Monty Tayloe

The FCC Enforcement Bureau should change tactics to avoid the risk of targets making an end run around its processes by taking advantage of recent U.S. Supreme Court decisions to drag the agency into litigation, said former FCC General Counsel Tom Johnson in a white paper sponsored by CTIA and published Monday by Wiley, where he's a partner.

An FCC draft order on collecting broadcaster workforce diversity data using form 395-B has three votes but may not be approved until next week or later under the agency’s “must vote” procedures, industry officials told us. The draft equal employment opportunity item would make broadcaster diversity data publicly available in an online portal and includes a Further NPRM on extending the rules to cable, industry officials told us. “Broadcasting has such a great influence, it is essential that any hint of discriminatory intent or impact” be considered when assessing a broadcaster’s qualifications to hold a license, said Multicultural Media Technology and Internet Council Senior Adviser David Honig, a longtime supporter of the EEO proposal.

The FCC unanimously approved all its agenda items at Thursday's open meeting, including orders on mandatory outage reporting, mitigating orbital debris and misrouted 911 calls. The agency also announced millions of dollars in proposed pirate radio fines and FCC Chairwoman Jessica Rosenworcel commented on former President Donald Trump's remarks about revoking the “licenses” of CNN and NBC over their coverage of him (see 2401170050). “The First Amendment is something we take seriously and I take seriously,” Rosenworcel said. Commissioner Brendan Carr declined comment on the former president's remarks.

A draft order on making the FCC's disaster information reporting system mandatory for cable, wireline, wireless and VoIP providers hasn’t seen many changes since circulation and is expected to be approved at a commissioners' open meeting Thursday, agency and industry officials told us (see 2401040064). The item, in docket 21-346, also includes a Further NPRM that would seek comment on extending mandatory DIRS reports to broadcasters, satellite providers and broadband internet access service providers.

An FCC proposal prioritizing application processing for broadcasters that originate local programming may not offer enough incentive to change behaviors and would likely favor the largest broadcasters that already create their content, said broadcast attorneys and academics in interviews Thursday. Since the proposal would apply only to applications facing holds or petitions to deny, it also may not have a wide reach, said Fletcher Heald broadcast attorney Anne Crump. “Ultimately, it won't really make that much difference because the vast majority of applications just run a normal course.”

Radio broadcaster Audacy’s bankruptcy restructuring won't signal a huge shift for radio but could discourage outside investment in the medium, industry analysts and media brokers said in interviews this week. Audacy’s bankruptcy is expected to proceed much like those of Cumulus and iHeartMedia, they added. “The industry has been through this before,” Tideline Partners media broker Gregory Guy said. Audacy has 230 radio stations in 46 markets and is the country’s second-largest radio group.

Provisions in the 2018 quadrennial review order could inject uncertainty into negotiations between broadcasters and networks, several broadcast attorneys told us. The order’s extension of the top-four prohibition allows networks to switch an affiliation from one station to another even if that would create a same-market duopoly but only as long as there isn’t “any undue direct or indirect influence from a broadcast entity.” Attorneys told us it isn’t clear what constitutes undue influence. The QR "creates more confusion," said Rob Folliard, Gray Television senior vice president-government relations and distribution. “You can’t have a transaction where there’s confusion.”

Broadcast attorneys expect likely legal challenges against the FCC’s 2018 quadrennial review order will focus on two questions: Does the Communications Act allow the FCC to tighten regulations during the QR process? And do restrictions on shifting top-four network programming to low-power stations and multicast streams violate the Constitution?

The FCC adopted the 2018 quadrennial review order 3 to 2 late Friday -- on the eve of a three-day holiday weekend -- with both Republican commissioners dissenting. Released Tuesday afternoon, the item extends the top-four prohibition to low-power TV stations and multicast TV channels and makes methodology changes for determining a top-four station. Yet it declines to reconsider the markets in which broadcasters compete or to loosen radio ownership caps. “We take this action to preserve the efficacy of the Top-Four Prohibition because we find it necessary to prevent further exploitation of unintended ambiguities or gaps in the rule,” the order said. “Such exploitation harms competition and denies consumers the benefits of competition.

A Warner Bros. Discovery/Paramount Global combination will likely receive regulatory approval but could encounter challenges at the FCC or DOJ, said industry analysts, reacting to rumors Warner is eyeing a purchase of Paramount.