city of license change

The FCC’s Order released at the end of August deciding the issues in its Quadrennial Review of its ownership rules is over 100 pages long. The full document, with the dissents from the Republican Commissioners, required regulatory impact statements and similar routine attachments totals 199 pages. The Order addresses many issues. For TV, it declines to change the local ownership rules, readopts the decision to make Joint Sales Agreements into attributable interests (thus effectively banning them in many markets, though making some tweaks to the grandfathering of existing JSAs), and adopts new rules for reporting shared services agreements. The Order retains the newspaper-broadcast and radio-television cross-ownership rules. It takes limited new steps to encourage minority ownership (principally re-adopting the rule that allowed small businesses to acquire and extend expiring construction permits for new stations and to buy certain distressed properties, see our article about that old rule here), but does not adopt any racial or gender preferences for broadcast ownership. It also ends consideration of using TV channels 5 and 6 for the migration of AM radio and other new audio services including those targeted to new entrants into broadcast ownership (see one of our articles about that proposal here). And it rejects most proposals to change the radio ownership rules. Today, with the NAB Radio Show just two days away, we will look closer at the radio rules, and will cover many of these other aspects of the decision in coming days.

Perhaps the biggest “ask” for changes in the rules came from numerous radio groups that requested changes in the “subcaps” that apply to radio ownership. For instance, in the largest radio markets, one owner can hold up to 8 stations, but only 5 can be in any one service (AM or FM). Some parties had hoped to be able to own more FM stations in a market, particularly given the growing levels of competition in the audio marketplace from satellite and online radio. Some AM owners looked to hold more than the current maximum number of AMs in a market as a way to provide economies of scale that might help to preserve and strengthen the struggling AM radio industry. The Commission rejected such changes.
Continue Reading FCC’s Decision on the Quadrennial Review of the Multiple Ownership Rules – Part 1 – Radio Issues

Changing the city of license of an AM or FM station is getting more difficult, based on recent FCC decisions.  As we have written before, the FCC’s Rural Radio order changed the manner in which the FCC reviews city of license changes.  In connection with any proposed city of license change, the FCC reviews the proposal to make sure that the change will result in a favorable arrangement of allotments, making sure that the distribution of radio channels is in the public interest.  In making that decision, the FCC has relied on a series of priorities – first insuring that all areas of the country get at least two radio reception services (Priority 1 was to provide service to "white areas" that currently receive no radio service at all, Priority 2 was to provide a second reception service to all areas).  The next priority was to provide as many communities as possible with their first "transmission service", i.e. a station licensed to that community that would have a primary responsibility to address its needs and interests.  Finally, if there was no proposal to provide a first or second reception service or a first local transmission service, the FCC  looked at Priority 4 factors, i.e. other public interest matters.  In the past, service to a greater number of people itself was a Priority 4 consideration.  Based on a case released last week, service to a greater population apparently is no longer be viewed as justification for the change in the city of license of a radio station – even if the proposed move is from a rural community that already has a significant amount of service to a similarly well served urbanized area and results in a significant increase in the population served by the station.

The Rural Radio order changed the Priority 3 preference for a first transmission service by determining that any proposal for a city of license within an urbanized area would be viewed as being a proposal for service to the entire urbanized area (meaning that, instead of being a first local service to a named community, all the stations in the urbanized area would be considered as serving the same city). Thus, a proposal to take a station from a rural area (e.g. proposing to take the third radio station from some smaller rural town) to a city without a service in a urbanized area would no longer be viewed as providing the first local transmission service to the suburban community (but would instead be viewed as being a proposal to provide just another service to a metro area that probably already has many stations that are licensed to the various communities in the urbanized area).  Some had thought that, while Priority 3 would no longer justify such a move, a Priority 4 preference would be available if the move would allow the station to serve a much larger population, and if any loss area was already well served.  In the proposed move discussed last week, the Commission relied on language in the Rural Radio Order that stated that population increases alone would not be enough to justify a city of license change when a station proposed to move into an urbanized area.  In this case, the Commission’s staff found wanting a proposal to move from the well-served community of Boone, Iowa to a community in the Des Moines urbanized area – even though the proposed change would result in service to over 300,000 more people than are currently served by the station – increasing the number of people served by the station from less than 100,000 to over 400,000. The request was not denied outright, but instead the applicant was given another opportunity to supply additional information to demonstrate the public interest benefits that would result from the move. Continue Reading FCC Makes Changing City of License of Radio Stations More Difficult

Changing the city of license of a broadcast station was made more difficult by the FCC’s rural radio order.  That order, about which we wrote here, imposed substantial obstacles on broadcasters attempting to move their stations from rural areas into urbanized areas – making such moves difficult if not impossible in many cases. 

The FCC’s decision in its rural radio proceeding addresses numerous radio issues – some of which seem to provide a solution in search of a problem.  In an era where the President has called for agencies to review their decisions to access how they will affect businesses and job creation, some aspects of this rural radio decision appear to be moving in the opposite direction – imposing new hurdles on broadcasters trying to improve their operational facilities. While the FCC in this decision adopted largely uncontested rules that would promote the development of new radio stations on Tribal lands, the Commission also adopted rules making it harder for radio stations to move from more rural areas into more urban ones – rule that were almost universally condemned by broadcasters. The decision also restricted the ability of FM translators to “hop” from the commercial to the noncommercial band and vice versa, and adopted rules that codified the determination of how AM applications are determined to be “mutually exclusive” when filed in the same window for new or major change applications.  The changes to the procedures for consideration of AM and FM station allotment and movement are summarized below.  The other changes made in this proceeding will be discussed in a subsequent post on this blog.

Easily the most controversial of the decisions made by the Commission in this proceeding was the conclusions reached as to the movement of AM and FM radio stations from more rural areas into more urbanized ones.  We wrote about some of the concerns raised by broadcasters last week.  Many of the new rules and policies adopted by the Commission were ones feared by broadcasters – though many of the policies are still undefined, and how they are enforced may well determine their ultimate impact.  That impact may well take years to sort out.  Regardless of the ultimate impact on the actual movement of stations, there is no question that these rules will require far more paperwork from broadcasters seeking to allot new channels and from those seeking to change the cities of license of existing stations, and open more moves to challenge, making the process slower and more expensive.Continue Reading FCC Adopts Rules Restricting Rural to Urban Radio Moves and Translator Band Hopping – And Adopts Tribal Area Preferences

At the FCC meeting next week, the Commission will be considering an item dealing with radio stations that serve rural areas, and the ability of licensees to make technical modifications to those stations that would change the communities which they serve.  While, as we wrote last week, most of the attention of broadcasters has centered on the television issues to be considered at the meeting as the Commission is to begin an inquiry on the retransmission consent process.  The rural radio issue poses real concerns for radio operators – especially those contemplating a move of a radio station from a community outside of a metropolitan area to one in a metro.  In the name of protecting service to rural areas, the Commission may well restrict minority groups, specialty programmers, and other new entrants from bringing new services to metropolitan areas – permanently entrenching those companies who currently have major market stations as the only competition in those markets.  A proposal to protect service to rural areas may well have the impact of decreasing diversity in large markets.

In virtually every large market, there is little or no potential to add new channels for FM service both because of interference protections that need to be accorded to stations in the market and because of protections to stations outside of the market but close enough to be short-spaced to any potential station in the metro area.  In some cases, creative engineering has found ways for some of these non-metro stations to be moved into the metropolitan area, or at least close enough to provide some service to those markets.  "Move-in stations" have allowed new entrants, some with specialized programming, to provide service to large cities – when such entrants could never afford the price of an existing in-market station, even if one was for sale.  Even "rim shots", those move-ins that don’t provide full coverage of a metro area, may be very worthwhile for groups with unique formats (religion, Spanish language, and other targeted programming) trying to reach a small audience that is not otherwise going to get service in such markets.   Continue Reading Restrictions on Moving Radio Stations From Rural to Urban Areas May Be Coming – What’s The Potential Impact?

Last month, the FCC released its proposal to restrict the movement of FM stations from rural areas into larger markets (which we summarized here).  The proposals that the FCC has put forward would greatly restrict the ability of broadcast owners to move stations to cover larger population areas – in many senses reversing the decision of the FCC just two

Rural communities – do their radio stations need government protection? The FCC seems to think so, proposing a series of new rules and policies that restrict the ability of the owners of rural radio stations to move their stations into Urban areas. These rules would make it harder for entrepreneurs to do “move in” applications – taking stations from less populated areas and moving them to communities where they can serve larger populations in nearby cities. The Commission states that it is making these proposals to attempt to live up to its obligations under Section 307(b) of the Communications Act to ensure a “fair, efficient and equitable” distribution of radio services to the various states and communities in the country. While this may be a noble goal, one wonders if it is a solution in search of a problem. Are there really rural communities that have an unmet demand for missing radio services – and which can economically support such services? And do these proposals conflict with other goals of the new Commission, by effectively decreasing the opportunities for minorities and other new entrants from acquiring stations in major markets – by taking away move-in stations that are often the only stations that these broadcast station owners can afford in urban markets?  These are questions that the FCC will need to resolve as part of this proceeding. 

A Section 307(b) analysis is done by the FCC when it faces conflicting proposals, specifying different communities of license, for new AM stations or requests for new FM allotments. It is also required when an applicant proposes to move a station from one community to another, as the applicant must demonstrate that the move to the new community would better serve the objectives of Section 307(b) than would the current location of the station. In the past, the 307(b)  analysis looks at several factors, or “Priorities.” These include:

 

  1. Service to white areas – when a proposed station will serve “white area,” an area where residents currently receive no predicted radio service (no “reception service” in FCC parlance). 
  2. Service to gray areas – when a proposed station will serve areas that currently receive only a single reception service
  3. Provision of a first local “transmission” service – where the proposed station will be the first station licensed to a particular community, and thus the first station that has the primary responsibility to serve the needs of that community
  4. Other public interest factors – usually meaning which proposal will provide the service to the most people (with service to “underserved areas,” i.e. those that receive 5 or fewer “reception services,” getting somewhat more weight).

Continue Reading FCC Proposes to Encourage Rural Radio By Making it More Difficult to Move Radio Stations to Urban Areas

Yesterday’s unique Public Notice outlining Chairman Martin’s proposals for reform of the multiple ownership rules (which we summarized here) is a surprisingly restrained and limited approach to relaxation of the ownership rules – proposing to relax only the newspaper-broadcast cross-ownership prohibitions, and only in the Top 20 TV markets.  Moreover, the reform would only allow the combination of a daily newspaper and a single radio or TV station, and the newspaper-TV combination would only be allowed if the TV station is not one of the Top 4 ranked stations in the market.  While the extremely limited nature of the proposed relief has not stopped critics of big media from immediately condemning the proposal (see the joint statement of Commissioners Copps and Adelstein, here), much less attention has been paid to those multiple ownership issues that the Chairman’s proposal does not seem to address – including TV duopoly relief in small markets and clarifications to the radio ownership rules requested by a number of broadcasters who sought reconsideration of the changes that arose from the 2003 ownership reforms. 

The Chairman’s Public Notice is itself a new approach to regulation – putting out for public comment (due by December 11) an action of the Commission just before that action is to be taken.  Usually, the Commission proposes a set of rule changes in a Notice of Proposed Rulemaking, and the Notice provides time for interested parties to comment and then reply to each other’s comments.  Once all the written comments are submitted to the Commission, parties and their representative often make informal visits to the FCC to argue about the suggestions that have been made, and eventually, after much consideration, the Commission’s staff writes up a decision which is vetted by the Commissioners and their staff, and voted on by the full FCC.  Usually, these final decisions are shrouded in secrecy – though outlines of the proposals are often the subject of informed gossip and rumor, rarely does anyone see the full set of rules that the Commission is considering until after the decision is made. 

Continue Reading What Chairman Martin’s Multiple Ownership Proposals Omit – No Relief for Radio and TV

Twice this week, the FCC released decisions denying applications proposing city of license changes for AM stations proposing to take away the only station licensed to one community and move it to another.  In its order adopting simplified city of license changes (see our previous posts including those here and here), the FCC refused to change its policy of not allowing the removal of an established radio station which is the only station licensed to a community except in cases where an extraordinary showing justifying a  waiver of the rules could be made.  The two cases decided this week show that merely moving to a community with greater population (even one which has no other station licensed to it) will not, in and of itself, justify a waiver of the rules.  Thus, stations which are the only station licensed to their communities are effectively blocked from changing cities of license without  providing a "back-fill", i.e. moving another station so that it can be licensed to the community that would otherwise be abandoned.

In one case decided this week, the broadcaster proposed to move its AM station to a community that had three times the population of the one that it was proposing to leave.  The Commission rejected the move, finding that the residents of the current community should be able to rely on continued service from that station.  This was true even though other stations could be received in the community, as the Commission reminded licensees that their primary responsibility is to serve the needs of their city of license, and that this primary service cannot be duplicated by the secondary service provided by a station licensed to another town or city.  Continue Reading FCC Says No To City of License Change Taking Away Community’s Only Radio Service