“To say there is a wide divergence of opinion among broadcasters on whether there should be further deregulation is an understatement.” That’s what one respected executive told Radio Ink last week, despite others saying there is widespread support for loosening the ownership caps. And, following our story on the NAB’s response to some of the comments filed with the FCC, iHeartMedia CEO Bob Pittman wanted his opinion known as well.
The NAB has been put in an interesting position. The organization is charged with representing its members. And, on most issues, after hashing things out behind closed doors, industry executives come out fighting on the same side. The board, made up of a lot of Radio’s CEO’s or high ranking radio executives, vote on things and the NAB moves forward promoting that position. And while the NAB has been saying that support for loosening ownership caps has been overwhelming, many other executives dispute that.
The NAB filed additional comments last week aimed at those opposed to more deregulation. In addition to iHeart, Radio One, Salem and The Association of Black owned Broadcasters, there were groups such as musicFIRST, which provided a form letter to members and asked them to bombard the FCC in opposition. The NAB, aiming those comments at the activist groups, said they were “backward.” However, the iHeart CEO didn’t appreciate the filing much. Pittman sent this note to NAB CEO Gordon Smith and NAB Executive Committee Board Member Caroline Beasley: “I was surprised and disappointed to read the NAB characterization of those of us who oppose radio deregulation. Both unnecessary and not the tone I would expect from the NAB —especially against some of its own members. I thought we still had respect for those who have differing opinions.”
NAB Executive Vice President, Communications Dennis Wharton told Radio Ink the comments were not meant as a slap at other board members. “The board sets the policy of the NAB. The board voted overwhelmingly in support of ownership relief. We acknowledge there is some disagreement. NAB respects the opinions of all of our member stations and board members. We are better as an organization because of robust input from all of our members. At the end of the day, our policy positions are established through a deliberative democratic process. The Radio Board voted overwhelmingly in support of changes to ownership rules that will allow local radio to remain competitive in an evolving world that includes heightened local advertising threats from Google, Facebook and other social media companies.”
This FCC has signaled its ready to do something on loosening ownership caps. There’s no clear indication when that might be.
Regarding the effects of deregulation, e.g., concentration and consolidation of stations, it (deregulation) has had an enormous amount to do with keeping me off of the airways, as talk stations have been controlled by fewer and fewer owners and operators. Deregulation has effectively resulted in command and control of broadcasting, and further deregulation will continue this unhealthy development; that said, it is to be expected that further consolidation and concentration will continue.
Brad Thomas presents, “After All Is Said & Done”
Here’s a news flash: Remember Larry King? He was on over 500 radio stations before deregulation and consolidation. The company that syndicated him didn’t own any stations. If radio was back to old ownership limits, it would just open the door for more national syndication and network radio, just like in the 1930s. Don’t ever underestimate the chance for owners to find a way to save money. The FCC is not in the job creation business.
Pittman is 100% correct and he no question is exponentially more qualified to speak on this subject than the pro-dereg NAB Board members. Beasley Broadcasting and other pro-dereg broadcast companies simply have not figured out how to grown their revenues by more than an anemic 2% or so a year. Whether this is because of lack of compelling content on their stations – content ultimately drives all things – or because of lack of visionary and forward-thinking company leadership, is up for debate. But to advocate buying up more stations, as a short-term way to show revenue growth and appease Wall Street, is a short-term band aid, and long-term does NOT grow the audience or revenues of your individual stations or assets. THAT requires and demands creative and talented leadership, plus investments in both promotion and in your personalities. (NOT voice-tracing and $12 an hour part-time announcers.)
Amen! “You get what you pay for.”
Why am I thinking that iHeart, Salem, Radio (Urban) One, and NABOB are very substantial leaders in the radio industry, and that their (and many others’) lack of consensus on further deregulation is hardly ‘overwhelming’ support?
I, for my part, actually agree with most of NAB’s deregulation proposal. In particular, I agree with total loosening of AM limits, in all markets; and with total deregulation in markets 76+. However, in the major and large markets, I think it is breathtakingly irresponsible to allow a company to own up to 10 FM stations. Think about that. Even the very largest markets, such as New York City and Los Angeles, would essentially become ‘one company towns’, if a single company is allowed to accumulate the full ten stations, if that company participates in the so-called ‘incubator’ program that is proposed by NAB; and especially if one company is allowed to control the most powerful Class C or B FMs in these markets. Any other radio broadcasters even wanting to continue doing business in these large markets would be relegated to the lower class, less powerful FMs, mainly constituted of ‘fringe’ and ‘rimshot’ signals coming in from outside the geographic core of the markets. In my book, that’s called ‘effective monopoly’…the very thing that many folks in the NAB and elsewhere in the radio industry accuse their social media competitors of being. And, such a concentration of power in the radio sector also would have the perverse effect of creating a significant competitive disadvantage for the ‘minority, women and small business’ owners who would theoretically be relegated to making do with the lesser FM signals in and around the major/large markets.
Yes, companies like Facebook, Twitter and others are true, powerful competitors to radio. But, prescribing monopoly to counter monopoly is not the way things are supposed to be accomplished, even in a free market, capitalist economy. I have been an outspoken critic in recent times of the FCC’s ‘AM revitalization’ efforts, and now I find myself in strong opposition to such an ill-considered deregulation proposal in the major and large radio markets. Let’s stop this nonsense, now!
One easy way for the gov’t to address this issue, as well as many others, is simply regulate Facebook & Twitter. It’s a bi-partisan issue that would get full support. Put them under the FCC. Require them to perform community service. Control their reach. Treat them the way they treat broadcasters. Now is the time to act. But as I’ve said before, if any radio company approaches a monopoly, it is subject to the controls of the DOJ. They have acted many times before, and they will act again.
Well, then, I would say that ‘monopoly’ is about to be greatly — and negatively — redefined, if the FCC adopts the degree of deregulation of FMs, in markets 1 – 75, that the NAB is proposing. Ten full Class C or B FMs, even in the largest of the radio markets, would be effectively monopolistic, I think. And, that still would do nothing to offset the power of the social media competitors.
As far as regulating Facebook, Twitter, et al, I would only agree on that when it applies to deliberate anti-competitive practices on their part. Beyond that, I believe you start treading on First Amendment free speech rights, which the social media assuredly possess. It’s a tricky balance.
The public doesn’t see radio as strictly defined by transmitters and towers. They see it as audio content. So radio itself has been redefined. But the laws have not kept up with the reality. That’s the point. Monopoly is a legal and financial definition, not a technical one. If a radio group controls too much of the ad revenue in a market, it is a monopoly. It’s not a function of transmitters. That’s how the DOJ sees it. That will not change, and the DOJ is about to use that same barometer with Amazon and Google. Why not Facebook & Twitter?
Essentially, the monopolization of commercial radio was a government-mandated operation that was pounced on with glee by a few outfits with deeper pockets or better credit ratings than some others.
As the entire industry is aware, eliminating competition has resulted in subsistent services to audiences, advertisers and employees.
Rendering extraordinary services, however, is no longer a priority for most of the participants – with justifications that can’t be arbitrarily promoted, justified or overlooked altogether.
The refusals to address the service issues – and the colossal whining are what galls me.
How has the deregulation worked out so far for you? One owner too many radio stations is not a good thing. It will never be a good thing for broadcasters or the general public.