FCC v. Fox and the Demise of Local Broadcasting:

I have written at short and great length about the desirability of opening up more wireless frequencies to flexible uses, and in particular freeing up spectrum currently devoted to television broadcasting.

Now those opposed to indecency are helping the cause. As I noted in an op-ed yesterday, the Supreme Court’s decision in FCC v. Fox affirms indecency regulations that make life worse for local stations.

Much ink has been spilled about the possible demise of print newspapers. Local broadcasters have been a bit better off. Their viewership has long been declining, but they had an ace in the hole – coverage of local events. If people wanted to witness live local events, they needed to watch a local television broadcaster. But that has started to change. Viewers, and thus advertisers, are being siphoned off by websites covering local issues and new local offerings from cable providers.

And now some local stations are halting coverage of live local events out of fear of FCC indecency fines that the Supreme Court upheld in FCC v. Fox. The FCC has long emphasized the importance of helping local broadcasters, but more recently it has focused on indecency – ruling that even a fleeting expletive can subject a broadcaster to fines in the tens of thousands of dollars for each fleeting expletive.

National networks can afford tape-delay systems, but many local broadcasters cannot. The problem, as Justice Breyer noted in his dissent in Tuesday’s opinion, is that the FCC’s indecency policy “places all broadcasters at risk when they broadcast fleeting expletives, including expletives uttered at public events.” And, indeed, some stations have responded to the FCC’s policy by ending their coverage of local live events.

Viewers who want to see live coverage of a contentious city council meeting, or (more likely) a celebration of a local sports team’s victory, thus may have better luck with a locally oriented website than with their local broadcaster, since the First Amendment forbids indecency penalties for the website but not for the broadcaster.

The Supreme Court in FCC v. Fox did not rule that the FCC’s policy was consistent with the First Amendment, so the courts still have to address the argument (made by Justice Thomas in a separate opinion) that there is no basis for lessened First Amendment protection of broadcasters. But as matters stand right now, local television broadcasters have a new disincentive to airing live local events – and viewers have less reason to watch local broadcasters.

As I suggested above, this is probably for the best. Only 14% of households rely on over-the-air television broadcasting (86% subscribe to cable or satellite). The government could reclaim and auction the spectrum used by broadcasters –- as it has auctioned most other frequencies –- and use a small fraction of that money to subsidize cable or satellite for those who cannot afford it. The reclaimed airwaves could then be opened to other uses that would allow for new and enhanced cellular and wireless internet services on newly plentiful frequencies. Many telecommunications policy analysts have long favored this option as the best fiscal and technological policy, but so far little has happened. Maybe the FCC’s revulsion at the “f-word” can achieve what fiscal and technological arguments couldn’t.

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