1. the magic of radio Terms to know, regulation and ownership

2. Terms  Call letters : the four (sometimes three) letters assigned by the FCC to identify a particular broadcast radio station.  Those east of the Mississippi River begin with “W”, while those to the west begin with “K”.  Disc jockey : aka DJ; radio station employee who broadcasts music over the air.  Drive times : the part of morning and evening when many people are driving to and from work or school. Drive times are similar to rush hours. Times when most people are listening to radio—best times for advertisers.  Voice tracking : the use of prerecorded rather than live disc jockeys by a radio station.

3. Terms continued  Federal Communications Commission : (FCC) founded by the U.S. Government in 1934, this agency is in charge of granting licenses to owners of broadcast television and radio stations, and can fine radio stations that violate FCC regulations. Howard Stern has been fined numerous times, for example, for airing obscene material.  Payola : the practice of radio companies paying radio station disc jockeys to play certain songs. This practice was common in the 1950s. The word is a combination of the word “pay” and “victrola” (old name for a record player).  Synergy : coordinated interaction between two or more organizations, designed to create a combined effect that is greater than the results either organization could have had on its own. [example—Disney and McDonalds]

4. Federal Communications Commission The FCC is composed of 5 members. It was established to regulate the broadcasting industry. The agency has the responsibility to supervise all over-the-air communications. Although they are forbidden by law from censoring the content of broadcast programming, the agency nevertheless has considerable control over what is broadcast by radio and television. By licensing and relicensing broadcasting stations, the FCC can ensure that broadcasters meet certain standards, including programming standards.5 members

5. FCC continued Broadcast stations are licensed for 8 years. To gain license to broadcast, an applicant must meet several important criteria which have been established by Congress and the FCC. When two or more persons seek the same license, the FCC uses an auction process to select who will get the license. Listeners and viewers can challenge a renewal. Public participation in this process is relatively rare, and recent rule changes have made it even harder for citizens to mount an effective license challenge.

6. Licensing Issuing and renewing broadcast licenses are perhaps the most important function of the FCC. These functions are very important to broadcasters as well, for without a license there can be no broadcasting. Virtually everything the broadcaster does is tied in some way to having the license renewed. In addition to getting a license for a new station, the broadcaster must also seek FCC approval for most operational changes, such as increasing power, changing the antenna height or location, selling the station, transferring ownership, and so forth. Broadcasting licenses are granted to radio and television stations for 8 years at a time.

7. Licensing continued An applicant for a broadcast license may seek a license to operate a new station or an existing station that he or she wishes to purchase In either case the process is extremely complicated. Attorneys familiar with FCC rules guide the applicant throughout the process. Someone seeking a license for a new station, more and more a rarity as the broadcast spectrum is being filled up, must first obtain what is called a construction permit. Obtaining this permit is actually the biggest hurdle. If the permit is granted, if construction of the station conforms to technical requirements, and if the work is completed within the time specified by the permit, the license is routinely issued.

8. Licensee Qualifications  The applicant must be a citizen of the U.S. Companies with less than 25% foreign ownership also qualify.  The applicant must have sufficient funds to build and operate the station for at least three months without earning any advertising revenue.  The applicant must either possess or be able to hire people who possess the technical qualifications to operate the broadcasting station.  The applicant must be honest and open in dealing with the commission and must have good character. Making fraudulent statements on the application can doom the applicant to failure. The character matter relates to violation of FCC rules and regulations as well as convictions of the owners or managers.

9. Multiple Ownership Rules For nearly 55 years the government sharply limited the number of broadcasting properties any single individual or company could own. These rules were founded on the notion that diversity in broadcast programming is a good thing, and one way to gain such diversity is to have as many different people as possible operating the nation’s broadcasting stations. In recent years the rules regarding the multiple ownership of broadcast properties have been changed.

10. Ownership Rules  A single entity can own in a single market as many as six radio stations and two television stations or seven radio stations and one television station if that single market has at least 20 media outlets (newspapers, television, radio).  As of the spring of 2000, rules still existed that prohibited license applicants from owning a broadcasting station and a daily newspaper in the same market. This is continually facing pressure from large media owners and some members of Congress.

11. Ownership EXAMPLE: Clear Channel Radio Stations http://www.clearchannel.com/Radio/PressRelease.aspx?PressReleaseID=1563&p=hidden

12. Works Cited Pember, Don R. Mass Media Law. Boston: McGraw and Hill Higher Education, 2001-2002.