Audacy Order Expected Next Week; FCC and Carr Disagree on Whether It's 'Unprecedented"
An order approving Audacy’s request for a temporary exemption from the foreign-ownership rules was adopted but isn’t expected to be released before next week, FCC officials told us. The waiver would allow Audacy to complete foreign-ownership review after it finishes a bankruptcy restructuring that involves control of the broadcaster passing to a fund affiliated with George Soros' family. FCC Republicans hadn’t submitted dissenting statements Wednesday afternoon but indicated they plan to do so, the agency officials said. Broadcast industry officials, attorneys and others told us the Audacy transaction wouldn’t attract as much attention without Soros’ name attached, and that radio broadcasters have long sought increased private equity investment in their industry. “They’re making it a political ax,” said Christopher Terry, University of Minnesota media law professor. “The radio industry has been cash-strapped for 20 years.”
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An FCC spokesperson said Wednesday, “No decision is final until the Commission releases it, which we have not.” Though the decision isn’t final, both FCC Republicans have already blasted the order in the press. Commissioner Brendan Carr has also done so on social media. “A person’s last name should not determine how the government treats them,” Carr posted on X Wednesday. “That is why I oppose the creation of a special Soros shortcut that fast tracks the acquisition of 200+ radio stations.”
In an interview with conservative radio personality Glenn Beck Tuesday, Carr called the process around the Audacy waiver “unprecedented,” although the FCC and several broadcast attorneys have noted similar proceedings for large, bankrupt radio groups that occurred under multiple administrations during Carr’s tenure without objection from him or other FCC Republicans. “We have a very clear process ... for reasons that aren’t clear to me, the FCC ... for the very first time ever, has skipped that process for the benefit of this Soros-backed group,” Carr told Beck. “I’ll let people draw their own conclusions about it.” “This fast track before an election," said Space X CEO Elon Musk in a reply to Carr’s post, "sounds like corruption.”
Carr’s office declined to comment about how the Audacy process is different from similar past FCC proceedings for Cumulus, iHeart and others. In a Fox News interview Tuesday, Commissioner Nathan Simington conceded that the FCC granted such requests previously but said the Audacy item was “fast-tracked” in that it was presented to commissioners as a bureau-level decision with only 48 hours' notice on a Friday. All the previous grants of temporary relief from the foreign-ownership process for bankruptcy restructuring were also bureau-level decisions. “The Commission has a long-standing process for reviewing transactions that involve emergence from bankruptcy,” said the FCC spokesperson. An FCC official told us the Audacy order is very similar to the previous occasions the agency allowed a broadcaster to delay foreign-ownership review during a bankruptcy restructuring.
A person with knowledge of the Audacy deal told us that the Soros-affiliated Fund for Policy Reform involved in the deal isn't foreign owned and isn't the reason the restructuring requires FCC authorization for foreign ownership. The restructuring involves multiple parties owning shares in Audacy, and the FCC's foreign-ownership rules are triggered anytime foreign ownership is over 25%.
While Carr and Simington have historically been seen as siding with broadcasters against the current FCC’s policies on transactions, their calls for foreign-ownership review of the Audacy deal run counter to the views of many broadcasters. The government-wide foreign-ownership process injects uncertainty into transactions and can delay deals for six months to a year, broadcast attorneys told us. The Committee for the Assessment of Foreign Participation in the U.S. Telecommunications Services Sector, formerly known as Team Telecom, is an interagency review body composed of DOJ, DOD and the Department of Homeland Security. Former President Donald Trump issued an executive order formalizing the foreign-ownership process, and FCC Republicans have traditionally tried to limit the extent of foreign-ownership review. Radio broadcasters have also long sought increased investment in radio from private equity. Beasley Media CEO Caroline Beasley gave a speech critical of the FCC for driving away investors from radio last year (see 2307270052). “The radio industry is always looking for new investment,” said radio broker Gregory Guy. NAB didn’t comment.
In the past, Carr condemned suggestions that the FCC intervene in broadcast matters over a station’s political leanings. In June 2021, he blasted the Loudoun County, Virginia, school system over an FCC filing calling for the agency to go after a Sinclair broadcast news station for its reporting. And in remarks about the Audacy deal, he repeatedly referenced a Congressional Hispanic Caucus effort from 2021 urging the FCC to block the sale of a Spanish-language radio station in Florida over the purchaser’s conservative views. “This is a deeply troubling transgression of free speech and the FCC’s status as an independent agency,” Carr said in a 2021 statement about the Hispanic Caucus pressure. “I call on my FCC colleagues to join me in publicly rejecting this attempt to inject partisan politics into our licensing process.” More recently, Carr declined comment on Trump's apparent threats against broadcast licenses (see 2409190063).
Social media posts on the Audacy deal and its Soros connection have attracted antisemitic comments, some about FCC Chairwoman Jessica Rosenworcel. “A far left progressive self hating Jew wanting to control the airwaves,” said an X post from "PatriotMom35" directed at Rosenworcel, which FCC spokesperson Jonathan Uriarte highlighted. “Our eyes are open and we’re watching you,” the post said. “George soros and the chair person of the fcc that is fast tracking this is Jessica Rosenworcel, who both just happen to be Jewish. Is this now easy to figure out that she's running this thru so quickly," posted "regular looper" commenting on Carr’s testimony before Congress on the Audacy deal. “There’s a dangerous lie intentionally being spread regarding the FCC’s review of media transactions,” FCC spokesperson Jonathan Uriate wrote. “I won’t speculate about the motivations behind it, but the result is clear: vile antisemitic rhetoric that’s increasing hate and division in this country. Shameful.”