Now, the embattled Chairman is scrambling to clean up the mess caused by exempting pay-TV operators from political ad disclosures as candidates gear up for the election this November.
The law has long required broadcast television stations, cable operators, and satellite television to maintain publicly-accessible political files that disclose the identity of candidates and organizations that buy political ad time and how much it costs. That changed in 2012, when the FCC started requiring that broadcast television stations publish their political files in a searchable database hosted by the FCC.
Making it that much easier for attack groups to monitor rival political spending on broadcast television has given ad buyers an incentive to shift their campaign focus to less-transparent pay-TV channels. This and other FCC policies that tilt the playing field against TV stations are increasing the pressure on television networks to sell their programming to pay-TV directly, and could end free over-the-air television as we know it.
Some groups on the left have taken notice and decided its time to close this gaping pay-TV loophole. The Campaign Legal Center, Common Cause, and the Sunlight Foundation recently filed a petition asking the FCC to expand the online filing requirement for political ads to pay-TV operators. Wheeler has put the petition out for comment, but didn't commit to taking any action on it.
The petition is a compelling litmus test for Wheeler. If Wheeler truly is as “rabidly pro-competition” as he claims, he’ll act on the petition sooner rather than later.
There is no rational justification for limiting online political filing to TV stations. The Communications Act requires pay-TV operators and TV stations to make the same political disclosures, and until 2012, the FCC applied similar rules to both industry segments. When the FCC imposed the online requirement on TV stations, it found that a searchable database would improve public access to information about political ad spending and would ultimately save money on filing costs. The same purpose would be equally well served by imposing the same requirement on pay-TV operators, who should also have no more difficulty complying than small, family-owned TV stations.
Wheeler’s predecessor attempted to justify the FCC’s discriminatory disclosure rule by asking, “Who can be against mom, apple pie and the American way of transparency?” He should have asked why the FCC was against treating similarly situated persons similarly, a concept so fundamental to America that it's required by our Constitution. If providing the public with online access to information about campaign ads is “common sense,” as Wheeler’s predecessor maintained, then common sense requires that the public have access to it for all campaign ads.
The law does, too. The Supreme Court has held that the First Amendment doesn’t permit categorical distinctions based on a particular type of media. “Today, 30-second television ads may be the most effective way to convey a political message. . . . Soon, however, it may be . . . the Internet.” The FCC’s decision to restrict the speech rights of TV stations based on their regulatory classification thus runs afoul of the First Amendment as well as common sense.
Wheeler can’t afford to sit on the petition for long. He has already amassed a long rap sheet of one-sided video regulations, including:
- Prohibiting TV stations from jointly selling advertising time in local markets (through Joint Sales Agreements or JSAs) while permitting the largest pay-TV operators to jointly sell advertising time on a nationwide basis;
- Prohibiting TV networks and their affiliated stations from bundling their channels for sale to pay-TV operators while permitting affiliated cable networks to bundle an unlimited number of their channels; and
- Proposing to eliminate local broadcast exclusivity rules that help TV stations in smaller markets finance the production of local news programming while permitting pay-TV operators to enter into exclusive programming agreements on a nationwide basis.
If Wheeler attempts to bury the political ad issue in agency bureaucracy at this point, he’ll burnish his image as a cable industry crony and undermine his pro-competition credibility. He should either apply the rule fairly or scrap it altogether.