FCC closes loophole in TV ownership rules

Staff report


A federal agency’s action to limit joint-sales agreements between television stations could force changes upon two companies in the Youngstown market.

The Federal Communications Commission in Washington on Monday took steps to close a loophole in its TV ownership rule by making sure that a company’s interests in a market are properly counted.

The action is intended to ensure competition, local authority and diversity in a broadcast market by reining in joint-sales agreements, according to a statement released by the FCC.

A JSA is a pact between two stations in the same market in which one station is authorized to sell advertising time on the other station.

Such a situation exists between LIN Media, which owns WKBN-TV and WYFX-TV, and Vaughan Media LLC, which owns WYTV-TV.

Both stations’ news and sales operations were combined under WKBN’s umbrella under an agreement between their parent companies that was reached several years ago.

David Coy, general manager of WKBN-WYTV, did not respond to a request to comment Tuesday on how the ruling might affect the Youngstown stations.

The order issued by the FCC decrees that such agreements create an ownership interest when the JSA allows for the sale of 15 percent or more of the advertising time on a competing local station.

Parties in existing JSAs will have two years to come into compliance with the applicable local ownership limits.

Waiver requests will be considered, but the stations in the JSA must show that strict compliance with the ruling is inconsistent with the public interest.

The National Association of Broadcasters, the voice of the nation’s television and radio broadcasters, criticized the FCC order.

“For a decade, Republican and Democratically controlled FCCs have approved JSAs, which allow free and local TV stations to survive in a hyper-competitive world dominated by pay-TV giants,” said Dennis Wharton, executive vice president of communications for the NAB, in a statement released Monday. “That model is now declared illegal, based on the arguments of pay-TV companies whose collaborative interconnected advertising sales practices make JSAs seem pale by comparison.

“It’s disappointing the FCC would take this action without first completing its 2010 statutorily mandated media-ownership review,” Wharton said. “As the record before the commission clearly shows, the public interest will not be served by this arbitrary and capricious decision.”

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