Sorry, had Capricon on my mind to such an extent I was streaming Allman Brothers cuts a moment later.
Yes, it was Sun. I corrected it.
But there were plenty of independent distributors and promoters, too.
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FCC & Radio Ownership Limits
- Thread starter TheBigA
- Start date
Sorry, had Capricon on my mind to such an extent I was streaming Allman Brothers cuts a moment later.
Yes, it was Sun. I corrected it.
According to a story on CFZM's rock history show heard on Saturdays (and which I haven't yet confirmed otherwise), one of the biggest reasons that Sam Phillips was forced to sell Elvis' contract to RCA Records had to do with its first single release, Rufus Thomas' "Bear Cat." "Bear Cat," was both an answer to, and a spoof of, the song, "Hound Dog," recorded by Big Mama Thornton back in 1951. The song's two writers (whose names I can't remember now but who wrote nearly all of the Coasters' hits of the late 1950s) and her record label promptly sued Sun (remember that the U.S. Supreme Court did not allow artists to spoof other other artists' material until the early 2000s). Sun's legal bills were mounting and, although Sam Phillips' best-selling artist was Elvis Presley, he had to sell Elvis' contract to help pay the legal bills for "Bear Cat."
Those types of recording arrangements were quite common 50-70 years ago. Tended to use cheap vinyl or even a flexi-disk format. If you dig through the selection at some of the bigger used record stores you will likely come across these, which people off-loaded along with the usual commercial disks. Why anyone would buy those personal items is anyone’s guess, but I suppose there is a mystery element of surprise involved.
There were many companies that would do limited runs of vinyl records for schools and churches that wanted to preserve and distribute the performances of their bands, orchestras and choirs.
I was in the band from 6th grade through college (60s-70s) and we made a number of such records. Live performances were recorded on tape and then edited together into a master reel. The selections were separated by leader tape so there was no confusion as to what was what, plus following time constraints. A list of titles was drawn up, and both were handed to the record production company. A few weeks later your run of whatever number of pressings was in your hands.
In junior high and high school our bands made some recordings that were pressed by “Director Records” which was a custom division of RCA. Looking at the albums many years later I noticed the physical characteristics of the vinyl and labels were pretty much the same as the “RCA Victrola” and “RCA Camden” budget lines. Most likely pressed in the same plants.
About 30 years ago between my junior and senior years of college, I worked for GE Card Services near Park Row and Bowen in Arlington. The hours were absolutely brutal, but the job wasn't terrible for a summer job in college. One of the big perks of it was, so long as I kept my rate up, I could wear a headset. I always felt like I was paid to listen to DFW radio. We worked a rotating shift two months at a time, first 6:30 AM to 3:00 PM and next 10:00 PM to 6:30 AM. Besides the having to get up early and having to get used to third shift when it was your turn, the worst part of the job was Sunday mornings. When my alarm went off a little after 5:00, most stations were in public affairs programming. Pretty much everyone was done by 7:00, but most of the rest of Sunday mornings was syndicated programming. The first half of Sunday mornings on first shift was awful, and, on third shift, having nothing to listen to the last hour and a half and on the way back home made staying awake a herculean effort. We were allowed to have tapes and CD's in our lockers, but we could only bring one to our workstation at a time because they didn't want changing tapes or CD's to hamper our processing speeds, and my car didn't have a player for either.
When I was working in radio five years later, public affairs was a 90 second to two minute blurb about a couple of important community issues of the time.
FCC's Brendan Carr says the FCC doesn't need congress to update ownership limits:
www.insideradio.com
He's right about that. Congress wrote the 96 Telecom Act with language requiring the FCC to regularly review ownership limits, and take whatever action it sees fit.
However, the FCC reports to congress, and if congress disagrees with what it does, they can reverse an FCC decision. This happened the one time the FCC increased ownership limits. At the time, the FCC was chaired by Republican Kevin Martin:
nacla.org
www.wthr.com
My sense is that this current congress wouldn't object to anything the administration wants to do.
Carr Says FCC Doesn’t Need Congress To Update Radio Ownership Caps.
FCC Chair Brendan Carr says the agency could raise local radio and TV ownership caps on its own, arguing the limits are “rule-based, not statutory.” Democrat Anna Gomez disagrees, saying
He's right about that. Congress wrote the 96 Telecom Act with language requiring the FCC to regularly review ownership limits, and take whatever action it sees fit.
However, the FCC reports to congress, and if congress disagrees with what it does, they can reverse an FCC decision. This happened the one time the FCC increased ownership limits. At the time, the FCC was chaired by Republican Kevin Martin:
Historic Senate Vote Rejects FCC's Rules
In a near-unanimous voice vote tonight, the Senate passed a "resolution of disapproval" that would nullify the Federal Communications Commission's latest attempt to dismantle longstanding media ownership limits.
nacla.org
Senate votes to roll back media ownership rule
WTHR.com is the news leader for Indianapolis and Central Indiana. Get the best news, weather, sports and traffic information from Channel 13.
www.wthr.com
My sense is that this current congress wouldn't object to anything the administration wants to do.
A senator is calling for FCC "transparency" with regards to upcoming changes in ownership rules.
radioink.com
Cantwell Calls for FCC Transparency as Dereg Debate Intensifies - Radio Ink
At a hearing on media freedom, Sen. Maria Cantwell challenged the FCC’s deregulatory stance and called on Chair Brendan Carr to answer.
radioink.com
I really don't understand the argument for more consolidation, especially from Beasley's perspective. I will preface what I'm about to say with the statement that I have no idea what the finances of any of the below companies look like, but what I lay out below could easily be done under the current rules, with the few exceptions that I will also address.
One company that seems to not be done growing yet is Connoisseur. They could swallow Beasley whole under the current rules, that solves that company's issues.
Then there's the rumored Audacy-Cumulus combination. I'm not buying that that one is going to happen, but as Lance pointed out when those rumors got going, there are only a few markets where spinoffs would be required. Of those, Connoisseur could easily swoop into most of those. The only issue under the current rules would be in Chicago and SF. I don't think things will play out that way, but if everything laid out above actually did come to pass, it would be completely legal under current rules.
I think the Fort Meyers/Sun combo in Fort Meyers should be an interesting situation to watch, as that's the most similar thing to anything we're going to see if ownership limits are in fact relaxed.
One company that seems to not be done growing yet is Connoisseur. They could swallow Beasley whole under the current rules, that solves that company's issues.
Then there's the rumored Audacy-Cumulus combination. I'm not buying that that one is going to happen, but as Lance pointed out when those rumors got going, there are only a few markets where spinoffs would be required. Of those, Connoisseur could easily swoop into most of those. The only issue under the current rules would be in Chicago and SF. I don't think things will play out that way, but if everything laid out above actually did come to pass, it would be completely legal under current rules.
I think the Fort Meyers/Sun combo in Fort Meyers should be an interesting situation to watch, as that's the most similar thing to anything we're going to see if ownership limits are in fact relaxed.
It's simple: There are very few formats that attract mass audiences anymore. So even if you own four stations in a market, those four stations don't reach the kind of mass audience that Sirius or any other digital outlet can.
At one time, a station could get a 20 share with one station. Today, they're lucky to get a quarter of that. So they need more stations in order to get the same size audience they once got with one. I don't think the FCC will ever remove all ownership rules. But I think they might allow companies to buy one or two more in the Top 25 markets.
Also, if you're interested in selling, your properties are worth more if you can sell to people already in the market. More potential buyers typically equal higher prices.
I know two clusters in the same small market that are for sale after turning away prospective buyers for decades. The owners are getting up in years, and their kids aren't interested in continuing the businesses. It's a tough place to make money, and two new operators are unlikely to come in and buy each of them. Makes more sense for someone already in the market to buy them or for an operator like Connoisseur to come in and buy both of them.
In this small market you're talking about, are both clusters at the market cap? If not, I don't see what the big deal is. Depending on how many stations are involved, I could see someone coming in and buying, then spinning some off if needed, whether that be a large company or a smaller regional player.
There's a market a few hours away from me with three clusters, all at or near the market cap, and all locally owned. Would it be better for this market to have one large, locally owned cluster or three clusters of the same size each owned by one of the big players? Personally, I'd like to see the former, but if that were to be allowed, I'd also like to see a total cap on the number of stations one company can own. If the latter, there's nothing in the current regulatory environment that would keep any of the big players out.
My concern continues to be the large number of job cuts at the big companies. If iHeart got one of these clusters, I'd be willing to put money on every local host at said cluster being out within a year. The other companies are quite a bit harder to tell what they would do, but there's certainly going to be more national programming involved.
There's a market a few hours away from me with three clusters, all at or near the market cap, and all locally owned. Would it be better for this market to have one large, locally owned cluster or three clusters of the same size each owned by one of the big players? Personally, I'd like to see the former, but if that were to be allowed, I'd also like to see a total cap on the number of stations one company can own. If the latter, there's nothing in the current regulatory environment that would keep any of the big players out.
My concern continues to be the large number of job cuts at the big companies. If iHeart got one of these clusters, I'd be willing to put money on every local host at said cluster being out within a year. The other companies are quite a bit harder to tell what they would do, but there's certainly going to be more national programming involved.
Remember, the real competition for "radio" is streaming. There are no "stream caps" and the argument of broadcasters is that the only chance "radio" has is to totally consolidate to compete with stream operators.
It's going on now, with traffic and music scheduling being done on the cloud and dropped to each station in many companies and cases. With expanded ownership, we can finally have "national stations" like we have on the web and like most of the rest of the free world has.
And in the "rest of the world" national radio gets a higher share of ad revenue than the fragmented sort we have in the U.S.
One is, and the other is not. The big deal is that there has to be a willing buyer. The market also has a single AM and FM cluster that's locally owned and could add the smaller cluster, but it has, at least so far, made clear it's not interested in expanding.
I don't think any of us like the job losses we see in the industry. In the market I'm talking about, iHeart and Cumulus already operate there. iHeart's stations are servers at the transmitter sites and a local sales office, and the Cumulus cluster is programmed out of the slightly larger market 45 minutes north with a local sales staff that works remotely. I'm not sure either would expand in this particular market if caps were lifted altogether, but the alternative is that the operators of the other clusters die, their kids who don't want the businesses take over, and the stations get sold at a fire sale price. Do you really think the kids are going to employ people out of a sense of duty? What about a fire sale operator? Even with the owner of the smaller cluster once employing as much local talent as he could, the stations aren't live 24/7 anymore. Regardless of what happens in this market and elsewhere, the job situation isn't likely to get better.
David,
Using your argument about national buys being easier, look at the scenario I laid out yesterday, and add another market. I'll come out and say it, the market I was thinking of in my last post is Bend, OR.
So, the scenario is Connoisseur swallows Beasley, Audacy and Cumulus combine, and the spinoffs go to Connoisseur. Add the combined Audacy/Cumulus, Connoisseur, and Townsquare entering Bend, and you have a significantly more consolidated industry already. There's absolutely nothing in the current rules preventing that from happening outside of a couple of markets.
Another point, a large part of Townsquare's portfolio comes from stations they got from... iHeart. So, Townsquare and iHeart could combine, with a handful of markets needing to be spun off. In those markets, who is available to buy? Connoisseur. If national revenue is such an important part of radio revenue these days, why did iHeart pull out of those markets 20 years ago?
My point is that everything I've laid out in this post can be done under current rules. If the argument is that radio's competition now comes from streaming, why not consolidate all you can under the current rules before lobbying for even more relaxed ownership limits?
Using your argument about national buys being easier, look at the scenario I laid out yesterday, and add another market. I'll come out and say it, the market I was thinking of in my last post is Bend, OR.
So, the scenario is Connoisseur swallows Beasley, Audacy and Cumulus combine, and the spinoffs go to Connoisseur. Add the combined Audacy/Cumulus, Connoisseur, and Townsquare entering Bend, and you have a significantly more consolidated industry already. There's absolutely nothing in the current rules preventing that from happening outside of a couple of markets.
Another point, a large part of Townsquare's portfolio comes from stations they got from... iHeart. So, Townsquare and iHeart could combine, with a handful of markets needing to be spun off. In those markets, who is available to buy? Connoisseur. If national revenue is such an important part of radio revenue these days, why did iHeart pull out of those markets 20 years ago?
My point is that everything I've laid out in this post can be done under current rules. If the argument is that radio's competition now comes from streaming, why not consolidate all you can under the current rules before lobbying for even more relaxed ownership limits?
This is one area where I agree with you. If the competition is streaming and is eating your lunch, you go into streaming. Nothing is stopping anyone from competing with Spotify and Apple Music in the streaming arena (and, by all accounts, iHeart does a pretty good job of that, even if it doesn't have near the subscriber count).
Okay, but you didn't mention any of the other big companies, and even you aren't sure iHeart and Cumulus would be willing to expand. Even in my most consolidated scenario above, Connoisseur is still an option under the current rules for one of these clusters. The other could be a problem, but depending on what market we're talking about, could still find a potential buyer in a regional operator such as My Town Media or Zimmer if it's in an area they already have clusters.
I think your uncertainty about whether each cluster would expand is also telling of where the industry is at. If iHeart or Cumulus don't end up expanding in your market despite caps being lifted, then you really aren't any better off anyway. My point is that it's about being willing to grow as much as it is what the rules are, and there are companies that could enter your market under the current rules if the owners were willing to sell to those companies, and those companies were willing to buy.
The difference is that streamers like iHeart can "consolidate" all they want but that won't block competitors and indie streamers from putting their content online via other providers since there's always room for more on the internet. When they consolidate by snapping up all the available FM frequencies, it shuts out competitors and limits diversity on the broadcast band which has a very limited amount of spectrum space for radio stations in each market.
When I was a college junior at Loyola Marymount University between 1983 and 1984, I took a business marketing class with Dr. Jim Bowie (he's now deceased) as professor. One of the things that Dr. Bowie told me and the entire class was that if you want to have free markets, then you must allow businesses to fail. And sometimes that includes whole industries!
I say all of that because what I'm about to say is done with a heavy heart. If the U.S. radio industry is dying, then we must let it die. No amount of propping up the industry (as @davideduardo suggests) will allow the industry to ultimately survive and thrive, not even allowing stations to create national networks. The only thing I see national networks doing is possibly prolonging the inevitable.
I am very much in agreement with @Theater of My Mind and the point he/she makes about why broadcast ownership rules shouldn't be loosened. There are only so many over-the-air frequencies available and, even if you narrowed the kHz frequencies to 9kHz apart (as is done outside of the Americas) and allowed broadcasters to broadcast on even numbered frequencies in the mHz band (such as 94.2), you *still* wouldn't have the current number of available places to listen as are on the Internet.
We humans tend to be a selfish and greedy lot, especially when it comes to business. We want it all. In another field and a few decades back, the Hunt brothers tried to "corner the market" on silver. Literally, these people (and they were actually brothers) tried to make it so that the only place both nationally and worldwide where people could purchase silver was through them. Fortunately, our government through legal enforcement stopped that.
Unfortunately, we are now in a situation today where the only option to "save" radio is to allow large corporations to gobble the smaller ones and create national networks like @davideduardo saw in central and South America. If that is really the only solution to the problems faced by radio broadcasters, then I think the only thing to do is let the whole medium die. It was nice while it lasted, but maybe the best thing to do now is let it end.
I say all of that because what I'm about to say is done with a heavy heart. If the U.S. radio industry is dying, then we must let it die. No amount of propping up the industry (as @davideduardo suggests) will allow the industry to ultimately survive and thrive, not even allowing stations to create national networks. The only thing I see national networks doing is possibly prolonging the inevitable.
I am very much in agreement with @Theater of My Mind and the point he/she makes about why broadcast ownership rules shouldn't be loosened. There are only so many over-the-air frequencies available and, even if you narrowed the kHz frequencies to 9kHz apart (as is done outside of the Americas) and allowed broadcasters to broadcast on even numbered frequencies in the mHz band (such as 94.2), you *still* wouldn't have the current number of available places to listen as are on the Internet.
We humans tend to be a selfish and greedy lot, especially when it comes to business. We want it all. In another field and a few decades back, the Hunt brothers tried to "corner the market" on silver. Literally, these people (and they were actually brothers) tried to make it so that the only place both nationally and worldwide where people could purchase silver was through them. Fortunately, our government through legal enforcement stopped that.
Unfortunately, we are now in a situation today where the only option to "save" radio is to allow large corporations to gobble the smaller ones and create national networks like @davideduardo saw in central and South America. If that is really the only solution to the problems faced by radio broadcasters, then I think the only thing to do is let the whole medium die. It was nice while it lasted, but maybe the best thing to do now is let it end.
Except the only other competitor for signals is K Love. They’re buying commercial frequencies and making them non commercial.
That's because the ownership caps were designed to allow a couple of big companies to dominate a market making it unfeasible for a smaller company to compete against them. So now, when a single station goes up for sale, the only buyer is the noncommercial religious operator. If the caps had been lower since 1996 then there would have room for more broadcast groups in the market, and fair competition on a more even playing field which doesn't exist now. You have literally made the point against consolidation by pointing out how no one can compete against Big Radio's monopolistic advantage today.
Tell that to Saul Levine
No one can compete? How about Spotify, Pandora, Amazon, You Tube, and TikTok???