Localism and Diversity in Radio

Much talk is swirling around radio at the moment as the new Obama administration begins to exert its considerable influence over the FCC.

Localism is the notion that radio should be responsible to “serve the public interest” of their local community and not be motivated by profit which  favors large companies that can create standardized national content and sell advertisement to national advertisers.  

Some of the nice sounding goals of the localism review are to encourage locally produced programming, staff radio stations 24 hrs/day to deal with emergencies in the community, and form processes to gather feedback from local citizens on what they want “their” local stations to broadcast. 

This argument goes back to the beginnings of radio in the 1920s and 30s. One faction argues radio spectrum is owned by the public and should exist solely to serve the Public Good, unencumbered by things like profits, advertising and ratings. The primary advocates of this point of view were the Progressive/Socialist political movements, some religious groups and the Labor Unions.   Pacifica Radio is the clearest example of this perspective.

Commercial Radio – primarily NBC [a company created in 1927 to settle patent disputes and divide up the radio business among  RCA, GE, Westinghouse, Alexander Graham Bell (AT&T), Marconi and others]  initially made money by selling radio sets and licensing others to make them – but the members of NBC then saw the potential for making money through promoting products on the air.  They started putting up as many stations at the highest power possible as fast as they could and they viewed non-NBC stations as blocking their corporate goals.    George Paley founded CBS Radio in 1928. 

Concerns that NBC was using its patents and technology as a monopoly caused Congress to pass the Communications Act of 1934 which established the FCC to set up a system of licensing and to participate in hammering out international treaties with other countries – but the public vs private battle for control continued until the outbreak of World War 2 in 1941. 

Following the end of World War 2, this battle for control of the “public” airwaves resumed, and a compromise was eventually hammered out. Non-commercial broadcasters would have exclusive control over the 88-92 MHz portion of the FM band, and the Commercial radio stations would commit to operating “in the public interest” in vague ways to be negotiated later.

In the 1950s and 1960s, Television started to displace radio as the primary source for broadcasting, expect in the automobile and the battle over who controls radio became less important.  The Fairness Doctrine was repealed in 1986 and the radio business largely deregulated in 1996.

In 2009, the pendulum is swinging back to the Progressive movement and the notion of “collective ownership of a public resource” through the election of President Obama and a veto proof majority of Democrats in Congress – many of whom have an intense desire to control the content of over the air radio and use it to further their social goals.

Some people in the radio business are suitability concerned about the potential for disruptive change (See: Saul Alinksy) in their business – especially since the major owners are all crippled with crushing debt that could be dumped into TARP by the banks holding their loans – and result in a defacto takeover of their radio business ala Chrysler and GM – others think those concerns are much ado about nothing and those people are sheep waiting for slaughter.    Sitting on the sidelines are the remaining independent radio owners who did not load up on debt or sell out in the 1990s to “Big Radio”.

I am in the first camp.  I think huge change is coming very soon to radio – the Obama administration’s goal is to create so much change so fast in so many areas that opponents can’t possibly fight all the battles at the same time.   

The license of your local Clear Channel station could well be turned over to control of the local ACORN chapter at some point in the not too distant future.   A decade of resentment against Clear Channel from people within the radio business and “The Left”, and Clear Channel’s abandonment of any pretense of local programming  is not going to leave Clear Channel with very many allies.

Diversity is pretty much what it sounds like – preference in approval of station licenses in the past has been given based on the applicant being an ethnic minority (mostly African Americans and Native American tribes) so that their communities would have a voice on the airwaves and not be drowned out by non-minority controlled (see: “White”) stations. Stations owned by women are also part of the concern about diversity. “Ownership” becomes very murky in an era of corporate ownership.   Hedge funds don’t tend to have skin colors or reproductive organs. 

In any case, the new FCC is on a mission to count up the number of dark skinned people and women who “own” radio station to be sure the over the air media is Diverse Enough to be Fair.

On the right hand side of the blog ===> is the beginning of documenting who the big owners are in radio today, how big are they, how did they get that way, what are their prospects for financial survival – to help you gather information to make your own opinion about whether what the new administration wants to do is or isn’t a “good thing”.

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