The NAB isn’t the only party with a deep interest in the FCC’s 2018 quadrennial review of its broadcast ownership rules.
No less than nine radio station licensees, along with a very well-known broker, have teamed up in offering joint comments that reiterates what many in the industry have desired for years: “modernization” of its cross-ownership rules.
The local radio industry cannot effectively compete in today’s media marketplace with rules that were adopted 25 years ago when today’s tech giants did not even exist.
That’s the key takeaway from the comments submitted by David Oxenford of Wilkinson Barker Knauer to the Commission on behalf of Connoisseur Media, Townsquare Media, Mid-West Family Broadcasting, Midwest Communications, Fransden Family Stations, Cherry Creek Media, Neuhoff Communications, Eagle Communications, and Legend Communications.
The latter licensee is led by Susan Patrick, and her husband, Larry Patrick of brokerage Patrick Communications, is also among the commenters.
With data from Edison Research’s “Share of Ear” survey included in its filing to the Commission, the licensees believe that competition for audience and advertising has
only increased since May 2019. “[T]rends will only continue as non-broadcast media outlets — many of which are owned and controlled by the biggest companies in America — continue to explode,” they say.
Absent relief from “outdated” ownership restrictions, the station owners go so far as to claim over-the-air radio stations “will simply be unable to maintain the current level of service, a result that is clearly contrary to the public interest.”
The solution? “The FCC must act now to remove the archaic regulatory burdens that restrict radio’s ability to compete in the modern marketplace. The trends are clear and unmistakable.”
Further, the tone of the joint comments suggests broadcast radio companies are at dire risk of continued economic declines, even after the 2020 pandemic punch some AM and FM station owners still can’t fully recover from.
“The FCC cannot wait to act – changes must be made now to preserve radio as an important local voice in the media marketplace,” the companies say in the comments, which includes references to RBR+TVBR‘s coverage of radio industry regulation by the FCC.
The key desire of the companies repeats a 2019 request to eliminate the local radio ownership rules. In bolstering their argument, they share a belief that local radio stations “could readily contribute to the public interest by providing diverse and local programming if they were owned by existing broadcasters who are forbidden by current rules from operating them.”
However, the joint comments offer no specific examples of how consolidation seen since the mid-1990s has demonstrated this. They exist: Lost Coast Communications brought a unique Adult Standards/Cool Jazz hybrid dubbed “The Lounge” to Eureka-Arcata, Calif., while shifting its signals and putting a longtime Classic Rock station on an FM translator, increasing the diversity of programming in Humboldt County, Calif.
Then, there’s the counter-argument that in markets ranging from Dayton, Ohio to Miami-Fort Lauderdale, consolidation has cut jobs while bringing a variety of imported voice-tracked air personalities to local stations — perhaps the biggest reason why further consolidation isn’t universally desired.
DOLLARS FIRST, CONTENT NEXT
As is the case with the NAB, the nine radio stations focus their argument on ad sales challenges brought on by the growth of local digital.
“While radio stations have made valiant efforts to capture their share of digital advertising revenues, they face an uphill battle against the Goliaths of the tech industry,” the licensees argue. “Even today, radio’s collective share of the local advertising market is in the single
digits, with individual stations experience less than 1 percent of total advertising share. Fighting to achieve a 1 percent share is not a means to local radio’s survival. They must be allowed to grow. Even though radio broadcasters are achieving some success with
digital advertising, this success pales by comparison to the out-of-market Internet companies that dominate the local advertising market … [O]utside the very largest markets, existing on 1 percent of the local advertising spending simply does not allow for any meaningful contribution to local discourse on matters important to local communities.”
Meanwhile, a quote from Patrick, in which he says, “there are stations where there simply are no buyers for the properties, other than a direct competitor who may not be allowed to purchase the troubled stations because of current regulations,” is given to build their argument that the “troubled” property couldn’t survive unless the crosstown, dominant radio operator buys it out.
The most striking takeaway from the joint comment filing is the numerous references to “out of town competitors.” They aren’t talking about WFAN in New York taking away ad dollars from a Hudson Valley or Connecticut Sports Talker. Rather, they’re referencing Amazon, Facebook and Google/YouTube.
The broadcasters say, “Radio broadcasters are no longer competing just against other radio broadcasters. Instead, they are competing against global tech giants and multimedia conglomerates that dwarf the size of any radio company. In fact, each of these tech companies individually dwarf the size of the entire radio industry. To think that a radio company owning a sixth or seventh FM station in a big market, or even all the radio stations in a smaller market, will damage competition or harm the public interest is to ignore reality.”
It’s now up to the FCC, a 2-2 body yet to receive a nomination for Chairman from the White House, to decide whether it agrees on this “reality,” or if the broadcasters’ notion that deregulation is the solution is against their interpretation of diversity.
To view the Joint Filing in full, please click here.
