The price of compliance


One of the most obvious truths about broadcasting is that radiated signals do not respect political boundaries. And people, and by extension, the public interest, are served by receivable signals. There are many many communities with a station licensed to them, but only several hundred are considered to be markets. And for the purposed of both the providers and consumers of broadcast programming, the market is the most important factor.

For that reason, perfectly legal station siting and grouping decisions have been made with business and programming questions in mind. However, this may all change if the FCC requires a physical community of license presence for every station in the US, regardless of other pertinent considerations.

A number of broadcasters have provided cost analysis in an FCC filing prepared by attorneys at Leventhal, Senter and Lerman.

 * Americom, with stations in Las Vegas, spent half a million dollars for a central studio and pays 25K/month in rent. It would have to spend 250K-1M to undo it.

 * Of Beasley’s nine grandfathered stations in Augusta GA, six would have to move at a cost of 1.2M. It would have to spend another 500K to fix Ft. Myers, where all five of its stations would have to move.

 * Citadel would have to move 120 of its 227 radio stations nationwide.

 * Davis Television operates WFXS-TV Wittenberg WI as a Wausau station. Moving it 30 miles back to Wittenberg would coast a quick 3M.

 * Journal, with 40 television station in 13 markets, would have to build 14 new studios, and could spend over 15M in the Palm Springs CA market alone.

 * Small broadcaster Kirkman, with four stations in Charleston SC, would need two new studios at 275K and would have 160k annually in new employee costs.

RBR/TVBR observation: The FCC decided in its 6/2/03 rulemaking that use of contour methods was allowing hanky-panky when cluster building and went to a market based system. Whether their assessment of contour was correct of not – it at least has the advantage of being a method grounded in scientific fact rather than the subjective boundary-making that has a role in determining market definitions – it as least proved that the FCC was taking market reality into account when making the rules.

So why would the FCC abandon that now? How often do the citizens of Suburbiaville ever complain to the FCC that the Suburbiaville FM station is playing to all of nearby Metrocenter? It’s a fact that the broadcast market of Washington DC is brim-full of stations licensed to small close-in towns in Maryland and Virginia. When the stations are part of a cluster, few citizens care that they are all housed in one location somewhere inside the Beltway.