CBS to use signal-overlap argument to own nine-station AM/FM/TV cluster

[EJM]

Mr. Fybush's new column contains the tidbit that CBS may try to keep all of its AM, FM, and TV stations in New York in the wake of its purchase of 101.9 by arguing that the FCC's current signal-overlap rules mean that WLNY's "market" is separate from that of all of the radio stations and WCBS-TV.

See http://www.fybush.com/nerw-10152012-unpacking-the-new-wfan-fm, specifically the "Monday Morning Update".  (The entire 101.9-related section may be part of the column's free content.)

[luperm]

Very interesting wrinkle, and very creative...

[TheBigA]

As always, a great analysis by Scott Fybush.

Here's my view:

1) As he points out, the ownership caps were set in the old analog days.  There have been attempts to revisit them several times by the FCC, and each time, they've been met by opposition.  Everyone remembers the slapping that Chairman Powell received when he tried to relax them 7 years ago, and again under Chairman Martin.  The current FCC has basically ignored OTA radio, so the problem hasn't gotten better.  Something needs to be done, but it's a huge hot potato that no one wants to touch.

2) There is a limited pool of buyers for major market stations.  Setting caps isn't bringing new owners into the industry.  Even with the drop in station prices, where they're priced at roughly 15% of what had been the going rate 5 years ago, hasn't attracted new names.  One could argue Merlin, but it's still Randy Michaels.  No one with money is rushing out and spending it on OTA radio.  Part of that might be the shortage of loan money, part of that might be the economy in general, but the fact remains that when a station goes on the market, you see the same companies looking to buy.

3) The NAB has tried to get the FCC to remove AMs from the ownership caps.  There's no question that, outside of the 50K blowtorches, AM radio is on life support, and any improvement will require some FCC action.  But since the FCC has taken a hands-off approach to OTA radio, AM is left on the death bed.  If CBS was able to remove WINS from the ownership cap, it would meet the old limit. 

We need to accept the fact that regulation won't attract new "voices" to the ownership pool.  The myth of "scarcity" that drove the old ownership caps seem quaint in the context of all the platforms available to people today.  There is a need for a more realistic approach to this situation.  Until then, lawyers will try to parce out the words of the dated ownership caps, and try to squeeze in more signals under the cap.  Punishing the current owners by using dated rules won't help the industry or the public interest.

[Bob1370]

660 is the interesting property, and it makes sense to move WINS to that facility, If CBS keeps the entire portfolio then it could move the CBS Sports Network to 1010, the Fan's locally oriented programming to 101.9, and if the Yankees really want a blowtorch AM at the center of their network they can either keep them on 880 or move them to 660 and keep the Mets either on Fan 101.9 or on CBS' other AM blowtorch WCBS-AM, since we know baseball and all-news seem to co-exist relatively well.

CBS has lots of alternative ways to play the chess pieces, especially if they can convince the FCC to consider WLNY as part of a separate Long Island ADI (not a hard thing to do if they either consider primary coverage contours as they now exist, or slightly directionalize WLNY to take a little notch out of the western part of their signal pattern and remove any remaining doubt).

[RadioPro65]

Mr. Fybush's new column contains the tidbit that CBS may try to keep all of its AM, FM, and TV stations in New York in the wake of its purchase of 101.9 by arguing that the FCC's current signal-overlap rules mean that WLNY's "market" is separate from that of all of the radio stations and WCBS-TV.

See http://www.fybush.com/nerw-10152012-unpacking-the-new-wfan-fm, specifically the "Monday Morning Update".  (The entire 101.9-related section may be part of the column's free content.)

It doesn't appear likely that the FCC will relax the ownership caps anytime soon, but CBS Radio just might get out of the cap in New York City.  I just read that CBS is petitioning the FCC that the coverage of WLNY-TV does not entirely encompass New York City, while none of the CBS Radio stations in New York put a city grade signal over WLNY-TV’s Riverhead city of license.   And, based on a few similar cases elsewhere, that just might work.

If the Commission nixes the CBS contention, though, the speculation will begin anew as to which station they might divest in the Big Apple.  For sure, it won't be another FM. 

And I dare suggest that we can bet that 660 AM will remain the home of WFAN-AM (established) which will carry the 24/7 CBS Sports Radio net starting in January.  That will, I am virtually certain, hold true no matter what else happens with CBS Radio and TV in NYC.

[TheBigA]

It doesn't appear likely that the FCC will relax the ownership caps anytime soon, but CBS Radio just might get out of the cap in New York City. 

All it really takes is for the FCC to grant them a waiver.  There are lots of exceptions to the various ownership rules, and they're usually covered by waivers given on a case by case basis. That way the FCC doesn't have to go into the lengthy rule-making process, where they get comments and hold hearings.

[reelyreal]

660 is the interesting property, and it makes sense to move WINS to that facility, If CBS keeps the entire portfolio then it could move the CBS Sports Network to 1010, the Fan's locally oriented programming to 101.9, and if the Yankees really want a blowtorch AM at the center of their network they can either keep them on 880 or move them to 660 and keep the Mets either on Fan 101.9 or on CBS' other AM blowtorch WCBS-AM, since we know baseball and all-news seem to co-exist relatively well.

CBS has lots of alternative ways to play the chess pieces, especially if they can convince the FCC to consider WLNY as part of a separate Long Island ADI (not a hard thing to do if they either consider primary coverage contours as they now exist, or slightly directionalize WLNY to take a little notch out of the western part of their signal pattern and remove any remaining doubt).

That's just way too much shuffling.  If it ain't broke, don't fix it.  People know sports are on 660 and news is on 1010.

[Scott Fybush]

CBS has lots of alternative ways to play the chess pieces, especially if they can convince the FCC to consider WLNY as part of a separate Long Island ADI (not a hard thing to do if they either consider primary coverage contours as they now exist, or slightly directionalize WLNY to take a little notch out of the western part of their signal pattern and remove any remaining doubt).

Read the column, Bob... 

There's no such thing as an "ADI" anymore, and Long Island is very much part of the New York Nielsen DMA.

But what CBS is doing is using the FCC radio/TV cross-ownership rules, which have nothing at all to do with DMAs. Those rules, unlike anything else in the FCC's ownership limits, look specifically at stations' cities of license and signal contours. The "markets" that exist under those rules are determined by which signals completely cover which other stations' COLs.

So in this case, we have only two COLs to consider: CBS Radio's six existing radio stations and WCBS-TV are all licensed to New York City, of course. So is 101.9.

When considering whether 101.9 fits under the cap, the CBS argument (supported, I think by the rules) is that you must consider two "markets." One of those is defined by the New York City limits, and includes any station with a signal contour that completely covers the NYC limits. There are enough of those stations to create enough independent "voices" to allow any single owner to hold six radio and two TV stations, or seven radio stations and one TV station. What CBS is arguing is that within that "market," CBS will have only seven radio stations (six existing plus 101.9) and one TV station (WCBS-TV), and that WLNY does not count because its signal does not cover all of New York City. The sleight-of-hand here, if any, is that the rules were created by looking at analog signals, and have not been rewritten for DTV. In the absence of new DTV rules, CBS is using the "noise-limited DTV contour" to determine WLNY's reach; we'll see if the FCC buys that argument.

(The other "market" is defined by the Riverhead corporate limits, and that's far enough from NYC that none of the New York-licensed stations put an attributable signal over Riverhead; that market therefore consists only of WLNY as far as CBS is concerned.)

These weird COL-based rules have affected CBS before. When CBS bought KOVR(TV) in the Sacramento-Stockton market, it had to study both the coverage over Sacramento, where it already owned KMAX-TV, and Stockton, the COL for KOVR. It turned out that one of CBS Radio's San Francisco stations, KFRC 610, covered all of Stockton...and that was enough to put CBS over the ownership limits for the KOVR "market" unless 610 was divested, which it was.

[DavidEduardo]

CBS has lots of alternative ways to play the chess pieces, especially if they can convince the FCC to consider WLNY as part of a separate Long Island ADI (not a hard thing to do if they either consider primary coverage contours as they now exist, or slightly directionalize WLNY to take a little notch out of the western part of their signal pattern and remove any remaining doubt).

Bob, there ARE NO ADI's any more. Not for decades. The term is arcane.

And the FCC does not define markets. Nielsen defines TV DMA's and Arbitron defines radio MSAs. The FCC has ruled that Arbitron MSAs are the base for radio market caps.

The only recent exception to market caps was made by the FCC when they ruled in the acquisition of WTOC (FM) by UnoRadio Grup that the Arbitron radio MSA could be waived in this case because no station, AM, FM or TV actually covered the entire metro and, thus, the metro was created because Puerto Rico was an isolated trade zone but not really a single radio market.

CBS would have to get a waiver of the MSA definition (based on coverage of the New York City stations), not a creation of a "new" market... something the FCC does not do.

[RadioGuy2004]

There's also been rumblings about WLNY's terrestrial signal being offered up to the FCC for their TV to Wireless Bandwidth Auctions.  They get a chunk of the action from the auction, a home for WLNY on cable (and possibly on WCBS-TV DT2, which would also be an interesting must carry situation), and they retain all the big brands: WINS, WFAN, WCBS, etc. and make the necessary AM to FM maneuvers.

The REAL losers of these situations WILL be the listening and viewing public.