Clyburn Weighs in Against Removing AM/FM Subcaps
FCC Commissioner Mignon Clyburn doesn’t support a proposal to eliminate the AM/FM subcaps that has recently been the focus of an industry push (see 1703020052), she told us Monday. “The Commission’s local radio ownership rule was designed to uphold the core principles of competition, localism and viewpoint diversity,” Clyburn said in an emailed statement responding to our question. “These values are at the heart of the Communications Act which is why I continue to believe we must preserve our media ownership rules.”
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The subcaps limit the number of stations in each band a single entity can own. The two services “don’t have an equal market share,” said Fletcher Heald broadcast attorney Frank Montero, and the subcap rule is seen as the reason for some larger companies continuing to own AM stations, attorneys said. Commissioner Mike O’Rielly announced his support for getting rid of the subcaps, in a speech last month (see 1703280079), and that’s seen as a sign Chairman Ajit Pai also supports eliminating the subcaps, broadcast attorneys said. Although Pai has “staked out a public position” supporting rules to strengthen AM radio, loosening regulations on broadcast ownership has also been an oft-stated goal of Pai’s, Montero said.
Doing away with the AM/FM subcaps could cause the AM industry to fail, National Association of Black Owned Broadcasters President James Winston said Monday, echoing the association’s filing in docket 14-50 Friday. NABOB was responding to a recent industry push to have the FCC get rid of the subcaps as part of its anticipated loosening of broadcast ownership regulations. Removing the subcap rule would run counter to Pai’s vocal support for AM radio, Winston told us. The subcaps are part of what is “keeping the AM band alive,” Winston said.
Pai’s remarks on AM radio “recognize that AM radio is not now, and is not likely to be in the near future, on an equal competitive level with FM radio,” Winston said in a letter to Pai. Thus the argument for eliminating the subcaps is based on an “unsupportable premise,” he said.
The FCC should get rid of the subcaps because the radio industry has changed, Wilkinson Barker broadcast attorney David Oxenford said Monday. Oxenford represents Connoisseur Media, one of the entities asking the FCC to do away with the subcaps. AM and FM radio now have competition from internet radio, podcasts and satellite radio, Oxenford said. "The whole idea behind these caps is to avoid undue concentration." With radio now facing so much outside competition, that’s no longer an issue, he said. The argument is similar to that used in favor of looser broadcast ownership rules, Montero said. On the TV side, Pai has spoken in support of such arguments many times. The current FCC majority recognizes the economic realities facing broadcasting, Oxenford said.
If the subcaps go away, larger radio groups will start unloading their AM stations in order to acquire more desirable FM stations, Winston said. That will mean fewer customers for companies that make AM equipment and fewer opportunities for engineers that work in the AM industry, and the band will begin to die, Winston said. That would affect minority owned broadcasters, Winston said. NABOB members own 180 radio stations, 76 of which are AM, Winston said.