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Surprise FCC Move Maims Sinclair-Tribune Merger

FCC Chairman Ajit Pai's said Monday that he has "serious concerns" about right-wing Sinclair Broadcast Group's proposed $3.9 billion merger with Tribune Media.

In a statement announcing a draft order that would require the merger applicants to attend a hearing in front of an administrative law judge, Pai said, "Based on a thorough review of the record, I have serious concerns about the Sinclair/Tribune transaction. The evidence we've received suggests that certain station divestitures that have been proposed to the FCC would allow Sinclair to control those stations in practice, even if not in name, in violation of the law."

Reuters reports that the FCC has the three votes needed to approve Pai's proposal, and the draft order - which has not been publicly released - notes that "Sinclair's actions here potentially involve deception" and possible "misconduct."

"This is a giant win for the public, and a huge setback for Sinclair's mega-merger plans," said Free Press policy director Matt Wood.

"Public outcry has been building over Sinclair's takeover of local television for months. Just last week, Common Cause and its allies delivered over 600,000 signatures to the FCC urging the agency to block Sinclair's merger," said Michael Copps, Common Cause special adviser and a former FCC commissioner. "The message is loud and clear: local news should reflect the concerns and interests of the communities they serve, not the will of a wealthy, powerful few. Sinclair's merger would make it too large and too powerful."

Although the Communications Act requires that the FCC allow applicants to argue their case before a merger can be denied, as Wood explained, "it is extremely rare for transactions to be sent to a hearing in the first place, much less for parties to fight it out and beat the FCC in that hearing. That's why analysts and investors rightly see today's news as potentially a fatal blow for this merger."

Indeed, an approved hearing order kicks off "a lengthy administrative process often viewed as a deal-killer," Politico says. "The agency used the same move in 2015 with the Comcast-Time Warner Cable deal, which the companies abandoned rather than go through the hearing process."

Wood added that perhaps "the most interesting part of Pai's announcement is his recognition that several of the divestitures Sinclair proposed are a sham that would leave the company in control of stations it purportedly sells off to relatives and cronies of Sinclair executives."

Earlier this year, 15 members of the Coalition to Save Local Media, including Common Cause, sent a letter to the FCC raising alarm about "sidecar arrangements" that Sinclair planned to use to make the merger appear to comply with federal audience-cap rules, even though the company would continue providing all services to the "sold" stations.

"We're encouraged by Chairman Pai's apparent recognition that Sinclair's proposed divestiture of stations to shell companies is in fact unlawful," Wood concluded. "We encourage the FCC to examine all other such shell-company arrangements held by Sinclair, Tribune, and other broadcasters, too."

The development came as a surprise considering that Pai is a Trump appointee and former Verizon lawyer who often has been accused of being too cozy with industries and companies he's charged with regulating - including Sinclair.

"As I have noted before, too many of this agency's media policies have been custom built to support the business plans of Sinclair Broadcasting," said the sole Democratic FCC commissioner, Jessica Rosenworcel. "With this hearing designation order, the agency will finally take a hard look at its proposed merger with Tribune. This is overdue and favoritism like this needs to end."

This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.

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Previously:
* Item: Former Trump Aide Joins Sinclair.

* Trump's FCC Chair Continues To Shaft The Public, Offer Major Handouts To Big Media.

* Trump-Friendly Sinclair's Takeover Of Tribune TV Stations Brought To You By Trump's FCC Chairman.

* Jonathan Pie, TV Reporter! Make The Air Fair.

* 'Maybe The Worst FCC I've Ever Seen.'

* A Pair Of Decades-Old Policies May Change The Way Rural America Gets Local News.

* Tribune's Disastrous Sale To Sinclair.

* Lawmakers Demand Answers About FCC's Favoritism Toward Sinclair.

* Can Anyone Stop Trump's FCC From Approving A Conservative Local News Empire?

* Sinclair's Flippant FCC Ruling.

* FCC Presses Sinclair For Answers On Tribune Merger.

* Trump FCC Eliminates Local Broadcast Main Studio Requirement In A Handout To Sinclair That Will Harm Local Communities.

* Trump's FCC Chairman Announces Plan To Scrap Media Ownership Limits Standing In Way Of Tribune-Sinclair Mega-Merger.

* Lisa Madigan et al. vs. Sinclair-Tribune.

* Local TV News Is About To Get Even Worse.

* Trump's Secret Weapon Against A Free Press.

* With Massive Handouts To Sinclair, FCC Clears Path To New Wave Of Media Consolidation.

* Trump FCC Opens Corporate Media Merger Floodgates.

* FCC Wraps New Gift For Sinclair.

* FCC Inspector General Investigating Sinclair Rulings.

* Behind Sinclair's 'Project Baltimore.'

* Don't Be Fooled By Sinclair's Shell Games.

* Free Press Sues The FCC For Dramatic Reversal Of Media Ownership Limits That Pave Way For Media Mergers.

* Thanks, Tribune Media, All You Did Was Weaken A Country.

* Sinclair-Fox Station Deal Enabled By FCC Is Dangerous For Democracy.

* The Sinclair Sham.

* Debunking The Broadcast Industry's Claims About Sinclair's Tribune Takeover.

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See also:

* Sinclair Broadcast Group Solicits Its News Directors For Its Political Fundraising Efforts.

* FCC Plans To Fine Sinclair $13.3 million Over Undisclosed Commercials.

* Sinclair's New Media-Bashing Promos Rankle Local Anchors.

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Comments welcome.



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Posted on July 17, 2018


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