In March 2025, Federal Communications Commission (FCC) Chairman Brendan Carr announced the agency's intent to scrutinize and potentially block media mergers involving companies that promote certain Diversity, Equity, and Inclusion (DEI) policies. Carr emphasized that the FCC could only approve transactions if they serve the public interest, suggesting that promoting "invidious forms of DEI discrimination" might disqualify businesses from merger approvals.

This policy shift introduces new complexities for pending mergers and raises questions about the balance between regulatory oversight and corporate autonomy.

The FCC's stance could affect several pending mergers, including those involving Paramount Global and Skydance Media, Verizon Communications Inc. and Frontier Communications Parent Inc., and T-Mobile US Inc. and U.S. Cellular Corp. Carr stated, "Any businesses that are looking for FCC approval, I would encourage them to get busy ending any sort of their invidious forms of DEI discrimination."

In addition to scrutinizing mergers, the FCC has initiated an investigation into Disney and its subsidiary ABC to determine whether their DEI practices violate the FCC's equal employment opportunity regulations. Carr's letter to Disney CEO Bob Iger expressed the need to ensure that DEI policies do not promote discriminatory practices. Disney has recently adjusted its DEI programs, including changing certain content disclaimers on its legacy titles and replacing diversity and inclusion as a performance factor used to evaluate executive compensation.

The FCC's actions have sparked reactions from various stakeholders. Former FCC chairs and commissioners have accused the agency of acting as the White House's personal censor. House Democrats have initiated a probe into the FCC's media investigations under the Trump administration, alleging that the FCC conducted biased probes into CBS, NBC, and ABC to intimidate the news media.

The FCC's authority to block mergers based on DEI policies is a novel approach and may face legal challenges. While the FCC does not have antitrust regulatory powers like the Federal Trade Commission (FTC) or the Department of Justice (DOJ), it must approve broadcast license transfers and can conduct investigations that significantly delay deals. The legal basis for using DEI policies as a criterion for merger approval remains uncertain.

This development marks a significant shift from previous administrations, which often viewed the promotion of diversity in a positive light during merger evaluations. The current approach reflects the Trump administration's broader efforts to root out DEI policies from both the federal government and corporate America.

As the FCC's new stance unfolds, it is likely to have far-reaching implications for corporate DEI initiatives and the media industry's consolidation landscape. Companies involved in pending mergers may need to reassess their DEI policies to align with the FCC's evolving criteria for merger approvals.