Radio Property Ownership Regulations Upholded by Appellate Court
U.S. Court Upholds Radio Ownership Limits, Vacates TV Top-Four Prohibition
In a recent ruling, the U.S. Court of Appeals for the Eighth Circuit has upheld the Federal Communications Commission's (FCC) Local Radio Ownership Rule, while vacating the "top-four" prohibition in the Local Television Ownership Rule.
The court's decision affirms the FCC's authority to maintain current local radio ownership limits, despite industry opposition citing competition from digital audio services. The existing limits on the number of AM and FM stations a single entity may own in a local market remain in place.
On the other hand, the court struck down the FCC’s "Top Four" television ownership rule, which prohibited owning two of the top four TV stations in a market. The ruling gives the FCC 90 days to justify retaining the TV Top Four rule, but no such requirement was imposed on the radio ownership rules.
The court found that the FCC acted within its authority in defining the relevant market narrowly as broadcast radio only, excluding competition from digital audio platforms like Spotify and YouTube Music. This means that the Local Radio Ownership Rule, which allows a licensee to own up to eight commercial radio stations in the largest markets, with subcaps limiting ownership to five on each band (FM/AM), remains unchanged.
The National Association of Broadcasters (NAB) and other radio companies had challenged the FCC’s decision, arguing that the commission had failed to justify the Local Radio Ownership Rule regulations. However, the court determined that the FCC's decision was not arbitrary and capricious.
FCC Chairman Brendan Carr, who has been a vocal critic of the commission's approach to regulating the broadcast industry, focused on the court's decision to toss the top-four rule in a reaction statement. Carr believes that the FCC's current approach has failed to promote the public interest.
Carr is pleased to see that the court agrees and has vacated the top-four regulation. He hopes that the new FCC Chairman, Carr himself, will help modernize the local radio ownership rules. Curtis LeGeyt, President/CEO of the NAB, considers the decision regarding TV ownership rules a significant step for local television broadcasters.
The court's decision leaves the FCC with the task of justifying the retention of the TV Top Four rule and considering potential changes to the Local Radio Ownership Rule. The FCC is expected to possibly propose relaxation of local ownership rules later in 2025 or 2026, but no immediate changes to radio ownership limits have been ordered by the court.
- The U.S. Court of Appeals for the Eighth Circuit's decision affirms the FCC's authority to maintain the Local Radio Ownership Rule, which allows a licensee to own up to eight commercial radio stations in the largest markets, with subcaps limiting ownership to five on each band (FM/AM).
- The existing limits on the number of AM and FM stations a single entity may own in a local market remain in place, despite industry opposition citing competition from digital audio services like Spotify and YouTube Music.
- The ruling leaves the Federal Communications Commission (FCC) with the task of justifying the retention of the TV Top Four rule, but no such requirement was imposed on the radio ownership rules.
- The FCC Chairman, Brendan Carr, is expected to possibly propose relaxation of local ownership rules later in 2025 or 2026, but no immediate changes to radio ownership limits have been ordered by the court.
- The court found that the FCC acted within its authority in defining the relevant market narrowly as broadcast radio only, excluding competition from digital audio platforms like Spotify and YouTube Music, underscoring the significance of media technology in today's business, education-and-self-development, entertainment, and general-news environments.
