Choosing between the Necessity and Public Interest Standards in FCC Review of Media Ownership Rules

Section 202(h) of the Telecommunications Act of 1996, as amended, directs the Federal Communications Commission (“FCC”) to review its media ownership rules every four years. But the statute contains an ambiguity regarding the standard of review that the FCC must apply during such proceedings. To retain a particular media ownership regulation, must the FCC merely show that the regulation advances one of the FCC’s three public-interest goals for media: competition, diversity, and localism—applying a “public interest” standard? Or must the FCC meet the higher burden of demonstrating that the regulation is also indispensable for maintaining competition, diversity, or localism at some threshold level—applying a “necessity” standard? The answer to this procedural question has important substantive consequences for media policy. But, despite recent case law on the issue, the controversy over the standard of review can recur with each FCC media-ownership proceeding. Furthermore, neither cannons of construction nor legislative history settle the ambiguous nature of section 202(h). But the analysis of previous appellate courts, as well as several policy considerations like facilitating cost- benefit analysis and ameliorating agency capture, suggest that the FCC and the courts should apply a public-interest standard until Congress acts to clarify section 202(h).