Policy

Newsmax to FCC: Deny or Dismiss Sinclair-Tribune Merger

Says allowing deal would do immeasurable harm to democracy, diverse media 8/08/2017 10:19 AM Eastern

Conservative news network Newsmax has made it official. It has filed a petition with the FCC to deny the merger of Sinclair and Tribune, saying that the combination would cripple a diverse press and do "immeasurable harm to democracy."

Newsmax CEO Christopher Ruddy had already told the FCC he did not like the proposed Sinclair-Tribune deal and had asked the agency to hold off on making any decision about it, signaling that his company would likely oppose the transaction. It has.

In the petition, a copy of which was obtained by Multichannel News, Newsmax said the merger -- which would create the nation's largest broadcast group with over 200 stations reaching over 72% of the country -- "creates an unprecedented concentration of power in the hands of one broadcaster while setting the stage for other television broadcast networks to amass similar market penetration."

Related: Dish Asks FCC to Deny Sinclair-Tribune

Newsmax is also concerned that the combined company, and other broadcast mergers that could follow Sinclair's lead, would result in demands for carriage of co-owned cable nets, "further reducing the limited market space now available to independent cable operators," meaning less space to carry networks like Newsmax TV.

The company says the FCC is abetting that concentration with "regulatory sleight of hand" and the result will cripple a free and diverse press.

Related: Diverse Groups Combine to Oppose Sinclair-Tribune

The "sleight of hand" reference is to the decision by the FCC under chair Ajit Pai to restore the UHF discount, which means that only half of UHF TV stations audience reach count toward the 39% national cap, which paves the way for the combo on its effective 70%-plus reach. The discount dates from the analog days when UHF stations were weaker than VHF, a situation that was reversed with the switch to digital in 2009.

Invoking a conservative icon, Newsmax pointed out that the national ownership cap -- then 25% -- was instituted during the Reagan Administration, in which there was also an ownership cap of 12 TV stations.

"The Commission’s approval of this merger [it has not yet done so] blatantly subverts congressionally mandated media ownership rules," Newsmax said.

"The level of media concentration proposed by this transaction will homogenize the content available to U.S. consumers, eliminate unique viewpoints and reduce press diversity, especially in the delivery of local news," Newsmax told the commission. "These actions cannot be justified under the FCC’s public interest standard and this the transaction should be denied."

Newsmax wants the FCC to dismiss the application and complete its review of media ownership rules -- Pai said he was reinstating the UHF discount to deal with it in that review alongside the 39% cap.

"If the outcome of that media ownership rulemaking allows a single entity to control more than 70% of American television households, the Applicants can resubmit their application to the FCC at that time," it said. "However, if the FCC chooses to move forward, the proposed transaction should be denied on its face. It cannot be justified under the confines of the public interest standard and is only enabled by apparent political rulemaking."

Back in May, Sinclair agreed to buy Tribune's 42 stations for $3.9 billion. While the FCC has not signed off on that deal yet, it did approve Sinclair's recent purchase of seven TV's from Bonten.

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