Unpaid Royalties is a series about the myriad ways that the music industry exploits Black artists—and what's being done to change them. Read more here. KJLH is an adult R&B radio station that serves Los Angeles, home to about 10 million Black people. The weekday lineup pulls from Billboard’s weekly adult R&B national airplay chart, which includes newer songs from artists a little past their prime, targeted to 25 to 54-year-olds (in other words, it’s one of the platforms where a new Ne-Yo song is a priority). There’s some Saweetie in there too, but the station is still one of a kind, and not because you’d hear that now-obscure Queen Pen joint within the same hour as Beenie Man and Mya’s “Girls Dem Sugar” in 2020. KJLH is alone in being the only independent terrestrial commercial radio station serving a Black music audience in California’s major markets. Its peer, KTWV (94.7 The Wave), is one of the 235 radio stations owned by Entercom. A Utah corporation named Bonneville International owns San Francisco’s 41-year-old KBLX, along with 13 other stations. KJLH relies on revenue from ads and various events—two streams dried out by the COVID-19 pandemic—while its peers rest atop bags of corporate money. “Where we may have been competing one-on-one or two-on-one, now in L.A., you can be competing with as many as seven or eight stations owned by the same entity,” said KJLH VP/General Manager Karen E. Slade. “Then you’re competing for audience and advertising dollars. They make it just so much harder to compete in the market because they tend to have a lot of efficiencies because of their financial structure.”
The station would be an anomaly regardless of which time zone it was in, thanks to legislation passed when some of its listeners were toddlers. The Telecommunications Act of 1996 lifted a cap on the number of radio properties a single company could own nationally. Its stated purpose was to promote competition, and if we are judging laws by stated purposes, it’s failed. Within three years, Bonneville International, the now-defunct Infinity Broadcasting, and Clear Channel dominated the market, collecting about 68 percent of the ad dollars while crippling the diversity of airwaves nationwide. "I think the Telecommunications Act has taken some of the localism out of radio. Ultimately, there may be a backlash," Emmis Communications CEO Jeffrey Smulyan told the Chicago Tribune in 2001. “It is very hard for us to be arbiters of taste, especially when we're responsible to shareholders." Of course, the act didn’t just disrupt Black radio. It’s an industry-wide contortion that some classic rock fans blame for making people think Jay Z is good. But if the music business is like every other American business in how it denies Black people capital, the law at least helped instate other roadblocks. At the very least, the Telecommunications Act doesn’t appear to have had too much of a negative impact on Black radio ownership. Black majority-owned AM and FM stations currently make up roughly 2.4 percent of the market, which is a little less paltry than the 1.6 percent it was in 1997. The shift after the act was more structural. Black radio wasn’t uniformly friendly to emerging forms of expression before 1996—Public Enemy’s “How to Kill a Radio Consultant” wasn’t a thank you note—but some of hip-hop’s most seminal artists were introduced by DJs.
But in the two decades since, DJs and personalities started to resemble figureheads instead of gatekeepers. What gets played on the radio rests in the distant hands of advertisers and playlists mandated by the few corporations who own them. That’s a lot of repetition among the dozens of Black radio stations that iHeartMedia and its predominantly white board of directors oversee, flattening the music’s regional characteristics to fit under one ad-friendly umbrella. “What we’ve noticed since the ‘90s is that this consolidation of commercial media ownership has allowed for an increasingly smaller number of people to impact what forms of Black cultural production become popular and then re-disseminated back to Black audiences here and around the world,” said Jared Ball, a communication studies professor at Morgan State University. In a 2020 study, Nielsen reported that 91 percent of Black adults 18 and older still listen to radio on a weekly basis, and radio interviews are still promptly mined and aggregated for website content. These are consolation facts; streaming has, of course, overtaken the dial as young listeners’ main mode of music consumption and discovery. But for radio, breaking new artists or premiering an exclusive were more attributes than the main point. When they’re well-studied in the culture, the stations’ hosts lend context to what’s played. “I don’t want to understate the importance of giving listeners context around what’s important and what’s happening right now, which is hard to get unless you’re a lean-forward listener listening to the hippest playlists,” said Larry Miller, director of the music business program at NYU Steinhardt. “For the average listener, they need and want context.” It’s wishful thinking to believe amending the Act could salvage the radio landscape. iHeartMedia owns 855 stations, followed by Cumulus Media’s 445 and Townsquare Media's 321. Breaking up the conglomerates would cause a web of financial insolvencies and litigation that would likely cause too much harm to justify a small chance of regaining a platform capable of finding the Next Big Thing. But in its pivot to the newer tastemaking frontier of streaming playlists, the music industry might’ve just found a mirror of corporate radio. A song getting skipped over and consequently moved lower down or removed from a playlist is analogous to a radio program director being forced to drop a record from rotation. The muscle of a record label is just as potent in apps, too.
“They have big teams who do nothing but maintain relationships with the people who are choosing which tracks appear on what order on which playlist,” Miller said. The songs that do get top billing on the main streaming platforms’ landing pages and playlists are often linked to major labels, a dynamic that raises its own ethical issues about ownership. Hip-hop is the driving force behind streaming’s dominance, yet the number of Black executives in the record labels that own stakes in Spotify—Sony Music and Universal—is still disproportionately small. What results is a permutation of two traditions that’s long gamed Black artists: The pre-1996 one, of predominantly white record execs feasting off Black music while controlling its artists’ destinies, and the consolidation of an industry that routinely refuses to give those artists any stake. “What is important to take from the Telecom Act of 96 is the process that it set in motion as it relates to popular culture—music in particular,” Ball said. “And that’s what needs to be revisited: Who controls the popularity and who controls the wealth that’s being created from what’s made popular. And that’s what needs to be targeted with whatever particular legislation we want to focus on.” Hypothetically, labels that already control the bulk of pop music don’t have much incentive to support legislation that would force them to relinquish such power. But streaming is still a fluctuating business, and while its fate is to be decided, radio’s fate—a fall from a diverse platform to a largely homogenous one—is already sealed, leaving stations like KJLH figuring out ways to support itself without a corporate pocket to reach into. But Slade remains optimistic. Los Angeles is still a major market, she said, and an audience will always be there. “We serve the community. We’re in the community,” she said. “So it’s like we’re helping ourselves. One of our slogans is, ‘We are you.’ And we are. We are the audience that we serve.”
Peter DiCola and Kristin Thomson
 On November 18, 2002 the FMC publicly released its report documenting the effects of radio station ownership consolidation on musicians and the public. This comprehensive analysis was conducted in partnership with Media Access Project and funded by a grant from the Rockefeller Foundation. On November 18, 2002, FMC publicly released its Radio Deregulation: Has It Served Citizens and Musicians? – its report documenting the effects of radio station ownership consolidation on musicians and the public. Since its release, this report has been widely referenced in the media, among academics and by policymakers. Radio’s Vitality Each week, radio reaches nearly 95 percent of the U.S. population over the age of 12. But more importantly, radio uses a frequency spectrum owned, ultimately, by the American public. Because the federal government manages this spectrum on citizens’ behalf, the Federal Communications Commission (FCC) has a clear mandate to enact policies that balance the rights of citizens with the legitimate interests of broadcasters. Radio has changed drastically since the 1996 Telecommunications Act eliminated a cap on nationwide station ownership and increased the number of stations one entity could own in a single market. This legislation sparked an unprecedented period of ownership consolidation in the industry with significant and adverse effects on musicians and citizens. This report supplies a comprehensive analysis of statistical radio industry data and a survey of public views on radio, raising serious concerns about the state of commercial radio. Deregulation has not met the aspirations and stated goals of Congress and the FCC. The Report’s Methodology for Statistical Analysis Using radio station ownership data from BIA Financial Networks, we analyzed changes in the radio industry’s structure from 1996 to 2002. We recorded the number of station acquisitions and the number of parent companies over time, and then focused on the holdings of the large parents. We estimated market shares nationwide using revenue estimates from BIA and Arbitron listenership estimates contained in the BIA database. We also estimated market share by geographic market and programming format.(3) We used three classifications to categorize formats: two based on BIA data and one based on information from an established trade journal, Radio and Records. We employed two measures of choice in the radio programming available to consumers: “format variety,” which refers to changes in the number of formats available per market, and “format redundancy,” which refers to the phenomenon of one parent owning two or more stations with the same format, in the same market. As one of the relevant labor forces in the radio industry, we studied the effects of deregulation on musicians. Using chart data from 1994, 1998, and 2002 published in Radio and Records and another industry publication, Billboard Airplay Monitor, we measured overlap in the songs played by different music formats. Also, using a classification method for record labels that we developed, we calculated the percentage of songs on the radio charts released by the recording industry’s six (now five) major label conglomerates. Methodology for Public Opinion Survey FMC also commissioned a public opinion survey to measure citizens’ satisfaction with commercial radio. From May 13, 2002 to May 20, 2002, Behavior Research Center, a private research firm, conducted in-depth telephone interviews with a random sample of 500 respondents throughout the U.S., aged 14 years or older. The survey asked respondents fifteen questions about radio designed to measure listening habits and opinions on available programming and their views on issues such as radio station ownership and “pay-for-play” practices. Based on data from the total sample, one can say with 95 percent confidence that the range of error attributable to sampling and other random effects is 4.5 percentage points. Major Findings Evidence of Consolidation 1. Ten parent companies dominate the radio spectrum, radio listenership and radio revenues. Deregulation has allowed a few large radio companies to swallow many of the small ones. Together these ten parent companies control two-thirds of both listeners and revenue nationwide. Two parent companies in particular, Clear Channel and Viacom, control 42 percent of listeners and 45 percent of industry revenues (see Chapter 3, pp. 24-25). 2. Consolidation is particularly extreme in the case of Clear Channel. Since passage of the 1996 Telecommunications Act, Clear Channel has grown from 40 stations to 1,240 stations — 30 times more than congressional regulation previously allowed. No potential competitor owns even one-quarter the number of Clear Channel stations. With over 100 million listeners, Clear Channel reaches over one-third of the U.S. population (see Chapter 3, p. 24). 3. Oligopolies control almost every geographic market. Virtually every geographic market is dominated by four firms controlling 70 percent of market share or greater. In smaller markets, consolidation is more extreme. The largest four firms in most small markets control 90 percent of market share or more. These companies are sometimes regional or national station groups and not locally owned (see Chapter 3, pp. 31-35). 4. Virtually every music format is controlled by an oligopoly. In 28 of the 30 major music formats, nationwide, four companies or fewer control over 50 percent of listeners (see Chapter 3, pp. 36-39). Effects of Consolidation 5. A small number of companies control the news Americans hear on the radio. Four parent companies control two-thirds of the nation’s News format listeners. Two such firms, Viacom and Disney’s ABC Radio, also control major television networks (see Chapter 3, p. 38). 6. Format consolidation leads to fewer gatekeepers. A small number of companies control what music is played on specific formats. Coupled with a broad trend toward shorter playlists, this creates few opportunities for musicians to get on the radio. Further, overwhelming consolidation of these formats deprives citizens the opportunity to hear a wide range of music (See Chapter 4, pp. 61-63). 7. Increased format variety does not ensure increased programming diversity. From 1996 to 2000, format variety – the average number of formats available in each geographic market – increased in both large and small markets (see Chapter 3, p. 44-45). Yet format variety is not equivalent to true diversity in programming. Formats with different names have similar playlists. Analyzing data from charts in Radio and Records and Billboard Airplay Monitor, revealed considerable format homogeneity – playlist overlap between supposedly distinct formats: as much as 76 percent (see Chapter 4, p. 56). Furthermore, radio companies regularly operate two or more stations with the same format in the same geographic market. Such format redundancy undermines a common economic assumption that station owners with multiple stations in a market would program differently, in order to avoid competing against themselves. We found 561 instances of format redundancy nationwide, amounting to massive missed opportunities for format variety, which might in turn enhance programming diversity (see Chapter 3, p. 50). 8. A “twin bottleneck” limits musicians’ access to radio. Radio’s oligopolies interact with a five-company recording industry oligopoly, hurting musicians and citizens. Eighty to 100 percent of radio charts are dominated by songs released by the five (previously six) major label conglomerates. This “twin bottleneck” makes access to the airwaves even more difficult for musicians – and reduces choice for citizens (see Chapter 4, pp. 63-67). Citizens’ Views on Radio and Consolidation 9. Radio reaches a large portion of adults on a weekly basis, but time spent listening is at a 27-year low. In September 2002, Duncan’s American Radio reported that the “average persons rating” – the percentage of the U.S. population listening to the radio in any average quarter hour – has experienced a near-17 percent drop in listening over the last 13 years. 10. Citizens favor preservation of independent and locally owned stations. Eighty percent of survey respondents support action to prevent further consolidation. Thirty-eight percent would go a step further, supporting congressional action that encourages more local ownership of radio stations (see Chapter 5, p. 81-82). 11. Radio listeners want less advertising. Industry wide, the amount of advertising per hour has grown significantly over the last several years. A 2000 study found that advertising “clutter” had increased six percent nationwide in 1999, though by 2000 the amount of ads had leveled off. (4) When asked about the quantity of ads, 60 percent of survey respondents said that radio has too much advertising (see Chapter 5, p. 85). 12. Radio listeners want to hear a wider range of music that includes local musicians. Twenty-five percent of survey respondents said they hear too little of the music they like; 38 percent said that local artists are underexposed on the radio (See Chapter 5, p. 85). 13. Radio listeners want longer playlists with more variety. Seventy-eight percent of those surveyed would rather hear programming from a longer playlist – one with more songs – than from a shorter one. Fifty-two percent of those surveyed said that less repetition, more new music, or more local acts would most make radio more appealing (See Chapter 5, pp. 76-77). 14. Citizens support action to stop “indie” promotion. Sixty-eight percent of those surveyed support congressional involvement to curb the use of payola-like systems that use third parties to let record companies pay radio stations for airplay (see Chapter 5, pp. 80-81). 15. Citizens support efforts to grow low power FM radio. Seventy-five percent of survey respondents said they would welcome low power radio stations into their communities (see Chapter 5, p. 82-84). |
Which of the following was the major effect of the telecommunications act of 1996 on radio?
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