Press accounts suggest that a good time was had by all at the Federal Communications Commission's hearing on media ownership held in Nashville, Tennessee on Monday. Celebrated country music stars such as Porter Wagoner decried media consolidation at the FCC's second gathering on this issue.
"The days of an artist receiving regional airplay or breaking as a new act on radio are gone, and you are now considering making the situation even worse by letting some broadcast dynasties become even bigger broadcasting dynasties," The Washington Post quotes Wagoner telling the commissioners.
Less quoted were the formal remarks of FCC Chair Kevin Martin. "We are still in the beginning phases of this review of our ownership rules," Martin said at the event, a comment that may have been designed to reassure nine United States Senators who wrote to him last week warning the agency not to rush things (see Indaily Digest, December 6, 2006 [0]) on the broadcast ownership docket.
At least as interesting were the comments of one Bayard H. Walters of the Cromwell Radio Group, quoted by the Post as counterpoint to the likely overwhelming consensus among the hearing attendees against broadcast conglomeration.
In our database wanderings, LLFCC has run into Mr. Walters' thorough FCC comments in the past. One disclosed that his Cromwell Group has run about 31 radio stations over three decades. It expressed skepticism about a proposed FCC requirement that broadcasters keep recordings of their daytime programming for 60 or 90 days so that indecency complaints can be verified.
Another filing claimed to support Low Power FM Radio (LPFM), but only if such stations produce no "third adjacent" channel interference, a rule that effectively banishes LPFM from major market areas.
The Post summarizes Mr. Walters' comments at the Nashville hearing thus:
Bayard Walters, president of Cromwell Radio, was among the broadcasters who told the commissioners that some consolidation is necessary to survive.
"At small stations, in big and small towns, most of the business is local, but the bigger box stores are coming and changing that," Walters said. "Thus consolidation opportunity is even more important in smaller towns to compete against other media and be viable as a 'free' local service."
Walters pointed out that Nashville has more stations now than it did in the heyday of radio when WSM and WLAC dominated the local market.
"Those stations are still here and owned by larger companies, but it takes a cluster of several stations to get the listeners and advertisers that one station could get 35 years ago," he said.
With all due respect to Walters' perspective, as transcribed by the Post, his comments strike us as further evidence of the need for vigilance against media consolidation.
With the passage of the Telecommunications Act of 1996, which made it possible for Clear Channel to snap up over 1,200 radio stations in three years, big station chain owners began to hog all the advertising revenue. They could do this because they could offer advertisers more air time for their dollar. Indeed, one recent media ownership study [1] indicates that the largest two firms in your average Arbitron metro market have gobbled up an incredible 74 percent of the market's radio advertising revenue.
That means that if smaller station owners like Bayard Walters want to compete in this environment, they have to merge as well. It's a consolidator's race to the bottom.
That is, unless the radio listeners of this country tell the FCC and Congress that the solution to media consolidation is not more media consolidation, but a restoration of local ownership rules that make ad revenue grabbing behemoths like Clear Channel and Cumulus Broadcasting impossible.
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