uly 18th, 2018 the FCC chairman Ajit Pai has recently expressed some concerns over the merger between Sinclair and Tribune media. The positions taken by Pai and the FCC through the course of the past year, make this reversal on the merger quite surprising. However considering Ajit Pai led the charge to remove the Net Neutrality consumer protections, his willingness to regulate on behalf of anti-trust laws is fair to question. Attorney general’s in Illinois, Maryland, Massachusetts and Rhode Island have condemned the Sinclair/Tribune merger. The condemnation is based on the grounds that the media consolidation will be damaging to consumers because it is destroying competition (Donnis, 2017).
Opponents of the Sinclair/Tribune merger are observing that Sinclair is selling stations to partner companies in order to circumvent laws limiting broadcast ownership. One such case of this is the sale of flagship Tribune station WGN-TV in Chicago to an automobile executive Steven Fader. Sinclair Executive Chairman David Smith and Fader are longtime business associates (Channick, 2018). The current layout of the FCC, led by former Verizon lawyer Ajit Pai, has been structured in a way to provide market dominance to the largest corporations involved in media and electronic communications including but not limited to internet service providers with the disposal of Title 2 internet protections. An example of this new FCC direction cited by critics is the reinstating of the Ultra High Frequency (UHF) discount. This obsolete UHF discount aids in Sinclair’s navigation around the 39 percent cap on national audience size. Under the guidelines of the UHF discount, media companies are lawfully allowed to count UHF stations they own in half. The original justification for the UHF discount when it was implemented by the 1985 FCC was that it countered the lower audience reach of ultra high frequency. However, since the movement on to digital television ultra high frequency stations received placement on cable and satellite, thus negating any disadvantages ultra high frequency stations may have faced in the past. Sinclair was counting on the FCC acting in this manner to be able to move forward on the Sinclair-Tribune merger (Johnson, 2018).
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https://www.bloomberg.com/news/articles/2018-07-02/sinclair-station-sales-risk-new-scrutiny-as-part-of-tribune-deal
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