The
First Amendment to the United States Constitution included a provision that protected "freedom of the press" from Congressional action. For newspapers and other print items, in which the medium itself was practically infinite and publishers could produce as many publications as they wanted without interfering with any other publisher's ability to do the same, this was not a problem. The debut of radio broadcasting in the first part of the 20th century complicated matters; the
radio spectrum is finite, and only a limited number of broadcasters could use the medium at the same time. The United States government opted to declare the entire broadcast spectrum to be government property and license the rights to use the spectrum to broadcasters. After several years of experimental broadcast licensing, the United States licensed its first commercial radio station,
KDKA, in 1920. Prior to 1927, public airwaves in the United States were regulated by the
United States Department of Commerce and largely litigated in the courts as the growing number of stations fought for space in the burgeoning industry. In the earliest days, radio stations were typically required to share the same standard frequency (833 kHz) and were not allowed to broadcast an entire day, instead having to sign on and off at designated times to allow competing stations to use the frequency. The Federal
Radio Act of 1927 (signed into law February 23, 1927) nationalized the airwaves and formed the
Federal Radio Commission, the forerunner of the modern
Federal Communications Commission (FCC) to assume control of the airwaves. One of the first moves of the FRC was
General Order 40, the first U.S.
bandplan, which allocated permanent frequencies for most U.S. stations and eliminated most of the part-time broadcasters.
Communications Act of 1934 The
Communications Act of 1934 was the stepping stone for all of the communications rules that are in place today. When first enacted, it created the FCC (Federal Communications Commission). It was created to regulate the telephone monopolies, but also regulate the licensing for the spectrum used for broadcasting. The FCC was given authority by Congress to give out licenses to companies to use the broadcasting spectrum. However, they had to determine whether the license would serve "the public interest, convenience, and necessity". The primary goal for the FCC, from the start, has been to serve the "public interest". A debated concept, the term "public interest" was provided with a general definition by the Federal Radio Commission. The Commission determined, in its 1928 annual report, that "the emphasis must be first and foremost on the interest, the convenience, and the necessity of the listening public, and not on the interest, convenience, or necessity of the individual broadcaster or the advertiser." Following this reasoning, early FCC regulations reflected the presumption that "it would not be in the public's interest for a single entity to hold more than one broadcast license in the same community. The view was that the public would benefit from a diverse array of owners because it would lead to a diverse array of program and service viewpoints." The
Communications Act of 1934 refined and expanded on the authority of the FCC to regulate public airwaves in the United States, combining and reorganizing provisions from the Federal Radio Act of 1927 and the
Mann-Elkins Act of 1910. It empowered the FCC, among other things, to administer broadcasting licenses, impose penalties and regulate standards and equipment used on the airwaves. The Act also mandated that the FCC would act in the interest of the "public convenience, interest, or necessity." Nevertheless, radio and television was dominated by the
Big Three television networks until the mid-1990s, when the Fox network and UPN and The WB started to challenge that hegemony.
Cross-ownership rules of 1975 In 1975, the FCC passed the newspaper and broadcast cross-ownership rule. This ban prohibited the ownership of a daily newspaper and any "full-power broadcast station that serviced the same community". The ruling was put in place to limit
media concentration in TV and radio markets, because they use public airwaves, which is a valuable, and now limited, resource.
Telecommunications Act 1996 The
Telecommunications Act of 1996 was an influential act for media cross-ownership. One of the requirements of the act was that the FCC must conduct a biennial review of its media ownership rules "and shall determine whether any of such rules are necessary in the public interest as the result of competition." The Commission was ordered to "repeal or modify any regulation it determines to be no longer in the public interest." The legislation, touted as a step that would foster competition, actually resulted in the subsequent mergers of several large companies, a trend which still continues. Over 4,000 radio stations were bought out, and minority ownership of TV stations dropped to its lowest point since the federal government began tracking such data in 1990. Since the Telecommunications Act of 1996, restrictions on media merging have decreased. Although merging media companies seems to provide positive outcomes for the companies involved in the merger, it might lead to negative outcomes for other companies, viewers and future businesses. The FCC even found that they were indeed negative effects of recent merges in a study that they issued. In June 2003, after its deliberations which included a single public hearing and the review of nearly two-million pieces of correspondence from the public opposing further relaxation of the ownership rules the FCC voted 3-2 to repeal the newspaper/broadcast cross-ownership ban and to make changes to or repeal several of its other ownership rules as well. In the order, the FCC noted that the newspaper/broadcast cross-ownership rule was no longer necessary in the public interest to maintain competition, diversity or localism. However, in 2007 the FCC revised its rules and ruled that they would take it "case-by-case and determine if the cross-ownership would affect the public interest. In 2003 the FCC set out to re-evaluate its media ownership rules specified in the Telecommunications Act of 1996. On June 2, 2003,
FCC, in a 3-2 vote under Chairman
Michael Powell, approved new media ownership laws that removed many of the restrictions previously imposed to limit ownership of media within a local area. The changes were not, as is customarily done, made available to the public for a comment period. • Single-company ownership of media in a given market is now permitted up to 45% (formerly 35%, up from 25% in 1985) of that market. • Restrictions on newspaper and TV station ownership in the same market were removed. • All TV channels, magazines, newspapers, cable, and
Internet services are now counted, weighted based on people's average tendency to find news on that medium. At the same time, whether a channel
actually contains news is no longer considered in counting the percentage of a medium owned by one owner. • Previous requirements for periodic review of license have been changed. Licenses are no longer reviewed for "public-interest" considerations. The decision by the FCC was overturned by the
United States Court of Appeals for the Third Circuit in
Prometheus Radio Project v. FCC in June, 2004. The Majority ruled 2-1 against the FCC and ordered the Commission to reconfigure how it justified raising ownership limits. The
Supreme Court later turned down an appeal, so the ruling stands. In June 2006, the FCC adopted a Further Notice of Proposed Rulemaking (FNPR) to address the issues raised by the United States Court of Appeals for the Third Circuit and also to perform the recurring evaluation of the media ownership rules required by the Telecommunications Act. The deliberations would draw upon three formal sources of input:(1) the submission of comments, (2) ten Commissioned studies, and (3) six public hearings. The FCC voted December 18, 2007 to eliminate some media ownership rules, including a statute that forbids a single company to own both a newspaper and a television or radio station in the same city. FCC Chairman
Kevin Martin circulated the plan in October 2007. The FCC held six hearings around the country to receive public input from individuals, broadcasters and corporations. Because of the lack of discussion during the 2003 proceedings, increased attention has been paid to ensuring that the FCC engages in proper dialogue with the public regarding its current rules change. FCC Commissioners Deborah Taylor-Tate and Robert McDowell joined Chairman Martin in voting in favor of the rule change. Commissioners Michael Copps and Jonathan Adelstein, both Democrats, opposed the change.
UHF discount Beginning in 1985, the FCC implemented a rule stating that
television stations broadcasting on UHF channels would be "discounted" by half when calculating a broadcaster's total reach, under the market share cap of 39% of U.S. TV households. This rule was implemented because the UHF band was generally considered inferior to VHF for broadcasting
analog television. The notion became obsolete since the completion of the
transition from analog to
digital television in 2009; the majority of television stations now broadcast on the UHF band because, by contrast, it is generally considered superior for digital transmission. The FCC voted to deprecate the rule in September 2016; the Commission argued that the UHF discount had become
technologically obsolete, and that it was now being used as a loophole by broadcasters to contravene its market share rules and increase their market share through consolidation. The existing portfolios of broadcasters who now exceeded the cap due to the change were
grandfathered, including the holdings of
Ion Media Networks,
Tribune Media, and
Univision. However, on April 21, 2017, under new
Trump administration FCC commissioner
Ajit Pai, the discount was reinstated in a 2-1 vote, led by Pai and commissioner
Michael O'Rielly. The move, along with a plan to evaluate increasing the national ownership cap, is expected to trigger a wider wave of consolidation in broadcast television. A challenge to the rule's restoration was filed on May 15 by The Institute for Public Representation (a coalition of public interest groups comprising
Free Press, the
United Church of Christ, Media Mobilizing Project, the
Prometheus Radio Project, the
National Hispanic Media Coalition and
Common Cause), which requested an emergency motion to stay the UHF discount order – delaying its June 5 re-implementation – pending a court challenge to the rule. The groups re-affirmed that the rule was technologically obsolete, and was restored for the purpose of allowing media consolidation. The FCC rejected the claims, stating that the discount would only allow forward a regulatory review of any station group acquisitions, and that the Institute for Public Representation's criteria for the stay fell short of meeting adequate determination in favor of it by the court; it also claimed that the discount was "inextricably linked" to the agency's media ownership rules, a review of which it initiated in May of that year. The challenge and subsequent stay motion was partly filed as a reaction to
Sinclair Broadcast Group's proposed acquisition of Tribune Media (announced on May 8), which – with the more than 230 stations that the combined company would have, depending on any divestitures in certain markets where both groups own stations – would expand the group's national reach to 78% of all U.S. households with at least one television set with the discount. On June 1, 2017, the
District of Columbia Court of Appeals issued a seven-day administrative stay to the UHF discount rulemaking to review the emergency stay motion. The D.C. Court of Appeals denied the emergency stay motion in a one-page memorandum on June 15, 2017, however, the merits of restoring the discount is still subject to a court appeal proceeding scheduled to occur at a later date. Following this, in November 2017, the FCC voted 3-2 along partisan lines to eliminate the cross-ownership ban against owning multiple media outlets in the same local market, as well as increasing the number of television stations that one entity may own in a local market. Pai argued the removal of the ban was necessary for local media to compete with online information sources like Google and Facebook. The decision was appealed by advocacy groups, and in September 2019, the
Third Circuit struck down the rule change in a 2-1 decision, with the majority opinion stating the FCC "did not adequately consider the effect its sweeping rule changes will have on ownership of broadcast media by women and racial minorities." Pai stated plans to appeal this ruling. The FCC petitioned to the Supreme Court under
FCC v. Prometheus Radio Project. The Supreme Court ruled unanimously in April 2021 to reverse the Third Circuit's ruling, stating that the FCC's rule changes did not violate the
Administrative Procedure Act, and that there was no Congressional mandate for the FCC to consider the impact on minority ownership of its rulemaking, thus allowing the FCC to proceed with relaxation of media cross-ownership rules. ==Local content==