It’s been one of the hottest rumors that insiders insist is a done deal, yet no one is talking on the record. The subject? FOX has a plan in place to assume control of the CBS Television Network via a shared services agreement.
A FCC filing made last week by FOX advocates for the eye-opening scenario.
Fox Corporation offered its argument for elimination of the “dual network rule” by the Commission in a 24-page ex parte comment submission as part of MB Docket No. 22-459, the 2022 Quadrennial Regulatory Review.
With Assistant General Counsel and SVP/Legal and FCC Compliance Joseph Di Scipio and Ann West Bobeck, Vice President of FCC Legal & Business Affairs at Fox Corporation, co-signing the filing, FOX argues that the Commission “should implement the deregulatory mandate established by the Telecommunications Act of 1996 by eliminating the obsolete Dual Network Rule and Local Television Ownership Rule.”
Why? “Elimination of these rules will serve the public interest by providing broadcasters the flexibility to compete more effectively in a rapidly changing media marketplace.”
The FOX legal executives believe the Dual Network Rule and Local Television Advertising Rule “also unduly constrain broadcasters as compared to less regulated—and, in many cases, less locally rooted—participants in the media ecosystem, including the largest tech companies.”
As they see it, “These artificial competitive restraints ultimately harm local affiliates and their communities. To retain either rule would be to neglect the 1996 Telecommunications Act’s deregulatory mandate, which insists that the Commission unleash competition. Preserving burdensome regulations that hamstring broadcasters in their efforts to modernize and compete would do the very opposite.”
The Local Television Ownership Rule prohibits an entity from owning two television stations in the same Nielsen Designated Market Area unless their service contours do not overlap or at least one of the stations is not ranked among the top-four stations in the DMA. Waivers and a recent Eighth Circuit shoot-down of the “Top Four” rule only put the wheels in motion for this greater deregulatory need, FOX asserts.
And, given the Eighth Circuit decision, “retaining the Dual Network Rule would be arbitrary and capricious in light of the volume of evidence reflecting monumental structural changes to the market in which the Restricted Networks operate.”
With the FCC’s OK, CBS could be acquired by FOX — following a shared services agreement many believe is all but finalized, based on market chatter following Skydance’s takever of CBS from the Redstone family.
Download Fox’s Dual Network Rule Comments in full by clicking here.
