GCI Asks FCC to Block Gray TV Purchase

Says Station Buys Will Give Gray Too Much Control

Alaskan cable operator GCI has asked the Federal Communications Commission to stop Gray TV from purchasing Anchorage broadcast station KYES, stating that pairing the broadcaster with its other pending buy of NBC affiliate KTUU would give it too much control.

Gray TV agreed to purchase Schurz Communications’ 10 TV stations in September for $442.5 million. Included in that deal was KTUU, the NBC-affiliate in Anchorage. In a separate deal, Gray said it has agreed to purchase KYES, a MyNetworkTV affiliate in Anchorage from Fireweed Communications for about $500,000. Gray has asked the FCC for a “failing station” designation for KYES so it can combine the two stations into one.

GCI, which offers cable, broadband, telephone and cellular service throughout the state and owns CBS-affiliate KTVA in Anchorage, said that because Gray is already purchasing the Schurz station, it should not be allowed to add the Fireweed station to its portfolio.  

Gray has said in FCC filings that combining the stations would allow it to invest more resources in the remaining property, expand weather coverage and offer a new outlet for its Washington, D.C. news bureau.

According to reports, Gray said in response to the GCI petition that instead of welcoming a new competitor, the telecom company “bears its brass knuckles to Gray.”

Gray called GCI’s accusations “speculative nonsense,” and pointed out that GCI already dominates the communications business across the state.

In a reply comment to the FCC, Alaska state Attorney General Craig Richards said it has “serious concerns” about the failing station designation which it said has “the potential for significant negative effects on competition in the small Anchorage DMA.”

Richards added that Gray’s assertion of the benefits of combining the stations were “minimal at best.”

“Competition is fragile in the Alaska broadcast market,” Richards wrote. “With limited players, a small population and geographic challenges, we strive to keep all the competition available whenever possible. The State asks the Commission to conduct a thorough review of this application to ensure these goals are preserved.”