With much of the media world celebrating the life of Walter Cronkite this weekend, we have to wonder what he would have thought about press reports that the FCC is considering the commencement of a proceeding to investigate the status of broadcast journalism – assessing its quality, determining whether the Internet and other new sources are making up for any quality that is lost, and potentially deciding to mandate specific amounts of news coverage by broadcast stations. That surprising story about a planned FCC Notice of Inquiry on the state of broadcast journalism was reported in an an online report picked up by the broadcast trade press last week.  And even if that story is not true, concerns about the government’s intrusion into a broadcaster’s coverage of controversial issues arise from the recent Congressional committee action voting down a bill that would ban the FCC from reinstating the Fairness Doctrine.  In what should have been a symbolic embrace of the First Amendment (symbolic as, in the last 6 weeks, four of the FCC Commissioners or Commissioners-to-be disavowed any interest in bringing back the Fairness Doctrine in their confirmation hearings ), the defeat of the bill raises questions as to whether someone has an agenda to resurrect the government’s role in assessing broadcast media coverage of controversial issues.  In reading one of the many stories of the life of Cronkite (here, at page 3), we were stuck with the contrast between these actions, and the actions of Mr. Cronkite to address controversial issues – regardless of the FCC implications.  One anecdote related his questioning of John Kennedy about his religion when Kennedy thought that topic off limits, even in light of the potential president’s veiled threat that, when he took office, he would be appointing the FCC who would be regulating CBS.  Do we really want the FCC to have that power to assess what journalism is good, or what opinions each station must air to ensure "fairness"?

In reviewing the many FCC Fairness Doctrine claims that CBS faced in the Cronkite era, we are struck with the amount of time and money that must have been spent in defending its coverage against critics from both the right and the left.  We also found one particularly relevant quote from Mr. Cronkite himself: 

That brings me to what I consider the greatest threat to freedom of information: the Government licensing of broadcasting. Broadcast news today is not free. Because it is operated by an industry that is beholden to the Government for its right to exist, its freedom has been curtailed by fiat, by assumption, and by intimidation and harassment. 

 In the last 20 years, since Mr. Cronkite’s retirement as the CBS anchor, the FCC has steadily moved away from the role that he feared.  Yet with these recent actions, one wonders if there are some in government now trying to prove Mr. Cronkite’s concerns correct.


Continue Reading The Potential for the Return of the Fariness Doctrine and the FCC’s Assessment of the Quality of Broadcast News – What Would Walter Cronkite Think?

This past week, I attended the BIAfn Winning Media Strategies Conference in Washington, DC.  During the course of the conference, there was much talk about how broadcasters and publishers need to provide unique service to their communities in order to survive in the competitive media marketplace.  The point was made over and over again that, in each market there are unique attributes and personalities that a station should be covering in its programming, and should be exploiting even more broadly through their digital assets, to tie it to its community.  Only by doing so will the station be able to survive in the new media environment – and by doing so, the station may be able to thrive.  In fact, I was stuck by a statement by USC’s Adam Clayton Powell III that domination of the local online and digital media marketplace was "the broadcasters to lose."  In other words, the broadcaster has such unque promotional abilities with its current audience that it can establish its brand in the online and in the mobile world far easier than other media players.  But there were also the repeated warning that there is more and more competition for this local digital market from new entrants and other media entities and that, if the broadcasters did not take advantage of their current advantage, the local service would come from someone else.  What most stuck me was that there was no question that the superservice to local needs would be coming from someone – broadcaster or not – as a result of marketplace developments, not because of any government mandate.  The broadcaster has to adapt to and compete in this new media marketplace or become culturally and economically irrelevant.  The broadcaster needs to serve the local market to meet these challenges, not because some Washington agency has ordered him to do so.  And the broadcaster needs to serve his community in a way that the public will find compelling, not in a way that the government thinks is best.

At BIAfn, the presentation that made the greatest impact was probably that of Greenspun Media from Las Vegas, which has reinvented a secondary newspaper and a Low Power TV station as an on-line powerhouse, uncovering the aspects of the community that would draw the largest audience and covering that information in great detail.  The Las Vegas Sun site not only covers hard news, but also the gaming industry, University of Las Vegas sports and even state government issues in a way that its audience seems to find interesting.  Even a history of Las Vegas, in great detail, is included.  And video plays a big part of the site, with the company in development of a hip news and events program, 702.tv, that will soon be a daily program on the television station and online (featuring local "celebrities" doing the weather, including strippers and Neil Diamond sound-alikes).  While some attendees at the conference thought that Las Vegas presented unique opportunities that might not be available in all communities, many were immediately speculating on the opportunities in their own communities to find unique personalities and events that could be developed on-air and on-line in ways to maximize their connection with their audience. 


Continue Reading Localism Without Government Regulation

The press was abuzz yesterday with the news that Julius Genachowski is apparently the pick of the Obama Administration for the position of FCC Chairman.  Mr. Genachowski was at the FCC during the Reed Hundt Administration, and has since worked in the private sector in the telecommunications industry, including work with Barry Diller and running a DC-based venture capital fund.  From the positive reactions that the appointment has received from all quarters, the choice would seem to be a great one.  But, in looking at some of the reactions, you have to question whether everyone has to be reading what they want to see into the new Commission.  For instance, while the NAB has praised the choice of Genachowski (stating  that he "has a keen intellect, a passion for public service, and a deep understanding of the important role that free and local broadcasting plays in American life"), so too did media-reform organization Free Press ("This moment calls for bold and immediate steps to spur competition, foster innovation and breathe new life into our communications sector. With his unique blend of business and governmental experience, Genachowski promises to provide the strong leadership we need.")  What will this appointment really mean for broadcasters?

In short – who knows?  When Kevin Martin was appointed Chairman of the FCC, few would have imagined that a former communications attorney, a person deeply involved in the Bush campaign, and a former staffer of FCC Commissioner Harold Furtchgott-Roth (perhaps the most free market Commissioner ever) would have supported sustained, wide-reaching inquiries into the underbrush of FCC regulation – e.g. localism, embedded advertising, indecency.  So we can’t really know what a Chairman will do until he does it.  The Washington Post and the Wall Street Journal both suggest that the new chairman will be focused on Internet issues, and may be less interested in indecency – but who knows?


Continue Reading Julius Genachowski as New FCC Chair – What Will It Mean to Broadcasting’s Future?

Yesterday, the Detroit Free Press and the Detroit Morning News, which operate their publication and distribution operations through a joint operating agreement, announced that they will cut back on the physical publication of their papers – publishing full editions delivered to homes only three days a week.  On other days, the papers will publish an abbreviated version, available only on newsstands.  The papers will not abandon news coverage the remainder of the week, but will instead concentrate on their on-line presence, showing the power of the Internet to disrupt traditional media.  As we said years ago in one of our first posts on this blog – New Media Changes Everything, and it seems that this is just another indication of how true that is.  The broadcast media, particularly radio, has often looked at the advertisers served by the daily paper as a ripe source of new business, and may well see the Detroit change as a major business opportunity.  But does it also change the FCC’s consideration of the multiple ownership rules applicable to radio and television cross-ownership with newspapers?

The FCC’s multiple ownership rules prohibit the ownership of a broadcast station and a "daily" newspaper that serve the same area.  The rules define a daily paper as one that is "published" at least four days each week, and is circulated "generally in the community."  Here, the Detroit papers arguably will not meet that 4 day a week requirement – at least for a publication that is generally circulated throughout the community.  Of course, some may argue that the abbreviated newsstand copy constitutes a daily publication but one would assume that, sooner or later, even that will disappear.  Thus, while there has been so much controversy about the Commission’s decision of one year ago (summarized here) deciding that combinations of broadcast properties and newspapers in Top 20 markets were presumed to be permissible, while those in smaller markets were not, one questions whether this still makes any sense in today’s marketplace where seemingly few can profitably publish a daily paper in most markets, and no one seems to want to rescue the many papers that have fallen on hard times. 


Continue Reading Detroit Newspapers Cut Back on Publishing and Home Delivery – What’s the Impact on FCC Ownership Regulation?

This week, an interesting concept has been advanced in a series of applications filed with the FCC.  Ion Media Networks, the successor to Paxson Television, has proposed to transfer some of its broadcast stations to a new company, Urban Television LLP, to be owned 51% by Robert Johnson, the former owner of BET, and 49% by Ion itself.  But, when we say that they are transferring "some" of its stations, we don’t mean that any of its stations are being transferred, but instead only that a piece of its stations are proposed to be transferred.  Ion proposes to continue to own and operate stations in every market where it currently operates, but proposes to sell digital multicast channels to Johnson. Unlike any LMA or other programming agreement, the proposal is to actually take one 6 MHz television channel and break it up so that Ion continues to program one channel with its programming and the Urban Television will program the other channel with its programming, and become the actual license of that portion of the spectrum.  The FCC has accepted the applications and issued a Public Notice, giving parties 30 days to file comments on the proposal. 

It is not unheard of for two licensees to share the same channel – though where it is currently occurs most frequently is in connection with noncommercial broadcasters who share a single radio or TV channel, they divide it by time, so that one licensee operates, say midnight to noon and the other operates from noon to midnight.  Obviously, in these shared-time arrangements, both broadcasters are not operating on the same channel at the same time.  This new proposal, though, does not come out of the blue.  The idea of allowing a broadcaster to sell a digital channel to a different company, has been proposed before, for both Digital Television and Digital HD Radio channels when the original station is multicasting, as a way to increase diversity of ownership.


Continue Reading Splitting a Television Station License – Ion and Robert Johnson Propose a Unique Concept for Increaing Media Ownership

In recent months, the broadcast industry has experienced one of the most active periods of regulatory activity in recent memory. Since November, the FCC has adopted enhanced disclosure obligations concerning the public interest programming of television broadcasters and requirements for an on-line public inspection file; rejected most calls for increased deregulation of broadcast ownership (allowing only the cross-ownership of broadcast stations and newspapers in the largest markets); established specific prohibitions against advertising practices that involved “no Spanish, no urban dictates”; placed mandatory disclosure obligations on television broadcasters in connection with promotion of the DTV transition; proposed rules that could favor low power FM stations over improvements in full-power broadcast services and existing FM translator licensees; and proposed sweeping regulation of broadcasters which could potentially require specific amounts of nonentertainment programming by all stations, restrict the flexibility of broadcasters’ location of their main studios, require 24-7 live staffing for all stations that operate on that basis, and perhaps even evaluate the music selection process of radio operators. Rumored to be in the offing are proposals to regulate embedded advertising, to adopt enhanced rules on sponsorship identification in connection with video news releases and payola-like practices, and perhaps even expand EEO reporting requirements (as the FCC recently asked for public comment on the employee-classification information for its long-suspended requirements for the filing of FCC Form 395 – the Annual Employment Report in which stations categorize all their employees by their employment duties, race and gender). And Congress has not been idle, with proposals introduced for the adoption of a performance royalty on over-the-air radio for the use of sound recordings, hearings about potential restrictions on prescription drug advertising, and a proposal to roll back the limited ownership reform adopted by the Commission in December.

With all this activity in a six month period under a Republican administration with a Republican majority on the FCC, during a time of great turmoil in the broadcast industry itself, as television prepares for the digital transition and broadcast revenue growth is slow or nonexistent (based on a variety of factors including general economic conditions and competition from the plethora of new media choices), many broadcasters are wondering what’s going on? And some fear even more changes could come about in any new administration that may come to Washington after the November elections, no matter what the result of that election. The one candidate with the most experience in the regulation of broadcasting, Senator McCain who has chaired the Senate Commerce Committee which regulates the broadcast industry, has by no means been a captive of the broadcast industry – leading efforts to enhance the use of LPFM and at one point pushing a spectrum tax proposal for television broadcasters for the use of the digital spectrum.


Continue Reading Broadcasters and the Regulatory Pendulum – Swinging Toward More Regulation

Just prior to the filing of comments in the FCC’s Localism proceeding on April 28, one FCC Commissioner has spoken out, condemning these proposals as being unnecessary in a world of vast media competition, and likely unconstitutional.  According to press reports, Commissioner Robert McDowell last week argued that the rules were unnecessary and counterproductive in a world of media plenty.  The Commissioner pointed to all of the competition from digital and traditional media and asked why the Commission should impose on broadcasters rules abolished 20 years ago – rules which will put them at a competitive disadvantage in the new media world.  These are sentiments that we have repeatedly echoed here.

Today, as comments were being submitted to the Commission, a letter from 23 Senators was sent to the Commission making many of the same arguments.  The letter suggests that the Commission was imposing unreasonable costs on broadcasters when these broadcasters have an economic incentive to serve the public or risk the loss of their audience and the resulting loss of advertising and income.  In other words, they are arguing that the Commission had it right 20 years ago when it decided that marketplace competition would insure that broadcasters served the public interest.  This letter is a companion to the letter sent to the FCC the week before last by members of the House of Representatives, about which we wrote here.


Continue Reading As Comments are Filed in Localism Proceeding, Commissioner Speaks Out

The deadline for submitting comments in the Commission’s Localism rule making proceeding is fast approaching.  Comments are due by April 28th, and can be filed electronically through the FCC’s Electronic Comment Filing System.  This proceeding contains a number of significant proposals and could possibly re-institute regulations that were lifted from the broadcast industry decades ago.  Formal ascertainment through community advisory boards and possibly other means, requirements for manning main studios during all hours of operation of broadcast stations, imposing quantitative programming requirements, and requiring that main studios be maintained within a station’s community of license are just a few of the many proposals the FCC is considering.  See our more detailed summary here.  This proceeding seeks input on these and other potentially burdensome requirements, many of which were eliminated by the Commission long ago, and some of which go beyond what the FCC has ever required before.   Given the potential impact this proceeding could have on broadcast stations, broadcasters are encouraged to file comments in this important rule making proceeding.   When submitting comments, commenters should be sure to reference the docket number for this rule making, MB Docket No. 04-233.

Some members of Congress have already chimed in in this proceeding and submitted comments opposing the Commission’s localism proposals.  Over 120 members of Congress signed on to a letter addressed to Chairman Martin urging the Commission to avoid imposing additional regulations on broadcasters and to carefully consider the cost and effect that such regulation would have on the industry.  A copy of the letter is available here.  A summary of the letter posted on Rep. Marsha Blackburn’s web site characterizes the localism proceeding as an attempt to "restore a 1970s era regulatory regime for local broadcasters." 


Continue Reading Comments on Localism Proceeding Due April 28; Congress Chimes In

In the early 1980s, the FCC deregulated many of the very detailed programing rules that governed broadcasters,  based on the theory that the marketplace would assure that broadcasters provided programming of interest to their local community.  The FCC looked at the marketplace, and decided that broadcasters either had to program to the needs of their community, or risk the loss of their audience to competitors.  Now, the FCC is proposing to bring back many of these rules with a vengeance (see our post on the FCC’s current efforts) – imposing rules even more detailed than those that were abolished over a quarter century ago.  A look at this week’s news raises the question of why now – when there are more media choices than ever (and when, particularly in the radio industry, revenues with which to meet such requirements are shrinking) – the FCC cannot rely on the marketplace to assure service to the public.  When marketplace forces require that broadcasters use their most important asset – their localism – to compete against all the new competition, the FCC is now looking to require that broadcasters meet their public interest obligations in a very specific, cookie cutter, government-mandated fashion.  Some of the announcements made this week highlight the extent of the competition that broadcasters now face.

On the most basic level, there are simply far more stations than there ever were.  According to an FCC Report published in 1980, there were 4559 commercial AM stations, 3155 commercial FM stations, and 1038 noncommercial FM stations.  While the number of AM stations had not increased substantially by the end of 2007 (4776), the number of commercial FM stations has doubled to 6309, and the number of noncommercial FMs has increased even more substantially, to 2892.  TV shows a similar increase in service – from 746 commercial and 267 noncommercial stations in 1980 to 1379 commercial stations and 380 noncommercial stations.  In addition, thousand of LPTV stations have been created, and over 800 LPFM stations – services that didn’t even exist in 1980.  Clearly, the over-the-air competition is far greater than when the FCC initiated its deregulation efforts.


Continue Reading I-Pod Radio, Internet in Cars and More Broadcast Stations Than Ever – Why Can’t the Marketplace Decide?