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For Local Media, Size Matters
Published on Friday, December 22, 2006 by the Seattle Times (Washington)
For Local Media, Size Matters
by John Carlson

When should government restrict the media business? Hardly ever. A free society wants as few regulations on newspapers, magazines, journals, the Internet, cable TV and satellite radio as possible. The one exception is when media operate on publicly owned airwaves — so-called free radio and TV.

The government still imposes restrictions on mainstream broadcasters, but they've loosened over time. Remember George Carlin's famous "seven dirty words you can't say on television"? Today, he could get away with three or four of them on CBS. But, he could say them all (plus a few more) on cable network HBO, which is why national media giants dislike these rules. They think decency standards are outmoded and hold down profits. The Federal Communications Commission (FCC), guardian of those airwaves, won't budge.

Big media also want to end restrictions on media consolidation for the same reasons. And, a dozen years ago, the FCC loosened the belt, allowing media chains to own as many as eight stations in one city. This set off a consolidation binge, which set off a lobbying campaign to allow even more consolidation, which the FCC is considering now.

Before the FCC makes that move, I hope it asks a few simple questions. Is national consolidation crowding out local owners in local markets? (Yes.) Does it enhance competition? (Sometimes it actually undermines it.) Does it pour more money and attention into local news gathering and reporting? (Just the opposite.) Are any of these things relevant to the FCC as stewards of the public airwaves? (Why wouldn't they be?)

Here's the impact of national consolidation locally. Eighty percent of Seattle's biggest radio stations are now owned by media companies outside the state. Only six of the top 30 remain locally owned. Two are Christian stations. Three, including KOMO-AM and KVI-AM, are held by Seattle-based Fisher Broadcasting. And KING-FM is owned by a trust to protect its classical-music format, a gift to the community from the Bullitt family, former owners of KING-TV. Excepting KING-FM, the days of local companies owning just one station are now gone. All 29 other stations in Seattle are owned by chains.

Now, chains by themselves aren't bad. Many industries have evolved in this direction, but there's a difference. Local investors can start an in-town bank to compete with Bank of America. A chef with enough backing can compete with Applebee's. But there are only a limited number of radio and TV signals available. A referee must protect the ability of local, smaller media companies to compete, and the FCC is that referee.

The FCC also has to face the reality of Wall Street's impact on the public airwaves. The Street has pushed the publicly traded media companies that own these stations to produce profits by cutting costs, which translates into more automated programming and homogenized music formats. It also means cutting local news programming. Philadelphia-based Entercom recently fired its entire award-winning news department at Boston station WRKO. Locally, we've seen Entercom-owned KIRO-AM, once known as the "News Authority," cut its news broadcasting by more than half, replacing both its noon news and afternoon news block with less-costly talk shows. A trend is under way and it's not a healthy one.

Defenders of consolidation say that it has no impact on competition; that stations still compete regardless of who owns the license. But sometimes national consolidation undermines rather than fuels local competition.

For example, several years ago, KOMO and KIRO competed head to head for the rights to broadcast the Seattle Mariners' games. KOMO (Fisher Broadcasting) won the bidding war. That's competition.

Entercom, KIRO's owner, struck back by targeting Rush Limbaugh, then heard on Fisher-owned KVI. Frankly, it was a good business move, and everyone anticipated another spirited bidding war. But it never happened. Entercom had additional interests in other parts of the country with the firm syndicating Limbaugh's show, and used that angle to get Rush plucked off KVI and placed on another Entercom station in Seattle, no bidding required.

Do I blame Entercom's CEO for doing business this way? No, he's a smart executive playing his strengths. And the stations involved lived to fight another day. But shouldn't media decisions in Seattle be based on business decisions here, rather than cities thousands of miles away?

America's most-powerful media companies argue that none of these problems are problems because people have access to more news, information and entertainment than ever before, because of the Internet, cable TV, satellite radio and other forms of communication. Look at the "big picture," they say.

But the FCC dismisses that argument when the issue of fierce language or nudity arises on the public airwaves. The FCC says it doesn't matter what's on cable TV, satellite radio and the Internet, or in the record store. Our focus, it says, is protecting the public's interest on the public's airwaves because the public owns them.

Fine, then the commission should apply that same standard when considering how much national consolidation is too much. Halting further expansion of national chains in local markets would likely preserve and perhaps expand independent, unencumbered local content. The station that disseminates more local and regional news in this market, as we've seen with particular clarity during the recent storms, is locally owned KOMO-AM. Size matters. And in this case, small and local are better than big and national.

John Carlson, a commentator on KVI-AM and KOMO-AM in Seattle, spoke at the FCC field hearing Nov. 30 in Seattle on rules governing media ownership.

Copyright © 2006 The Seattle Times Company


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