FCC’s Next Deregulatory Success Story Could Be Broadcasting – Inside Sources

America’s wireless revolution shows what happens when regulators let markets evolve rather than lock industries into outdated rules. Wireless prices have fallen more than 41 percent over the past decade. Unlimited plans cost 35 percent less than five years ago, while prepaid plans are down 51 percent. Consumers enjoy faster speeds, broader coverage and more data than ever before — often while paying less.

Those gains did not happen by accident. Carriers invested hundreds of billions of dollars to build 5G, acquiring spectrum, upgrading networks and merging where it made economic sense. The T-Mobile–Sprint merger accelerated nationwide 5G deployment by combining complementary spectrum holdings. Verizon’s acquisition of TracFone strengthened the prepaid market. 

More recently, the FCC approved transactions involving USCellular and Metronet to keep spectrum and infrastructure in productive use. After the failed effort to establish DISH as a fourth nationwide carrier, the FCC reclaimed AWS-3 licenses and returned them to market, generating more than $3.5 billion for taxpayers.

Wireless is the single best value for money in America today in part because of mergers.

Broadcast television has not been afforded the same flexibility. More than half of America’s local television newsrooms are unprofitable, yet broadcasters remain subject to ownership restrictions written when over-the-air television dominated the media landscape.

That world no longer exists. Americans spend more time with streaming video than traditional television. Advertising has migrated to Google, Meta, Amazon, YouTube, TikTok, Netflix and other digital platforms that operate without audience caps or ownership limits.

Station groups such as Nexstar, Sinclair, Scripps, Gray Media, Hearst Television, and Allen Media Group want to deliver the next generation of free, over-the-air television, combining broadcasting with internet connectivity to deliver improved emergency alerts, mobile television and new digital services. They’re constrained by a 39 percent national audience-reach cap, which limits their ability to achieve scale and return on their investment.

Nexstar’s proposed acquisition of Tegna illustrates the stakes. A combined company would have greater resources to invest in local news, deploy next-generation broadcast technology, and compete with digital platforms that already reach nearly every American household.

Even if the FCC modernizes its rules, broadcasters face another obstacle: state attorneys general. In recent years, some state AGs have challenged mergers and federal policy through litigation. These lawsuits fail to provide a solution for broadcasting to survive under the status quo.

State attorneys general warn that larger broadcasters will demand higher retransmission fees from cable and satellite providers. That concern remains largely speculative. Retransmission fees account for only one component of the pay-TV bill, and the largest driver of rising programming costs has been sports rights, not local television stations. More important, retransmission revenue has become one of the few reliable sources of funding for local news as advertising has migrated online. Weakening broadcasters’ ability to negotiate does not lower the cost of producing local journalism; it simply reduces one of the last revenue streams available to support it.

Blocking mergers will not bring advertising back from digital platforms. It will not hire another reporter or upgrade another newsroom. It simply cements bad economics while local television continues to deteriorate.

On August 6, the FCC will vote on Chairman Brendan Carr’s proposal to replace the rigid audience cap with case-by-case public-interest review. Instead of relying on an arbitrary numerical limit inherited from the analog era, the commission would evaluate mergers on their actual competitive effects.

That approach reflects today’s marketplace. Broadcasters compete against streaming services, social media, podcasts and digital advertising giants that face no comparable ownership restrictions.

Communications policy should encourage investment, not preserve obsolete market structures. Wireless succeeded because regulators allowed companies to reorganize, invest and compete. Consumers benefited.

Broadcasting deserves the same opportunity. Local news will not be preserved through litigation, subsidies or increasingly rigid ownership rules. It will survive only if broadcasters have the freedom to innovate, attract investment and build businesses capable of competing with global digital platforms.

Wireless became an American success story because regulators allowed companies to merge, invest and build networks for the future. Consumers reaped the rewards. Broadcasting should have the same opportunity to compete. The beneficiaries will not simply be broadcasters, but millions of Americans who rely on free local television for news, emergency information and community coverage.