Black Owned Broadcasters pitch alternative SSA plan to FCC

The National Association of Black Owned Broadcasters (“NABOB”) has evidently pitched an alternative to the heavily anticipated crackdown on Joint Service Agreements (“JSA”) and Shared Service Agreements (“SSA”). You can read the ex parte disclosure by NABOB about the proposal here.  According to the disclosure, NABOB Executive Director James Winston said some of the following to certain FCC Commissioners last week:

On February 26, 2014, the undersigned Executive Director and General Counsel of the National Association of Black Owned Broadcasters, Inc. (“NABOB”) met with Commissioner Mignon Clyburn and Adonis Hoffman, Chief of Staff to Commissioner Clyburn. In the meeting, I explained NABOB’s view that the continuing decline in minority broadcast ownership needs to be addressed in the Commission’s Quadrennial Review. I pointed out that less than ten years ago there were 21 full power commercial television stations licensed to African American controlledcompanies in the United States, and today there are only three. Moreover, of those three stations, two were just recently acquired and are being operated pursuant to Joint Sales Agreements (“JSA”) and Shared Services Agreements (“SSA”). Therefore, there is only one full power commercial television completely operated by an African American owned licensee.

The fact that there are so few African American owned television stations is a sad commentary on the state of diversity in the broadcast industry and calls Ms. Marlene H. Dortch February 27, 2014 for action on the part of the Commission to improve this abysmal ownership situation. I pointed out that the situation has caused NABOB to reconsider its previous position on JSAs and SSAs. I explained that NABOB has always opposed JSAs and SSAs, because they appeared to be mere gimmicks for group licensees to avoid the intent of the local ownership rules. However, NABOB and the Commission are faced with an unfortunate fact. Two of the three full power television stations licensed to African Americans are being operated under JSA and SSA agreements. In addition, given the precipitous fall-off of African American television ownership in the past few years, and the accelerating pace of consolidation that has roiled the television industry in recentmonths, there is no reason to be optimistic that the number of African American owned television stations is going to appreciably increase in the near future without some serious rethinking of the Commission’s policies.

. . .

To this end, I suggested that the Commission look at JSAs and SSAs on a case-by-case basis to see if they have the potential to promote diversity of ownership or other important Commission policies. If so, the Commission could place conditions on such JSAs and SSAs such that these agreements would be structured to enable the licensee of the station to eventually operate the station without the need for a JSA or SSA. In other words, the JSA or SSA would have clear steps in place that turned over full operation of the station to the licensee over time. For example, the JSA or SSA might be structured such that at predetermined periods, perhaps annually, the licensee and the JSA or SSA operator would file a progress report with the Commission reporting on the operational changes that have occurred in the reporting period that have turned over specific responsibilities to the licensee, and the licensee would identify the personnel and other enhancements it has made to the station to take over these responsibilities.

In this arrangement the JSA or SSA operator would be required to turn over full control to the licensee in a set period, perhaps five years. The annual reporting to the Commission should demonstrate that that licensee was making progress toward taking control. If the annual reporting failed to demonstrate that the licensee was making progress toward operating the station, the Commission could order an early termination of the JSA or SSA. In any event, whether the licensee had fully obtained the ability to operate the station over the five year period, the JSA or SSA would terminate at the end of that period.

TVNEWSCHECK first reported this and you can read their story, which includes comment from the National Association of Broadcasters (“NAB”), linked here.

NAB spokesman Dennis Wharton said of the proposal: “”NAB has documented numerous examples to the FCC of JSAs that benefit the public interest, improve local news, and provide badly needed competition to pay TV giants. NABOB deserves credit for coming up with another creative idea that could enhance TV ownership diversity in broadcasting. We think this idea merits serious consideration.”



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