The Battle Over Low Power Radio

Written by Eric Boehlert on . Posted in Posts.


On paper, the NAB ought
to be able to squash this quixotic, power-to-the-people issue like a bug. After
all, three years ago NAB lobbyists, representing every major television and
radio station owner in America, effortlessly shepherded through Congress the
Telecommunications Act (Telcom), which ignited a radio gold rush that’s
still thriving today. Thanks mostly to the NAB’s crafty work, it’s
been a long time since station owners were disappointed by broadcasting policy
decisions made in DC.


Until now. With FCC Chairman
Bill Kennard personally leading the charge for LPFM, and an expansive grassroots
movement swelling behind it, the issue refuses to die. And with public comments
on LPFM concluding this week, with an up-or-down vote from FCC commissioners
coming as soon as early 2000, the NAB suddenly faces a small crisis of containment.
How to stop, or least delay, the arrival of feel-good LPFM?


The proposal itself is a
simple one: Let everyday citizens, led by church groups, elementary schools
and music junkies, purchase inexpensive licenses for newly formed micro FM stations
(powered by just 10, 100 or 1000 watts), and allow them to program for very
small communities. The motive behind LPFM stations, which would reach maybe
six blocks in a city and cover a six-mile radius in the country, is to bring
more diversity to the airwaves in the wake of Telcom’s massive consolidation,
which not only eliminated many independent broadcasters, but pushed up station
price tags into the seven-, eight- and even nine-figure range, effectively barring
entry to most newcomers.


Low power is no cure-all.
Even if the FCC adopts LPFM, existing congestion on the dial would make it all
but impossible for any new signals to be added in major markets. And who knows,
maybe the new mini-FMs, built on shoestring budgets and run by amateurs, could
just be an underwhelming hodgepodge of eccentricities on the airwaves.


For broadcasters, none of
that matters. Their goal is to snuff out LPFM before the first community signal
signs on.


So far, that 10-month-old
battle has been fought not on the airwaves, but in the filing room. Three months
after the FCC in January proposed what it calls a rule change to consider implementing
low power radio, the commission invited citizens to write in with comments.
That’s how the FCC makes its internal decisions; not with lengthy hearings
or debates in Congress. Instead, arguments for and against are submitted in
writing and read over by the commissioners and their staffs. Usually of interest
only to broadcasters and a handful of DC communications attorneys, the comment
period for low power radio, which has already been extended four times, has
attracted nearly 3000 comments filed with the FCC. (By comparison, just a couple
hundred were submitted during the FCC’s recent comment period regarding
loosening television ownership limits.)


The comment by Keith Allen–an
adviser at Century High School outside Portland, OR, lobbying for LPFM for the
school’s weak student-run station–was just a paragraph long. Others,
like the massive North Carolina Association of Broadcasters’ document dump,
numbered 463 pages. Sifting through them, it’s clear the battle lines were
drawn from day one; anyone who owns a station is against low power.


Critics, including several
noncommercial broadcasters like NPR, which remains vehemently opposed to LPFM,
argue low power stations would create dangerous technical interference for existing
stations. Many are also adamant that low power is unnecessary, since radio already
services every type of consumer.


Taken as a whole, however,
the submitted comments should give any radio broadcaster pause. (To read them,
go to https://gullfoss.fcc.gov/cgi-bin/ws.exe/prod/ecfs/comsrch.hts; enter 99-25
in the "proceeding" box and hit "Retrieve Document list.")
What station owner wouldn’t be concerned about the curious patchwork coalition
of low power proponents, including the United States Catholic Conference; the
Green Party; civil rights groups; Ralph Nader; university presidents; the Library
Association of America; the cities of Detroit, Seattle, Ann Arbor, Santa Monica,
Berkeley and Richmond; the United Church of Christ; Kurt Vonnegut; college professors;
the Council of Calvin Christian Reformed Church; everyday listeners; Grammy-award
winning artists; congressmen and senators; Native American tribes; and the ACLU,
who have all explained to FCC commissioners that more voices are desperately
needed on the dial?


It’s doubtful, though,
that many broadcasters have taken time to read the worrisome comments. Who wants
to waste time fretting during a gold rush? As radio’s best friend, Gavin
magazine, recently asked in an article about the industry’s never-ending
profit expansion, "How tiring can good news get?"


And station owners will
tell you it’s been a long time coming. Ever since Walter Winchell’s
star began to fade nearly half a century ago, radio has operated as media’s
stepchild, quietly existing in the shadows of television, newspapers and magazines.
Then Telcom virtually threw away ownership limitations and allowed companies
to buy hundreds of outlets nationwide and streamline their operations at the
same time, and now radio is strutting its way through a profit-and-loss renaissance
that has Wall Street analysts swooning.


Ask CBS CEO and former radio
station GM Mel Karmazin. He’d admit it’s been the runaway earnings
posted by CBS’ radio division, not the tv network’s ho-hum ratings,
that have turned him into an all-star on The Street.


It used to be a rule that
music-intensive stations only aired eight minutes of commercials each hour.
Post-Telcom, that number has ballooned to 12 minutes, which adds up to 500 additional
hours of ads each year.


What happened? As George
Sosson, Clear Channel’s senior vice president, boasted to The New York
Observer, before Congress loosened ownership regulations station owners were
nervous that impatient listeners would punch the dial and head to "the
other guy" whenever lots of commercial clutter came today. "Now,"
said Sosson, "we all are the other guy." (GMs are also under extraordinary
pressure to beef up their ad budgets now that parent companies answer to Wall
Street.)


The feeding frenzy that
Telcom unleashed on America’s 10,000 commercial radio outlets has been
startling. According to BIA Research, between 1996 and late 1999, 8500 stations
valued at $74 billion have changed hands. An even more telling statistic reveals
that just four years ago the top 50 owners, with a total of 876 radio stations,
billed approximately 45 percent

of the total 1995 estimated radio industry

revenues.


Today, according to BIA,
it requires just the top 10 owners, which account for 1784 stations, to bill
almost 50 percent of the total 1998 estimated radio industry revenues. And how
about those radio ad revenues? They’ve jumped nearly $5 billion, or 30
percent, since Telcom passed. Because it’s now easier for advertisers to
buy dozens, if not hundreds, of co-owned stations with just a few phones calls,
radio’s enjoying 10, 15 and, in some West Coast markets flooded with dot-com
advertisers, even 20 percent ad growth over last year. For the month of August,
radio ad sales nationwide were up 42 percent this year compared to August 1995.


In other words, Telcom,
which the NAB spent millions of dollars lobbying for, has been more profitable
than broadcasters could ever have dreamed. It turned mom-and-pop operators into
millionaires many times over as conglomerates lined up to buy FM.


But now comes the consumer
backlash–LPFM. The NAB, no doubt stunned that an FCC chairman would actually
move forward with an initiative unpopular among major broadcasters, has been
caught flatfooted.


"Of course they didn’t
see low power coming while writing the Telcom Act," says micro-radio activist
Alan Freed. "They got what they wanted without thinking about the results,
and never imagined the common person would ever rise up against them."


Maybe if virtually every
major-market FM station in the country hadn’t eliminated its news department
(relying now on wire service copy and clipping the local newspaper), hadn’t
canceled its local community program (even if it did air at 7 a.m. on Sunday)
and hadn’t loaded up its spot breaks with record levels of commercials,
the grassroots campaign wouldn’t be so strong. But they did, and it is.


LPFM "is the single
biggest issue to hit the radio industry in the last few decades," wrote
NAB president (and Trent Lott’s former college roommate) Eddie Fritts in
a mailing to association members earlier this year, kicking off a campaign to
derail the FCC initiative. The association’s wild exaggeration about LPFM’s
importance telegraphed the association’s posture–ready for a fight.


Gathering for its annual
convention in Florida in September, the association’s Radio Show at times
morphed into an anti-low-power pep rally. Bonneville International’s CEO
and NAB board member Bruce Reese denounced LPFM as a "silly proceeding"
and a "rotten idea."


But the battle for low power
radio will ultimately be decided over the single issue of interference. If a
majority of the five FCC commissioners think the new signals would compromise
existing stations, low power will die. But if interference is deemed not to
be a problem–and the FCC’s Kennard earlier this year warned broadcasters
not to "use interference concerns as a smokescreen"–then the
chairman should be able to push the initiative through.


While the NAB is spending
generously to complete its own set of interference tests to boost its technical
argument, broadcasters continue to grapple with LPFM’s grassroots popularity.
"Low power radio seems to have taken on a life of its own," claimed
Radio Business Report early this year, perfectly capturing the mood among bewildered
station owners and GMs. "Why? …there doesn’t seem to be any reason
for the LPFM frenzy."


The FCC’s low power
website has received 65,000 hits this year and nearly 3000 formal LPFM comments
have been submitted in writing. Yet according to broadcasters, there’s
no reason for the LPFM frenzy.


"Radio’s fooling
themselves," says Robert Unmacht at the M Street Journal. "Detroit
didn’t think there was anything wrong with their cars in the early 70s."
He notes the percentage of people using radio has dipped more than 10 percent
in the last decade. "If McDonald’s got a report that indicated fast
food business was down just 1 percent they’d panic. Radio doesn’t
seem to notice."


Indeed, according to the
NAB, the state of radio has never been more exciting. Included as part of the
19-page, anti-low-power radio kit sent out to members was a sample editorial
the broadcasters were urged to submit to their local newspapers for publication.
It boasted "there has never been more program diversity than in today [sic]
fiercely competitive radio market." A representative from Franklin Broadcasting
commented to the FCC: "Radio is already everywhere. The choice is unlimited,
including a format for every walk of life and interest." And Radio Business
Report chimed in with a popular defense among broadcasters, arguing that "consolidation
has greatly increased program diversity. No longer is each market overrun with
FM’s butting heads to dominate AC, Country, or Rock. Instead, superduoply
owners have broadened their score to include new offerings as [sic] Smooth Jazz,
Urban AC, Hot Talk, AAA and even Christian country."


If broadcasters are so bent
on diversity, why does CBS hang on to identical twin all-news stations in New
York–WINS and WCBS-AM–which distinguish themselves only by the fact
that WINS delivers its traffic updates on the ones and WCBS on the eights? Obviously
it’s because, combined, the two stations will bill approximately $80 million
this year, according to Duncan’s American Radio Report.


As for the notion that new
formats have blossomed in the wake of consolidation, the numbers simply don’t
back it up. According to M Street Journal, over the last four years there has
been virtually no increase in the number of commercial AAA, classical or smooth
jazz stations. And there are still virtually no commercial folk, punk, blues,
world music, opera, reggae or traditional jazz stations.


One of the few new formats
to emerge in the last four years has been children’s radio, and that’s
only because ABC/Walt Disney is aggressively pushing its own network, allowing
remote broadcasters to sign up for Disney’s satellite feed, flip a switch,
fire the staff and become an automated outlet.


Trying to play down the
consolidation that has transpired in recent years, the NAB boasts that "there
are still more than 4,000 owners of radio stations in the U.S." The association
doesn’t bother to point out that that number is down an astounding 25 percent
in just four years. More importantly, of the 10,000 commercial stations operating
today, only about 1000–the top 10 stations in each of the top 100 markets–are
really worth owning. How tightly have the Big Three–AM/FM, CBS and Clear
Channel–sewn up that business? If the recently announced $23 billion, 830-station
merger between Clear Channel and AM/FM were a done deal today, the newly formed
company would enjoy roughly $3.3 billion in radio ad sales, CBS would come in
second with $2 billion and at number three would be ABC/Disney, at roughly $380
million.


Meanwhile, broadcasters
see all sorts of societal trouble ahead if LPFM becomes a reality. FCC comments
from a group of New Mexico broadcasters expressed the fear that "militiamen,
religious fanatics, drug culturists, alternative life stylists and various assorted
crackpots…" would dominate the new LPFM service. In a written response,
the Committee on Democratic Communications of the National Lawyers Guild noted,
"What if they do? The last time we checked, the First Amendment belonged
to everybody. It’s called ‘free speech.’ (And which drug are
they talking about–tobacco, alcohol, or viagra?)"


Another argument floated
by broadcasters is that the Internet is the real answer to empowering people,
not LPFM. "Given the congestion in the AM and FM bands, moreover, the benefits
associated with the proposal may be better realized through other means of electronic
communication, such as the Internet," wrote representatives for National
Public Radio. "In addition to its attributes as a communications medium,
the Internet also offers low barriers to participation, opportunities for personal
advancement through life-long learning, and exposure to technological innovation."
Someone might want to inform the folks at NPR that 190 million Americans currently
don’t have access to the Internet.


The main problem for broadcasters
as they try to beat back community-focused LPFM is that in their recent rush
to cash in, station owners have walked away from what used to be radio’s
strength: its localism. With the Howard Stern and Imus morning shows beamed
from New York, the afternoon jock piped in from a sister station 80 miles away
and overnight syndicated shows replacing the night jock, radio is no longer
local, and it’s certainly not focused on community service.


When recently asked about
the ramifications of the mega-merger with AM/FM, Clear Channel president Randy
Michaels told Billboard, "As local owners who tend to play their favorite
music get forced out by people who are focused on shareholders’ value and
therefore understand we have to move customers’ products, meaning we have
to attract larger desirable audiences–we’re intensely focused on serving
the public."


That may be the best argument
yet for low power radio.


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