Evan Swartztrauber: Newsmax’s Curious Defense of Legacy Broadcast Regulation
CEO Chris Ruddy's opposition to repealing the FCC's 39% ownership cap is protectionism dressed up as conservative principle.
Washington is no stranger to advocacy that cloaks business interests in the language of principle. But it’s especially revealing when conservatism is the principle invoked to defend market-distorting regulations.
When FCC Chairman Brendan Carr announced plan to repeal the agency’s national television ownership cap, Newsmax CEO Chris Ruddy called the proposal “shameful.”
It’s a remarkably loaded description for an act of regulatory modernization, something routine for Republican agency heads and consistent with President Trump’s mandate to scuttle outdated rules.
The FCC’s national ownership rule prevents a television station group from owning stations that reach more than 39 percent of U.S. television households. It dates back to the 1940s when broadcast television was a dominant medium and a handful of networks had outsized control over information flows.
Today broadcasters compete for local ad dollars with a range of competitors whose reach and market caps dwarf those of broadcasters. YouTube, Netflix, TikTok, and others are free to reach 100% of the country without restriction—as is Newsmax, the national cable channel that Ruddy helms.
Eliminating the cap enjoys widespread support on the right, including from dozens of prominent conservative groups, former Trump officials, and Republicans in the House and Senate.
Democrats like Senator Elizabeth Warren overwhelmingly oppose lifting the 39% cap. The rule constrains the growth of broadcasters like Sinclair and Nexstar that Democrats have panned for news coverage they view as slanted to the right.
It’s for that exact reason that Ruddy wants to keep the 39% cap in place.
Newsmax does not hold broadcast licenses, so the rule doesn’t apply to his network. Broadcast groups that gain greater scale could become stronger competitors for his conservative viewers, as well as his company’s advertisers, talent, and influence.
Ruddy has an understandable business interest in supporting government regulations to limit that possibility. But he should be candid about that interest rather than couching it in concerns for the conservative movement overall.
And he’s hardly been subtle. He has called lifting the cap a “disaster for conservatives,” even warning that Republicans would “have little chance to win in state and federal elections” without the rule in place.
His argument that lifting the cap would harm conservatives is especially strange, because the broadcasters Ruddy wants the government to restrain are routinely portrayed by the left as conservative. The Washington Post has described Sinclair as a “conservative media giant.” The progressive group Media Matters has called Nexstar’s NewsNation “another right-wing cable network.”
Those descriptions can be debated. But they reveal the contradiction. A conservative media executive is asking conservatives to preserve a federal restriction on the growth of companies that progressive critics themselves regularly attack as conservative.
There is nothing conservative or pro-consumer about leveraging the federal government to weaken potential competitors. In fact, Ruddy’s apparent concern about stronger competitors is one of the best arguments for repealing the cap. If greater broadcaster scale would allow them to put more competitive pressure on Newsmax, Fox News or other national outlets, consumers would benefit from that competition.
The same principle applies regardless of ideology. More competition among news sources in general is healthy for conservatives, progressives, and everyone in between.
Ruddy’s position is also difficult to square with Newsmax’s antitrust lawsuit against Fox News. Newsmax alleges that Fox used its market position and distribution agreements to impede competition in right-leaning pay-TV news. Fox strongly disputes those allegations, and the case is ongoing.
But regardless of the case’s merits, Ruddy’s allegation is revealing. Newsmax argues in court that consumers suffer when a powerful company prevents a rival from growing. At the same time, Ruddy is defending a federal rule that prevents broadcast companies from growing beyond a fixed threshold without regard to whether their growth would actually harm competition.
Of course, consolidation is not inherently good or pro-consumer. It depends on market conditions and the facts of each proposed transaction. Ruddy and other defenders of the cap raise legitimate concerns about the potential consumer effects of individual broadcast mergers. But repealing the 39 percent cap would not greenlight a single deal.
The Justice Department would continue reviewing broadcast mergers under the antitrust laws, and the agency has repeatedly required television station divestitures when proposed combinations threatened competition. The FCC would also continue reviewing transfers of broadcast licenses under its public-interest standard. Regulators could approve deals that withstand scrutiny, impose conditions or divestitures when appropriate, and block transactions that would unduly harm competition.
That is how the system should work. Ruddy may prefer an arbitrary ceiling that can end the discussion before it begins, but calling the FCC’s effort to remove that ceiling “shameful” does not turn protectionism into principle.
The FCC should repeal the national ownership cap. It and the Justice Department should continue reviewing individual transactions and impose remedies as needed. Broadcasters should have to prove their case, and opponents should remain free to challenge them.
A rule that stops that discussion from even happening is a poor substitute for competition analysis.
Evan Swarztrauber is a senior fellow at the Digital Progress Institute, a bipartisan technology and telecommunications policy think tank in Washington, DC. Previously, he was a policy advisor at the Federal Communications Commission to then-Chairman Ajit Pai and Commissioner Brendan Carr. This Expert Opinion is exclusive to Broadband Breakfast.
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