The Federal Communications Commission has granted unrestricted licenses to cable provider GCI for the operation of three TV stations it has purchased, denying a challenge from several Alaska broadcasters.
In the Tuesday order, announced Wednesday, FCC officials sharply rejected a series of objections to GCI subsidiary Denali Media Holdings' acquisition of Anchorage CBS affiliate KTVA-TV, as well as Southeast Alaska NBC affiliates KATH-TV in Juneau and KSCT-TV in Sitka. The purchases were announced in November 2012.
Four broadcasters opposed granting GCI the operating licenses in a petition in a joint filing before the FCC:
• KTUU-TV owner Northern Lights Media, Inc.
• Vision Alaska LLC, owner of ABC affiliates KYUR-TV in Anchorage, KATN-TV in Fairbanks and KJUD-TV in Juneau
• Ketchikan TV LLC, owner of Southeast Alaska CBS affiliates KXLJ-TV in Juneau, KUBD-TV in Ketchikan and KTNL-TV in Sitka
• Coastal Television Broadcasting LLC, owner of Anchorage Fox affiliate KTBY-TV
The broadcasters claimed the purchase was potentially monopolistic, citing GCI's massive statewide reach as a communications provider through such initiatives as its TERRA-SW broadband Internet project in Southwest Alaska.
In addition, KYES-TV owner Fireweed Communications LLC filed a separate protest saying the purchase would add a vertical monopoly in Alaska's TV market to what it described as an existing horizontal monopoly.
In responses to the petitions, GCI officials said the purchase would simply improve competition in the state's TV markets, noting that KTUU reaches an estimated 90 percent of Alaska households. According to GCI officials, the FCC had considered and dismissed the issue raised by Fireweed when it repealed a rule limiting cross-ownership of cable TV systems and broadcast stations.
In its 10-page order (PDF) denying the petitions and granting the GCI licenses this week, FCC officials say the agency first considered whether the objections raised by the various broadcasters inherently justified denying GCI the licenses.
"The petitions and informal objections fail to meet this statutory burden," FCC officials wrote. "We conclude that the petitions to deny and objections do not make a prima facie showing that grant of the Applications would be inconsistent with the public interest, convenience and necessity."
The commission also denied a major element of Northern Lights Media's argument against granting the licenses, stating the merger of Comcast and NBCUniversal -- upon which the FCC imposed safeguards -- is not similar to GCI's purchase of the three Alaska stations. It also threw out allegations that GCI would discriminate against other broadcasters after the purchase was complete.
"We disagree with these objections, and conclude that no additional conditions are necessary or appropriate to prevent GCI from discriminating against other content providers over its broadband network," FCC officials wrote. "The record indicates that facts underlying the instant transaction are distinguishable from those in the Comcast-(NBCUniversal) acquisition."
Commissioners also characterized claims that GCI might distort the stations' news content as premature and not strong enough to warrant denying GCI the operating licenses.
"The allegations regarding journalistic independence are speculative and based on hearsay, but, even if true, would be insufficient to make out a prima facie showing that grant of the Applications would be inconsistent with the public interest," FCC officials wrote.
KTUU-TV Marketing Director Brad Hillwig says managers at Northern Lights Media are disappointed with Tuesday’s order, particularly commissioners’ rejection of the Comcast-NBCUniversal comparison, but are evaluating options going forward in the ruling’s wake.
“We have no problem with competition,” Hillwig said. “That said, we don’t want to be competing with an entity that can use distribution muscle to squeeze out broadcasters.”
GCI spokesperson David Morris confirmed the decision in a brief statement Wednesday afternoon.
"The Order concluded that the licenses transfer is consistent with the public interest, convenience and necessity," Morris wrote. "With today's announcement, Denali Media will move to close the transactions over the next several days."
This is a developing story. Please check KTUU.com and the Channel 2 newscasts for updates.