Good To See NAB Getting Tough With FCC

It's unusual for a trade association to send a cease-and-desist letter to a federal regulatory agency, but that's just what National Association of Broadcasters did.

It told the Federal Communications Commission to back off on its transaction-based regulation of shared services agreement by May 8 or else. The NAB didn't specify the or-else, but we can presume that it is a court challenge. Either that or the NAB intends to send a single-combat champion to duke it out with FCC Chairman Tom Wheeler right there on 12th Street SW.

The NAB contends that even though the FCC acknowledged in its March 31 order banning joint sales agreements that it has yet to build enough of a record to regulate shared service agreements (SSAs), it has already begun to do so in the context of the station sales reviews based on a March 12 public notice. In that notice, the FCC said it would "closely scrutinize" all deals that appear to circumvent local ownership limits through joint sales agreements (JSAs), SSAs, local marketing agreements and financial entanglements. By encompassing SSAs, the notice is "fatally premature," the NAB says in its threatening letter.

The notice "cannot be squared with the March 31 decision, reflects unreasoned action and sends conflicting signals to broadcasters as to the rules of the game for sharing arrangements."

The NAB's action reflects mounting frustration among broadcasters who are seeking FCC approval of deals that involve the alphabet soup of ownership rule work-arounds. The deals were done in good faith and based on FCC precedent.