Radio and Government Regulations
Almost from the start it was recognized that radio could be a unique instrument for the public good. This point was never made more apparent than in 1912, when, according to legend (which was recently challenged by scholars who contend that others were involved), a young wireless operator named David Sarnoff picked up the distress signal from the sinking Titanic and relayed the message to ships in the vicinity, which then came to the rescue of those still alive. The survivors were the beneficiaries of the first attempt at regulating the new medium. The Wireless Ship Act of 1910 required that ships carrying 50 or more passengers have wireless equipment on board. The effective use of the medium from an experimental station in New York City’s Wanamaker Building helped save 700 lives.
Radio’s first practical application was as a means of communicating from ship to ship and from ship to shore. During the first decade of the twentieth century, Marconi’s wireless invention was seen primarily as a way of linking the ships at sea with the rest of the world. Until that time, when ships left port they were beyond any conventional mode of communications. The wireless was a boon to the maritime services, including the Navy, which equipped each of its warships with the new device. Coming on the heels of the Titanic disaster, the Radio Act of 1912 sought to expand the general control of radio on the domestic level. The secretary of commerce and labor was appointed to head the implementation and monitoring of the new legislation. The primary function of the act was to license wireless stations and operators. The new regulations empowered the Department of Commerce and Labor to impose fines and revoke the licenses of those who operated outside the parameters set down by the communications law.
Growth of radio on the national level was curtailed by World War I, when the government saw fit to take over the medium for military purposes. However, as the war raged on, the same young wireless operator, David Sarnoff, who supposedly had been instrumental in saving the lives of passengers on the ill-fated Titanic, was hard at work on a scheme to drastically modify the scope of the medium, thus converting it from an experimental and maritime communications apparatus to an appliance designed for use by the general public. Less than 5 years after the war’s end, receivers were being bought by the millions, and radio as we know it today was born. As explained earlier, the lack of regulations dealing with interference nearly resulted in the premature end of radio. By 1926 hundreds of stations clogged the airways, bringing pandemonium to the dial. The Radio Act of 1912 simply did not anticipate radio’s new application. It was the Radio Act of 1927 that first approached radio as a mass medium. The Federal Regulatory Commission’s five commissioners quickly implemented a series of actions that restored the fledgling medium’s health.
The Communications Act of 1934 charged a seven-member commission with the responsibility of ensuring the efficient use of the airways, which the government views as a limited resource that belongs to the public and is leased to broadcasters. Over the years the FCC has concentrated its efforts on maximizing the usefulness of radio for the public’s benefit. Consequently, broadcasters have been required to devote a portion of their airtime to programs that address important community and national issues. In addition, broadcasters have had to promise to serve as a constant and reliable source of information, while retaining certain limits on the amount of commercial material scheduled.
The FCC has steadfastly sought to keep the medium free of political bias and special-interest groups. In 1949, the commission implemented regulations making it necessary for stations that present a viewpoint to provide an equal amount of airtime to contrasting or opposing viewpoints. The Fairness Doctrine obliged broadcasters “to afford reasonable opportunity for the discussion of conflicting views of public importance.” Later, it also stipulated that stations notify persons when attacks were made on them over the air. Although broadcasters generally acknowledge the unique nature of their business, many have felt that the government’s involvement has exceeded reasonable limits in a society based on a free-enterprise system. Because it is their money, time, and energy they are investing, broadcasters feel they should be afforded greater opportunity to determine their own programming.
In the late 1970s, a strong movement headed by Congressman Lionel Van Deerlin sought to reduce the FCC’s role in broadcasting, to allow the marketplace to dictate how the industry conducted itself. Van Deerlin actually proposed that the Broadcast Branch of the commission be abolished and a new organization with much less authority be created. His bill was defeated, but out of his and others’ efforts came a new attitude concerning the government’s hold on the electronic media. President Reagan’s antibureaucracy, free-enterprise philosophy gave impetus to the deregulation move already under way when he assumed office. The FCC, headed by Chairman Mark Fowler, expanded on the deregulation proposal that had been initiated by his predecessor, Charles Ferris. The deregulation decision eliminated the requirement that radio stations devote a portion of their airtime (8% for AM and 6% for FM) to nonentertainment programming of a public affairs nature. In addition, stations no longer had to undergo the lengthy process of ascertaining community needs as a condition of license renewal, and guidelines pertaining to the amount of time devoted to commercial announcements were eliminated.
The rule requiring stations to maintain detailed program logs was also abolished. A simplified postcard license renewal form was adopted, and license terms were extended from 3 to 7 years. In a further step the commission raised the ceiling on the number of broadcast outlets a company or individual could own from 7 AM, 7 FM, and 7 television stations to 12 each. As of March 1992, the FCC saw fit to raise the caps on ownership again, this time to 30 AM and 30 FM. Later in the year, these were reduced to 18 AM and 18 FM. Three years later, with a Republican Congress in place, a new telecommunications bill proposed to eliminate ownership caps completely. The bill also sought to relax the cross-ownership rule, which kept a single entity from possessing a radio, TV, and newspaper company in the same market. Meanwhile, radio license terms were to be raised to 10 years.
On August 4, 1987, the FCC voted to eliminate the 38-year-old Fairness Doctrine, declaring it unconstitutional and no longer applicable to broadcasters. A month before, President Reagan had vetoed legislation that would have made the policy law. The extensive updating of FCC rules and policy was based on the belief that the marketplace should serve as the primary regulator. Opponents of the reform feared that with their newfound freedom, radio stations would quickly turn their backs on community concerns and concentrate their full efforts on fattening their pocketbooks.
Those who support the position that broadcasters should first serve the needs of society are concerned that deregulation (unregulation) has further reduced the medium’s “good citizen” role. “Radio, especially the commercial sector, has long since fallen down on its ‘interest, convenience, and necessity’ obligation born of the Radio Act of 1927. While a small segment of the industry does exert an effort to address the considerable problems facing society today, the overwhelming majority continue to be fixated on the financial bottom line. There needs to be more of a balance,” observes Robert Hilliard, former FCC chief of public and educational broadcasting. Proponents of deregulation applauded the FCC’s actions, contending that the listening audience would indeed play a vital role in determining the programming of radio stations, because the medium has to meet the needs of the public to prosper.
Although the government continues to closely scrutinize the actions of the radio industry to ensure that it operates in an efficient and effective manner, it is no longer perceived as the fearsome, omnipresent Big Brother it once was. Today, broadcasters more fully enjoy the fruits of a laissezfaire system of economy, although they are not immune to commission actions (see Figure 1.24).reality, and ownership caps were all but eliminated. The act opened the floodgates for those radio groups wanting to vastly expand their portfolios. For example, by 2002, Clear Channel Radio had acquired nearly 1400 stations. Consequently, by the mid-2000s, localism had taken a substantial hit, as many of the major radio groups had replaced the indigenous broadcasts of their stations with voice-tracking and “outof-town” programming.
In terms of what interests the FCC most regarding station acquisition, radio group CEO Robin Martin offers the following view: “Over the last decade and more, the Commission has relaxed the bureaucratic requirements for approval of the transfer of licenses to new owners. Most of the questions on the forms can be answered by checking boxes. However, simple as this process might seem, the check marks a new owner places in the boxes represent legal certifications by the proposed licensee and should not be taken lightly. The FCC has great interest in a certain few areas that qualify as threshold questions of eligibility to be a license holder. The percentage of foreign ownership is but one example. If the answers to these questions do not comply with FCC rules and regulations, the transfer will not be approved. However, all the non-threshold questions, while not necessarily individually disqualifying, may in the aggregate lead the FCC staff to inquire further about the response to clarify the details or to understand if the application is fatally defective or can be corrected or amended with supplemental information.
The most important issue for the FCC is honesty. If an applicant answers a question dishonestly, the Commission will take swift action against the applicant should it discover falsehoods. The consequences of not being truthful with the Commission are more dire than if the answer was truthful and required more explanation or even a waiver of the rules. It’s therefore important to understand the meaning or implications of the questions to avoid unwittingly answering incorrectly. Attorneys need to be consulted before applications are submitted.”
Prominent broadcast attorney Erwin Krasnow provides the following summary pertaining to the downsizing trend of the past two decades in FCC regulations for radio broadcasters. “The world of FCC regulation has changed dramatically. No more ascertainment. No more Fairness Doctrine (William Paley once quipped that the Fairness Doctrine was like the Holy Roman Empire, which was neither Holy, Roman, nor an Empire). No regulation of call signs or submission of Annual Financial Reports. Virtually all applications and forms are now filed electronically, many without the assistance of a communication lawyer. Rather than terms of three years, licenses are now renewed for eight years (that’s a long time; a common law marriage results after only seven years).”