FCC Removes Local TV Ownership Cap, Benefiting Sinclair

The FCC repealed a 22-year-old rule Thursday limiting broadcast TV ownership to 39% of U.S. households. The 2-1 vote replaces the fixed cap with case-by-case merger review.

• 39% was the cap Congress codified in a 2004 appropriations bill.
• 2 Republican commissioners voted to repeal; 1 Democratic commissioner dissented.
• Nexstar's pending Tegna deal would cover roughly 80% of U.S. households.
• $6.2 billion Nexstar-Tegna transaction is currently on hold under a court order.

Why it matters: FCC Chairman Brendan Carr argued the cap prevented local broadcasters from scaling up against streaming services and tech platforms not subject to the same rules.

• Carr warned local stations risk "going the way of newspapers" without the ability to consolidate.
• Democratic Commissioner Anna Gomez said the decision is "unlawful on its face" and that large national station groups, not local broadcasters, will benefit.

How 28 sources split on this story

Where they split: The central dispute is whether the FCC has legal authority to repeal a cap that Congress set by statute — a concern raised by both Democrats and some Republicans.

What’s next: Legal challenges are expected; Newsmax CEO Chris Ruddy said he is "prepared to litigate."

• Sen. Ted Cruz and former FCC Commissioner Michael O'Rielly have both said the authority belongs to Congress.
• Will courts uphold the FCC's claim that its Communications Act authority supersedes the 2004 congressional cap?
• Which proposed mergers will clear the new case-by-case review, and on what criteria?