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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In re Application of ) ) RIVER CITY LICENSE ) PARTNERSHIP II ) (Assignor) ) ) and ) File No. BALCT-980506IJ ) WSYX LICENSEE, INC. ) (Assignee) ) ) For Consent to the Assignment of License of) Station WSYX(TV), Columbus, Ohio) MEMORANDUM OPINION AND ORDER Adopted: July 23, 1998 Released: July 24, 1998 By the Chief, Mass Media Bureau: 1. The Commission, by the Chief, Mass Media Bureau, acting pursuant to delegated authority, has before it for consideration the above-captioned unopposed application for assignment of license of WSYX(TV), Channel 6 (ABC), Columbus, Ohio, from River City License Partnership II to WSYX Licensee, Inc., an indirect wholly-owned subsidiary of Sinclair Broadcast Group, Inc. 2. Sinclair Broadcast Group, Inc. controls the licensee of WSTR-TV, Channel 64 (WB), Cincinnati, Ohio, whose Grade B contour overlaps the Grade B contour of WSYX(TV), the station to be acquired. Common ownership of stations with such Grade B overlap violates the Commission's television duopoly rule, 47 C.F.R.  73.3555(b). Accordingly, WSYX Licensee, Inc. (hereinafter referred to as "Sinclair") has requested a permanent waiver of the television duopoly rule to permit common ownership of WSYX(TV) and WSTR-TV. 3. Duopoly Waiver Showing. As demonstrated in Sinclair's engineering report, the predicted Grade B overlap of WSYX(TV) and WSTR-TV encompasses 2,547 square kilometers and 279,441 individuals. This represents 8.0% of the area and 11.5% of the population within the Grade B contour of WSYX(TV), and 10.8% of the area and 9.8% of the population within the WSTR-TV Grade B contour. The stations' Grade A contours do not overlap. Sinclair argues that this level of overlap is within the range of overlaps previously approved by the Commission. 4. Sinclair maintains that the stations serve separate and distinct markets, as WSYX(TV) is located in the Columbus Designated Market Area ("DMA"), ranked 34th, while WSTR-TV is located in the Cincinnati DMA, ranked 30th. Sinclair represents that the stations will continue to operate separately following consummation, including the continued use of their own local sales, programming, news and office staffs. 5. Sinclair asserts that the overlap area is served by a multitude of media voices. According to Sinclair, excluding WSYX(TV) and WSTR-TV, 17 television stations (13 commercial, four noncommercial) provide Grade B service to the overlap area, three of which serve the entire area. In addition, states Sinclair, the overlap area is served by numerous commercial radio stations (minimum of seven, maximum of 32) and 11 daily newspapers, and 24 cable systems, operated by 10 separate operators, serve counties in the overlap area. 6. Additionally, Sinclair contends that common ownership of the television stations will not result in undue concentration of economic power in the overlap area. WSYX(TV), an ABC affiliate which operates on VHF Channel 6, trails both the NBC and CBS affiliates in terms of average station shares during prime time and over the total day. WSTR-TV, a WB affiliate which operates on UHF Channel 64, trails the affiliates of ABC, CBS and NBC and Fox in terms of average station shares during prime time and over the total day. Sinclair maintains that the Commission has recognized that the non-dominant position of stations in the marketplace may reduce their impact on competition in the overlap area. In sum, Sinclair submits that the proposed common ownership presents no competitive threat because both stations are non-dominant in their markets, the Grade B overlap encompasses a relatively small area, and the overlap area is served by numerous competing media. 7. Discussion. In adopting the duopoly rule's fixed standard of prohibiting overlap of Grade B service contours, the Commission also acknowledged the need for "flexibility" in that rule's application, noting that waivers should be granted where rigid conformance to the rule would be "inappropriate." Multiple Ownership of Standard, FM and Television Broadcast Stations, 45 FCC 2d 1476, 1479 n.12, recon. granted in part, 3 RR 2d 1554 (1964). To that end, the Commission has developed the following set of factors to be considered when evaluating an applicant's request for waiver of the duopoly rule: the extent of the overlap, the number of media voices available in the overlap area, the distinctiveness of the respective markets, the independence of the stations' operations, and the concentration of economic power resulting from the combination. See Iowa State University Broadcasting Corporation, 9 FCC Rcd 481, 487-88 (1993), aff'd sub nom. Iowans for WOI-TV, Inc. v. FCC, 50 F.3d 1096 (D.C. Cir. 1995); H&C Communications, Inc., 9 FCC Rcd 144, 146 (1993). After weighing the factors, the Commission considers any public interest benefits proposed by the applicant to determine whether, in light of the overlap, the benefits outweigh any detriment which may occur from grant of the waiver. See, e.g., Iowa State University, 9 FCC Rcd at 487-88. As with any waiver, it will only be granted if the Commission concludes that the waiver is in the public interest. 8. Currently, the Commission is reexamining its broadcast television ownership policies, including the duopoly rule. In January 1995, the Commission proposed a new analytical framework within which to evaluate its broadcast television ownership rules. See Review of the Commission's Regulations Governing Television Broadcasting, Further Notice of Proposed Rule Making, 10 FCC Rcd 3524 (1995) ("Television Ownership Further Notice"). Subsequent to the release of the Television Ownership Further Notice, Congress directed the Commission to conduct a rulemaking proceeding to determine whether to retain, modify or eliminate existing limitations on the number of television stations that an entity may control within the same television market. See Section 202(c) of the Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (Feb. 8, 1996) ("Telecom Act"). In response to this Congressional directive in the Telecom Act and to update the record, the Commission released the Review of the Commission's Regulations Governing Television Broadcasting, Second Further Notice of Proposed Rule Making in MM Docket Nos. 91-221 and 87- 8, 11 FCC Rcd 21655 (1996) ("Television Ownership Second Further Notice"). 9. The Commission stated in the Television Ownership Second Further Notice that it will be inclined, during the pendency of the television ownership proceeding, to grant temporary duopoly waivers to authorize common ownership of television stations that are in separate DMAs and whose Grade A contours do not overlap, conditioned on coming into compliance with the outcome of the proceeding within six months of its conclusion. Television Ownership Second Further Notice, 11 FCC Rcd at 21681. It also noted there its tentative conclusion that the record in that proceeding "supports relaxation of the geographic scope of the duopoly rule from its current Grade B overlap standard to a standard based on DMAs supplemented with a Grade A overlap criterion." The Commission further stated that "we do not believe granting waivers satisfying the proposed standard, and conditioning them on the outcome of this proceeding, will adversely affect our competition and diversity goals in the interim." Id. 10. Given the clearly articulated policy in the Second Further Notice, we do not believe that an unconditional grant of Sinclair's duopoly waiver is appropriate. See WHOA-TV, Inc., 11 FCC Rcd 20041, 20046-47, 20051. However, we believe that grant of a conditional waiver of the duopoly rule, subject to the outcome of the pending ownership rulemaking, is justified. The temporary common ownership of WSYX(TV) and WSTR-TV would be consistent with the interim policy set forth in the Second Further Notice, as the stations are in separate DMAs and there is no Grade A signal contour overlap. Moreover, our examination of the record presented here reveals nothing suggesting that we should not follow the established interim policy in this case. The extent of the Grade B overlap, although not de minimis, falls well within the range of those we have approved in previous cases. See, e.g., NWCG Holdings Corp., 11 FCC Rcd 16318 (1996) (granting waiver where Grade B population overlap was 29.4% and 10.2% and area overlap was 14.7% and 16.5%); Benedek Broadcasting Corporation, 11 FCC Rcd 6319 (1997) (granting waiver where Grade B population overlap was 10.5% and 24.6% and area overlap was 10.8% and 27.2%). We note also that the stations serve different markets, and that Sinclair has pledged to operate the stations independently. Additionally, numerous broadcast stations will continue to provide service to the overlap areas after the proposed assignment. Accordingly, we conclude that grant of a temporary waiver, conditioned on the applicant coming into compliance with the outcome of the pending television ownership rulemaking proceeding within six months of its conclusion, will serve the public interest, convenience and necessity. Any request to extend this conditional waiver should be filed at least 45 days prior to the end of the six-month period and would be closely scrutinized. Conclusion 11. Having determined that the applicants are qualified in all respects, we find that grant of the above-captioned application will serve the public interest, convenience and necessity. 12. Accordingly, IT IS ORDERED, That the request for permanent waiver of the Commission's duopoly rule, 47 C.F.R.  73.3555(b), to allow common ownership by WSYX Licensee, Inc., of WSYX(TV), Columbus, Ohio, and WSTR-TV, Cincinnati, Ohio, IS DENIED; however, a conditional waiver of Section 73.3555(b) IS GRANTED, subject to the outcome of the Commission's pending broadcast television ownership rulemaking in MM Docket Nos. 91-221 and 87-8. Should divestiture be required as a result of that proceeding, the licensee is directed to file, within six months from the release of the final order in MM Docket Nos. 91-221 and 87-8, an application for Commission consent to dispose of such station as would be necessary for WSYX Licensee, Inc., to come into compliance with the rules as provided in the final order. 13. IT IS FURTHER ORDERED, That the application for consent to the assignment of license of station WSYX(TV), Columbus, Ohio, from River City License Partnership II to WSYX Licensee, Inc. (File No. BALCT-980506IJ), IS GRANTED, subject to the condition that prior to or concurrently with consummation of the subject transaction, the assignment of license of station WTTE(TV), Columbus, Ohio, to Columbus (WTTE-TV) Licensee, Inc. (File No. BALCT- 960710IA) be consummated. FEDERAL COMMUNICATIONS COMMISSION Roy J. Stewart Chief, Mass Media Bureau