The New Radio Rules – A Slight Taming

The FCC just released a rundown of today’s decision. The radio rules have not been subject to the same amount of publicity and public discussion, and have emerged only slightly changed. All the current limits, which allow one company to own up to 8 stations in a large market, with no nationwide limit, remain as before.

The change to the radio rules regard a redefinition of what a local market is. Up to now, the FCC has defined a market based upon the effective transmission range of a station. The new rules are based upon where a station is located geographically, which is consistent with how Arbitron ratings are calculated. According to the FCC, what this does is make some markets smaller than they had been considered, which would allow for less consolidation.

In a press conference going on right now, FCC Media Bureau Chief Ken Ferree acknowledges that Clear Channel may have to stop as many as 50 deals to buy stations in markets where they’re already well consolidated.

However, another less positive change to the radio market definition is that now both non-commercial in addition to commercial stations will be counted in totalling up the size of a given radio market. The number of stations that may be co-owned is determined by the total number of stations in a market:

  • In markets with 45 or more radio stations, a company may own 8 stations, only 5 of which may be in one class, AM or FM.
  • In markets with 30-44 radio stations, a company may own 7 stations, only 4 of which may be in one class, AM or FM.
  • In markets with 15-29 radio stations, a company may own 6 stations, only 4 of which may be in one class, AM or FM.
  • In markets with 14 or fewer radio stations, a company may own 5 stations, only 3 of which may be in one class, AM or FM.

  • By and large this ruling will help stem the further expansion of Clear Channel in many cities, but will do nothing to trim back it’s current power position. As Ferree said this morning, the new ruling will help correct some “anomolous” situations, such as Minot, ND, which the FCC classified as a 45 station market, allowing for massive consolidation there, whereas Arbitron sees it as a 18 station market, which would allow for less.

    It’s still unclear whether or not companies will be forced to divest stations in cities that see their market size decrease. Powell had been opposed to forcing companies to divest and had floated a proposal to prevent companies from selling their blocks of stations wholsesale to another company, unless that company is minority owned. I see nothing about this proposal right now.






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