FCC Deregulation Alone Won't Trigger the Radio M&A Wave Everyone's Predicting, Here's Why

Written by:

Rudi Davis

Date:

15 Jan 2026

Share

Share via Facebook

Share via Linkedin

Share via X

Copy to clipboard

The broadcast industry’s outlook for 2026 relies heavily on the expectation that Republican FCC leadership will relax ownership caps, which could spark a surge in consolidation. However, Roger Rafson, President of CMS Station Brokerage and Managing Director at Media Services Group, cautions that regulatory relief addresses only one part of a much larger and more challenging landscape. Despite widespread industry optimism, Rafson says the anticipated regulatory changes have not yet occurred—and even when they do, they will not automatically reverse the steep decline in deal activity seen since 2019.

“The Republican FCC right now is under Brendan Carr’s leadership,” Rafson says. “With the upcoming ownership relaxation, which we anticipate will happen, station groups can own more stations. It hasn’t happened yet, but we do anticipate that it will happen, and that will result in more mergers and acquisitions.”

Rafson’s emphasis on anticipation rather than certainty underscores the gap between policy expectations and actual market conditions. While raising ownership caps would, in theory, allow regional operators to expand, Rafson points out that such regulatory permissions matter only if market economics justify the investment.

The Market-by-Market Reality

Radio deal activity today is driven by local market fundamentals, not just regulatory constraints. Rafson explains that buyers are not making decisions solely based on FCC rules—they analyze economic conditions in each market before proceeding. “Every market is different,” he says. “I like to view a given county based on its economic activity. Is the population growing? Are there strong, major employers there to employ people? If the market is healthy, a radio station is definitely part of the mix. But conversely, if the market is in a downward spiral, that’s bad.”

As a result, even if FCC ownership caps are lifted, consolidation will only occur in markets where population growth, stable employment, and advertising demand support profitable station operations. In struggling markets with shrinking populations or weak economies, changes in ownership rules do not improve the business case for acquisition.

Rafson notes that while radio stations remain essential to their local communities, their value as acquisition targets depends on whether the local economy can sustain them. “The people in the counties that the stations operate in know that the radio station is critical as a business partner in their community,” he says. However, if the market cannot support profitable operations, that local importance does not translate into increased deal activity.

Who’s Actually Buying—And What They’re Avoiding

The current buyers in radio are selective and strategic. Rafson observes that regional operators and large religious broadcasters are actively expanding, as are Spanish-language broadcasters who target specific audience segments. “I see that the regional operators and big religious broadcasters are expanding all over the place,” he says. “Language-specific broadcasters, specifically Spanish-language, they’re expanding. So it depends. People see opportunities in various regions, and they go for it.”

This targeted approach shows that the fundamental drivers of consolidation are operator capability and market positioning, rather than regulatory permission alone. Religious and Spanish-language broadcasters can find value in serving defined audiences and often rely less on local ad revenue than traditional commercial operators.

For conventional commercial broadcasters, acquisition decisions are more complicated. Rafson notes that some potential buyers avoid entire station categories when market conditions are unfavorable. “If you’ve got a competitor who does not maintain rate integrity about how much they charge for their commercials, if they lowball it, that’s not a healthy situation,” he says. “So you sort of want to avoid that.”

The Post-2008 Valuation Reality

The market for radio stations changed significantly after the 2008 financial crisis. Rafson explains that since then, it has become a buyer’s market, with cash flow multiples declining and deal terms shifting. “Since 2008, the market has shifted. It’s become more of a buyer’s market, and that means that the metrics about cash flow have trended down,” he says.

A critical factor in this shift has been the withdrawal of major lenders from broadcast lending. “The major lenders stopped lending to broadcast properties,” Rafson says. As a result, sellers must accept that buyers typically cannot pay the full purchase price upfront. “Sellers had to start shifting their realization, so that people aren’t coming to the closing with 100% purchase price—they’re asking the sellers to do some seller financing, and that’s much more of our day-to-day reality these days.”

This financing reality means transaction volume will increase only if sellers accept current market valuations and offer terms that make acquisitions viable for buyers, regardless of regulatory changes.

What Deregulation Actually Enables

Rafson’s analysis suggests that relaxing the FCC ownership cap will have the most significant impact on regional operators already active in healthy markets. For these groups, regulatory relief removes a barrier to further consolidation in areas where they already have a strong presence and where the economics work.

However, in markets experiencing long-term decline or among operators who lack a proven ability to generate local sales, regulatory changes alone will not create new transaction opportunities. The underlying economics—population trends, employment levels, and advertising demand—remain the decisive factors.

Whether the predicted wave of M&A arrives depends less on FCC decisions in Washington and more on whether local market conditions support profitable operations for radio stations. Without strong community-level fundamentals, regulatory changes are unlikely to drive the surge in deal activity many in the industry hope for.