The surveys ask a number of detailed questions about regulatory practices and policies that might help or hinder minorities and females from obtaining a broadcast license.  For example, the surveys address the former Tax Certificate program which allowed broadcasters to defer the capital gains taxes on a transaction if they sold a station to a qualified minority buyer. The surveys also inquire into the broadcasters’ perceptions of the effect of the Telecommunications Act of 1996 and the consolidation of the radio and television industries on their ability to compete and to serve the public.  They ask about whether additional consolidation should be permitted, and what public policies would assist minority and female broadcasters.  They also include questions about the effect of other market forces, such as access to capital and advertising industry practices, that have paid less for broadcasters serving minority audiences. 

To test these survey instruments, the researchers administered the surveys to 16 minority and female broadcasters.

The responses to the survey highlight the importance of asking about when and how the respondent obtained their first broadcast license.  The first license is a critical step in entry and may lead to other opportunities in broadcasting.  Although not designed to yield statistically significant responses, it is noteworthy that 13 of the 16 broadcasters who responded to the survey obtained their first broadcast license before the consolidation permitted by the Telecommunications Act of 1996.

All survey respondents cited the effect that consolidation of the segment of the media in which they competed (radio or television) had on competition and advertising opportunities for minority-owned and independent stations.  Many cited the difficulties faced by single stations in competing against locally, regionally or nationally consolidated stations.  Almost all respondents stated that consolidated stations were better positioned to obtain advertising buys than independent stations.  Some also complained about such practices as consolidated stations offering advertising packages across several stations, “throwing in” minority-formatted stations for $1.00 or at no cost.  The economies of scale permitted by consolidation make it difficult for independent station owners to compete.  Several cited the high cost of buying stations and difficulty in obtaining financing, particularly if they did not already have station clusters to obtain group advertising buys. All of these factors contributed to competitive difficulties and universal opposition among survey respondents to FCC rules that would permit more local consolidation in radio.

Nine of the survey respondents specifically called for restoration of the tax certificate.  Congress abolished the program in 1995, although it left in place the 1031 tax-free exchange program, which allows broadcasters to trade stations or cable systems with each other and defer the capital gains on those transactions. 

The need for more information about the experiences and views of minority and female broadcasters is evident. The National Telecommunications and Information Administration (NTIA) stopped conducting surveys of minority and female broadcasters in 2001, while the Federal Communications Commission has not conducted any systematic surveys of minority and female broadcasters. 

In Prometheus Radio Project vs. FCC, the Third Circuit Court of Appeals chastised the FCC for repealing its only regulatory provision that promoted minority television station ownership without considering the repeal's effect on minority ownership. The court concluded that the FCC’s action was inconsistent with the Commission's obligation to make the broadcast spectrum available to all people "without discrimination on the basis of race." 47 U.S.C. § 151.  The court also ordered the FCC to consider proposals for advancing minority and disadvantaged businesses and for promoting diversity in broadcasting, including those put forward by MMTC. 

These surveys can create a valuable database regarding minority and female broadcasters.  That information will provide additional data to help the FCC make better decisions about its media ownership policies, including how it collects and reports data on minority and female ownership. A full administration and analysis of the surveys will allow policy makers, the FCC, and advocates for a diverse media to better understand and address the effect of regulatory policies on opportunities for financing and the competitive pressures that influence industry entry and exit.

For more information about this study, please contact Catherine Sandoval or Allen Hammond IV at Csandoval@scu.edu and Ahammond-at-scu.edu, respectively.  For more information about the Minority Media Telecommunications Council, see their website at http://www.mmtconline.org.

___________________________________________________________________________

[1] “Out of the Picture: Minority & Female TV Station Ownership in the United States” September 2006, Derek Turner.