Media Council Hawai`i (MCH) Files Federal Communications Commission (FCC) Challenge to Merger of KGMB, KHNL, and KFVE

Today, Media Council Hawai`i (MCH) filed a complaint with the Federal Communications Commission (FCC) to stop the proposed merger of MCG Capital’s KGMB TV with Raycom Media’s KHNL-TV and KFVE-TV.

On behalf of MCH, Georgetown Law’s Institute for Public Representation (IPR) filed with the FCC in Washington, DC a “Complaint and Request for Emergency Relief Regarding Shared Services Agreement between Raycom Media and MCG Capital for Joint Operation of Television Stations KHNL, KFVE, and KGMB, Honolulu, Hawai`i.”

The Petition requests that the FCC order Raycom and MCG to show cause as to why a “cease and desist order” should not be issued to stop its “shared services agreement” announced on August 18, 2009. Because the agreement is expected to take effect in mid-October, the Petition requests that the FCC issues a “standstill order” to prevent Raycom and MCG from taking any further action to implement the agreement, pending FCC review.

Chris Conybeare, MCH president, said: “"We are taking this action to save local television, local news, and local programming from concentrated control in the hands of a few offshore corporations.

“This is a major step forward in our effort to involve the public in the media policy debate. Broadcast licenses are granted on the basis of the public interest, convenience, and necessity. For too long the public has let corporate owners define what is in the public interest.

“We are pleased that Hawai`i people and organizations have decided to stand up, and raise their voices in protest to this deal that will rob us of diversity of opinion, stifle competition, and lock up control of the local market!"

Angela Campbell, IPR attorney and MCH chief counsel, said: “Prompt FCC action is needed to ensure that the residents of Hawai`i have access to diverse, high quality sources of local news. If the FCC fails to act, stations in other communities will enter into similar agreements, thus undermining the FCC’s local ownership rules.”

MCH and IPR assert that this unprecedented agreement would give Raycom, the licensee of KHNL (an NBC affiliate), and KFVE (a MyNetworkTV affiliate that broadcasts UH sports), control of KGMB (a CBS affiliate, that is licensed to MCG Capital). The agreement would result in the shutdown of one newsroom, and will result in having all news operations on all three stations controlled by Raycom.

Raycom and MCG state that no FCC approval is needed for this agreement. However, MCH and IPR assert the agreement will accomplish a de facto transfer of the license for KGMB. In such cases, federal law requires that the parties file an application with the FCC. The FCC can only approve such an application if the FCC finds that the transfer serves the public interest.

This transfer of control is not in the public interest. In fact, Raycom’s control over KGMB violates the FCC’s local television ownership rules in two ways. First, Raycom will control three stations serving the same area, even though the rule prohibits common control of more than two. Second, Raycom’s control over two major network affiliates—CBS and NBC—will violate FCC rules against owning more than one of the top-four ranked television stations.

MCH and IPR believe Hawai`i residents will be harmed by the agreement. Television is the main source of local news. Reducing the sources from four to three reduces competition and reduces local coverage.

“Reduced competition in local news will mean less local coverage, less diversity in the viewpoints presented, and lower quality news programming,” according to the Complaint.

“Moreover, Raycom’s control over approximately 44% of the advertising revenues decreases competition in the sale of advertising time and raises serious antitrust concerns.”

There is growing community support for MCH’s efforts to stop the merger. Community organizations that have joined in supporting MCH include Common Cause Hawai`i; the Society for Professional Journalists, Hawai`i Chapter; the Newspaper Guild; the Interfaith Alliance; the Oahu County Democrats; the Screen Actors Guild, Hawai`i; IBEW Local 1260; and Americans for Democratic Action, Hawai`i Chapter.

Media Council Hawai`i was established in 1970 as the Honolulu Community Media Council. It is the oldest of the five volunteer media councils in the United States. MCH members include individuals from the community and the media industry. It is a non-partisan, non-profit, non- governmental independent group, which seeks to improve public access to information, strengthen public support for First Amendment rights and freedoms, broaden public understanding of the role of the media, and promote accurate and fair journalism in Hawai`i.

IPR is one of the nation’s premier public interest law centers. It was founded by Georgetown Law in 1971. It has both a public interest law firm and a clinical education program. IPR works in the areas of First Amendment and media law, environmental law, civil rights, and general public interest matters. Professor Angela Campbell is co-director of IPR and is head of IPR’s First Amendment and Media Law Project. Adrienne Biddings is the Graduate Fellow in IPR.