THE FCC MUST ACT NOW TO RESCUE MINORITY BROADCAST OWNERSHIP

by David Honig on November 20, 2012

Where do the nation’s minority groups – the most intensive consumers of radio and television – stand now in ownership of radio and television stations?

Thanks to the FCC, we now know the answer, and it’s not pretty.  People of color – 36% of the population – own just 5.1% of commercial full power TV stations and 8.0% of commercial full power radio stations.  The statistics by racial group and by type of broadcast service are generally either stagnant or declining, as they have been for the past 12 years.

On the ground, the situation is even worse than the raw numbers suggest.  Most minority-owned stations are small.  They typically operate on inferior frequencies or from outlying transmitter locations.  Thus, minority asset value in radio and television has hovered for years around the 1% mark, even though spectrum is a public resource like the national parks.

Turning this around is the responsibility of FCC, which has before it 47 proposed rule and policy modifications and initiatives that have been offered by a coalition of 50 national minority and civil rights organizations (http://mmtconline.org/download/law_and_policy/media_ownership/Supplemental-Media-Ownership-Comments-040312(2).pdf).  Nearly all of the proposals are unopposed.  Here are just three examples:

  • Enabling AM broadcasters to migrate to new frequencies now used by TV Channels 5 and 6, which are adjacent to the FM band and use FM sound propagation.  This straightforward spectrum reallocation, which would be naturally followed by a new wave of receivers, would triple the value of AM stations.  Two-thirds of minority owned stations are AM’s.

 

  • Relaxing restrictions on foreign investment in domestic broadcasting to provide greater access to capital to American broadcasters, especially minorities, and facilitate American broadcasters’ reciprocal entry into diverse overseas markets hungry for African American, Hispanic American and Asian American music and culture.  Dozens of broadcast companies and civil rights organizations support this relief.
  • Allowing a broadcaster to own an additional station in a market when it brings into being, through “incubation” such as providing financing, an independently owned new voice.  This proposal by the National Association of Black Owned Broadcasters is nearly unopposed.

These and dozens of other pending diversity proposals are based on the fundamental premise that minority media owners enrich public discourse by providing diverse viewpoints over the airwaves.  For 40 years, the FCC, buttressed by dozens of research studies, has validated this principle.  And certainly the principle is intuitively obvious.  Consider this:  is Chicago’s WVON superfluous because, after all, Chicagoans have WGN?  Is the Washington Informer superfluous because Washingtonians have the City Paper?  And is Politic365 (http://politic365.com/) superfluous because we all have Politico (http://www.politico.com/)?

Today, the unique contributions of minority broadcasters could not be more vital to the nation’s cohesiveness and unity.  One need look no farther than the 2012 election to recognize how deep is the level of misinformation, stereotyping and sometimes outright hatred toward minorities.  The best way to overcome these trends is through the shared information and shared viewpoints that are produced and disseminated by diverse owners of our television and radio stations.

One way the FCC promotes diversity of viewpoints is through its “structural ownership” rules that govern how many media properties a company can own in a market.  Some of these structural rules have kept the minority ownership situation from getting even worse.  Thus, in its widely anticipated year-end decision on media ownership review, the FCC wisely intends to retain the rules governing the number of radio stations, and the number of TV stations, that a company can own in a market.

One rule the FCC proposes to relax is newspaper/broadcast crossownership.  And that makes sense given the endangered state of journalism in our country today.  The FCC recognizes that broadcast news departments’ combining with print newsgathering operations may be one of the few ways to help save local newspapers and thus slow the decline in the ranks of working journalists.

Starting a decade ago, local newspapers began laying off the reporters who covered City Hall, the Board of Education and, tragically, the Board of Elections.  We all know why this happened – among other things, Craigslist has eaten newspaper classified ads’ lunch.  Some large cities no longer have daily papers, and most daily papers still publishing are shells of their former selves.

Something must be done to reverse this trend.  Remember that for 400 years, it’s been vital to minority communities to have a vibrant Fifth Estate to “comfort the afflicted and afflict the comfortable.”

Fortunately, relaxation of the crossownership rules is unlikely to impede minority station acquisitions.  From MMTC’s vantage point, operating the nation’s only minority owned media brokerage (with $1.7B in properties sold to minorities since 1997), we’ve never seen a deal that got in trouble, or didn’t happen, or couldn’t attract capital, because of crossownership or potential crossownership.  That’s because minority broadcasters seldom seek to acquire the types of stations sought by newspapers – although, to be extra careful, when the FCC writes new rules it should keep the door open to the possibility that crossownership in a particular local market could impede minority ownership in ways that seldom arise now.

The real reasons for the decline in minority ownership are well known:  Access to capital.  Advertisers’ “no urban” and “no Spanish” instructions to ad agencies not to place ads on stations targeting customers they don’t want patronizing their stores.  Employment discrimination.  Sampling deficiencies in radio ratings.  The recession coupled with the 20:1 racial wealth gap.  The loss of the 1978 Tax Certificate Policy that quintupled minority ownership until Congress repealed it in 1995.  And the FCC’s failure to consider nearly four dozen proposed remedial measures.

We know what can happen when the FCC ignores threats to minority ownership.  In the 1970s, the nation had 42 minority owned cable systems.  Today, thanks to FCC indifference, only two small systems remain.  Will the FCC’s sitting on its hands also doom minority TV and radio ownership?

Hopefully, in its forthcoming decision on media ownership rules, the FCC will take aggressive steps to save, and grow, the remaining footholds of minority owners in broadcasting.

  • David Honig is co-founder and president of the Minority Media and Telecommunications Council (MMTC). Since its founding in 1986, MMTC has represented over 70 minority, civil rights and religious national organizations in selected proceedings before the FCC, and it operates the nation’s only full service, minority owned media and telecom brokerage.
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