Could NBC, ABC, CBS and Fox finally merge as FCC reopens ownership rules?

The U.S. Federal Communications Commission (FCC) has voted to begin the process of reconsidering a decades-old prohibition on mergers between the country’s four largest broadcast networks—NBC, ABC, CBS, and Fox. The move, announced on Tuesday, signals a significant shift in the regulatory landscape governing U.S. media ownership and could reshape the balance of power in television broadcasting.

The rule, known as the “dual network prohibition,” has prevented any of these major broadcasters from merging for nearly eight decades. Originally introduced in the 1940s to preserve competition, diversity, and localism, the ban was most recently reaffirmed in 2018. By reopening the question of whether the restriction should continue in today’s digital and streaming-dominated environment, the FCC is acknowledging growing industry pressure to modernize ownership rules.

FCC Chair Brendan Carr described the vote as an opportunity to reassess ownership regulations within the context of the modern media marketplace. Rather than treating television as an isolated industry, the agency now seeks to balance broadcast competition against the dominance of digital platforms and the broader shifts in consumer viewing habits.

How the history of US broadcast ownership rules shaped the current regulatory debate

For decades, the FCC has maintained ownership rules to prevent excessive consolidation among television, radio, and newspaper outlets. These policies were designed to ensure that no single entity controlled an outsized share of information channels, which regulators feared could reduce the diversity of viewpoints and weaken local journalism.

Among the most significant of these is the dual network prohibition, barring mergers among NBC, ABC, CBS, and Fox. Another cornerstone regulation is the national television ownership cap, which limits any single broadcaster’s reach to no more than 39 percent of U.S. households. Alongside this, local market rules have historically prevented a company from owning more than one of the top four television stations in a given market.

The FCC has already begun to relax some restrictions in recent years. In 2017, the commission eliminated a longstanding ban on cross-ownership between newspapers and television stations, citing the collapse of traditional print revenue and the need for legacy media firms to consolidate. Courts have also played a role, with a 2021 U.S. Supreme Court ruling granting the FCC broader authority to revise ownership rules so long as changes are not arbitrary or capricious.

This evolving backdrop has emboldened broadcasters to lobby for further deregulation, arguing that legacy restrictions no longer reflect the realities of a market dominated by streaming giants such as Netflix, Amazon Prime Video, and YouTube. The National Association of Broadcasters has publicly stated that the national television ownership cap is outdated and should be repealed entirely, while large station groups such as Nexstar and Sinclair have long argued that scale is essential for competing in the digital era.

What specific FCC rules are now under review and why the timing matters for consolidation

In its Tuesday vote, the FCC signaled that it would not only reconsider the dual network prohibition but also open a wider review of media ownership rules. Among the items under scrutiny are the top-four rule preventing common ownership of two of the four highest-rated stations in a local market, the national ownership cap that limits household reach to 39 percent, and cross-media restrictions that have historically limited common ownership across radio, television, and cable.

The timing is critical, as industry consolidation pressures are mounting. Traditional broadcasters continue to face declining linear advertising revenues while competing with streaming services that operate without comparable ownership restrictions. At the same time, several pending deals, including Nexstar’s proposed $6.2 billion acquisition of Tegna, are testing the boundaries of existing FCC rules. Analysts note that any loosening of the national cap or relaxation of the top-four restriction could determine whether such transactions gain regulatory approval.

The FCC has invited public comment on the proposed rule changes, opening the door to vigorous debate among broadcasters, consumer groups, policymakers, and academics. This process will allow stakeholders to weigh in on whether deregulation would strengthen the competitiveness of American broadcasters or undermine media diversity and local accountability.

Why potential mergers among NBC, ABC, CBS, and Fox could reshape competition and advertising

If the FCC ultimately lifts the dual network prohibition, the possibility of mergers among the nation’s most prominent broadcast networks becomes real. A merger between any two of the “Big Four” would fundamentally reshape the advertising marketplace, programming strategies, and bargaining dynamics with pay television providers.

Consolidation at the network level could give broadcasters more leverage in retransmission negotiations, allowing them to demand higher fees from cable and satellite distributors. This would create ripple effects for consumers, who may face higher costs passed down from distributors. It could also prompt further consolidation among smaller networks and station groups seeking scale to remain competitive.

On the other hand, proponents argue that consolidation may be the only viable path to ensuring the survival of broadcast television in a world where digital advertising dollars overwhelmingly flow to platforms like Google and Meta. By combining resources, networks could invest more heavily in original programming, sports rights, and digital distribution strategies that allow them to compete with streaming rivals.

What critics fear about concentration of media power and the erosion of local news diversity

Opponents of deregulation warn that removing ownership limits could harm local news ecosystems and reduce the diversity of viewpoints available to the public. Media watchdog groups, academics, and consumer advocates have long argued that ownership concentration results in fewer local voices, less investigative journalism, and more homogenized national programming.

Pay television groups have already raised objections to the FCC’s review, cautioning that lifting caps would enable broadcasters to consolidate power and demand outsized retransmission fees. Political stakeholders are also likely to weigh in, with some members of Congress questioning whether the FCC even has the statutory authority to eliminate certain ownership restrictions without legislative approval.

The question of localism remains central. For decades, U.S. media policy has been built on the principle that communities deserve independent and diverse news sources. Critics fear that mergers among large broadcasters would erode this principle, particularly in smaller markets where independent stations could be squeezed out or absorbed into consolidated ownership structures.

How institutional sentiment is shaping investor expectations around media deregulation

From an investor standpoint, the FCC’s decision to review ownership rules has introduced new momentum into media consolidation speculation. Equity analysts tracking broadcasters such as Nexstar Media Group, Sinclair Broadcast Group, Paramount Global, and Fox Corporation have noted that regulatory relaxation could unlock significant dealmaking potential.

Institutional sentiment has been cautiously optimistic. On one hand, a looser regulatory environment could unlock synergies through mergers and acquisitions, driving valuation multiples higher for companies with strong balance sheets and appetite for expansion. On the other hand, the regulatory process is fraught with uncertainty, and any shift could face legal challenges from consumer groups or state attorneys general.

The Nexstar–Tegna merger is seen as a bellwether case. If the FCC shows willingness to increase the national cap or allow waivers for local station ownership limits, investors may interpret it as a green light for further consolidation across the sector. Conversely, strong opposition in the public comment phase or intervention from Congress could dampen expectations and restrain share price momentum.

What to watch as the FCC weighs deregulation and prepares for public comment

The FCC’s decision to consider lifting the dual network prohibition and revisiting broader media ownership rules represents one of the most consequential regulatory reviews for U.S. broadcasting in decades. Over the coming months, the agency will collect public comments, weigh stakeholder arguments, and potentially draft rule changes that will determine the future of broadcast consolidation.

Key areas to monitor include whether the FCC proposes incremental adjustments—such as raising the national ownership cap modestly—or pursues a more sweeping overhaul by removing longstanding prohibitions entirely. Congressional oversight may also influence the process, as lawmakers on both sides of the aisle have historically expressed strong opinions on media diversity and consolidation.

Judicial review remains another wildcard. Even if the FCC finalizes rule changes, consumer groups are likely to challenge them in court, forcing the commission to defend its decisions under administrative law standards. The Supreme Court’s 2021 ruling in FCC v. Prometheus Radio Project gave the commission wider latitude, but any shift will still need to withstand scrutiny as being in the public interest.

For now, broadcasters, advertisers, investors, and policymakers are bracing for what could become the most transformative overhaul of U.S. media ownership policy since the Telecommunications Act of 1996.