On September 10, 2009, David Oxenford addressed the Christian Music Broadcasters’ Momentum ’09 Conference in Orlando, Florida. Dave’ s presentation was titled 18 Issues in 18 Minutes: What a Broadcaster Should Worry About From Washington DC. In 18 minutes, Dave discussed topics including the FCC’s proposed localism rules, sponsorship identification and noncommercial underwriting issues, contest fines, FCC technical
Last week, the FCC issued several fines to noncommercial broadcasters who had underwriting announcements that sounded too commercial. In these decisions, the Commission found that the stations had broadcast promotional announcements for commercial businesses – and those announcements did not conform to the FCC’s rules requiring that announcements acknowledging contributions to noncommercial stations cannot contain qualitative claims about the sponsor, nor can they contain "calls to action" suggesting that listeners patronize the sponsor. These cases also raised an interesting issue in that the promotional announcements that exceeded FCC limits were not in programming produced by the station, but instead in programs produced by outside parties who received the compensation that led to the announcement. The FCC found that there was liability for the spots that were too promotional even though the station itself had received no compensation for the airing of that spot.
The rules for underwriting announcements on noncommercial stations (including Low Power FM stations) limit these announcements to ones that identify sponsors, but do not overtly promote their businesses. Underwriting announcements can identify the sponsor, say what the business of the sponsor is, and give a location (seemingly including a website address). But the announcements cannot do anything that would specifically encourage patronage of the sponsor’s business. They cannot contain a "call to action" (e.g. they cannot say "visit Joe’s hardware on Main Street" or "Call Mary’s Insurance Company today"). They cannot contain any qualitative statements about the sponsors products or services (e.g. they cannot say "delicious food", "the best service", or "a friendly and knowledgeable staff" ). The underwriting announcements cannot contain price information about products sold by a sponsor. In one of the cases decided this week, the Commission also stated that the announcements cannot be too long, as that in and of itself makes the spot seem overly promotional and was more than was necessary to identify the sponsor and the business that the sponsor was in. The spot that was criticized was approximately 60 seconds in length.
In a decision released late on Friday, the FCC upheld a $9,000 fine on a noncommercial television operator who broadcast underwriting announcements which, in the opinion of the Commission, were too much like commercials and thus were impermissible on a noncommercial station. Under the Commission’s policies governing the noncommercial nature of noncommercial stations, it is permissible to air an underwriting announcement acknowledging a commercial entity that makes a financial contribution to the station. And it is permissible to state the nature of the business, where it is located, and to air the slogan of the company. What is not permissible is when the underwriting announcement contains "calls to action," qualitative or comparative claims, price information, or other inducements to do business with this particular company. In this case, the Commission felt that the announcements crossed some or all of these lines.
In the initial Notice of Apparent Liability in this case, released in late 2004, the text of the announcements at issue are set out. In last week’s order, phrases such as "planning a special occasion?" as the intro line to an announcement about an Ice cream store were deemed to be calls to action, and the description of the ice cream cakes that the store made as "tastefully decorated" were deemed to be qualitative. Similarly, statements about a real estate company that "we’re all about family" and "we love selling real estate" were deemed to be comparative in nature, trying to distinguish this particular agent from other competitors. In only one of ten ads, one for a school supply store, did the Commission overturn its previous determination, finding that an announcement for "creative learning materials" was arguably descriptive and not qualitative.