FCC Demands that Sinclair Answer Questions Merger Opponents Have Long Raised

Now, the FCC has stepped in and demanded that Sinclair answer fundamental questions about the merger, before allowing the deal to move forward. Sinclair’s answers are due on Thursday, October 5^th.

“It’s clear Sinclair feels that they have greased the wheels with the Administration and think they can jam this deal through without answering the tough questions. If this deal goes through, Sinclair would have unprecedented control of local news stations with reach into nearly 3-out-of-4 U.S. households,” said Allied Progress Executive Director Karl Frisch.

Frisch continued, “I hope that this request for information means that the FCC is going to start taking their job seriously and holding Sinclair accountable. This is a good step, but the FCC needs to do more. They should stop their 180 day review clock until Sinclair submits answers to these legitimate concerns. The ball is in the FCC’s court now. They can either fight for consumers or be a lapdog for special interests like Sinclair.”

Sinclair’s quid-pro-quo relationship with the President’s inner circle and their ethically questionable ties to the FCC are well documented. Sinclair President and CEO Chris Ripley recently bragged to analysts that the “FCC has been very constructive in terms of its review.”

According to the FCC, “The Commission reviews applications for the transfer of control and assignment of licenses and authorizations to ensure that the public interest would be served by approving the applications.” While Sinclair has made clear how the merger would benefit their interest, they have failed to explain how the merger is in the public interest.

Key Questions the FCC Has Asked of Sinclair:

• The FCC requested that Sinclair and Tribune describe and provide documentation of “Sinclair’s current national audience reach,” which was not included in the companies’ application. The application did note that, post-merger, “the Combined Company would exceed the permissible commercial broadcast television national audience reach.”

• The FCC requested “the specific calculations and methodology used to determine both” Sinclair’s current national audience reach and post-transaction national audience reach.

• Because Sinclair and Tribune did “not indicate what steps, if any, they have already taken or what specific steps they plan to take Post-Transaction to comply with the national ownership limit,” the FCC requested that the companies describe and provide documentation “of what specific steps” the companies have taken or “plan to take to comply with the national ownership limit, including a complete list of stations that would be divested to comply with” FCC regulations. This includes “contacts with station brokers and/or potential buyers, any plans to request permission to place stations in divestiture trusts, and/or any plans to seek a waiver(s)” to the ownership limit.

• Although Sinclair and Tribune stated in their application that they intend to take actions to comply with local television ownership rules, the companies did “not indicate what steps, if any, that they have taken so far to comply with the local television ownership rules.” The FCC requested that Sinclair and Tribune describe and provide documentation of how Sinclair intends “to comply with the local television ownership rules.”

• Sinclair and Tribune stated that the merger “will produce both operating efficiencies and economies of scale.” The FCC requested that the companies detail and provide documentation to demonstrate that the alleged “operational efficiencies and economies of scale” would not be achieved without the merger.

• The FCC also requested details and documentation on “how Sinclair plans to reinvest the additional revenues generated by any predicted greater audience reach and how such reinvestment will improve service to the public.”

• Sinclair and Tribune’s merger applications states “that Sinclair would offer even greater value to the multi-channel video distributors.” The FCC requested details and documentation on how the merger “would offer greater value to MVPDs.”

• The FCC requested that Sinclair and Tribune “provide a complete list and copies of all Sharing Agreements or Options to which either Sinclair or Tribune is a party in the DMAs in which the Tribune Stations are located,” including details about each agreement.

To speak with Karl Frisch about the proposed Sinclair-Tribune merger, please contact Annette McDermott at 202-697-4804 or annette@alliedprogress.org.