FCC Ownership Rule Proposal & The NAB

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The FCC has been soliciting input to changes to it’s ownership rules for radio properties. The corporate lobby group – the NAB had proposed several changes.. They include removal of caps on AM ownership; allowing a single entity to own up to eight commercial FM stations in Nielsen markets 1-75 (or up to 10 FMs for participants in the FCC’s incubator program); and imposing no restrictions on FM ownership in markets 76 and lower and in unrated markets. Critics then weighed in. Several objections from small broadcast ownership groups, such as Saul Levine’s Mt Wilson Broadcasters, Crawford Broadcasting plus associations representing minorities representing woman’s broadcast groups, NABOB representing Black station ownership have rattled the mighty NAB, who have basically become the shill voice & powerful lobby of the major corporate broadcasters including iHeart, Cumulus, Entercom & others. The relationship between the FCC & NAB is a disturbing one & is not conducive to a diverse, healthy station ownership environment. It was the NAB who lobbied so hard for now disastrous 1996 Telecomm Act that initially relaxed ownership rules & led to the corporate takeover of America’s radio stations & their downward spiral for the attention of media consumers. The FCC increasingly has become the lapdog of the powerful NAB. Both entities care little for diversity & localism in broadcasting.

In today’s RadioWorld is posted the latest missive by the NAB against those who oppose further relaxation of the ownership rules, which would permit the NAB’s members to grow even larger & further reduce competition in radio. As is so typical of the divisiveness & contention taking over our world & country, the NAB has resorted to name-calling & self-promoting propaganda to ensure their arguments sway the commission’s rulemaking. The NAB response contends: “If broadcast stations cannot successfully compete against other audio and video delivery platforms for audiences and, thus, advertising dollars, they will not earn revenues needed to cover their substantial fixed costs and will be unable to serve listeners and viewers effectively, let alone improve their programming and technical facilities. Similarly, other parties insist that broadcast media, especially TV, are critical for providing local communities with news and information, or even for maintaining democracy, but then chastise the FCC for denigrating those values by focusing on economic concerns. This, again, is backward. The broadcast industry’s ability to function in the ‘public interest, convenience and necessity’ is fundamentally premised on its economic viability. These parties fail to explain how imposing ownership restrictions only on local broadcast stations in today’s competitive marketplace promotes their ‘economic viability’ and, thus, their ability to serve the public.”

The NAB & it’s corporate members fail to admit that many of the negatives that have evolved in today’s radio are of their own making. They further argue: “These parties urge the FCC to de-emphasize competition in its review, contrary to statutory mandate, congressional intent in the 1996 Act, judicial precedent and previous quadrennial review decisions. Particularly given the vastly increased competition in the modern digital marketplace, placing competition at the rear of relevant considerations in this proceeding clearly would be backward. As multiple commenters, including NAB, demonstrated in comments and studies, radio stations are experiencing declines in audiences due to fierce competition, especially from online options, and significant revenue reductions in local ad markets increasingly dominated by digital platforms.”

The NAB then lashes out at those who oppose their proposals instead of providing intelligent counter-arguments to back up their insistent claims: “Those parties opposed to reform of the outdated local radio and TV rules present no legal, factual or even logical arguments that undermine NAB’s proposals. Most notably, these commenters offer no serious analyses — and provide virtually no relevant data — relating to competition for audiences and vital advertising revenues, even though free, over-the-air broadcast stations depend on ad dollars for their very survival. Perhaps those parties against reform of the rules felt compelled to act as proverbial ostriches with their collective heads in the sand. After all, if they looked at the current market with their eyes open, they would be forced to recognize that radio and TV broadcasters compete against myriad multi-channel and online audio and video sources and that the relevant market for evaluating ownership regulations can no longer be limited just to broadcast stations. And in that case, of course, the existing broadcast-only ownership rules would need to be repealed or modified. But whatever the reason for their failures to meaningfully address the central issues in this proceeding, the FCC should pay little heed to commenters whose submissions opposing reform amount to little more than opinion pieces (or quotes from other people’s opinion pieces).”

This represents the mode of thinking at the NAB & the refusal to acknowledge or integrate the needs of smaller & more diverse broadcasting entities. Their counter-argument amounts to little more than the same propaganda they have been submitting to the commission for a number of decades now: “NAB and other commenters firmly believe that addressing the lack of access to capital remains the only effective way to promote new entry into broadcasting. Moreover, retention of the existing rules will not foster, but will instead hinder, the provision of local news programming, given the resources needed to maintain local news operations, especially in smaller markets where stations most struggle to earn advertising revenues to support local programming production. Finally, it borders on the absurd to contend that broadcast-only restrictions are needed to promote diverse viewpoints in the internet age.” Once again we are subject to direct attacks on those who choose to oppose the powerful lobby group. The remainder of the NAB’s statements merely repeat the same “buzz” & “corporate-speak” underlyng the bulk of their submissions to the FCC on this issue. 

One only needs to spin the local radio dial to see how corporate radio ownership has manifested itself in our contemporary media landscape. Where once, the Seattle-Tacoma market had a diverse, vibrant choice of stations based on small ownership, today’s offerings are mostly bleak. There ARE exceptions & some stations & programs that offer sometimes excellent choices. But these few & far between. The arguments for further consolidation do not pan out & today’s corporate broadcasters are in big trouble. Witness the near bankrupcy of iHeart. Now Cumulus wants the FCC to allow it to be fully financed & owned by foreign investors. How does that foster a healthy broadcasting scene or increase American economic health & expansion? The writing is on the wall: should the FCC give in to increasing the ownership caps – and there is little to suggest this won’t happen – expect further struggles for small broadcast groups & “indie” owners. It will mean a further reduction in local programming & radio employment opportunities as the corporate’s integrate their radio programming from a single location with a “one size fits all” mentality governing programming in all American urban markets. “All markets all the time!” The situation in Canada is identical – a federal regulator acting as a puppet to a handful of corporate owners & giving in to corporate dominance of radio broadcasting. That country’s radio diversity is almost nil & local, small & medium market radio has all but been destroyed – just as is happening in this country. Those countries with strict & small ownership caps have the healthiest, most diverse & generally profitable commercial radio industries. These include the UK, Germany, Italy & Australia – all countries that only allow ownership of a handful of stations & no more than ONE AM, FM & DAB+ per market. Make no mistake that this is an ill-thought out proposal that will reduce employment in local radio & ultimately the choices available to the poor, suffering listener.

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Mike Cherry

Author: Mike Cherry

retired broadcaster: on-air, MD, PD, asst PD, Prod Mgr, IT, station technician/engineer, pioneer Internet webcaster, station installation/maintenance; 12 years in commercial radio, 17 years volunteer in campus/community radio in B.C., Alberta & Wash. Amateur radio operator & "DXer" specializing in AM night-time DX, short-wave DX/listening & remote SDR DXing/listening

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