For the Media
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On Tuesday, top unions of workers in communications, broadcast, and journalism recommitted themselves to preventing more hedge fund and private equity ownership of local news, planning to win at a hearing that will be the final chapter of their effort to kill an attempt to buy local broadcaster TEGNA.
The Federal Communications Commission Media Bureau said last Friday it was referring hedge fund Standard General’s attempt to buy local broadcaster TEGNA to an administrative hearing, citing issues regarding anti-competitive price increases, local station job cuts threatening localism, and private equity ownership of local newsrooms. Such actions by the agency traditionally have resulted in parties choosing to withdraw their applications rather than spend additional resources and time pleading their case before an administrative law judge (ALJ) when they are unlikely to prevail.
On Monday, Standard General said it planned to fight the Media Bureau’s Hearing Designation Order and attacked the legitimacy and mandate of the FCC in a statement.
CWA, NewsGuild-CWA, and NABET-CWA all remain committed in their opposition to Standard General’s proposed takeover of TEGNA.
“This decision confirms that the FCC is using a real public interest standard as part of its decision-making in the transfer of broadcast licenses,” NABET-CWA President Charlie Braico said. “The Commission staff took into account all stakeholders – consumers and employees, as well as the companies themselves.”
“We deeply appreciate Chairwoman Rosenworcel’s statement endorsing the Media Bureau’s action and expressing her willingness to protect localism and journalism in the U.S.,” NewsGuild-CWA President Jon Schleuss said. “The Bureau order explicitly refers to local TV station jobs as a meaningful indicator of localism under the public interest standard, and acknowledges the concerns we have raised for years about the dangers of private equity and hedge funds acquiring newsrooms. Big Wall Street funds might disparage and attack her, but Chairwoman Rosenworcel is just doing her job.”
“We have all seen what happens when private equity and hedge funds are allowed to take over,” Communications Workers of America President Chris Shelton said. “They care about one thing and one thing only: profits. In the case of media companies, that means rapid job cuts and gutting local journalism. The consequences for our democracy have been enormous, and I commend Chairwoman Rosenworcel and the FCC’s Media Bureau for appropriately exercising their role in protecting the public interest.”
Overall newsroom employment fell 26% from 2008 to 2020, according to the Pew Research Center. That drop has hit newspapers most, which lost more than half of their overall jobs. Broadcast television employment meanwhile ticked up 4% over those twelve years.
In Guild-represented newsrooms owned by at least one hedge fund, Alden Global Capital, jobs have been cut by 75% over the last 10 years, far faster than the national loss of jobs.
In June 2022, The NewsGuild-CWA and NABET-CWA filed a Petition to Deny with the FCC, challenging Standard General’s plans to reduce local TV station jobs, raise consumer prices, and violate the FCC’s ownership cap.
Several members of Congress raised serious issues presented by the deal. In October, then Speaker of the House Nancy Pelosi and Energy & Commerce Committee Chairman Frank Pallone, Jr. wrote to FCC Chairwoman Jessica Rosenworcel, saying in particular that they were “concerned that this transaction would violate the FCC’s mandate by restricting access to local news coverage, cutting jobs at local television stations, and raising prices on consumers.”
Then, in January, Senator Elizabeth Warren wrote to Chairwoman Rosenworcel, asking “that the Federal Communications Commission use its full statutory authority to block this acquisition and address the increasing consolidation in the media industry.”
“America’s workers thank then-Speaker Pelosi, Chair Pallone, and Senator Warren for standing up to big Wall Street funds and their army of lawyers and lobbyists, encouraging Chairwoman Rosenworcel to do the right thing for consumers, journalists, technicians, and broadcast employees,” Shelton said.
In the staff’s decision to refer the matter to a hearing, it highlighted important questions about the impact of hedge fund and private equity ownership of local news, writing that although in years past, the Commission did not give any weight to arguments about funds like Standard General cutting costs by eliminating jobs, “real world experience” since then should lead to questioning whether the acquisition of a publicly traded broadcast company by a private investment fund “would promote, hinder, or indeed, have no effect on localism.” In other words, hedge fund and private equity fund acquisitions of newsrooms matters. At last, regulators are taking notice.
“Local journalists have been talking about Wall Street funds destroying local news for years and I cannot thank Chairwoman Rosenworcel enough for highlighting this concern from the FCC,” Schleuss said. “We can’t let hedge funds hollow out local broadcasting like they’ve done to local newspapers.”
About CWA: The Communications Workers of America represents working people in telecommunications, customer service, media, airlines, health care, public service and education, manufacturing, tech, and other fields.