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TABLE OF CONTENTS Heading Paragraph # I. INTRODUCTION.................................................................................................................................. 1 II. BACKGROUND.................................................................................................................................... 4 III. MEDIA OWNERSHIP RULES............................................................................................................. 8 A. Newspaper/Broadcast Cross-Ownership Rule................................................................................. 8 B. Radio/Television Cross-Ownership Rule....................................................................................... 49 C. Local Television Ownership Rule ................................................................................................. 66 D. Local Radio Ownership Rule......................................................................................................... 86 IV. TELEVISION JOINT SALES AGREEMENTS.................................................................................. 96 V. SHARED SERVICE AGREEMENTS............................................................................................... 114 VI. DIVERSITY/INCUBATOR PROGRAM.......................................................................................... 121 VII. NOTICE OF PROPOSED RULEMAKING ..................................................................................... 126 VIII. PROCEDURAL MATTERS ........................................................................................................... 146 IX. ORDERING CLAUSES..................................................................................................................... 153 APPENDIX A – Final Rule Changes APPENDIX B – Supplemental Final Regulatory Flexibility Analysis APPENDIX C – Initial Regulatory Flexibility Analysis 9802 Federal Communications Commission FCC 17-156 I. INTRODUCTION 1. Today we end the 2010/2014 Quadrennial Review proceeding. In doing so, the Commission not only acknowledges the dynamic nature of the media marketplace, but takes concrete steps to update its broadcast ownership rules to reflect reality. Indeed, the Commission plainly stated in its 2010 NOI initiating this proceeding that the broadcast ownership rules required a fresh look in light of “[d]ramatic changes in the marketplace,”1 yet the resulting Second Report and Order issued in August 2016 manifestly failed to adopt any meaningful changes to these rules—and effectively tightened the Local Television Ownership Rule.2 In this Order on Reconsideration, we refuse to ignore the changed landscape and the mandates of Section 202(h), and we deliver on the Commission’s promise to adopt broadcast ownership rules that reflect the present, not the past. Because of our actions today to relax and eliminate outdated rules, broadcasters and local newspapers will at last be given a greater opportunity to compete and thrive in the vibrant and fast-changing media marketplace. And in the end, it is consumers that will benefit, as broadcast stations and newspapers—those media outlets most committed to serving their local communities—will be better able to invest in local news and public interest programming and improve their overall service to those communities. 2. Accordingly, in today’s Order on Reconsideration, we grant in part and deny in in part, as set forth herein, various petitions for reconsideration3 of the Second Report and Order. Specifically, we (1) eliminate the Newspaper/Broadcast Cross-Ownership Rule; (2) eliminate the Radio/Television Cross- Ownership Rule; (3) revise the Local Television Ownership Rule to eliminate the Eight-Voices Test and to modify the Top-Four Prohibition to better reflect the competitive conditions in local markets; (4) decline to modify the market definitions relied on in the Local Radio Ownership Rule, but provide a presumption for certain embedded market transactions; (5) eliminate the attribution rule for television joint sales agreements (JSAs); and (6) retain the disclosure requirement for shared service agreements (SSAs) involving commercial television stations. 1 2010 Quadrennial Regulatory Review – Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996, Notice of Inquiry, 25 FCC Rcd 6086, 6087, para. 1 (2010) (NOI). 2 See generally 2014 Quadrennial Regulatory Review – Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996 et al., Second Report and Order, 31 FCC Rcd 9864 (2016) (Second Report and Order). 3 Petition of Connoisseur Media for Reconsideration of the 2010/2014 Quadrennial Review Second Report and Order, MB Docket Nos. 14-50 et al. (filed Dec. 1, 2016) (Connoisseur Petition); Petition of the National Association of Broadcasters for Reconsideration of the 2010/2014 Quadrennial Review Second Report and Order, MB Docket Nos. 14-50 et al. (filed Dec. 1, 2016) (NAB Petition); Petition of Nexstar Broadcasting, Inc. for Reconsideration of the 2010/2014 Quadrennial Review Second Report and Order, MB Docket Nos. 14-50 et al. (filed Dec. 1, 2016) (Nexstar Petition). In addition, various parties filed ex parte comments—well after the filing deadline for petitions for reconsideration—urging the Commission to address other aspects of the Second Report and Order that were not raised in any petition for reconsideration. See, e.g., Letter from Barry A. Friedman, Thompson Hine, Counsel for Dick Broadcasting Company, Inc. of Tennessee, to Marlene H. Dortch, Secretary, FCC, MB Docket Nos. 14-50, 09- 182, and 07-294, at 2 (filed Mar. 24, 2017) (Dicks Broadcasting Mar. 24, 2017 Ex Parte) (stating that “continued applicability of the [AM/FM] subcaps warrants a hard look from the Commission”). In effect, these ex parte filings are untimely petitions for reconsideration, which we lack discretion to consider absent extraordinary circumstances not present here. See 47 U.S.C. § 405(a) (“A petition for reconsideration must be filed within thirty days from the date upon which public notice
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