McCain readies hearing on radio consolidation


As opposition to media-ownership deregulation gels, Senate Commerce Committee
chairman John McCain (R-Ariz.) plans to hold hearings on radio consolidation Jan. 30,
industry sources said.

Expected to testify is Clear Channel Communications Inc. chairman Lowry Mays, who heads the
country's largest radio group, as well as an owner of a single station or small
radio group and a representative of consumer organizations.

Without referring to the hearing specifically, consolidation critic Sen.
Russell Feingold (D-Wis.) said Tuesday that he was "awfully pleased" about McCain's
"intentions" regarding the radio-merger wave of the past seven years.

"I was awfully pleased with his sense on this issue, as well as other
consolidation issues," Feingold told the Future of Music Coalition, a group of
musicians and others opposed to radio consolidation. "He gets it beyond belief,
and I think you'll be pleased about his intentions."

Feingold said he plans to reintroduce legislation from last year that would
tighten Federal Communications Commission oversight of radio.

Feingold noted that he and McCain, besides authoring the newly enacted
campaign-finance-reform law, were among the handful of lawmakers who voted
against the 1996 Telecommunications Act. That law removed national ownership
caps on radio and ushered unprecedented consolidation in the industry.

Industry officials countered, however, that McCain opposed the law for nearly
opposite reasons than Feingold. Unlike the Wisconsin Democrat, McCain argued that the
law was not deregulatory enough and, for instance, endorsed lifting the ban on
local broadcast/newspaper cross-ownership. A McCain staffer said the Arizona senator's
concerns about the 1996 law haven't changed.

Some industry observers speculated that McCain has called the hearing to tweak
broadcasters for opposing legislation that would require free airtime for
federal candidates and as a favor to his campaign-finance-reform partner,

Nevertheless, the National Association of Broadcasters isn't taking the
Future of Music's effort lightly. Monday, the NAB attacked the coalition's Nov. 18
economic analysis of radio consolidation's impact in a two-page letter to the
group that was circulated to the press. According to the NAB, the coalition
overestimated conglomerates' share of ad revenue and relied on loaded questions
in a survey purporting to show public unhappiness with the current state of the
airwaves. FMC officials stood by their report.

Last year, Feingold introduced legislation that would have:

  • Stripped conglomerates owning both radio stations and concert promoters of
    broadcast licenses if they discriminate against unaffiliated musicians,
    promoters and stations.
  • Triggered an FCC hearing to prove that there would be no discrimination when a
    radio merger gives the buyer a 60 percent national audience reach.
  • Barred the FCC from raising limits on local-radio ownership.
  • Counted radio local marketing and time-brokerage agreements toward
    local-ownership caps.
  • Outlawed local-market-area partnerships that bring an operator above 35 percent
    local-market audience or ad-revenue share.
  • Forbid "payola" that some said requires record companies to pay a small
    group of promoters in order to obtain radio airtime.
  • Required the FCC to ensure that Arbitron Inc. ratings are not