FMC Releases Study On Local Radio And Diversity
December 13, 2006

The Future of Music Coalition (FMC) has released its extensive report on radio station ownership consolidation. Entitled "False Premises, False Promises: A Quantitative History of Ownership Consolidation in the Radio Industry," the study claims that consolidation has led to fewer programming choices for listeners, as well as harming the listening public and music & radio industry employees.

The FMC study found that the top four station ownership groups have almost half of all radio listeners and that local ownership has declined by almost one-third from 1975 to 2005. Also, just 15 formats make up three-fourths of all commercial programming and formats with different names can overlap up to 80 percent in terms of the songs played on them.

Also, the FMC results showed that radio listenership has declined over the past 14 years since its peak in 1989. Additionally, the playlists of stations in the same format owned by the same company can overlap by up to 97 percent. The report delves into the history of radio ownership and consolidation as well.

From its findings, the FMC concludes that "radio consolidation has no demonstrated benefits for the public. Nor does it have any demonstrated benefits for the working people of the music and media industries, including DJs, programmers—and musicians."

The authors continue, "From the recent new-payola scandal to the even more recent acknowledgements that giant media conglomerates have begun to fail as business models, we can see that government and business are catching up to the reality that radio consolidation did not work. Instead, the Telecom Act worked to reduce competition, diversity, and localism, doing precisely the opposite of Congress’s stated goals for the FCC’s media policy. Future debates about how to regulate information industries should look to the radio consolidation story for a warning about the dangers of consolidated control of a media platform."

Recommendations are made to either maintain current ownership caps, or lower them. Retaining the current attribution wells as well as encouragement of ownership by small, independent or minority owners is also recommended.

The FMC also suggests the adoption of the Local Ownership Index that the organization has developed, changing the full-power licensing process, licensing more LPFM stations and the use of the digital audio broadcast (DAB) transition as an way to reallocate spectrum to entirely local entities. As for the issue of diversity, the FMC proposes the FCC find a more accurate measurement of diversity and end payola practices. They also suggest ways to improve access to data about radio stations and programming, such as making all basic information on stations readily available on the FCC's Web site.

The FMC concludes that, "Radio has great importance for our culture, our economy, and our democracy. The public deserves to see it repaired."

The entire report can be found here on the FMC's Web site.

Before the report had even been released today, the NAB released its own response, disputing the results. According to the NAB and BIA Financial Network, the number of radio formats has increased in a variety of ways in recent years. The NAB also says that the 1996 Telecomm Act has not prevented diversity in radio, citing the rise in Spanish-language radio around the country, as well as growth in Asian and African-American targeted stations.

NAB EVP of Media Relations Dennis Wharton said in a statement, "FMC's long history of producing questionable research and dubious data to fulfill its agenda-driven mission is apparent for all to see. As the BIA Financial Network study indicates, free local radio has more format diversity than at any time in its rich history. Moreover, with the advent of HD Radio, local radio will be providing more news, more music formats, and more public service for the 260 million people who tune in every week."

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