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Round-Up for the Week of January 13-17

On Wednesday, January 15, the House Commerce Committee's Subcommittee on Communications and Technology held a hearing on diversity in the media market. In announcing the hearing, Commerce Committee Chairman Frank Pallone, Jr. (D-NJ) and Communications and Technology Subcommittee Chairman Mike Doyle (D-PA) said, "Since the Federal Communications Commission isn’t doing enough to advance media diversity, Congress must." So what's on the agenda? 

Background

Media outlets provide viewers with educational, political, entertainment, and news programming. Diversity — in ownership and employment— helps to ensure that programming offers different perspectives and that viewers have access to programming that is relevant to them. A lack of ownership diversity can affect the viewpoint diversity in the marketplace.

Systemic, racist discrimination, lack of access to capital, and limited opportunities have resulted in women and people of color being shut out of ownership opportunities. For example, the FCC did not begin granting radio licenses to applicants of color until 1949, nor television licenses to applicants of color until 1973. The FCC and its predecessor agency, the Federal Radio Commission, denied applications to qualified African Americans, yet allowed known segregationists to hold broadcast licenses.

This imbalance continued and was exacerbated by a licensing process that favored applicants with prior broadcasting experience, which women and people of color did not generally have.

It was not until 1978 that the FCC adopted policies to promote ownership opportunities for people of color. By that time, the most sought-after radio and television licenses had already been awarded.

Women and people of color also face hurdles when it comes to financing, and research by the FCC and National Telecommunications and Information Administration has shown that access to capital is a barrier to entry. This can be due to discrimination or the bank’s lack of familiarity with the broadcasting industry. Even overcoming the hurdle of financial resources, there are fewer opportunities for women and people of color to enter the market because there are limited broadcast properties available for purchase.

According to the most recent data (October 2015) from the FCC, ownership of full-power commercial television stations and commercial FM radio stations by women and people of color was around 10 percent. There's no reason to assume it has grown in the interim.

Past ownership, employment discrimination also affects viewpoint and ownership diversity. It was not until 1969 that the FCC adopted its first employment nondiscrimination rule, which was extended to gender discrimination in 1971. The FCC has acknowledged that the underlying rationales of the equal employment opportunity (EEO) rules are to promote “varying perspectives” and to deter employment discrimination, which can harm “efforts to diversify media ownership by impeding opportunities” for women and people of color to gain broadcasting experience. 

The EEO rules prohibit employment discrimination on the basis of race, color, religion, national origin, or gender. The rules also require broadcasters to create a recruitment and outreach program to provide notice of job vacancies. Some argue that the FCC has done little to enforce its own EEO rules, even though the FCC has said it will consider, among other things, compliance with the EEO rules when determining whether a broadcast license should be renewed. Additionally, the FCC is required to collect employment demographic data. Despite the statutory requirement to collect employment data, the FCC has failed to collect this data for nearly two decades.

The past decade has seen an explosion of new media sources. But despite the proliferation of these new sources, traditional media sources continue to be dominant sources for programming.

There Ought to Be a Law

On the agenda for the subcommittee this week were three bills.

H. Res. 549 -- Reaffirming the commitment to media diversity and pledging to work with media entities and diverse stakeholders to develop common ground solutions to eliminate barriers to media diversity. Seventy-one cosponsors back the resolution introduced by Rep. Val Butler Demings (D-FL). 

H.R. 3957 -- the Expanding Broadcast Ownership Opportunities Act. Rep. Butterfield (D-NC) reintroduced H.R. 3957 after first introducing the legislation in the 115th Congress. The legislation would reinstate a tax certificate program at the FCC, which would incentivize sales to women and members of minority groups and encourage investment of capital in stations owned by women and members of minority groups. Historically, the tax certificate program helped increase diversity of broadcast ownership. The FCC created the minority ownership tax certificate program in 1978 to address the dearth of broadcast ownership by people of color.  The program provided tax breaks to companies that sold a radio or television station to a minority-owned business. Congress eliminated the tax certificate program in 1995. During the tax certificate program’s tenure, minority broadcast ownership increased from 40 radio and TV stations in 1978, to 288 radio and 43 TV stations in 1995. (Courts have since prevented government agencies from adopting race-specific policies without sufficient data demonstrating the need for the race-specific measures.)

The bill also requires the FCC to make recommendations to Congress for increasing the number of broadcast stations owned by women and members of minority groups and submit to Congress a report every two years that states the total number of broadcast stations that are owned by women and members of minority groups.

H.R. 5567 -- the Measuring the Economics Driving Investments and Access (MEDIA) Diversity Act. Rep. Billy Long (R-MO) introduced H.R. 5567. The bill would require the FCC to consider, with the input of its Office of Communications Business Opportunities of the Commission, market entry barriers for socially disadvantaged individuals in the communications marketplace.

Testimony

Multicultural Media, Telecom and Internet Council (MMTC) President and CEO Maurita Coley enthusiastically endorsed the legislation under consideration noting that 1) ownership diversity and access to capital are essential to promoting media diversity, and 2) equal employment opportunity is essential to a diverse media marketplace, and 3) data collection is critical to government’s policy development and implementation.

The National Urban League's Clint Odom also testified in support of the legislative agenda. Odom, who served as an attorney and legal advisor to FCC Chairman Bill Kennard and FCC Commissioner Jessica Rosenworcel, warned that "the number of stations owned by people of color may be at risk of falling even lower than the incredibly low levels that exist right now." 

"Media diversity protects democracy and the public interest," was the overarching message of the testimony offered by Santa Clara University School of Law Associate Professor Catherine Sandoval. Prior to her current position, Professor Sandoval served as a California Public Utilities Commissioner and director of the FCC's Office of Communications Business Opportunities. Her extensive testimony noted:

• Broadcast Ownership Diversity and Diffusion of Control of Broadcast Licenses Reflect Longstanding Policies of the Communications Act and First Amendment Values that Protect Democracy
• Broadcasting Remains an Important Source of News and Public Affairs Programming
• Broadcasting Protects Public Safety
• The FCC Was Founded to Protect Public Safety and Promote the Public Interest
• Sandoval's research on minority ownership in commercial radio
• The Relationship between Minority Ownership and Entry and FCC Media Ownership Rules
• Understanding the Impact of the Tax Certificate’s Repeal
• Minority Ownership Contributes to Program and Viewpoint Diversity that Promotes American Democracy and Protects Public Safety
• The FCC’s 25-year Failure to Conduct an Adarand Study and Nearly Two Decades of Failure to Properly Analyze Media Ownership Diversity
• Transparency about Broadcast Hiring Serves the Public Interest

The subcommittee also heard from Diane Sutter, the president and CEO of ShootingStar Broadcasting, who represented the National Association of Broadcasters (NAB), the lobbying group that represents the interests of commercial and non-commercial over-the-air radio and television broadcasters in the United States. In 2018, FCC Chairman Ajit Pai tapped Sutter to chair the commission's Advisory Committee on Diversity and Digital Empowerment. On behalf of the NAB, Sutter urged the subcommittee to support H.R. 3957 and reinstate the tax certificate program. Sutter was instrumental in starting the Broadcast Leadership Training (BLT) program two decades ago. The 10-month Executive-MBA style program aims to help talented senior level broadcast executives who aspire to advance as group executives or station owners – particularly women and people of color – to be exposed to the fundamentals of purchasing, owning, and running a successful operation of radio and television stations. The BLT program – supported by broadcasters for broadcasters to help create the diversity that mirrors the communities they serve – sponsors the women and people of color with scholarships which amount to an investment of over $17,500 in each participant.

Can We Agree to Agree?

During the course of the hearing, Democrats and Republicans agreed that more needs to be done to boost minority media ownership. 

House Commerce Committee Chairman Frank Pallone, Jr (D-NJ) said, "I do not think anyone can dispute that ownership of our media does not reflect the diversity of our country." He voiced support for the bills under consideration.

But Republicans focused more on what they said broadcasters and cable operators are already doing to address the issue.

Subcommittee Ranking Member Bob Latta (R-OH) suggested that he might have preferred an informational hearing first before one on specific legislation. But he said both sides of the aisle share the same goal and he was happy to discuss ideas on how to promote diversity, including saying it was crucial for the FCC to periodically look at the impact of its rules. He applauded existing broadcasting and cable programs to promote diverse executives, saying both industries are taking "big strides" in ensuring diversity, though more work needs to be done.

Full Commerce Committee Ranking Member Greg Walden (R-OR), himself a former broadcaster, said he understood "the efforts the broadcast industry – and the media industry as a whole – takes to ensure diversity of ownership, viewpoint, and employment." He said, "I appreciate the many steps that industry has taken to not only recognize and take responsibility for the problem, but also the many programs and initiatives they have put in place to promote opportunities for women, minorities, and veterans."

What's Next?

Subcommittee Chairman Doyle has voiced media ownership concerns since at least 2007; the issue is likely to remain a priority for him and the subcommittee in 2020. Expect the subcommittee to advance this package of bills to the full House Commerce Committee soon and, with Chairman Pallone's support, for the bills to then move on to a vote on the House floor. 

In the Senate, the Commerce Committee held a hearing in June 2019 on the state of the television marketplace. That discussion demonstrated a consensus that the video marketplace has changed dramatically -- while the laws that govern the industry have not. The Senate committee has yet to devise a legislative agenda in this area.

All to say -- expect a stalemate. A stalemate that does not advance diversity, but rather reinforces and serves the unequal status quo.

The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.

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