Interesting to speculate what we'd have now if the FCC had ruled that re-broadcasting was just fine, and no rights accrued to the original broadcaster. Well, it could have happened!
It would just mean that your local stations would all be home shopping channels, and there would be no news, no local production and no one to answer the phone when you call them. Think "Mega-Corp radio".....
It depends on if the other protections built into the current law survived.
The original problem was a satellite company picking up local network stations and transmitting them nationwide - which violates the affiliation agreements of the stations and could, theoretically, lead to the problems kenglish proposes. Now that the satellite market has grown to a combined 34 million "subscribers" one could calculate that nearly a third of television viewers would be able to receive a completely out of market feed and not their local station. (Subscriber counts include a calculated number representing commercial accounts - so it is inaccurate to say the subscriber number is the number of television households. But it is the number we have to work with.)
The decision of the courts was that satellite companies could not do that ... and the law passed by Congress that allows re-broadcast was written to respect the affiliation agreements ... delivering local channels only into their local markets (defined by Nielson - not their actual RF coverage) and allowing out of market "distant" stations only where no local affiliate covered the viewer. Not a horrible law as it gave permission overriding the court decision.
Where the system fails is with "consent to carry". I don't mind the regional restrictions that protect the affiliation agreements networks have worked out with their stations. But the "consent to carry" system where a station transmitting a freely received OTA broadcast can refuse to have that signal delivered to customers they should be reaching is wrong.
So keep the regional restrictions ... protect the local stations from being replaced by an out of market affiliate. But get rid of consent to carry. All it has become is an additional revenue stream for something the station is already supposed to be doing ... reaching their own market with their TV signals. The benefit of reaching more TV homes should be payment enough.