The Federal Communications Commission took a page from "The Godfather" movies in getting Spanish language broadcasting behemoth Univision to quietly accept a $24 million fine for skirting requirements to air educational programming for children.
The agency made Univision an offer it couldn't refuse.
Univision badly wants to to sell itself to a group of private equity firms for an estimated $12.3 billion. One of the last remaining hurdles to the deal is approval by the FCC.
With the deal hanging in the balance, the FCC was in a position to ask for virtually anything from Univision -- and that is precisely what it did. It slapped Univision with the with the largest fine in FCC history and the company said okay, without a protest.
As Don Vito Corleone often said, it was just business.
Univision was unquestionably in violation of FCC rules requiring its stations to broadcast at least three hours of educational children programming per week. Prior to getting its buyout offer, Univision had tried to argue that it was meeting those requirments primarily through the airing of "telenovelas" for teens, which are basically soap operas.
To its credit, the FCC used the leverage of the pending buyout to force Univision to drop the charade and pony up plenty of cash for its transgressions. It's possible the big fine will get the attention of other media companies, many of whom have sidestepped or ignored all kinds of FCC rules and regulations with relative impunity for years.
The Univision slapdown is in sharp contrast to the FCC's overwhelmingly hands-off approach to regulation in recent years. We are not convinced the agency will exercise the same, get tough approach to similar violations when the violators are not desperate to clear the decks for a huge buyout, but we would like to be pleasantly surprised.
We will also note in passing that former FCC Chairman Michael Powell is now a senior executive at one of the private equity firms that will likely profit handsomely from the buyout.
What was it that Michael Corleone said in "The Godfather, Part II" about keeping your friends close and your enemies closer?
