One of the first moves of the FRC was General Order 40, the first U.S. bandplan, which allocated permanent frequencies for most U.S. stations and eliminated most of the part-time broadcasters.
"[11] Following this reasoning, early FCC regulations reflected the presumption that "it would not be in the public's interest for a single entity to hold more than one broadcast license in the same community.
It empowered the FCC, among other things, to administer broadcasting licenses, impose penalties and regulate standards and equipment used on the airwaves.
Consequently, "the franchise to operate a broadcasting station, often worth millions, is awarded free of charge to enterprises selected under the standard of 'public interest, convenience, or necessity.
"Beginning in 1975, FCC rules banned cross-ownership by a single entity of a daily newspaper and television or radio broadcast station operating in the same local market.
"[16] The legislation, touted as a step that would foster competition, actually resulted in the subsequent mergers of several large companies, a trend which still continues.
[3] In September 2002, the FCC issued a Notice of Proposed Rulemaking stating that the Commission would re-evaluate its media ownership rules pursuant to the obligation specified in the Telecommunications Act of 1996.
Broadcasters, pointing to the increasing competition from new platforms, argued that the FCC's rules—including other ownership regulations that govern TV duopolies and radio ownership—should be relaxed even further.
"[15] That public interest is what the FCC bases its judgments on, whether a media cross-ownership would be a positive and contributive force, locally and nationally.
The FCC held one official forum, February 27, 2003, in Richmond, Virginia in response to public pressures to allow for more input on the issue of elimination of media ownership limits.
[23] In June 2006, the FCC adopted a Further Notice of Proposed Rulemaking (FNPR)[24] to address the issues raised by the United States Court of Appeals for the Third Circuit and also to perform the recurring evaluation of the media ownership rules required by the Telecommunications Act.
[26] The FCC voted December 18, 2007 to eliminate some media ownership rules, including a statute that forbids a single company to own both a newspaper and a television or radio station in the same city.
[23] Martin's justification for the rule change is to ensure the viability of America's newspapers and to address issues raised in the 2003 FCC decision that was later struck down by the courts.
Because of the lack of discussion during the 2003 proceedings, increased attention has been paid to ensuring that the FCC engages in proper dialogue with the public regarding its current rules change.
FCC Commissioners Deborah Taylor-Tate and Robert McDowell joined Chairman Martin in voting in favor of the rule change.
The move, along with a plan to evaluate increasing the national ownership cap, is expected to trigger a wider wave of consolidation in broadcast television.
[32][33] A challenge to the rule's restoration was filed on May 15 by The Institute for Public Representation (a coalition of public interest groups comprising Free Press, the United Church of Christ, Media Mobilizing Project, the Prometheus Radio Project, the National Hispanic Media Coalition and Common Cause), which requested an emergency motion to stay the UHF discount order – delaying its June 5 re-implementation – pending a court challenge to the rule.
The FCC rejected the claims, stating that the discount would only allow forward a regulatory review of any station group acquisitions, and that the Institute for Public Representation's criteria for the stay fell short of meeting adequate determination in favor of it by the court; it also claimed that the discount was "inextricably linked" to the agency's media ownership rules, a review of which it initiated in May of that year.
Pai argued the removal of the ban was necessary for local media to compete with online information sources like Google and Facebook.
Research by Philip Napoli and Michael Yan showed that larger media groups actually produced less local content.
"[46] McChesney believes that the Free Press' objective is a more diverse and competitive commercial system with a significant nonprofit and noncommercial sector.
The expense should come out of the general budget"[47] Benjamin Compaine believes that the current media system is "one of the most competitive major industries in U.S.
[50] Benjamin Compaine's main argument is that the consolidation of media outlets, across multiple ownerships, has allowed for a better quality of content.
[52] Critics of media consolidation in broadcast radio say it has made the music played more homogeneous, and makes it more difficult for acts to gain local popularity.
After the controversy caused by criticism of President George W. Bush and the Iraq War by a member of the Dixie Chicks, the band was banned by Cumulus Media and Clear Channel Communications, which also organized pro-war demonstrations.
[54] After the Super Bowl XXXVIII wardrobe malfunction, CBS CEO Les Moonves reportedly banned Janet Jackson from all CBS and Viacom properties, including MTV, VH1, the 46th Annual Grammy Awards, and Infinity Broadcasting Corporation radio stations, impacting sales of her album Damita Jo.