We finally get a look under the hood at what the NAB’s secretive ownership committee has been working on in terms of deregulation. Comments have been filed with the FCC as the Commission gets close reviewing broadcast ownership rules as part of its 2018 quadrennial review. And, as expected, radio is using the competition of Pandora, Spotify, SiriusXM and other digital players as the reason, they say, more deregulation is needed.
Here’s what radio executives are asking for:
-In the top 75 Nielsen Audio markets, allow a single entity to own or control up to eight commercial FM stations, with no limit on AM ownership;
– — To promote new entry into broadcasting, an owner in these top 75 markets should be permitted to own up to two additional FM stations (for a total of 10 FMs) by participating in the FCC’s incubator program; and
– In Nielsen markets outside of the top 75 and in unrated markets, there should be no restrictions on the number of FM or AM stations a single entity may own or control.”
The NAB filing states that the FCC’s current regulatory framework ignores a large portion of the listening and advertising equation. “The notion of what constitutes a competitor to radio stations must include audio outlets that consumers in local markets are listening to and the outlets that advertisers use. Consumers may not know or care where Sirius XM, Spotify or Pandora are headquartered, but they know that they can listen to them in their cars, in their homes and in their offices – exactly where consumers can listen to AM/FM radio and where advertisers can reach those consumers. Given that the FCC’s numerical radio ownership limits are “competition-based,”5 the Commission cannot continue to ignore multiple major sources of competition for both listeners and advertisers in the audio marketplace.”
The NAB filing states that outdated rules that apply only to radio have a real-world impact on stations’ ability to serve their local areas. “The financial viability of radio stations’ informational programming, including emergency information and related local weather coverage, would be enhanced by permitting local stations to take greater advantage of economies of scale. Studies have shown that local news production “is subject to strong economies of both scale and scope.” Although these studies focused on the TV industry, there is no reason to believe that radio broadcasting differs in this regard, as earlier FCC studies indicated.”
This is sure to be a controversial topic this year and while we are told there was “overwhelming support” in the NAB Board room, we know not every radio company is in agreement. We know for sure that iHeartMedia, Federated Media and several other companies do not want more deregulation.