The FCC Chairman’s Localism Paradox

LocalProximity
Written By Tim Hanlon

Federal Communications Commission Chairman Brendan Carr's latest argument on broadcast ownership sounds, on its surface, almost noble. He says he wants to strengthen local TV by freeing stations from a 39 percent national audience cap that he now portrays as an anachronism in a streaming-first world. He says a case-by-case public interest review would let larger station groups raise capital, gain scale and, in turn, produce more trusted community-focused news and programming. That is the theory he is selling.

And to be fair, the underlying problem is real. Local television has been battered by audience fragmentation, digital ad migration, retransmission fights and a broader collapse in the economics of local media. Carr is not inventing the pain. He is exploiting it. When he argues that broadcasters are being squeezed by national programmers and giant tech platforms, he is describing a marketplace that has plainly changed. The mistake is what he does next: he takes a legitimate diagnosis and prescribes a treatment that is far more likely to accelerate the disease than cure it.

Scale And Localism Are Not The Same Thing

Carr's argument ultimately rests on a premise that deserves more scrutiny: that scale and localism are somehow synonymous. They are not. One describes ownership structure. The other describes community service. The two often move in opposite directions.

That is because lifting the cap does not magically create more localism. It creates more scale. And in broadcasting, scale has almost always meant centralization first and local reinvestment maybe, eventually, if at all. It means more shared services, more hubbed operations, more standardized newsroom templates, more automation and more pressure to "rationalize" costs. It means larger balance sheets and fewer independent decision-makers in the market. It means private equity firms and levered public companies getting a fresh invitation to treat local television as a roll-up play, strip out duplicated expenses and call the resulting shrinkage "efficiency." The language of localism is doing a lot of work here.

A Deregulation Proposal Disguised As Localism

Carr tries to reassure everyone by swapping a hard numerical limit for a discretionary case-by-case review. But that is exactly the problem. A bright-line rule is blunt, predictable and comparatively transparent. A discretionary standard is political, lobby-friendly and inherently more subjective. It does not reduce FCC discretion; it expands it. It turns ownership policy into a transaction-by-transaction negotiation over what counts as "the public interest," which is just another way of saying the biggest and best-lawyered applicants will get the best shot at defining the terms.

Carr also leans hard on the familiar "broadcast TV is being crushed by Big Tech" frame. Again, the setup is not wrong. The problem is that he uses it to imply a false conclusion. Yes, broadcasters compete with national distribution platforms that face no 39 percent cap. Yes, the FCC itself has been asking whether changes in the video marketplace and continuing MVPD subscriber losses warrant revisiting the cap. But that does not prove that the answer is to let broadcasters become more concentrated. It proves only that the old rules are under stress. It says nothing about whether bigger groups will actually produce better journalism, more newsroom jobs or more meaningful local accountability.

In fact, the historical evidence cuts the other way. Carr himself reaches for the collapse of local newspapers as a cautionary tale, arguing that outdated regulation helped hollow them out. But that example is a warning, not a model. The newspaper industry's experience should give regulators pause. Greater ownership flexibility did not produce a renaissance of local journalism. It produced consolidation, financial engineering and newsroom retrenchment. The result was not a revival of local reporting but a long slog of contraction and civic abandonment. The idea that broadcast television will somehow be the exception, just because it uses the word "local" more frequently, is wishful thinking dressed up as policy philosophy. The FCC's own 2017 repeal of the newspaper-broadcast cross-ownership rule did not usher in a golden age of hyperlocal journalism either.

The Real Beneficiaries Of Consolidation

That is why Carr's narrative is so slippery. He treats consolidation as if it were a civic good rather than a financial strategy. He speaks as though scale automatically sustains the reporting that gives local stations their public value, when in practice scale often becomes the rationale for cutting the very people and processes that create that value. The likely winners of his proposed rule change are not the communities he invokes in his rhetoric. They are the station groups, investors and private equity firms best positioned to buy, merge and "optimize." The likely losers are the local newsrooms that become thinner, more regionalized and less distinguishable from one another.

So yes, Carr deserves credit for naming a real objective: local television still matters, and policy should not be blind to the financial pressure on the institutions that produce genuinely local news and public affairs. But the rest of his argument collapses under its own convenience. If the FCC really wants to preserve localism, it should demand evidence of more reporting, more original local programming and more community responsiveness, not simply bigger station groups with better spreadsheets.

Listen to Episode 17 of “In the Vicinity”

Local News To Peruse

Tim Hanlon

Tim Hanlon is the Founder & CEO of the Chicago-based Vertere Group, LLC – a boutique strategic consulting and advisory firm focused on helping today’s most forward-leaning media companies, brands, entrepreneurs, and investors benefit from rapidly changing technological advances in marketing, media and consumer communications.

Next

Media Companies Stopped Making Stars. Now They Rent Them.