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How Will the FCC’s New Local TV Studios Policy Affect Local TV?

January 4th, 2018   ||    by John R. Osborn   ||    No Comments

On October 24th, 2017, the Federal Communications Commission (FCC) eliminated the 80-year-old “Main Studio Rule,” which required TV stations to have local TV studios with staffing and equipment in or near the market for which they were licensed.

The decision came as one of several moves on the part of the federal administration to deregulate local broadcasting. The move could, as The New York Times predicts, end up stimulating more industry consolidation—starting with the pending Sinclair-Tribune merger.

Why the Change?

The FCC decision was made along political lines, according to Ars Technica, with the majority Republican commissioners arguing that local TV studios are no longer needed to enable broadcasters to be responsive to their communities—since the public these days is more likely to interact with stations online.

Additionally, technology allows broadcast stations to produce local news even without a nearby studio, which can help sustain local broadcasting in rural areas. Stations do still have an obligation to air programming responsive to the interests of the community.

Opposing Democrat commissioners argued unsuccessfully that consolidation of program production and station management at large, out-of-town parent companies will encourage broadcast station groups (large and small) to terminate studio staff and abandon communities. They believe services like immediate coverage of local emergencies would also be affected.

The Impact on Local TV

Even as government policies change, technology is already transforming the local TV industry for the better by eliminating old barriers—inefficient buying, selling, and stewardship processes—and opening new marketplace opportunities, such as future programmatic private marketplace TV deals and new dollars from regional, national, and international advertisers.

Beyond marking some of the most significant changes to media ownership regulations in a generation, these FCC rulings open the door for broadcasting to achieve greater scale to compete with cable and internet companies for local ad revenue. When it comes to local TV, greater scale means greater ad placement optimization and greater relevancy for consumers.

With these new rules, local TV buyers would benefit from thinking about station groups as a new kind of TV “network” and taking advantage of their goals of capturing higher, multi-market budgets. Automation technology companies like Videa, who are already working with these new television “networks,” are transforming the traditionally cumbersome process of local ad buying.

A 2017 BIA/Kelsey report outlined several ways national marketers are increasing local TV buys by leveraging technological solutions to find greater efficiencies and effectiveness within such buys.

By continuing to invest in technology, talent, and change management, both buyers and sellers of local TV can stay connected to the future—as well as to whatever political- or technology-driven opportunities and changes arise next.

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