In January 2002, Minot, North Dakota, became a symbol of what's wrong with media consolidation. One night a train derailed, resulting in a chemical spill, and Minot's emergency-response authorities had difficulty getting their message on the air. Clear Channel, the country's largest owner of radio stations, owns 6 of the 9 stations in Minot.
When the authorities called Clear Channel that night to address the problems with the Emergency Alert System, no one answered the phone. Eric Klinenberg's new book, Fighting for Air, describes the Minot incident in detail. (Full disclosure: Eric Klinenberg is a friend and colleague, and I offered comments on a draft of his book.)
Yesterday, Slate's media critic Jack Shafer published an article questioning Klinenberg's claims about the state of Minot's radio stations. He makes some accurate corrections to the record. But the main point of Shafer's article is to debunk a key story used by the media-reform movement, which happens to be meeting in Memphis this weekend at the National Conference on Media Reform. Shafer also suggests that radio consolidation has actually benefited the diversity of programming available in Minot and across the country. Although I admire Shafer's effort to get all the facts about Minot, he does not set the record all the way straight about radio consolidation in Minot. I would also question his conclusions about the alleged benefits of media consolidation.
As a Ph.D. student in economics at the University of Michigan and (until very recently) research director for the non-profit research and advocacy group Future of Music Coalition, I have written or co-written two studies of the effects of radio consolidation. The most recent study, published in December 2006, is titled False Premises, False Promises: A Quantitative History of Ownership Consolidation in the Radio Industry. (The report and related materials are available here.) Since I'm familiar with radio-industry data, I was able to check some of the claims relayed in Shafer's article that originated with Clear Channel's Chairman, Lowry Mays. As it happens, many of Mays's claims are inaccurate. Clear Channel uses its inaccurate information about Minot radio alongside broader -- and also unfounded -- claims about the diversity of its programming.
The FCC is currently examining its media ownership rules, and Clear Channel is advocating the elimination of the local radio ownership rule, which limits the number of stations one company can own in a single market. The stakes in that proceeding make it even more important to set the record completely straight about Minot, Clear Channel's stations in Minot, and the broader impact of radio consolidation on programming diversity.
In my research, I use the industry's own data, collected by a firm called BIA Financial Networks, to evaluate the radio industry. (The FCC's research staff uses this same data in many of its reports.) So the data on radio ownership and radio formats I discuss below come from BIA Financial Networks' Media Access Pro (Radio Version) database. The quotes are all from Shafer's article in Slate.
"Clear Channel Chairman Mays said the Minot stations represented only three radio formats before the company made its acquisitions--country, adult contemporary, and news talk. Clear Channel diversified the mix by adding a classic rock, a hits, and an oldies station."
Chairman Mays's characterization of the formats on Clear Channel's six Minot stations before Clear Channel purchased them is false. The three stations previously owned by Reiten (until Fall 1999) had the following formats at the time of sale: Country, Country, and Adult Contemporary (AC). The three stations previously owned by Roberts (until Spring 2000) had the following formats at the time of sale: Classic Rock, Hot AC, and Country. According to the BIA database, there were no "news talk" stations among the six, and four distinct formats (not three) were represented among the six stations before Clear Channel arrived.
Chairman Mays's characterization of the formats on Clear Channel's six Minot stations after Clear Channel purchased them is also inaccurate. The only format switches came in the Fall of 2000. At that time, Clear Channel switched the previously Classic Rock KRRZ-AM to Oldies, and switched the previously Country KZPR-FM to Classic Rock. This added one new format on net, not three. Clear Channel may have "diversified the mix," but only slightly, and to a much lesser degree than Shafer reports.
To this day, Clear Channel programs both KCJB-AM and KYYX-FM with the same format -- Country -- in the same small market of Minot, according to the BIA database, which collects its format data directly from the radio stations themselves on a quarterly basis.
"The six stations weren't owned by six mom 'n' pop broadcasters but by two broadcasters."
This claim is accurate, but it's important to note that the ownership structure was quite different before the Telecommunications Act of 1996 (Telecom Act). In the fall of 1995, the six Minot stations in question actually had four different owners: Reiten Broadcasting (KCJB-AM and KYYX-FM), CD Broadcasting Corp. (KRRZ-AM and KZPR-FM), the Hoberg family (KMXA-FM), and Judith Ekberg (KIZZ-FM). So, including Faith Broadcasting's KHRT-FM and KHRT-AM, the Telecom Act pushed the number of independent commercial owners from 5 to 3, and eventually to 2 by the Spring of 2000.
Minot's experience is not atypical. I documented the dramatic change in radio's market structure over the last decade, both nationally and locally, in Chapters 1 and 2 of False Premises, False Promises.
"Wherever a broadcaster consolidates ownership in a region, it will tend to diversify programming for economic reasons."
This chestnut from economic theory is a venerable one -- it dates back to an article by Michigan's own Peter Steiner in 1952 (he wasn't yet at Michigan when he published the piece). Unfortunately, Shafer reports this theoretical economic claim without supporting it with data beyond his flawed Minot data from Chairman Mays.
In False Premises, False Promises, I tallied up the array of formats offered by the largest station groups -- those that meet or exceed the FCC's limits on local radio ownership -- and compare the formats offered to those offered by the smaller station groups (see Ch. 3, pp. 93-98 for the details). I found that the largest station groups actually focus on a narrow range of formats, and that the niche formats are actually offered by smaller station groups. In fact, many large station groups offer redundant formats in the very same markets, as we saw with Clear Channel operating two Country stations in Minot.
Just to check whether Clear Channel's radio stations might provide an exception to this general trend, I looked at the formats offered in both Spring 1996 and Summer 2005 (the latest quarter for which I have data from BIA) by stations Clear Channel now owns but did not own in Spring 1996. Among these stations, the top twenty formats were offered on 81.8% of the stations in Spring 1996. By Summer 2005, once under Clear Channel's ownership, the top twenty formats were offered on . . . 81.8% of the stations. Clear Channel has not used its size -- often much larger than its competitors' sizes locally -- to diversify its format offerings.
"The economic incentive to occupy as many strong programming niches as possible is so great that the scurvy bastards at Clear Channel even broadcast the liberal Air America network in about 17 markets."
While I can't personally speak to any deficiencies in Clear Channel executives' Vitamin C levels, I can point out an opposing economic incentive to the one Shafer describes. Offering homogenized programming is cheaper than offering something different on every station. It's really important to note that Peter Steiner's 1952 economic model did not have a cost side. Steiner's model relies on the assumption that offering two Country stations in the same market cost exactly the same as offering one Country station and one News station. Clear Channel's attempts to exploit economies of scale in programming -- through voice tracking, redundant programming formats, etc. -- shows what a crucial and ultimately misleading assumption that is.
I applaud Jack Shafer for sparking a debate about media consolidation, questioning some commonly cited stories, and getting more of the facts about Minot. I hope that I have corrected a few of the inaccurate and misleading comments from Clear Channel he quoted, and added a counterweight to the economic theory he cites.
I also hope I have clarified part of the main narrative of economic, social, and political concerns about media consolidation. While Steiner's economic model supports the idea that consolidation leads to diversity, that model misses a key feature of reality: the cost savings of homogenized programming. More importantly, such a model is not supported by the facts. Radio consolidation has not added to diversity; on the contrary, consolidation appears to detract from it.
The media-reform movement should raise concerns about the situation of radio in Minot. It is especially important to challenge the inaccuracies and half-truths propounded by Clear Channel as it seeks permission from the FCC to own even more stations in each local market than it already does.
Musicians Get the Hint About Health Insurance
Two Raleigh concerts in memory of musician Drew Glackin; proceeds go to Glackin’s family and Future of Music Coalition’s Health Insurance Navigation Tool
April 10, 2008 Press release FMC's HINT program
New York State Music Education Events Examine Crucial Issues Facing Artists Forums in Rochester (April 28), Syracuse (April 29) and Albany (April 30) to focus on music, media, technology and policy issues for songwriters, composers and performers from all genres.
March 25, 2008 Event details | RSVP
Pop Rockers OK Go "Tour" Congress in Support of Net Neutrality
Damian Kulash and Andy Ross discuss the importance of open Internet structures to musicians; Kulash testifies before House Judiciary Committee.
March 13, 2008 Press release
Spoken testimony
Written testimony
Rock the Net
New York State Music Education Events Examine Crucial Issues Facing Artists Kick-off forum in Buffalo on April 2 to focus on music, media, technology and policy issues for songwriters, composers and performers from all genres. March 7, 2008 | Event details
Philly Bands Rocking for Net Neutrality February 23 Sugar Town show at Tritone in Philadelphia will showcase lady rockers and DJs, as well as musicians' support for net neutrality. February 15, 2008
OK Go and Bonerama Rocked DC for New Orleans Musicians Bands also champion FMC's "Rock the Net" campaign for net neutrality February 2 benefit show at DC's 9:30 Club raised over $8,000 for New Orleans musicians. Bands played cuts off their new benefit EP, You're Not Alone, available on iTunes on February 5. February 4, 2008
Upcoming Washington, DC show and benefit EP from OK Go & Bonerama
On February 2, OK Go and Bonerama will play a benefit at D.C.'s 9:30 Club in support of You're Not Alone - an EP to support Sweet Home New Orleans and Al "Carnival Time" Johnson. January 21, 2008
Successful New Orleans Concerts Aid Big Easy Musicians
Last week, two benefit concerts raised over $6,000 for Sweet Home New Orleans - a coalition of non-profit organizations that helps find affordable housing and provides rental assistance for the city's musicians - and Big Easy music legend Al "Carnival Time" Johnson.
January 15, 2008 Press release | Event details
Ann Chaitovitz Appointed
FMC's New Executive Director A proven leader in musician and public policy issues, Chaitovitz replaces founding Executive Director Jenny Toomey January 3, 2008
Concerts for New Orleans Musicians Bring Artists Together Two New Orleans shows and upcoming benefit CD from OK Go and Bonerama January 2, 2008
FMC's Jenny Toomey Appointed Program Officer for Ford Foundation
Kristin Thomson to Serve as FMC’s Interim Executive Director Michael Bracy to Chair FMC Board of Directors November 26, 2007
Seattle "Rocked the Net" Rep. Jay Inslee advocated network neutrality;
joined by rocker Matt Nathanson, Reclaim the Media, FMC and local music business representatives October 31, 2007
Rock the Net: Campaign for Net Neutrality Rocks Seattle
Teleconference with Rep Jay Inslee on Tuesday, Oct 30. Matt Nathanson performs at Seattle’s Crocodile Café on Tuesday, Oct. 30 October 26, 2007
Future of Music Policy Summit to Tackle Critical Issues at the Intersection of Music, Law, Technology and Policy Sen. Byron Dorgan and Sen. Ron Wyden to Deliver Keynote Addresses
Mac McCaughan, Bob Mould, Marybeth Peters of the U.S. Copyright Office and More Than 90 Other Panelists Confirmed. September 10, 2007 Summit home page Press Credentialing
AT&T's muting of bands points toward a pattern of silencing political speech Content monitor did not edit out 20 instances of curse words during Pearl Jam webcast, despite AT&T claim it hires monitors to block "excessive profanity". August 13, 2007
Top musicians, lawyers, technologists confirmed for FMC's 7th annual Policy Summit August 13, 2007 Press Release Summit home page Press Credentialing
FMC Statement on AT&T Silencing Pearl Jam's lyrics during Lollapalooza webcast August 9, 2007
FMC Statement on Federal Trade Commission Report on Net Neutrality June 29, 2007
FMC files testimony with House Small Business Committee on CRB Webcasting Rates June 27, 2007 Press Release | Testimony
Clear Channel strips local, independent artists of digital performance royalties
FMC has discovered that Clear Channel's online application for local and independent artists to submit their music for airplay on each of its stations requires the artist to approve a licensing agreement that does away with their digital performance right. June 22, 2007
Low Power Radio Gets New Push in Congress
Congress introduces bills to create hundreds of new low power FM radio stations to cities and suburbs across the country. June 22, 2007
FMC Announces Dates for 7th annual Policy Summit
September 17-18, 2007
GWU Betts Theatre, Washington, DC June 11, 2007
FMC Organizes "Musicians Bringing Musicians Home II"
A Benefit Concert on May 27 at New Orleans' Tipitina's for Sweet Home New Orleans featuring: Indigo Girls, Damian Kulash of OK Go, Jim James of My Morning Jacket, Matt Nathanson, Pamela Z...and special guests
May 23, 2007 Press Release | Details
Congressman Mike Doyle to address conference on music, law and technology
May 2 event will bring together leading experts from worlds of music, law, technology and policy. April 25, 2007
A2IM Endorses Rock the Net Campaign
American Association of Independent Music urges its label members to join the campaign for network neutrality. April 17, 2007
Music Mashes with Policy at upcoming Technology and IP Policy Day
May 2 event will bring together leading experts from worlds of music, law, technology and policy. April 16, 2007
FMC Applauds FCC's Payola Settlement
Payola agreement by FCC and big broadcast chains represents a major - but tentative - step toward once again opening the nation's airwaves to local music and voices. April 13, 2007
Rep. Edward Markey, Ted Leo kick off "Rock the Net"
Nearly 150 artists and labels have already signed onto campaign for net neutrality
March 27, 2007 Press Release | Rock the Net
Major Artists To Join Launch of Rock the Net Campaign for Net Neutrality March 23, 2007
FMC Statement on FCC's "Rules of Engagement" On Payola March 5, 2007
FMC Files Reply Comments in FCC Media Ownership Proceeding January 16, 2007
FMC Statement on FCC Payola Settlement
FMC's statement on FCC's reported consent decree with the broadcast industry in regards to payola. January 16, 2007
Radio Station Ownership Consolidation Shown to Harm Musicians and the Public
FMC study shows that the rapid consolidation of the commercial radio industry that followed the Telecommunications Act of 1996 has led to a loss of localism, less competition, fewer viewpoints and less diversity in radio programming in media markets across the country.
December 13, 2006 Press release Report details
FMC Organizes Musicians Bringing Musicians Home Benefit concert at New Orleans' Tipitina's on November 6th featuring Steve Earle, Mike Mills, Allison Moorer, Tom Morello, Boots Riley, Corin Tucker and special guests.
October 23, 2006 Read press release Read press coverage
Job
Losses Associated with Radio Consolidation Undermine Localism and Diversity FMC, Newspaper Guild and Consumers Union urge FCC to take employment effects
of their policies into account during upcoming review of media ownership rules August 9, 2006
FMC Releases Research on Employment and Wage Effects of Radio Consolidaton August 9, 2006
FMC on Preserving the Dynamism of the Internet Opinion Piece on ABC News June 29, 2006
FMC Statement on Senate Commerce Committee Vote in Support of LPFM June 28, 2006
FMC Statement on FCC Media Ownership Proceeding June 21, 2006
Indie-rock revolution, fueled by net neutrality Op-ed by FMC's Jenny Toomey and Michael Bracy June 13, 2006
Pearl Jam Donation To Help Musicians Help Themselves Proceeds From Washington, DC Appearance to be Donated to FMC Artist Research
Council May 25, 2006 Press Release
FMC signs on letter to preserve net neutrality May 17, 2006
FMC Announces Dates for Sixth Annual Future of Music Policy Summit
October 5-7, 2006 Media Advisory May 15, 2006
FMC Statement on Release of Feingold's Radio and Concert Disclosure
and Competition Act of 2005 November 18, 2005
FMC Sends Letter to Senate Commerce Committee in Support of a
Public Performance Right for Sound Recordings October 19, 2005
Top Names in Music, Law, Technology and Policy Return to Debate Critical
Issues at Fifth Annual Future of Music Policy Summit
September 6, 2005 Media Advisory | Policy
Summit home page
FMC Announces Health Insurance Navigation Tool
August 9, 2005 HINT Home Page
FMC Press Release: Music Mashes with Policy at DC Policy Day April 8, 2005
FMC's Michael Bracy Testifies in front
of House Judiciary Committee on "Digital Music Interoperability" April 6, 2005
FMC files comments at US Copyright Office on "Orphan
Works"
Comments also ask Copyright
Office to consider status of out-of-print recordings March 25, 2005
FMC Sends Letter to Senate Stating Concerns about S 193, Broadcast Decency Enforcement
Act March
10, 2005
FMC and artist groups file joint reply comments at FCC on localism in broadcasting,
MB Docket 04-233
January
3, 2005 PDF of document
