FCC repeals 39% television ownership cap for case-by-case broadcast reviews

The removal of the 39% cap immediately clears a regulatory path for major station groups like Nexstar and TEGNA to pursue larger scale through M&A. By allowing broadcasters to exceed previous limits, the FCC is signaling that local stations require greater consolidation to survive the advertising shift toward global streaming giants. This move likely intensifies the battle over retransmission fees as larger groups gain increased leverage against MVPDs and virtual providers. The ecosystem must now navigate potential legal challenges regarding the FCC's authority to bypass statutory limits. Watch for the outcome of the 2022 Quadrennial Review to see if local ownership caps face similar deregulation.

The repeal of the national ownership cap arrives amid an already active M&A cycle among station groups. Nexstar Media Group, which already controls the largest portfolio of local stations in the country, completed its acquisition of a majority stake in The CW network in October 2022 and has signaled interest in further scale. TEGNA, the second-largest station group by reach, has been the subject of acquisition interest from multiple parties since Standard General's attempted buyout collapsed in 2023. With the 39% ceiling removed, both companies now face a regulatory environment that evaluates deals on individual public-interest merit rather than a hard numerical limit, potentially opening the door for combinations that would have been blocked under the prior framework. The business case for consolidation has been reinforced by shifting advertising economics and the rise of streaming competitors. The National Association of Broadcasters has long argued that ownership caps disadvantaged local broadcasters relative to unregulated digital platforms. The FCC under Chairman Brendan Carr has pursued a broader deregulatory agenda that includes relaxing media ownership rules and reducing what it characterizes as compliance burdens on broadcasters. The commission's simultaneous push on ATSC 3.0 adoption adds another dimension: larger station groups can more easily absorb the capital costs of next-generation broadcast infrastructure, which requires significant upfront investment in new transmission equipment and content distribution agreements. Disney and ABC, which operate owned-and-operated stations in major markets, could also benefit from relaxed limits if they choose to expand their local broadcast footprint or pursue station-group partnerships. Technical and policy considerations around the Emergency Alert System and ATSC 3.0 transition intersect with the ownership changes. The FCC's new cybersecurity requirements for EAS, announced alongside the ownership cap repeal, impose additional compliance obligations on broadcasters regardless of size. Ericsson's June 2025 Mobility Report found that AI-driven traffic patterns are reshaping network architecture demands, a trend that parallels how ATSC 3.0's IP-based delivery model is redefining broadcast distribution. For station groups pursuing scale, the ability to fund both cybersecurity compliance and ATSC 3.0 upgrades simultaneously strengthens the argument that consolidation serves the public interest by ensuring technical resilience. Commissioner Anna Gomez has raised questions about whether case-by-case review provides sufficient safeguards for localism and viewpoint diversity, setting up potential legal challenges that could delay or reshape the new framework.