And with distributors ranging from cable to streaming apps, the 1990s rationale for must-carry protections no longer applies. “In the real world, these legacy rules actively harm consumers and distort the market,” Fruits writes, sharing in the opinions held by many broadcast leaders and the NAB.
FCC leaders are also wrestling with how to handle the public interest question. Republican Chairman Brendan Carr recently floated the idea of an auction system that could allow broadcasters to buy their way out of traditional obligations, while Democratic Commissioner Anna Gomez has urged the agency to begin a rulemaking that would more clearly define them.
But Fruits sees little merit in salvaging the framework. “The current regulatory framework shackles broadcasters to a 20th-century business model and prevents them from adapting to a 21st-century competitive environment,” he concludes.
Tactics can change rapidly, strategies evolve in a slower progression, principles never change.
We are broadcasters that have been licensed based on our building and supporting communities, the businesses in those communities and the individuals in them. I don’t have a problem with these obligations and it’s what makes us broadcasters. If you look at what’s happened we are being forced to compete with an industry that has no oversight, no accountability and answers to no one. I usually find myself in the “dereg” corner but look differently on this issue. With no oversight given to the tech community I fear the information super highway will continue to barrel out of control wrecking everything in its path.
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