Washington
The chairman of the Federal Communications Commission, Ajit Pai, said that he intends to send key parts of the $3.9 billion deal to be reviewed by an administrative law judge, which is typically the first step the FCC takes when it seeks to block a deal. The sudden clampdown on the Sinclair deal marks a shift from Pai’s previous moves to deregulate the broadcast industry
Sinclair’s proposed merger would give the conservative broadcaster unprecedented grip over American TV screens. Its original proposal, if approved, would grant Sinclair access to 72 percent of television households in America, far surpassing a national ownership cap of 39 percent. The FCC’s national ownership cap limits the reach of any one broadcast company, in an effort to ensure enough independent voices can thrive on the airwaves.
To get beneath the cap, Sinclair had proposed spinning off several stations. But a number of the owners of the stations that would be spun off have close ties to Sinclair, which critics said would allow Sinclair to stay in control of the stations it sold — divestitures that appeared designed to evade the FCC’s rules.
Pai said on Monday he found those arguments persuasive.
“The evidence we’ve received,” Pai said, “suggests that certain station divestitures that have been proposed to the FCC would allow Sinclair to control those stations in practice, even if not in name, in violation of the law.”
Sinclair didn’t respond to requests for comment. In the past, Sinclair chief executive Chris Ripley has said the deal will create “a leading broadcast platform with local focus and national reach.” Sinclair’s stock ended down more than 11 percent on Monday.
Sinclair’s political leanings highlight the political undertones to the deregulation Pai has spearheaded. Sinclair is a supporter of President Donald Trump, and the acquisition of dozens of Tribune media stations would give conservative media a wider platform. But Pai has faced criticism from lawmakers and consumer groups for approving policy changes that could benefit Sinclair as it seeks to close its deal.
Pai’s tenure leading the FCC since 2017 has been marked by multiple efforts to relax regulations on TV broadcasters. The agency last year repealed one rule that required local broadcast stations to operate a physical studio in the markets for which they hold a license. In another move, the FCC said it would no longer block media mergers that left fewer than eight remaining independent stations in a market.
The merger under investigation — proposed last spring — sought to bring Tribune’s 42 TV stations under Sinclair’s roof. Tribune controls stations in seven of the nation’s top 10 markets.