FCC testimony on media ownership: John Carlson

A quick 30-second introduction: my name is John Carlson. I was the Republican nominee for governor here in 2000 and took home the silver medal in that particular contest, despite the support of so many people here in the room. I’m the founder and former president of a free-market think tank here in Washington State, The Washington Policy Center. I’ve sponsored several state-wide initiatives and for a dozen years I have been on a radio talk show host on station KVI.

I sincerely regret that Mr. Martin, Ms. Tate, and Mr. McDowell couldn’t be here today to join you. For one thing, if they had, there would be at least four Republicans in the room. But more to the point, gentlemen, it would give me a chance to show them that the effects of media consolidation on the ground here in this Washington are far different than what it may appear in the sky box from the other Washington. When deregulation leads to competition, it is a good thing. When it leads, however, to massive consolidation and the concentration of more and more power on the airwaves in fewer and fewer hands, this is a cause of genuine concern.

Now here again is the reality on the ground, in this Washington, in my industry, the radio industry. Of the 30 largest radio stations in Seattle, there are about 40 that you can get a signal from. But at the top thirty, 90% are owned by media companies outside the state. There are only 3 radio stations in Seattle anymore that are locally owned among the top 30. In addition, there is not a single radio station among those top 30 that is singularly owned -- all the radio stations are owned by chains.

Now there are lots of businesses that have chains these days: banking, retail, restaurants… but a competitor can start a local bank. A competitor can start a restaurant. The number of radio signals is finite. It is limited. There needs to be a referee to protect the ability of smaller, locally owned media companies to compete. The FCC is that referee because at a certain point consolidation doesn’t lead to competition… it inhibits competition. That is something that other free market conservatives like Bill Safire understand, but it is not something that corporate interests are going to acknowledge because corporate interests look out for the interest of the corporation -- not for the principles of competition.

Decisions on which shows to run (when, where, and why) by radio stations that are owned by outside chains increasingly have nothing to do with that station or sometimes even that market. Now, let me give you a quick illustration of that. Several years ago, local radio stations here in Seattle -- locally owned -- decided to compete with the station that was running the Seattle Mariners’ games. They wanted to run the Mariners’ games and they put together their proposal. The station that had been running the Mariners’ games for 8, 15, 18 years… they made their presentation. The locally owned company won the rights to broadcast the Mariners. It’s good old-fashioned competition.

Now the company -- the out of state company that owned a group of radio stations including the one that lost the Mariners -- decided to get back at the locally owned company by going after one of their popular syndicated hosts. And again, competition was anticipated but the syndicate company said ‘You know what? We have interests with the group owner back in some of the larger markets back East, so we are just going to move that host off your station to one of these other stations owned by this group.’

In other words, there was no competition for this talent. It had nothing to do with the station, it had nothing to do with this market – the decision was based on things on the other side of the country. That is an example of how consolidation is actually undermining and inhibiting competition. Now, the rebuttal to all this -- and I think we have all heard it -- is that there is more sources of news, information, and entertainment for people today than ever before thanks to the internet, cable, satellite radio, and other forms of communication. That is true.

However, that is not what the FCC says when they are addressing the issue of indecency on the airways. When the issue of nudity or language comes up, the FCC says ‘It doesn’t matter what’s on cable. It doesn’t matter what’s on satellite radio. It doesn’t matter what’s on the internet. Our focus is on the public’s interest on the public’s airways because the public owns them, and we have a responsibility to safeguard that public interest.’

So, gentlemen, when it comes to local news and programming… shouldn’t the standard be the same? Shouldn’t the FCC focus exclusively on the airwaves that it regulates just as it does when it takes up the issue of decency? Let me also point out -- in concluding -- that while conservatives like me love the market, we also believe that local government is closer to the people than distant government because local knowledge is often the best knowledge. Local ownership is the best way to preserve local content. If you have stations with syndicated music, syndicated talent, basically what you’ve got there is a jukebox. But local talent, local entertainment, local talk, and local news are especially a local preserve; they are best safeguarded by local ownership. I hope the FCC will consider this when deciding that excessive consolidation often undermines this voice. Thanks very much. Good to be here.

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The media's job is to interest the public in the public interest. -John Dewey