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CONTACT: Amy Smorodin
February 23, 2006
(202) 289-8928

Broadcast Radio Needs Level Playing Field
Rep Upton's Radio Ownership Reform Proposal
is Constructive First Step

WASHINGTON D.C. - Ownership and other restrictions on terrestrial broadcast radio should be relaxed in order to allow them to compete with alternative providers and technologies, states Adam Thierer in "Rep. Upton's Welcome Call for Radio Ownership Reform," a new Progress on Point released today by The Progress & Freedom Foundation. Thierer explains that Chairman Upton's request to the FCC for additional tiers to current ownership caps is an important step in closing the regulatory gap between broadcast radio and competing platforms.

In the paper, Thierer, Senior Fellow and the Director of PFF's Center for Digital Media Freedom (CDMF), addresses concerns voiced over concentrated market power in the broadcast radio industry. Critics of ownership rule reform proposed by the FCC in 2003 claimed deregulation would hurt competition and access to information. "Indeed, the debate over media ownership was really a social debate about how much power media had in our lives and society in general," Thierer explains. While consolidation of the radio industry has taken place since the implementation of the Telecom Act, the author notes that it has helped many firms to survive in an environment of increasing competition from less regulated media outlets. The level of concentration is also far less of a concern from an antitrust standpoint compared to other industries. Thierer also notes that industry concentration statistics do not take into account competition from competing platforms and media outlets.

In addition to addressing the concerns voiced by those skeptical of media ownership reform, Thierer describes three reasons why radio ownership limit and other regulatory reform is urgently needed.

•  New Competition and the Level Playing Field
Ownership regulation that applied in an environment of "scarce" radio spectrum no longer makes sense in today's media market. Numerous platforms and devices used to consume audio entertainment now compete directly with terrestrial radio. Disparity in ownership regulations between providers does not leave a level playing field for competition.

•  New Competition and Concerns About "Localism" in Media
In order to compete with direct alternatives, such as satellite radio, the broadcast radio industry has begun to both consolidate and deconsolidate in order remain a viable and profitable industry. Again, regulatory disparity between platforms and technologies leaves terrestrial radio with restrictions not applied to their competitors.

•  First Amendment in a World of Media/ Platform Convergence
Currently, even though identical content can be accessed on a variety of platforms, speech restrictions are only imposed on broadcast outlets. In a world of media convergence, however, this regulatory disparity leaves all new technologies and outlets vulnerable to speech restriction. Deregulation of the radio market is essential in order to ensure all media outlets are "accorded the same fundamental level of speech protection consistent with our nation's First Amendment heritage."

Thierer discusses the broader issues of broadcast regulation in " The Future of Radio Regulation: The Need for a Level Playing Field," a Progress on Point released in December 2005. Thierer is also the author of the book, Media Myths: Making Sense of the Debate Over Media Ownership, where debunks longstanding arguments in favor of aggressive regulation of media ownership.

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.



The Progress & Freedom Foundation