October 2006

The Office of Communication of the United Church of Christ, Inc., National Organization for Women, Media Alliance, Common Cause, and Benton Foundation, urge the Commission to tighten or maintain existing broadcast ownership limits so as to increase opportunities for minorities and women to own broadcast stations and to best promote the public interest goals of diversity, localism, competition, and efficient use of the spectrum.

The Commission should make increasing opportunities for minorities and women to own broadcast stations a central focus of this proceeding. Analyses of the Commission’s Form 323 ownership data show that the percentage of broadcast stations owned by minorities and women is in the low single digits, has been stagnant or decreasing, and is far below that of other industries. Moreover, numerous studies find that minorities and women continue to be under-represented or stereotyped in both news and enteraininment programming.

Increasing minority and female broadcast station ownership would serve the public interest in many ways. First, it would benefit the public by increasing the diversity of programming. Second, it would help to break down racial and gender stereotypes. Third, increasing the number of minority or women-owned stations would result in better service for underserved segments of the population. Finally, it would help remedy the past discrimination against both women and minorities in which the Commission has been at least a passive participant.

Tightening the existing ownership limits and eliminating “grandfathering” are among the most important steps the Commission could take to foster new entry by minorities and women. At a bare minimum, the FCC must ensure that discrimination based on race or gender does not occur in the sale of broadcast stations by adopting MMTC’s Proposal for an equal opportunity transaction rule.

The Commission should also act promptly to develop a working definition of “socially and economically disadvantaged” businesses that would include small businesses controlled by minorities or women. The transfer of grandfathered clusters should be limited to socially disadvantaged businesses rather than small businesses generally, and other ways of assisting socially and economicall disadvantaged small businesses should be considered.

The Commission must ensure that local television stations, newspapers, and radio stations are held by multiple, diverse owners. These media are the primary sources of news and information for the vast majority of the American public. Alternative information sources such as cable, Internet, and satellite provide little if any local news, although they may serve as additional platforms for the news gathered and produced by broadcast stations and newspapers. Additionally, a significant number of Americans do not have access to or cannot afford these alternative media sources.

Specifically, Commenters urge the Commission to modify its broadcast ownership rules as follows:
Local TV: The Commission should return to a single-license restriction on local television ownership. Digital television enables licensees to broadcast multiple program streams using a single license, thus obviating the need to acquire a second or third license to provide additional programming to the public. Moreover, the predicted programming benefits from common ownership, on which the Commission relied in relaxing local television ownership rules in 1999, have failed to materialize. A single-license restriction would promote diversity of viewoints, improve local service, increaese competition, and give licensees the incentive to use the spectrum more efficiently.

Newspaper-Broadcast Cross-Ownership: The Commission should retain the current prohibition on common ownership of a daily newspaper and a broadcast station serving the same area. Recent developments that allow both broadcasters and newspaper publishers to disseminate content on other platforms have undercut arguments for relaxing the cross-ownership restriction. Moreover, studies and anecdotal evidence show little or no public benefit from cross-ownership. Retaining the current rule with a modification to close up the loophole created by the extension of license terms to eight years would best serve the goals of diversity, localism and competition. However, if the Commission concludes that some relaxation is necessary, it would best be accomplished by modifying the waiver policy to allow waivers where certain objective criteria are met indicating that the waiver would benefit the public and to disallow waivers in categories of cases where the diversity of local news sources available to public would be reduced.

Radio-TV Cross-Ownership: The Commission should reinstate a ban on radio-television cross-ownership. Reinstating the prohibition would promote diversity, competition and localism. According to the Media Burea’s recently released study, television stations that are cross-owned air less local news. Moreover, the Commission cannot retain the Cross Media Limit found arbitrary by the Third Circuit in Prometheus, nor can it simply return to the 1999 rule, because it suffers from the same defects as the Cross Media Limit.

Local Radio: The Third Circuit found most radio markets to be “excessively concentrated.” That excessive concentration continues today. The Commission should lower the maximum number of stations that may be commonly owned in a market. Lowering the limit and requiring divestiture within a reasonable time will increase opportunities for minorities and women to acquire radio stations, foster the diversity of views available to the public, improve local service, and encourage efficient use of the spectrum. Commenters also urge the Commission to retain the AM/FM subcaps.

Data Collection, Monitoring and Enforcement: Whether the Commission retains or modifies the rules, it should proceed in a deliberate and cautious manner so that the effects of any changes can be assessed and corrective action taken if needed. To accurately document and study the effects of any changes to the media ownership rules, the Commission must improve its data collection and analysis. The Commission should also strictly enforce the ownership limits and policies.

Does Bigger Media Equal Better Media?
Four New Studies Cast a Critical Eye on Media Ownership Consolidation

The Benton Foundation and the Social Science Research Council released four independent academic studies of the impact of media consolidation in the U.S. The studies focus on how the concentration of media ownership affect media content, from local news reporting to radio music programming and how minority groups have fared – as both media outlet owners and as historically-undeserved audiences -- in an increasingly deregulated media environment. These studies make clear that media consolidation does not correlate with better, more local or more diverse media content. To the contrary, they strongly suggest that media ownership rules should be tightened not relaxed.

The studies are intended to inform the FCC's reexamination of media ownership restrictions and have been filed with the FCC during the initial public comment period ending Monday, October 23.

Benton president and former FCC commissioner Gloria Tristani framed the importance of these studies, stating, “This is about everything we hear and see and read through the media. At stake is how TV, radio, newspapers and even emerging media will look, what role they will play in citizens’ lives, and who, if anyone, will control them and for what purposes.”

Joe Karaganis, program director at the Social Science Research Council (SSRC), commented that the goal of the SSRC is “to ensure that public policy is informed by rigorous data and analysis, and by a wide range of perspectives. Our role in this process has been that of a facilitator of a larger conversation among researchers interested in media ownership.”

The four studies examine key relationships between ownership, programming, and community impact.

Peter DiCola, of the University of Michigan and the Future of Music Coalition, examines how the concentration of radio station ownership affects the diversity of music programming. DiCola comments that the purpose of the study is to answer the question, "Do radio companies offer more variety when they exceed the local ownership cap?” He finds that “those station groups that came to exceed the local ownership caps focus their programming primarily on just six types of formats: news, adult contemporary, rock, classic rock, country, and top 40.” He concludes, “Large station groups in excess of the local ownership cap do not offer more variety -- they offer less -- and the FCC should not raise the local ownership caps in the expectation that large station groups will suddenly change their ways.”

Dr. Carolyn Byerly of Howard University examines FCC data on minority and women-owned media. She finds that women and minorities ownership is really miniscule. Women hold a majority interest in only 3.4%, and minorities own a majority interest in only 3.6% of the total number of stations. Thus, Dr. Byerly concludes that “FCC policy has done almost nothing to open access to the airwaves for women and minorities… Communication policy must include ways for women and minority groups to acquire more stations in communities of all sizes.”

Byerly, along with with her colleagues Jamila A. Cupid and Kehbuma Langmia, also examined minority perspectives on the media coverage of minority communities, drawing on 196 interviews with African-Americans, Africans, Latinos and Asians in the Washington DC and Maryland area. Among their findings, Carolyn notes that “television is the preferred source for news and the 20% who use radio news overwhelmingly preferred stations that were minority-owned, because these stations, they said ‘tell us the truth,’ and ‘know what is really going on.’” Dr. Byerly recommends that “FCC policy needs to assure that stations pay attention to public affairs issues relevant to minority communities, as well as to expand minority media ownership.”

Michael Yan of the University of Michigan analyzes the relationship between newspaper and television cross-ownership and the provision of local news and public affairs programming. Of this research, Dr. Phil Napoli of the McGannon Communications Research Center at Fordham University notes that the purpose of the study was to “test the assertion that has frequently been made on behalf of allowing newspaper-broadcast cross-ownership, that allowing such cross-ownership will produce benefits in terms of cross-owned stations providing more local news and public affairs programming than other stations.” To the contrary, the study finds that “cross-ownership is not related to the quantity of local news provided. Similarly, the results of the analysis of public affairs-providing stations show that cross-ownership is not related to the quantity of public affairs programming provided. These results cast significant doubt on the logic that cross-ownership can promote greater availability of important types of local programming such as news and public affairs.”

Principal Findings and Recommendations

MEDIA OWNERSHIP MATTERS: Localism, the Ethnic Minority News Audience and
Community Participation
—Carolyn M. Byerly, Kehbuma Langmia and Jamila A. Cupid

This project used ethnographic and survey research to discern patterns in news consumption
among minorities in the Washington, DC metropolitan area, and to determine whether news consumption
contributes to civic involvement. Scholars interviewed 196 people, two-thirds of whom
were African American, the rest comprising Latino, African or other ethnicities.

FINDINGS

• Most prefer news from television (48%) to newspapers (28%) and radio (18%).
  Those who use radio prefer minority-owned radio stations because “they give you the
  only accurate reporting.”
• A significant number of the African-Americans surveyed (12 %) perceive widespread
  media bias against African American communities. Among the examples given:
  • White murder victims were reported to get more sympathetic treatment than
    Black victims.
  • Some noted that important community events are ignored, such as the retire
    ment of a well-known civil rights leader.
• 40% said the news does not help them to understand the problems that are most
  important to them – safety, lack of income, and lack of affordable housing.

RECOMMENDATIONS

• The study supports the existing FCC rationale for encouraging minority ownership,
  while raising serious questions about whether current measures go far enough. We con
  clude that the FCC needs to reaffirm and expand its commitment to diversity of own
  ership—especially at the local level and among minority groups.
• Local stations—especially commercial television stations—are insufficiently attentive to
  issues of underrepresentation and misrepresentation of news and affairs in minority
  communities. Thus, the FCC needs to monitor fulfillment of the localism principle
  more intently.

QUESTIONING MEDIA ACCESS: Analysis of Women and Minority FCC Ownership
Data
—Carolyn M. Byerly
The goals of this project were to discern patterns in ownership of broadcast media by women and
minorities and to compare these to general trends in media ownership. We analyzed Form 323
reports, filed with the FCC, for the year 2005, with some comparison to 2003.

FINDINGS

• FCC data indicate that media ownership opportunities for women and minority groups
  remain extremely limited. Of the 12,844 radio and television stations that filed reports
  with the FCC in 2005, women own 3.4% and minorities own 3.6%.
• Most of the media owned by women and minority broadcasters are AM or FM radio
  (89% for women, 87% for minorities) —a medium with relatively low costs of entry
  and barriers to ownership in rural areas.
• Nearly all broadcast stations with majority women and/or minority ownership in the
  FCC reports for 2005 are located in rural areas and small towns (71% for minorities,
  87% for women).

RECOMMENDATIONS

• FCC responsibility for expanding women and minority media ownership is based on the
  recognition that patterns of social marginalization are reinforced by a lack of access to
  channels of communication. Lack of access diminishes the ability of groups to partici
  pate fully in public discourse and political debate.
• Current data indicate that (1) the FCC has made very little progress in this area, and
  that (2) ownership limitations provide support for these goals by increasing ownership
  opportunities overall.
• Unenforced reporting requirements, data-entry errors, duplicate filing, and other probl
  ematic aspects of FCC data collection make accurate accounts of minority and women’s
  ownership difficult. A more serious FCC engagement with these issues must begin with
  better data collection.

DO RADIO COMPANIES OFFER MORE VARIETY WHEN THEY EXCEED THE
LOCAL OWNERSHIP CAP?
—Peter DiCola

This study seeks to answer the question “Do larger radio station groups offer more variety?”.
DiCola notes that the method by which the FCC defines markets shapes how the local ownership
caps will actually be enforced. From 1992 until 2004, the FCC’s signal-contour market definition
allowed more consolidation than Arbitron’s market definition would have allowed.
Because of mergers allowed during the signal-contour market definition era, in 104 markets there
is now at least one radio company or organization that exceeds the local ownership cap.

FINDINGS

• Station groups that are over the cap and station groups that are exactly at the cap offer
  less variety in programming formats than station groups that are under the cap.
• Relatively uncommon or “niche” formats like classical, jazz, folk, tejano, and gospel are
  least common among station groups that are over the cap or exactly at the cap—even
  though those station groups have the most spectrum to spend on niche formats—
  while being much more common among station groups that are under the cap.

RECOMMENDATIONS

• The FCC should retain its current local ownership caps in the service of content diver
  sity. In the radio market, consolidation and content diversity are at odds.
• The FCC should consider a policy of mandated divestiture for those station groups
  that exceed the local ownership cap.

NEWSPAPER/TELEVISION CROSS-OWNERSHIP AND LOCAL NEWS AND PUBLIC
AFFAIRS PROGRAMMING ON TELEVISION STATIONS: An Empirical Analysis
—Michael Zhaoxu Yan

This study was conducted to test the proposition—often asserted in media ownership proceedings—
that consolidated media ownership allows for more and better investment in news and public
affairs programming. This study analyzes the relationship between local newspaper/television
cross-ownership and the presence and quantity of local news and local public affairs programming
on broadcast television. The analysis is based on a two-week constructed random sample of television
programming in 2003 for 226 randomly selected, plus 27 cross-owned television stations.

FINDINGS

• Cross-owned television stations do not provide more local news and a local public affairs
  programming than do independently-owned stations.
• Cross-ownership does not correlate with either the presence or the quantity of local
  public affairs programming.

RECOMMENDATIONS

• Cross-ownership is not associated with any meaningful improvement (in terms of pro
  gram quantity) in station performance, relative to comparable stations, in the local news
  and public affairs arenas.
• Thus, changes in ownership rules by the FCC can not be justified in terms of claimed
  improvements in local news and public affairs programming.

Read the full report at http://www.benton.org/benton_files/MediaOwnershipReportfinal.pdf
For more on media ownership see http://www.benton.org/index.php?q=initiatives/ownership