The U.S. Supreme Court this week began hearing oral arguments in an appeal that will decide whether the same company can own a broadcast station and newspaper in a local market. The prohibition
on cross-ownership was intended to prevent a single news source from dominating a community, but has become outdated with the rise of digital media.
The lawsuit, Federal
Communications Commission v. Prometheus Radio Project, centers on the agency's move in 2017 to relax rules on broadcaster ownership. The wide-ranging reforms included a measure to get rid of a
45-year-old restriction that prevented cross-ownership of local newspapers and TV stations.
Over the years, the FCC granted temporary waivers to the rule in select markets and
grandfathered others. The New York Times was allowed to own radio station WQXR, while the publisher of the Chicago Tribune -- the "World's Greatest Newspaper" -- held on to its WGN
radio and TV stations for years.
The rules against cross-ownership were well intended; the goal was to give consumers more choices for information. But the media market has
changed drastically since the FCC introduced the rules in the 1970s. Local newspapers and broadcast stations have seen steep drops in advertising revenue amid competition from internet search and
Limits on cross-ownership won't bring back that revenue; it merely prevents local media outlets from pooling their resources to better compete with digital
rivals. Ideally, the market would allow these media outlets to thrive and compete for audiences, but the economics of the producing original news have become untenable.
Third U.S. Circuit Court of Appeals has repeatedly blocked the FCC's efforts to reform the ownership rules, leading the agency to plead its case before the Supreme Court. A decision by the high court
to overturn the Third Circuit’s ruling in the FCC case would be a positive step toward allowing cross-ownership of local newspapers and broadcasters.