On the latest episode of the Inside Radio Podcast, NAB President and CEO Gordon Smith uses strong language to condemn last week’s decision by the Third Circuit Court to invalidate some modest media ownership rule changes the FCC made nearly two years ago. “It’s beyond disappointment, it’s really disgust,” Smith says of the decision to block changes adopted in November 2017 which included abolishing the newspaper-broadcast and TV-radio cross-ownership bans and relaxing several television ownership restrictions.
Calling it “an appalling outcome,” Smith accused the three judges that made the decision of “refusing to leave the ‘I Love Lucy’ era” and “only watching ‘Groundhog Day’, as though nothing has changed in the media landscape.” Blocking something as “common sense” as allowing radio stations and newspapers to merge for economies of scale has “cost the journalism profession hundreds of jobs,” Smith said, suggesting the three judges are wearing blinders to today’s media world reality.
The bombshell ruling was one of the hot topics discussed in financial circles at last week’s Radio Show in Dallas because it has put potential relaxation of the FCC’s radio ownership rules on ice – at least for now. Last year the NAB submitted a proposal to the FCC that called for allowing a company to own up to eight FMs and an unlimited number of AMs in the top 75 markets and to remove all local radio ownership restrictions beyond the top 75 markets. But the court ruling has put the entire ownership issue in limbo. Smith said the FCC “has a tremendously strong case” and he’s hopeful that it will request what’s known as an “en banc” hearing with the Third Circuit that would allow the case to be heard by a much larger group of judges “because hopefully not all of the judges are living in yesteryear.” Last week’s decision “ignores the facts,” Smith said on the podcast, and “makes no sense, particularly when there are new entrants into telecommunications that are entirely unregulated and are becoming the robber barons of this century. And yet radio is somehow regarded as it has to remain as it always was. That's just not how progress works.”
On the podcast, Smith walks listeners through other important regulatory issues affecting the industry, including pirate radio and FM chips on cell phones. He also explains why ending the ASCAP and BMI consent decrees would pose a greater threat to radio than a possible performance royalty. Listen to the Inside Radio Podcast with Gordon Smith HERE.