TheAgitator.com
Gold-Hearted Monopolists
Friday, July 2nd, 2004My Fox column will run over the weekend. It’s on the continuing saga between satellite radio and the National Association of Broadcasters. No link yet, but check the Fox site at around 7pm ET tonight if you’re interested.
In the meantime, Cato colleague Adam Thierer sends this amusing little nugget from Communications Daily (no link — subscription only). It’s the comment filed by Greater Media, a consortium of radio stations similar to Clear Channel, to the FCC’s consideration of whether or not to allow XM and Sirius to offer localized content:
Greater Media â??strongly supportsâ? the NABâ??s petition seeking a declaratory FCC ruling that Sirius and XM be barred from offering local traffic and weather reports……While Sirius and XM â??may be able to pass themselves off as local broadcasters, the fact is they have made utterly no local investment in local communities,â? Greater Media said. By contrast, local broadcasters donated some $9.6 billion in cash, goods and services to their local communities in 2003, it said, citing NAB statistics. Greater Mediaâ??s stations â??participate in countless local food drives, benefit concerts holiday toy drives and other charitable events that improves the lives of the people they serve and provide essential resources to the communities in need,â? it said.
So satellite radio providers should be barred from providing local traffic and weather reports because they don’t hold canned food drives? And terrestrial broadcasters should be given a medium monopoly on traffic and weather reports because they collect toys for tots?
Sounds like the argument of someone who doesn’t have an argument.
haha, now that’s funny.
why would I pay for radio when I get it for free? that’s just plain dumb.
Maybe they haven’t been involved in local charities BECAUSE they can’t broadcast local content.
It’s also a testament to how backward FCC regulations are. They really do measure local commitment through such ridiculous “community” efforts.
Terrestrial Silliness.
As a person who’s worked in radio for 7+ years, I have seen consolidation devestate an industry. Consider the following:…
No only that, but they force us to dedicate a percentage of airtime to the community and annualy prove that we’ve done it.
Note that this only applies to broadcasters, not other media such as cable, print, or subscripted services.
To answer Thorn first – because the good government gives you the use of very valuable National asset for no cost, other than that you have to use it for public good. The other users of the airwaves have had to pay for the use. Given that a station in a major market sells for many millions of dollars beyond the bricks and mortar assets, obviously that bandwidth has a huge value. XM paid aprox. 90 million for their 12.5MHz lease.
As for why pay for satellite radio, the old adage “you get what you pay for” applies. I know that it now qualifies as an “essential service” to me – that XM has a 1.3% churn rate clearly shows that I am not alone in this assessment. Some have joked that it is as addictive as crack – over 70% of those who try it are hooked.
“To answer Thorn first – because the good government gives you the use of very valuable National asset for no cost”
The government didn’t create the frequency spectrum. The “national asset” is a natural occurance which government has claimed rights to legislate. Government doesn’t create airwaves anymore then they create gasoline, yet they are quite comfortable in collecting their share of the profits from both.
But beyond “airwaves rights”, it comes down to the consumer. The average consumer doesn’t know the different in XM and WECT, nor WSSW and Lifetime network – other than one seems to have more commercials… and broadcasters have to compete in that consumer market, not some other non-existent market.
To effectively compete in a LOCAL market, stations must be able to offer a unique product that a consumer cannot find elsewhere – in this case, it is local information on traffic and weather. If they aren’t allowed to keep this ability, then their marketshare will dwindle, their revenues go down, and after we all CLOSE then all you’ll have is XM. At which point someone is going to bitch about XM’s monopoly and demand that XM dedicate 15% of their sat broadcast to political ads.
If you think i’m all for government regulating XM, you’re slightly off… i’m simply for leveling the playing field. Either keep XM out of the local radio business, or let Howard Stern say whatever he wishes on the radio and stop fainting everytime someone’s boob flashes on the screen for 1.145 seconds.
Like Tivo, I never knew how much I needed XM until I got it.
for those of you who want the selection but don’t want to pay, go with internet radio. most streams have no ads and you can find them on your favorite music player (i personally like Winamp but they’re also available on iTunes and RealPlayer). you just have to deal with normal internet headaches.
My name is BIG JOHN BOWEN.. I’m a program director for WGZR/HILTON HEAD SC . I’ve been doing live “FM” radio for the last 15yrs.
A couple of years ago while at the “COUNTRY RADIO SEMINAR”..or CRS as we call it in the biz.. I was walking by a booth in the exibit hall and spotted a booth with this funny little banner with SIRIUS on it. I stopped and ask them while walking thru the exibit hall.. “What’s sirius?”.. and the nice lady behind the table told me that.. and I quote “WE’RE GONNA BE THE INDUSTRY THAT WILL PUT YOU OUT OF A JOB IN THE NEXT 2 YEARS!!”.. and then she preceeded to tell me about how sat radio worked.
Now, fast forward to the present.. Sat radio to me and others in the industry is nothing more than “DIRECT TV” for your car.
First up.. you will have to pay for the service..per car(what a rip off that is!).. Second .. Local content in radio is not the weather and traffic … it’s part of the entire radio station and how plugged into the commnuity the radio station is.
I can remember when Cable was evolving.. Dish and Direct.. they all say that they are gonna shut down the local broadcaster.. folks..it’s just not gonna happen.. My local tv station is still there.. and your local radio station is still there…
When XM and Sirius are free.. and you don’t have to pay for them.. and they come to our hometown and broadcast live at the next blood drive for the red cross.. I’ll worry.. not till then…
BIG JOHN BOWEN
PROGRAM DIRECTOR
WGZR/SAVANNAH HILTON HEAD
Big John — I like your attitude! Instead of tattling to the government nanny, you directly take on the competition.
Shoot, DirecTV and Dish both make extra money by giving us the local channels over the bird! It is a PREMIUM service from them … and it saves them the trouble of building infrastructure to support local coverage, which would not necessarily be economical for them to do on their own.
Sirius and XM may try the same thing, someday, if they are allowed to do so.
Terrestrial radio people need to stop spouting off that they provide local content. PLEASE! In an all out effort to save money, terrestrial radio companies are working HARD to try and homogenize the radio industry from one coast to the other. It’s Clear Channel’s main plan of action. Most people are not aware that their “local” radio stations are actually programmed and performed from other markets. The city where I live is considered a big market (in the top 30) and the Clear Channel stations here (especially KISS FM) pump in voice tracks from jocks in other towns and more than half of thier morning shows are syndicated.
Believe it–radio IS working hard to be one big syndicator themselves…maybe they’re just unset that XM and Siruis make it sound better!
C’mon people, let’s just cut the monopoly! Some are making it sound like paying for something is evil. We all prefer to pay … if it’s worth it, right? I prefer to pay for music (which are what dj’s and radio stations actually offered people years ago) than get the same 10 songs aired all day long, commercials, junk talk and the “10 seconds of local info” for free. Bring on the competition … let the consumer choose. The majority of the people used to listen to the radio for music … MUSIC. Hey, NAB, … are you listening to our broadcast? … we want music!
Big John,
Excellent post. One item though.
With XM you purchase the little reciever thing then you can plug that into whatever you want. That way you can carry it from the car to the house.
Excellent post Evan … couldn’t have put it better myself. You know how it is … when the NAB figures out (a little late) that AM/FM radio is crap, then, they will try to jump on the bandwagon. If you cant beat ‘em, join ‘em. just watch.
thanks for your insight.
Took a bit to find this article.
But FM radio is already dieing by its own hand.
http://www.freerepublic.com/focus/f-news/1157068/posts
Adapt or Die.
Good site! Very nice.
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