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Allow Broadcasters to Compete on a Level Playing Field in the Digital Marketplace

ISSUE SUMMARY

For decades, the Department of Justice's (DOJ) Antitrust Division has maintained that local broadcast television stations compete only against one another when analyzing mergers and other competition issues. This view is out of sync with today’s media marketplace.

  • With the explosive growth of online video and digital content along with the proliferation of cable and satellite television channels, broadcasters face intense competition for audiences and local advertising dollars.
  • Yet, the DOJ’s outdated viewpoint stifles broadcasters' ability to achieve efficiencies to allow them to best serve audiences with the high-quality entertainment and locally-focused news, weather and sports they have come to expect. It is well past time for the DOJ to update its regulatory policies to reflect the realities of the 21st century media market.

Here's why:

As a direct result of the DOJ's narrow view of the media marketplace, broadcasters face strict limitations in acquiring stations and taking advantage of important economies of scale.

  • This skews the competitive playing field because giant tech companies such as Facebook and Google, large pay-TV and broadband providers such as Charter Spectrum and Verizon, and online video providers like Netflix and Amazon are not subject to comparable limitations.
  • Yet, broadcasters compete with them for local viewers and advertising dollars. Neither consumers nor advertisers believe that local TV stations are their only options for accessing video content or placing advertisements:/li>
    • Broadcast TV stations have lost and continue to lose advertising dollars to digital platforms, which dominate the local advertising market. According to Borrell Associates, in 2024 local digital advertising reached $103 billion, accounting for about 70% of all local ad spending (and likely to approach 75% of all local ad spend by 2028). In 2024, out-of-market "pureplay" digital ad platforms garnered 85.1% of all local digital ad spending, with Alphabet (Google/YouTube), Meta (Facebook/Instagram) and Amazon obtaining the lion’s share.
    • According to estimates from eMarketer and BIA Advisory Services (BIA), the U.S. advertising revenues of Google alone were more than double the combined ad revenues of all local TV and radio stations in the country in 2024.
    • Surveys and studies conducted by industry analysts, including Borrell, BIA and NERA Economic Consulting, have found that advertisers who utilize broadcast stations also use a wide range of other platforms, especially digital, and that advertisers view digital platforms as substitutes for local broadcast advertising. Competition to TV broadcasters from digital video platforms continues to expand, with rapid growth of advertising on free ad-supported streaming TV and ad-supported subscription video on demand services and via internet-connected TV devices.
    • Broadcast TV stations have lost and continue to lose audiences to online options. Nielsen’s monthly TV and streaming snapshot called "The Gauge" has documented the rapid increase of consumers' total time spent viewing streaming, at the direct expense of traditional linear television. Streaming now exceeds broadcast and cable/satellite viewing combined, with YouTube alone routinely garnering more than 12% of total TV viewing each month.

The bottom line:

The DOJ should recognize what broadcasters, cable and satellite providers, online content providers, advertisers and consumers already know: technological advances have transformed the media landscape.

  • In light of these vast changes, the DOJ should reevaluate its approach for defining the relevant market and analyzing competition when reviewing broadcast TV station mergers.






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