Calls For FCC Ownership Changes

[TheBigA]

There are a couple articles in today's Radio Ink demanding action from the FCC on the ownership rules.

NAB: FCC Wasting Time - Radio Ink

The NAB has filed comments with the FCC regarding the Commission's Public Notice triggering the 2022 quadrennial review of broadcast media ownership rules. The NAB calls the latest effort a waste of time.

radioink.com

It's Time To Lift Ownership Caps - Radio Ink

That's the conclusion of 8 radio companies who have filed comments with The FCC, including Townsquare, Connoisseur, MidWest Communications, Mid-West Family, Forever Media, Frandsen Family Stations, Neuhoff Communications and Eagle Communications.

radioink.com

The second article lists a bunch of smaller owners that want the rules liberalized, citing difficulties in competing with the larger groups. We saw that problem with Cumulus in NYC, and it's likely they're not the only one.

The reality is that with the FCC split 50-50, there can really be no action. Traditionally the dems oppose any liberalization to ownership rules, and the repubs want to deregulate. The NAB points out that the commission hasn't even moved on the rules that were revised in 2018. So things have ground to a halt.

 

[TheBigA]

The NAB filed suit against the FCC in May to complete its mandatory 2018 review of ownership rules. The Appeals court ruled in favor of the NAB, requiring the FCC to report by August 7th.

Court Puts Pressure On FCC In 2018 Media Ownership Proceeding.

A three-judge panel in federal appeals court in Washington has cleared the way for a media ownership action brought by the National Association of Broadcasters to move forward. The NAB

www.insideradio.com

The 2018 ownership review has been held up by various legal issues. In the meantime, the FCC is also required to do a similar review in 2022. Neither have been completed. Meanwhile, radio companies are forced to operate basically under the same rules that existed in 1997. A lot has changed in that time.

 

[Kelly A]

Not surprising that the government is behind a few years in having further ownership cap debates. Other than EMF, I can't think of another group who has the cash reserves or financing that they would want to pick up additional stations. For as painful for the industry as it's been since 2008, the effort is just trying to keep the ad-supported industry relevant. Growth is off the table.

 

[Rusty Muck]

The irony is that the TV ownership limits—especially the “39%” nationwide cap—have been loopholed into irrelevance through sidecar operations (Mission, Cunningham, American Spirit, Inyo) and the “UHF Discount” to the point they should be repealed. But they won’t and likely never will unless the ownership groups all claim economic hardship, which is a near improbability because local political ad dollars.

One could argue this fate was sealed after Sinclair’s attempted merger with Tribune imploded disastrously. Then-commissioner Ajit Pai’s expressed wishes to completely deregulate pretty much died on the vine when that happened. Thus the only major buyers or attempted buyers in M&As are now limited to private equity firms or the likes of INSP.

 

[TheBigA]

A federal court has ordered the FCC to complete its mandated review of ownership rules.

Court Orders FCC To Act On Media Ownership.

A federal appeals court in Washington is giving the Federal Communications Commission 90 days to complete the 2018 quadrennial review of its broadcast ownership rules or show cause for why

www.insideradio.com

 

[Rusty Muck]

A federal court has ordered the FCC to complete its mandated review of ownership rules.

Court Orders FCC To Act On Media Ownership.

A federal appeals court in Washington is giving the Federal Communications Commission 90 days to complete the 2018 quadrennial review of its broadcast ownership rules or show cause for why

www.insideradio.com

That might be a tough task if the pending government shutdown basically mothballs the agency for an extended period.

I have no idea why the NAB even bothered. At best, the FCC will just put up whatever the Ajit Pai-led commission drafted and gave up on. At worst, they'll totally erase anything Pai was trying to champion dereg-wise. But needless to say, the NAB's hopes of further deregulation in anything are a total pipedream... at least until 2025 or 2029.

 

[TheBigA]

At best, the FCC will just put up whatever the Ajit Pai-led commission drafted and gave up on.

Ajit Pai didn't "give up on" anything. He was sued, and it went to the courts, and the courts approved their new rules, but then the time ran out, and now the dems are in charge. These changes were already approved in 2018.

 

[Rusty Muck]

Ajit Pai didn't "give up on" anything. He was sued, and it went to the courts, and the courts approved their new rules, but then the time ran out, and now the dems are in charge. These changes were already approved in 2018.

So what did the NAB sue for? They aren't going to get anything else and certainly won't get the further dereg they do desire.

 

[TheBigA]

So what did the NAB sue for?

To finish the 2018 review.

 

[TexasTom]

There are a couple articles in today's Radio Ink demanding action from the FCC on the ownership rules.

NAB: FCC Wasting Time - Radio Ink

The NAB has filed comments with the FCC regarding the Commission's Public Notice triggering the 2022 quadrennial review of broadcast media ownership rules. The NAB calls the latest effort a waste of time.

radioink.com

It's Time To Lift Ownership Caps - Radio Ink

That's the conclusion of 8 radio companies who have filed comments with The FCC, including Townsquare, Connoisseur, MidWest Communications, Mid-West Family, Forever Media, Frandsen Family Stations, Neuhoff Communications and Eagle Communications.

radioink.com

The second article lists a bunch of smaller owners that want the rules liberalized, citing difficulties in competing with the larger groups. We saw that problem with Cumulus in NYC, and it's likely they're not the only one.

The reality is that with the FCC split 50-50, there can really be no action. Traditionally the dems oppose any liberalization to ownership rules, and the repubs want to deregulate. The NAB points out that the commission hasn't even moved on the rules that were revised in 2018. So things have ground to a halt.

I suspect that the best argument for liberalizing the ownership rules is that radio can't get much more irrelevant than it already is. I have to note that one of the primary outcomes of the last round of consolidation when ownership limits were raised in the late 90s is that promotional budgets were cut, advertising loads were increased, and programming staff were forced to divide their attention between more stations.

25 years later, listener engagement and time spent listening are way down from what they once were. Of course the industry blames streaming services for that decline, and perhaps that truly is the primary cause. But I can't help but wonder how much better radio might have been able to compete against those streaming services if the big companies hadn't already sucked so much of the juice out of the stations.

 

[TheBigA]

Of course the industry blames streaming services for that decline, and perhaps that truly is the primary cause. But I can't help but wonder how much better radio might have been able to compete against those streaming services if the big companies hadn't already sucked so much of the juice out of the stations.

Streaming services are unregulated music delivery services. They have no promotional budget, no real DJs or programming staff, and no ownership limits. People just want music, they want to make the playlists, and they want it with no commercials. They aren't going to get that from radio regardless of how many stations companies can own. The fact is that the ownership changes came about at the exact same time as the personal computer boom. To say the internet hasn't hurt radio is really head in the sand thinking.

The truth is that the "big companies" left radio in the 80s. That's when the big insurance and electronics companies started getting out of radio. It was caused by over-licensing of the spectrum by the FCC, which drove down shares and revenues. The exodus was complete in 2016 when CBS got out. What's left are all a bunch of companies built on one revenue stream. That is death no matter what business you're in.

 

[davideduardo]

25 years later, listener engagement and time spent listening are way down from what they once were. Of course the industry blames streaming services for that decline, and perhaps that truly is the primary cause. But I can't help but wonder how much better radio might have been able to compete against those streaming services if the big companies hadn't already sucked so much of the juice out of the stations.

It's mostly about two things: ads or no ads and only songs I want vs. some songs I don't like.

And, as people could find their friends, news, weather and traffic on the web, they did not want DJs talking to them.

 

[TexasTom]

Streaming services are unregulated music delivery services. They have no promotional budget, no real DJs or programming staff, and no ownership limits. People just want music, they want to make the playlists, and they want it with no commercials. They aren't going to get that from radio regardless of how many stations companies can own. The fact is that the ownership changes came about at the exact same time as the personal computer boom. To say the internet hasn't hurt radio is really head in the sand thinking.

The truth is that the "big companies" left radio in the 80s. That's when the big insurance and electronics companies started getting out of radio. It was caused by over-licensing of the spectrum by the FCC, which drove down shares and revenues. The exodus was complete in 2016 when CBS got out. What's left are all a bunch of companies built on one revenue stream. That is death no matter what business you're in.

It's not as if radio stations give listeners any reason to prefer anything else. I'm reminded of back when AM top 40 stations were live and local, and the FM stations were largely FM jukeboxes with limited commercial loads. In that environment, most of the listeners did stick with the AM stations even though they could get a lot more music and half as many commercials on FM. FM became competitive when they started having the DJs, contests, and promotions that engaged listeners. Listeners who were engaged to the point that they would actually put advertisements for their favorite stations on the backs of their vehicles (they were called "bumper stickers" and were quite common until the late nineties).

The bottom line is that you're right that radio can't give people custom playlists with no commercials. But the thing that radio could give listeners (and used to give listeners) was the entertainment factor that came with the listener engagement of radio prior to the nineties. Would that have been sufficient to hold a large portion of the audience against streaming? We'll never know, since those things were gone from radio before streaming was a significant factor in the market. But I can't help but suspect that a listener who was loyal enough to a station to stick a bumper sticker onto their car was also likely to be a listener who wouldn't have defected to a streaming service that made the automated stations of the late seventies sound lively by comparison.

 

[TheBigA]

Listeners who were engaged to the point that they would actually put advertisements for their favorite stations on the backs of their vehicles (they were called "bumper stickers" and were quite common until the late nineties).

Because they had no other choice. Once they had a choice of personal cassette tapes or home-made CDs, radio TSL went down. Video games also stole listeners once they incorporated music into their presentations.

It's hard to base a business around music when the music is no longer aiming for mass audiences. At one time, the music industry sought to sign small rosters of artists who could each sell millions of records. Radio was a willing partner. Now the music industry rosters are unlimited, because they're competing with artists who release their own music. Every music conference I go to encourages artists to aim at narrow audiences, super-serving them with music and concerts. Radio can't really be part of that business, because they need consensus hits that attract mass audiences. They can't play all the new music being released fast enough. So radio stations are really only useful for formats that do that, which are country, urban, and the classic genres. You're focusing only on how radio has changed, but the truth is the entire environment has changed. You can't put the toothpaste back in the tube.

In addition, the next major piece of legislation that came after the TCA of 96 was the Digital Millennium Copyright Act, that gave artists and record labels performance royalties when their music was played on digital services. So now artists and labels have a new revenue stream, and they have a new financial incentive to ignore broadcast radio, and instead cater to digital services. Couple that with the decision by electronics manufacturers to focus on phones and HDTVs, and people have a hard time finding devices that carry radio stations. All of this make the ownership rules of the 90s obsolete.

 

[TheBigA]

The long overdue and mandated FCC review of ownership rules has concluded with no changes for radio:

FCC Mostly Keeps Status Quo For Radio As It Wraps 2018 Quadrennial Review.

By a 3-2 party line vote, the FCC has concluded that the local radio ownership limits remain necessary in order to promote the public interest goals of competition, localism, and

www.insideradio.com

They obviously feel the status quo is good. By status quo, we mean the rules that have been in place for over 25 years.

More quotes in this story:

FCC Upholds Remaining TV-Station Ownership Limits

Says streaming and other video competition still does not trump unique public-interest mandate

www.nexttv.com

Link to the official report & order:

FCC Adopts 2018 Quadrennial Review of Broadcast Ownership Rules

Commission adopts Report and Order completing the 2018 quadrennial review of the Commission's broadcast ownership rules.

www.fcc.gov

 

[exdjted]

The long overdue and mandated FCC review of ownership rules has concluded with no changes for radio:

FCC Mostly Keeps Status Quo For Radio As It Wraps 2018 Quadrennial Review.

By a 3-2 party line vote, the FCC has concluded that the local radio ownership limits remain necessary in order to promote the public interest goals of competition, localism, and

www.insideradio.com

They obviously feel the status quo is good. By status quo, we mean the rules that have been in place for over 25 years.

It's this sort of ass-backward BS that has me questioning even having anything to do with this business anymore. I have wasted more time in the last 2 years lobbying congresspeople and FCC commissioners about these antiquated rules, and this is exactly what I expected. Nothing. The FCC has outlived its usefulness as far as I'm concerned. They aren't interested in the financial health of this business or its future. All they care about is auctioning off spectrum and making a show out of saving an antiquated service because it plays well on the 6 o'clock news.

To paraphrase Captain E.J. Smith when the Titanic went down, "Well, boys, do your best for FM and TV, screw AM, start a podcast and stream, and look out for yourselves."

 

[TheBigA]

They aren't interested in the financial health of this business or its future. All they care about is auctioning off spectrum and making a show out of saving an antiquated service because it plays well on the 6 o'clock news.

That's been true since radio left the oversight of the commerce department and became its own agency.

 

[Kelly A]

I remember having dinner with an acting FCC Commissioner back in the early 2000's who was convinced that traditional radio and TV's days were numbered. His take was everything media would be moving online, and it was their job to create avenues for the future. Can't say he was wrong.

 

[radiorobert]

I'm sure the consensus on here varies but....where there many who were hoping to see the ownership limits relaxed -or- tightened?

 

[TheBigA]

I'm sure the consensus on here varies but....where there many who were hoping to see the ownership limits relaxed -or- tightened?

It would be hard to justify tightening them after 25 years. The one thing some owners had hoped for was removing AM stations from the cap, allowing companies to but more FMs. If that would have happened, we'd see fewer commercial FMs going to non-com religious owners. In addition companies like iHeart would be more likely to buy more AMs for its BIN network.