Policymaking and policy trade-offs: broadcast media regulation in the United States

Abstract

Introduction The Federal Communications Commission (FCC) has a statutory obligation to pursue the ‘public interest’ through its regulation of broadcast media. The FCC's interpretation of the public interest has led it to pursue three policy objectives: competition, localism and diversity. This policy triad reflects both efficiency and antitrust considerations and concerns about the social, political and cultural effects of media. Therefore, in addition to pursuing competition in broadcast markets through (quasi)-antitrust analysis, the FCC considers the additional elements of diversity and localism – elements that can add considerable nuance and complexity for policymakers. The FCC employs two broad classes of regulatory tools: structural (ownership) rules and behavioural (content) regulation. The FCC's structural rules often take the form of ownership limits on the number of broadcast stations a single entity may own within and across local markets. The FCC has changed these caps periodically over the last fifty years, but since the 1990s there has been the most substantial change in broadcast ownership policies. The FCC first permitted the ownership of multiple radio stations within the same market in 1992, allowing entities to own up to two FM and two AM stations within a market with at least fifteen stations, provided that the combined audience share of the stations did not exceed 25 per cent. For stations in markets with fewer than fifteen radio stations, a single licensee was permitted to own up to three stations, of which no more than two could be AM or FM stations, provided that the owned stations represented less than 50 per cent of the total number of radio stations in the market.