FCC & Radio Ownership Limits

[bobdavcav]

David,
I don't see how you're making the argument for increased ownership limits. As Texas Tom said and I've argued in this thread, it would take significant investment, which is why I don't believe it will happen, but the big companies could create national networks if they wanted to today. They don't need to have 10, 12, or more stations in Portland, Seattle, or New York. They need to focus on one or two formats and build those out nationally. Yes, there are still some gaps in K-Love's network, but this is clearly their strategy.

 

[davideduardo]

David,
I don't see how you're making the argument for increased ownership limits.

I favor increased ownerships because over the air radio competes with no ownership limits at all for streaming services.

Heck, even satellite radio offers over 100 "stations" from one source that covers every market.

As Texas Tom said and I've argued in this thread, it would take significant investment, which is why I don't believe it will happen, but the big companies could create national networks if they wanted to today.

I agree. It is too late for anyone to want to try to build a "national station" as AM is dead and FM is in a decline that makes future value doubtful.

They don't need to have 10, 12, or more stations in Portland, Seattle, or New York. They need to focus on one or two formats and build those out nationally.

I agree, but what we will end up with is a couple of companies owning all the "good" FM signals in each market. This allows for many secondary formats to prosper, as they are all under the same roof.

Yes, there are still some gaps in K-Love's network, but this is clearly their strategy.

And it works for them and their listeners.

 

[TheBigA]

This should be interesting:

Key U.S. House Committee To Review 1996 Telecom Act - Radio Ink

Thirty years ago, the radio industry's ownership scheme was completely upended, as President Clinton signed into law the Telecommunications Act of 1996. On March 26, the House Subcommittee on Communications and Technology will examine what worked, and what needs a fix.

radioink.com

Especially in the context of the Nexstar merger. The FCC views it as one company owning only 15% of all TV stations. That's still more than the combined ownership of iHeart, Audacy, and Cumulus. If that's their view about TV, it likely extends to radio.

 

[umfan]

I favor increased ownerships because over the air radio competes with no ownership limits at all for streaming services.

Heck, even satellite radio offers over 100 "stations" from one source that covers every market.

I agree. It is too late for anyone to want to try to build a "national station" as AM is dead and FM is in a decline that makes future value doubtful.

I agree, but what we will end up with is a couple of companies owning all the "good" FM signals in each market. This allows for many secondary formats to prosper, as they are all under the same roof.

And it works for them and their listeners.

Spot on. The change will not return radio to its glory days, but will likely sustain many more signals than would otherwise be the case. The same applies to broadcast TV. I'm failing to see what ownership limits accomplish any longer when most media is consumed via non-broadcast means. If adjusting the regulations keeps stations in operation, that is better than the alternative IMO.

 

[bobdavcav]

Another deal to watch is the recent acquisition by Midwest of NRGG's stations in Wasaw. That gives Midwest 10 of 29 signals in that market.

 

[TheBigA]

FCC Commissioner Olivia Trusty addressed ownership limits today at the NAB convention. She is the swing vote on the commission, and usually is very circumspect in her comments on controversial issues. The fact that she seems to be in favor of loosening limits indicates it will happen at some point:

FCC Commissioner Signals Openness To Rethinking Ownership Rules.

FCC Commissioner Olivia Trusty, speaking at the NAB Show in Las Vegas, signaled openness to revisiting ownership rules, arguing legacy limits may no longer reflect today’s crowded audio marketplace. She

www.insideradio.com

 

[Theater of My Mind]

FCC Commissioner Olivia Trusty addressed ownership limits today at the NAB convention. She is the swing vote on the commission, and usually is very circumspect in her comments on controversial issues. The fact that she seems to be in favor of loosening limits indicates it will happen at some point:

Consolidation has already destroyed broadcast and entertainment media so what difference does it make at this point?

 

[davideduardo]

Consolidation has already destroyed broadcast and entertainment media so what difference does it make at this point?

Consolidation did not destroy broadcast media. Unregulated new media did.

Starting with the unfortunate Docket 80-90 and the profusion of new FMs, power increases and market moves, a majority of stations were presented with new competition with no increase of revenue. Then we got streaming, and then devices like the iPhone that provided consumers with hundreds if not thousands of options. And much of the revenue for the new media services has come from traditional over the air media.

Today's inflation adjusted radio revenue is about two-thirds less than it was in 2000. That is the definition of "destroyed".

 

[TheBigA]

Consolidation has already destroyed broadcast and entertainment media so what difference does it make at this point?

For those who don't like consolidated media, there is public radio.

 

[Kent]

Consolidation has already destroyed broadcast and entertainment media so what difference does it make at this point?

Consolidation was a symptom, not the cause.

If you look at where listeners are going, it's to more consolidated and, as David mentions, less regulated media.

I don't like the idea of removing all caps from broadcast ownership either, but some cap relief is probably necessary, at least in smaller markets, for OTA radio to be sustainable long-term. Otherwise, we'll likely see more K-Loves and religious operators emerge as the only buyers of commercial stations.

 

[radiofan2023]

For those who don't like consolidated media, there is public radio.

Public radio has also consolidated in some cases (see Iowa Public Radio and other statewide public radio networks).

 

[TheBigA]

Public radio has also consolidated in some cases (see Iowa Public Radio and other statewide public radio networks).

But not to the degree of iHeart or Audacy. And even in the case of those state networks, they often have independent non-com competitors.

My point is if you still want local ownership, local staffing, and local programming (with lots of fringe music), your best option is some form of NCE station.

 

[ted chittenden]

Consolidation did not destroy broadcast media. Unregulated new media did.

Starting with the unfortunate Docket 80-90 and the profusion of new FMs, power increases and market moves, a majority of stations were presented with new competition with no increase of revenue. Then we got streaming, and then devices like the iPhone that provided consumers with hundreds if not thousands of options. And much of the revenue for the new media services has come from traditional over the air media.

Today's inflation adjusted radio revenue is about two-thirds less than it was in 2000. That is the definition of "destroyed".

Allowing broadcaster monopolies is not going to save over-the-air radio from the problems created by the Internet. What it will do (and already has done) is create fewer choices for OTA listeners, especially when it comes to news and information. And while I think that @Kent may be right in terms of precision allowances for some small town outfits, I think that the FCC is moving in a much broader direction--a direction that is supported by big broadcasters of all stripes who, despite all of the radio and TV stations they own, are still losing money in a big way.

 

[TheBigA]

What it will do (and already has done) is create fewer choices for OTA listeners, especially when it comes to news and information.

More owners doesn't create more choices. It creates more stations doing the same thing. It's called competition. In NYC there are two news talk stations, one owned by iHeart and the other owned by John Catsimatidis. They are both conservative talk stations, both talking about the same issues in the same way. The issue of format choice has nothing to do with ownership. It has to do with money. The way to get more choice is to find alternative ways to fund radio, so the money comes from different places. That usually means having the listeners pay for radio. There are no shortage of choices at Sirius.

The bigger problem in terms of ownership is that there are very few people who want to buy and own traditional broadcasting. It's a much more expensive way to do radio. It's much cheaper on the internet. It's why so many colleges are either selling or shutting down their FM stations and opting for internet delivered radio. The current system that imposes ownership limits has led to the proliferation of heritage commercial stations being sold to religious broadcasters. Why? Because there were no other buyers.

 

[ted chittenden]

More owners doesn't create more choices. It creates more stations doing the same thing. It's called competition. In NYC there are two news talk stations, one owned by iHeart and the other owned by John Catsimatidis. They are both conservative talk stations, both talking about the same issues in the same way. The issue of format choice has nothing to do with ownership. It has to do with money. The way to get more choice is to find alternative ways to fund radio, so the money comes from different places. That usually means having the listeners pay for radio. There are no shortage of choices at Sirius.

You have a much better chance of information competition if you have multiple ownerships than if you have a single ownership.

The bigger problem in terms of ownership is that there are very few people who want to buy and own traditional broadcasting. It's a much more expensive way to do radio. It's much cheaper on the internet. It's why so many colleges are either selling or shutting down their FM stations and opting for internet delivered radio. The current system that imposes ownership limits has led to the proliferation of heritage commercial stations being sold to religious broadcasters. Why? Because there were no other buyers.

While webcasters don't have to pay for transmitter purchases and repairs and FCC license fees, they *do* have to pay music licensing fees to the recording industry, fees that don't apply to OTA-only radio. While in the short term it may seem cheaper to operate an Internet-only radio station, those music-licensing fees add up in a much bigger way over the long term than most proponents of the medium realize.

With regard to college radio, while I have noted a few instances of college radio stations selling out or turning in their licenses (the Cleveland situation immediately comes to mind), there is not the mass exodus from college radio that you argue is currently happening.

 

[Kent]

Allowing broadcaster monopolies is not going to save over-the-air radio from the problems created by the Internet. What it will do (and already has done) is create fewer choices for OTA listeners, especially when it comes to news and information.

The trend toward fewer choices for news and information started long before consolidation. That was usually one of the first departments to go after the FCC eliminated its requirement. It was expensive and generally didn't pay off as an investment for radio.

I'm a lot more worried about consolidation affecting news in the TV industry. Should the Nexstar/TEGNA merger get over the finish line with no additional divestitures than what were already promised, St. Louis will be at two independent newsrooms when it had four twenty years ago. It was arguably undernewsed then, too, as ABC affiliate KDNL stopped carrying local news around 2002. A little over three hours to the west on I-44, Springfield, which is a Top-100 TV market, is already at two independent news sources. As TV consolidates, we're not going to see more news sources.

I suppose one could argue that, in this day and age, independent news sources are more than ever before with the internet, cable, and social media, but fake and hyper-partisan news are big problems there, and, as AI proliferates, I tend to think it's going to get worse before it gets better. With broadcast news, seasoned professionals are still gathering and presenting the news, and they still value their integrity. TV also still has a standard of excellence that just doesn't exist on the World Wide Web. Having an FCC license also demands (or at least used to demand) a certain level of veracity and accountability. Maybe it's wishful or hopelessly romantic thinking in the current day and age and with the current FCC, but broadcasters who knowingly broadcast false information used to be held accountable for doing so. Licensees used to get fined for going too far with fake news stories, and some even got designated for hearing. RKO had a lot of problems and many potential violations, but being reckless with the line between entertainment and news was one of the factors that ultimately forced it out of business.

 

[TheBigA]

You have a much better chance of information competition if you have multiple ownerships than if you have a single ownership.

There is no "single ownership" in radio. Even if ownership limits are eliminated, there will be lots of options. That's not the problem.

The problem is the lack of buyers. The forced ownership limits have led to quality FM stations being bought by religious broadcasters because they are the only willing buyers.

 

[TheBigA]

I suppose one could argue that, in this day and age, independent news sources are more than ever before with the internet, cable, and social media, but fake and hyper-partisan news are big problems there, and, as AI proliferates, I tend to think it's going to get worse before it gets better.

The problem there is how to control "fake & hyper-partisan news" without getting into first amendment issues. When the government gets involved, you end up with someone like Carr deciding what is in the public interest.

My view is the public can see what's going on, and it's why they're leaving broadcast TV for streaming and other media.

 

[bobdavcav]

But not to the degree of iHeart or Audacy. And even in the case of those state networks, they often have independent non-com competitors.

My point is if you still want local ownership, local staffing, and local programming (with lots of fringe music), your best option is some form of NCE station.

I care less about who is delivering my content than I do about the content itself. I don't want the fringe stuff I'm going to get on public radio. At the same time, it feels like the big companies are becoming more and more centralized in their programming and pushing corporate initiatives rather than actually delivering compelling programming. There are still some bright spots in smaller companies, but even then it can be hit or miss. My favorite station right now is a good example of this. It's a relatively forward-thinking Classic Hits in a smaller market. Even though I like what they're doing in general, they only have two dayparts that are staffed, morning and afternoon drive. I haven't heard the morning show as they're an hour ahead of me and I'm not a morning person anyway, but when the afternoon jock does speak, she sometimes feels local and sometimes feels like she's simply doing a bit that could be dropped in on any station anywhere in the country. If I had to explain my programming wants in general terms, they would be something like this:
1. Give me a format that's compelling. That doesn't have to be fringe, it's more likely a well done mainstream format.
2. If you claim to be the go to source for information in bad weather, give me that same sense of place on a random Thursday, or better yet on weekends. I'm getting really tired of station after station having one or two quality dayparts, but then being tracked with little relevant content the rest of the day. I'll turn you on the rest of the day because that's where my radio is set, but honestly, there's not much there to keep me connected. Oh and side rant, what's the deal with news stations these days? My local news station claims to be your go to source for news and information, yet outside of drivetime, they're a right wing talk station. During the day, they at least try to do some local news at the top of the hour and traffic reports a few times an hour, but there's none of that on nights and weekends.
3. This one is less common with bigger companies, but it's still worth mentioning. If you are a jock on a local station, I shouldn't forget you're there. I've heard a lot of stations that are mostly imaging and music, then the jock pops in just long enough to remind you they're still there. What's the point of even having jocks if you won't let them talk?
4. Almost the opposite of #3, don't overwhelm me with corporate crap. Even 10 years ago, this was getting annoying. Why is Z100's countdown no longer known as simply the Interactive 9 at 9? It now has to be the iHeart Radio Interactive 9 at 9. If I turn on any iHeart station, I'm probably going to get a promo for whatever initiative they're pushing this week, followed a few minutes later by a podcast on the iHeart app, followed by a promo to listen on the app coming back into music, followed by a legal now saying guaranteed human but lacking any creativity, followed by, at least right now, a national text to win contest. Meanwhile, the voice tracker is trying to sound local but seems like they're reading copy promoting an event rather than actually engaging.

 

[TheBigA]

it feels like the big companies are becoming more and more centralized in their programming and pushing corporate initiatives rather than actually delivering compelling programming.

You think radio companies are corporate? Try calling Apple, Amazon, or Spotify with a programming issue. They are way bigger and more corporate than what's left of iHeart or Audacy. Try explaining what you want in curated programming to any one of the streaming companies. Tell me what they tell you.

People want broadcast radio to be like it used to be. That's not going to happen. They think that ownership laws will force companies to go back to the way things were. That's not going to happen. You can't force companies to lose money. They'll just quit and shut down.