UPDATE Saying he has “serious concerns,” FCC Chairman Ajit Pai Monday proposed designating the proposed Sinclair purchase of Tribune Media for a hearing. That action surprised many experts, who believed the nearly $4 billion deal would sail through the current pro-business agency’s antitrust merger review. Last August, Inside Towers reported that T-Mobile, the Competitive Carriers Association and the Rural Broadband Association urged the agency to deny the merger, saying the combined entity could delay the repacking process. Yesterday, NTCA–The Rural Broadband Association, praised Pai for for taking measures to promote “a more thorough and thoughtful review” of the proposed deal and related transactions.
“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,” Pai said in a statement yesterday. In disputes like these, the Communications Act doesn’t allow the Commission to approve a transaction, he explained. That’s why he circulated a draft among his colleagues to designate some proposed divestitures related to the merger for a hearing before an FCC Administrative Law Judge (ALJ).
If the proposed transaction goes through as proposed, Sinclair would own 215 stations. In April, Sinclair proposed spinning off 23 stations in order to fall under the 39 percent TV media ownership cap. Critics said the sales were structured in a way that would allow Sinclair to continue to run them, reports Variety.
FCC Commissioner Jessica Rosenworcel applauded Pai’s move, saying too many of the agency’s media policies “have been custom built to support the business plans of Sinclair Broadcasting.” With a hearing, the FCC “will finally take a hard look” at the proposed transaction, which is “overdue.”
Commissioner Michael O’Rielly has said before the overloaded ALJ process needs reform, noting that often, the full Commission needs to reverse or somehow address an ALJ decision. Yesterday, O’Rielly said to garner his support, a hearing designation order must include “sufficient and defined timelines” for the ALJ to conduct and process a hearing. If those are included in the Sinclair/Tribune case, he said he’d be inclined to support that.
Pai needs a total of three votes for the proposal to pass.
July 17, 2018
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