Tuesday, November 30, 2004

The FCC makes some money ... at last!

According to Broadcasting & Cable, the FCC has just raised $147.4 million in the first-ever auction for 258 FM radio licenses. The proud new license holders — a mix of new entrants and big radio conglomerates such as Cumulus and Clear Channel — are mainly concentrated in rural areas, without too much profit-raising potential. There's an interesting background to this — interesting not only because no-one's paying much attention to it, but also because the industry is letting the government get away with taking money away from them! (How strange!) Back in the mid-1990s, when Congress was drafting the Telecommunications Act, the idea initially was for the federal government to auction chunks of the newly emerging digital TV spectrum off to media owners — which would have resulted in a cash windfall for the government. The National Association of Broadcasters and other media lobbyists successfully fought that off, and they essentially got trustee rights to billions of dollars of the public spectrum (i.e., they borrow it and use it in the public interest, rather than own it) for free. Only after that giveaway was set in stone did Congress allow the FCC to raise money by putting future licenses up for auction. It’s taken them another seven years to get around to completing the first auction! And of course it doesn't really matter because the big city TV licenses — where all the profits are at — are already safely in the pockets of the media conglomerates, who got them gratis. Media historians who have studied the battle for control of the public airwaves from 1927 to 1934 (see, e.g., Robert McChesney's work) are quite familiar with this pattern of corporate domination in U.S. media.


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