Rule2024-14496
Reinstatement of Radio Non-Duplication Rule for Commercial FM Stations
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
July 3, 2024
Effective
August 2, 2024
Issuing agencies
Federal Communications Commission
Abstract
In this document, the Federal Communications Commission (Commission) adopted an Order on Reconsideration that responds to a petition requesting reinstatement of the prohibition on the duplication of commercial FM programming beyond a 25% threshold.
Full Text
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[Federal Register Volume 89, Number 128 (Wednesday, July 3, 2024)]
[Rules and Regulations]
[Pages 55078-55085]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-14496]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 73
[MB Docket Nos. 19-310, 17-105; FCC 24-66; FR ID 228050]
Reinstatement of Radio Non-Duplication Rule for Commercial FM
Stations
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Federal Communications Commission
(Commission) adopted an Order on Reconsideration that responds to a
petition requesting reinstatement of the prohibition on the duplication
of commercial FM programming beyond a 25% threshold.
DATES: Effective August 2, 2024.
FOR FURTHER INFORMATION CONTACT: John Bat, Media Bureau, Industry
Analysis Division, <a href="/cdn-cgi/l/email-protection#8ac0e5e2e4a4c8ebfecaece9e9a4ede5fc"><span class="__cf_email__" data-cfemail="367c595e58187457427650555518515940">[email protected]</span></a>, (202) 418-7921.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Order
on Reconsideration (Order), in MB Docket Nos. 19-310, 17-105, FCC 24-
66, adopted on June 5, 2024, and released on June 10, 2024. The full
text of this document is available electronically via the search
function on the FCC's Electronic Document Management System (EDOCS) web
page at <a href="https://docs.fcc.gov/public/attachments/FCC-24-66A1.pdf">https://docs.fcc.gov/public/attachments/FCC-24-66A1.pdf</a>. To
request materials in accessible formats for people with
[[Page 55079]]
disabilities (Braille, large print, electronic files, audio format),
send an email to <a href="/cdn-cgi/l/email-protection#cbada8a8fefbff8bada8a8e5aca4bd"><span class="__cf_email__" data-cfemail="b0d6d3d3858084f0d6d3d39ed7dfc6">[email protected]</span></a> (mail to: <a href="/cdn-cgi/l/email-protection#1a7c79792f2a2e5a7c7979347d756c"><span class="__cf_email__" data-cfemail="43252020767377032520206d242c35">[email protected]</span></a>) or call the
FCC's Consumer and Governmental Affairs Bureau at (202) 418-0530
(voice), (202) 418-0432 (TTY).
Synopsis
1. By this Order, we grant the Petition for Reconsideration of REC
Networks, the musicFIRST Coalition, and the Future of Music Coalition
(Petitioners) requesting that the Commission reinstate Sec. 73.3556 of
the Commission's rules (the radio duplication rule) for commercial FM
stations. We find that reinstating the prohibition on the duplication
of FM programming beyond a 25% threshold serves the public interest by
furthering the goals of competition, programming diversity, localism,
and spectrum efficiency. We also find that the existing waiver process
should address sufficiently the concerns of specific FM stations in
unique circumstances.
Background
2. The Commission's radio duplication rule has evolved over time
consistent with changes in the broadcast radio market. The Commission
first limited the duplication of programming by commonly owned radio
stations serving the same local area in 1964 when it prohibited FM
stations in cities with populations over 100,000 from duplicating the
programming of a co-owned AM station in the same local area for more
than 50% of the FM station's broadcast day. The Commission observed
that it had never regarded program duplication as an efficient use of
FM frequencies; instead, it had allowed program duplication as, ``at
best, . . . a temporary expedient to help establish the FM service.''
Accordingly, the Commission envisioned ``a `gradual' process to end
programming duplication once the number of applicants seeking licenses
exceeded the number of vacant FM channels available in large cities.''
3. In 1976, the Commission tightened the radio duplication
restriction. It limited FM stations to duplicating only 25% of the
average program week of a co-owned AM station in the same local area if
either the AM or FM station operated in a community with a population
of over 25,000. Based on its 12 years of experience observing the
effects of the radio duplication rule, the Commission delayed
implementation of the tightened 25% limit on smaller cities for
approximately four years, establishing interim limits that prohibited
FM stations from duplicating more than 25% of average broadcast week
programming of a commonly owned AM station in communities over 100,000
and 50% of programming of a commonly owned AM station in communities
over 25,000 but under 100,000. At that time, the Commission observed
that ``the public does not have to depend on non-duplication to add
diversity'' when new broadcasting frequencies remain available. In
1986, in response to a petition for rulemaking seeking to exempt late-
night hours when determining compliance with the radio duplication
rule, the Commission eliminated the cross-service radio duplication
rule entirely. It found that FM service had developed sufficiently to
support the elimination of the rule and that FM stations were fully
competitive, obviating the need to foster the development of an
independent FM service through a requirement for separate programming.
4. In 1992, as part of a broad proceeding reviewing its national
and local radio ownership rules, the Commission adopted a new radio
duplication rule limiting the duplication of programming by commonly
owned stations or stations commonly operated through a time brokerage
agreement in the same service (AM or FM) with substantially overlapping
signals to 25% of the average broadcast week. The Commission saw no
public benefit to allowing commonly owned same-service stations in the
same local market to duplicate more than 25% of their programming,
observing that: ``. . . when a channel is licensed to a particular
community, others are prevented from using that channel and six
adjacent channels at varying distances of up to hundreds of kilometers.
The limited amount of available spectrum could be used more efficiently
by other parties to serve competition and diversity goals.'' The
Commission concluded, however, that limited programming duplication--
specifically, below the 25% threshold--had benefits, stating ``we are
persuaded that limited simulcasting, particularly where expensive,
locally produced programming such as on-the-spot news coverage is
involved, could economically benefit stations and does not so erode
diversity or undercut efficient spectrum use as to warrant
preclusion.''
5. The Commission issued the NPRM initiating this proceeding in
November 2019, seeking comment on the radio duplication rule and
whether it should be retained, modified, or eliminated. As the
Commission noted in the NPRM, the broadcast industry has changed
significantly since the Commission adopted the latest version of the
radio programming duplication rule in 1992. In particular, significant
growth in the number of radio broadcasting outlets, the advent of
digital HD Radio, and the evolution of new and varied formats in which
to disseminate programming (i.e., digital satellite radio, streaming
via station websites, and mobile applications) have led to greater
competition and programming diversity in radio broadcasting.
Accordingly, the Commission asked commenters to address several issues,
including the impact of market forces (i.e., new sources of audio
programming, increased number of stations, instances of consolidation
in any aspect of the media marketplace) and the impact of the radio
duplication rule on the Commission's public interest goals of
competition, programming diversity, localism, and spectrum efficiency.
The NPRM also sought comment on whether the Commission's prior
rationale (in 1986) for eliminating the cross-service duplication
programming rule--that duplication is preferable to curtailing
programming or going off the air entirely where separate programming is
not economically feasible--applies equally to the same-service
duplication rule. The NPRM sought input on the benefits of allowing
some level of programming duplication, as well as potential
modifications to the rule. In addition, the NPRM asked whether the rule
should treat stations in the AM service and the FM service differently
in light of the particular economic and technical challenges facing AM
stations. Finally, the NPRM asked commenters to discuss potential costs
and benefits of modifying or eliminating the rule. Four parties filed
comments in response to the NPRM, and two parties filed reply comments.
6. Prior to the Commission's elimination of the radio duplication
rule for both AM and FM stations in August 2020, Commission staff
publicly circulated a draft order that, if adopted, would have retained
the rule for the FM band. The draft order concluded that the radio
duplication rule for the FM service remained useful in furthering the
goals of competition, programming diversity, localism, and spectrum
efficiency. Among other things, the draft order concluded that the FM
service does not face the same persistent challenges as the AM service,
that the rule as applied to FM continued to ``act as a useful
guiderail'' to encourage programming diversity and spectrum efficiency,
and that the existing waiver
[[Page 55080]]
process was sufficient to provide flexibility where needed.
7. Following public release of the draft order, NAB submitted a
letter advocating for elimination of the rule for FM service as well as
AM. In the letter, NAB asserted that elimination of the rule entirely
would provide needed flexibility and benefits to FM licensees and ease
the burdens NAB alleged were caused by the rule. For instance, NAB
contended that FM station staffs forced to quarantine due to the
pandemic could find it difficult to produce original programming. NAB
further suggested that were the Commission to eliminate the rule,
stations could pool resources to simulcast emergency information
without incurring the delay of a waiver or could inform listeners of
format changes by simulcasting their new formats on multiple stations.
NAB went on to assert that the rule as applied to FM stations produced
no public interest benefits, that FM stations face considerable
competition, and that market forces would naturally give commonly owned
stations an incentive to air distinct programming, all of which
warranted eliminating the rule to allow FM stations to repurpose costly
programming, quickly and effectively, where appropriate.
8. In contrast to the draft order, the final Order, as adopted by
the Commission, eliminated the radio duplication rule for both AM and
FM services. Explaining its reasoning for the elimination of the rule
for AM stations in the final Order, the Commission stated that AM
stations could better serve the needs of the public if they were
afforded greater regulatory flexibility for innovative experimentation
with digital radio. The Commission pointed to unique pressures facing
the AM service, such as escalated environmental and man-made noise,
which has increased levels of harmful interference. The Commission also
stressed that unlike with FM service, the AM service faces higher
operational costs due to the larger and more complex physical plants
that are necessary to maintain the band. In removing the rule for FM
stations, the Commission relied primarily on its desire to afford
flexibility to respond to the exigencies of the ongoing COVID-19
national emergency. Stating that the elimination of the rule was
necessary for stations to inform listeners of emergency information and
formatting changes, the Commission also asserted that programming
duplication would in most cases not become a ``common practice,'' but
rather a short-term response to unique circumstances.
9. On November 20, 2020, REC Networks, the musicFIRST Coalition,
and the Future of Music Coalition filed a petition for reconsideration
asking that the Commission reinstate the radio duplication rule for FM
stations. NAB filed an Opposition to the Petition on January 5, 2021.
Common Frequency filed a Reply to the Opposition on January 14, 2021,
and REC Networks, the musicFIRST Coalition, and the Future of Music
Coalition did the same on January 15, 2021. Petitioners do not request
that the Commission reinstate the radio duplication prohibition for AM
stations.
Discussion
10. As discussed further below, we reinstate Sec. 73.3556 of our
rules as to FM stations in order to further the goals of competition,
programming diversity, localism, and spectrum efficiency. We find that
Petitioners provide valid reasons to reconsider eliminating the radio
duplication rule as applied to FM stations, and we conclude that the
record supports reinstating the rule for FM service. Specifically, we
find that the record does not provide sufficient evidence that the
rule, as applied to FM service, has caused or will cause harm to FM
licensees, that market forces alone would be sufficient to preserve the
rule's benefits, or that the 25% duplication allowance set forth in the
former rule and the potential to seek a waiver to exceed that allowance
in the event of special circumstances is insufficient to provide FM
licensees with flexibility where needed. Furthermore, contrary to NAB's
assertion that unique economic pressures facing radio stations
justified rescinding the rule for FM service, we find that the record
lacks sufficient evidence to demonstrate that the rule actually
contributes to such economic pressures or that eliminating the rule
would reduce those pressures in any meaningful way. As a result, we
believe that elimination of the rule for FM service in the final Order
was, at best, premature given the absence of such evidence, and
particularly as balanced against the countervailing public interest
objectives the rule serves. Accordingly, we find that reinstating the
radio duplication rule for FM service strikes the right balance between
affording FM stations the ability to repurpose some amount of
programming on commonly owned stations while continuing to further the
public interest goals of competition, programming diversity, localism,
and spectrum efficiency.
11. As an initial matter, we find that granting the Petition is
within the Commission's discretion. Contrary to NAB's assertion that
the Petition should be denied because it does not raise new issues that
were not already addressed by the Commission in the Order, we reiterate
that ``Commission precedent establishes that reconsideration is
generally appropriate where the petitioner shows either a material
error or omission in the original order.'' In this instance, we are
persuaded that the Commission's prior decision erred in eliminating the
radio duplication rule for FM stations. We note that Petitioners have
questioned whether the process by which the Commission eliminated the
rule with respect to FM service complied with the Administrative
Procedure Act. Because we conclude that Petitioners make convincing
arguments on the merits about the need to reinstate the rule for FM
service to further the public interest goals of competition,
programming diversity, localism, and spectrum efficiency, we need not
reach Petitioners' separate arguments about whether to reinstate the
rule based on alleged inadequacies in the process by which it was
eliminated.
12. We conclude that the record does not demonstrate that
eliminating the radio duplication rule as applied to the FM service
serves the public interest, and we are persuaded that the Commission's
earlier conclusion that it did so was in error. Although the Commission
stated in the Order that ``bare assertions as to the continued
usefulness of the radio duplication rule for the FM service--for
instance, that the rule ensures `some basic level of diversity and . .
. prevent[s] spectrum warehousing'--are not persuasive,'' we find that
contrary conclusions used to justify eliminating the rule for FM
service in fact rest on ``bare assertions'' derived from an exceedingly
thin record proffered in support of that decision. Specifically, only a
single commenter--NAB--advocated for elimination of the rule with
regard to FM service. In so doing, NAB offered only general assertions
regarding arguments supporting elimination of the rule for AM that it
contended could also apply to FM and anecdotal suggestions that there
could be select circumstances in which duplication would be ``helpful''
to FM stations. On reconsideration, we find NAB's claims about the
harms the rule causes to be lacking in concrete or credible support. By
contrast, we find comments describing the benefits the rule is intended
to foster and the harms that would accrue in its absence support
retaining the rule. Moreover, we find that, in the absence of more
convincing
[[Page 55081]]
evidence to assure us that elimination is wise at this time, there are
various countervailing objectives that support reinstatement of the
rule in the service of competition, programming diversity, localism,
and spectrum efficiency, objectives that we find compelling for the
reasons described herein.
13. Indeed, we find that the radio duplication rule acts as a
useful guiderail in the FM service--where spectrum is in higher demand
(than AM service) by consumers, advertisers, and owners--to encourage
the diversification of programming on commonly owned FM stations, which
then compete in the marketplace for listeners and advertisers. As
Petitioners note, allowing duplication of FM programming beyond the 25%
threshold can harm competition in the radio marketplace because, ``[t]o
the extent that larger clusters are allowed to slash programming costs
by eliminating programming on one or more FM stations within a given
single market, yet continue to sell advertising on such warehoused
spectrum, it follows that competing independent radio stations in that
shared market cannot take advantage of similarly drastic economies of
scale.'' We conclude that a quantifiable cap on duplication for FM
stations properly balances stations' economic and practical needs to
offer some duplication with consumers' needs for diverse and local
programming, and addresses competition concerns as well. Given the
potential economic incentives to duplicate programming (e.g., cost
cutting), we share Petitioners' concerns regarding the attendant harms
to the public interest goals of diversity and localism--due to
potential reduction of ``local voices on local airwaves'' providing
``locally-relevant programming''--should we not reinstate the rule.
14. Regardless of any perceived benefits, we note that duplication
of programming is an inherently inefficient use of spectrum. As
recognized before by the Commission, where there is limited quantity of
spectrum, duplication beyond a 25% allowance can be considered
inefficient. While the Commission previously took the position that
market forces give station owners an incentive to avoid duplicating
programming that renders a prohibition on duplication unnecessary, on
reconsideration we do not find sufficient evidence in the record to
demonstrate that market forces would dictate against duplication above
the rule's threshold in all, or even most, instances. Conversely, we
find that the record provides at least some evidence of an incentive to
duplicate programming where market forces apparently failed to prevent
it. Notably, Kern Community Radio (Kern), a prospective non-commercial
community broadcaster, stated that, in addition to the rebroadcast of
programming being imported from outside the market, duplication also is
occurring in its local market of Bakersfield, California. Given that
other commenters failed to cite evidence either refuting or countering
the market information provided by Kern, we are not convinced that the
duplication in the Bakersfield-area market is somehow unique or
isolated. While NAB notes that the radio duplication rule was
eliminated three years ago, thus providing an opportunity to assess
whether stations increased duplication after elimination of the rule,
NAB provides no evidence on this point or otherwise refutes or counters
the information in the record. Thus, we find that it was erroneous for
the Commission to have ignored such evidence when it agreed with NAB in
2020 that stations obviously are incentivized by market forces not to
duplicate, and relied on this reasoning to rescind the rule. While NAB
contends that duplication could reduce the revenues that a station
owner could otherwise earn by offering non-duplicative programming,
duplication also allows a station owner to reduce costs substantially.
Additionally, the ability to operate a station inexpensively using
duplicative programming may, in fact, give a group station owner a
disincentive to invest in new programming, or an incentive to occupy
the frequency simply to avoid the potential introduction of a
competitor. We find NAB's theoretical arguments are insufficient to
support the conclusion that market forces alone would be adequate to
protect against duplication in the FM band. While experience with the
AM band may, over time, provide some evidence relevant to such
theoretical questions, without more or better evidence in the record of
this proceeding, we find that it was premature to extend elimination of
the rule to FM in the Order.
15. We further find that the Commission erred in abolishing the
duplication rule in the context of the pandemic ongoing at the time. On
reconsideration, we find that the record fails to demonstrate that the
25% duplication allowance set forth in the former rule and the
potential to seek a waiver to exceed that allowance would not
sufficiently address exigent circumstances. When eliminating the radio
duplication rule, the Commission stated that the COVID-19 national
emergency ``highlight[ed] the need to provide broadcasters increased
flexibility to react nimbly to local needs, as circumstances have
changed rapidly in different jurisdictions across the country since the
beginning of the outbreak.'' We acknowledge that there may be
particular value in ``allowing FM broadcasters to duplicate programming
on a commonly owned station . . . in times of crisis, including the one
our nation is currently undergoing'' because ``small broadcasters with
fewer resources are especially vulnerable if one of their studio
employees contracts the virus.'' However, upon review we find that the
record lacks sufficient evidence or examples of inefficiencies tied to
the pandemic or other exigent circumstances that would justify
permanent industrywide relief. In addition, the record lacks evidence
that the existing 25% duplication allowance has proven to be
insufficient for FM stations to respond to emergencies. Given what we
believe to be the minimal burden of addressing by waiver what NAB
terms, somewhat imprecisely, as ``times of crisis,'' and what we assume
to be the relative infrequency of such occasions, we do not believe
that burden outweighs the risks associated with essentially exempting
FM stations from the nonduplication limitations on such a vague basis.
However, we would expect to look favorably upon waivers premised on
adequately documented weather or similarly unforeseen emergencies,
sought promptly at the time of such emergencies.
16. As the Petitioners note, the COVID-19 national emergency is ``a
temporary event.'' During this time, the Commission has taken a number
of steps to accommodate Commission licensees and regulatees in light of
disruptions to their businesses. As Petitioners state, ``radio station
owners whose financial struggles force a choice between duplicating
programming or allowing one or more of their FM stations to go `dark'
'' may seek a waiver to exceed the 25% duplication allowance. Overall,
we find that the clear potential harms arising from the Commission's
elimination of the rule--harms to competition, diversity, localism, and
spectrum efficiency--when weighed against speculative potential
benefits, if any, merit reinstating the rule for FM service. Benefits
of rescinding the rule cited by NAB, including efficiencies in
responding to emergencies, are inherently speculative. The record
[[Page 55082]]
contains no evidence demonstrating that such efficiencies could not be
achieved with the 25% duplication allowance and existing waiver
options. Further, we reject NAB's suggestion that potential efficiency-
related benefits can only be achieved through revocation of the rule
entirely when adequate regulatory relief was previously provided for in
the rule with the 25% duplication allowance.
17. Although the Commission previously expressed concerns regarding
costs and delay associated with waiver requests to exceed the 25%
duplication allowance based on special circumstances, we find on
reconsideration that in fact there is no information in the record
demonstrating that the waiver process has proven unreasonably
burdensome. We acknowledge that any waiver process inherently entails
some level of cost and delay, but those costs must be balanced against
the harms, noted above, that could ensue were the rule eliminated
entirely. On balance, we do not find evidence that the waiver process
entails costs or delay so unreasonable as to outweigh the legitimate
safeguards the rule provides. Indeed, NAB has failed to provide
concrete evidence demonstrating that FM stations have struggled to
respond to weather and other emergency events because of the need to
seek a waiver, despite raising such a concern. We find that the rule
provides stations a sufficient buffer under the 25% duplication
allowance so that stations may react responsively and nimbly to
emergencies, format changes, and other special circumstances that might
warrant a temporary level of duplication. We agree with Petitioners
that the wholesale elimination of the radio duplication rule for FM
stations across the industry ``shortchange[d] the careful tailoring and
analysis available through the waiver process,'' through which stations
can seek relief. A waiver process exists precisely to account for
temporary or unique circumstances that warrant a limited departure from
the overall rule.
18. Finally, whatever the alleged or perceived economic challenges
facing the FM service may be, we conclude that the record does not
establish that elimination of the prohibition on duplication as it
pertains to FM service is an appropriate, or likely to be an effective,
means to address those challenges. In its support of the elimination of
the duplication rule, NAB has repeatedly emphasized how FM stations
have encountered significant financial stress--in part due to listener
demands for higher fidelity in an ``expanding universe'' of platforms
and economic shocks from COVID-19. However, as stated above, the rule
was created in service of other objectives, which would be jeopardized
in its absence. Moreover, we cannot conclude that the duplication
rule's impacts are sufficiently tied to FM stations' economic and
listenership challenges such that revocation of the rule entirely would
meaningfully address these larger concerns. We find that the rule
already provides adequate flexibility for those FM stations that choose
partial or short-term duplication of programming in response to either
economic challenges or other temporary emergency or reformatting needs.
19. We are not persuaded by NAB's ex parte request to pause this
Order until the Commission first collects and analyzes new data on the
nature and prevalence of programming duplication, and/or information
regarding recent changes to stations' operations, since the
Commission's elimination of the duplication rule. We note that NAB has
not submitted such data. In any event, regardless of whether and to
what extent duplication has begun to take place, it does not follow
that the Commission should delay further the restoration of a useful
guiderail. As noted above, in those instances where duplication is
occurring or will occur in the future, and where there is a legitimate
need for it, the 25% duplication allowance and waiver process will
remain available to stations.
20. Although we reject calls to wait further to act, we provide a
six-month grace period to the extent that some FM stations are
currently employing duplication that exceeds the limits of the
reinstated rule. In order to minimize possible service disruptions and
burdens for these stations, and to provide them with an ample runway
back to compliance with the reinstated rule, we will provide a six-
month grace period after the rule's effective date to come into
compliance. The six-month grace period will begin when the reinstated
rule becomes effective thirty days after publication in the Federal
Register. Consistent with this grace period, we strongly encourage any
FM station that currently exceeds the duplication allowance, and that
intends to seek a waiver, to submit its request for a waiver within the
first ninety days after the new rule becomes effective. We believe that
adherence to this timeframe will benefit such stations by permitting
them to take advantage of the grace period and continue their current
practices while any waiver request is under review. Nevertheless, we
will permit FM stations currently employing duplication that exceeds
the 25% duplication allowance to continue to transmit their programming
in excess of the 25% duplication allowance unless and until the waiver
request is denied. In the event that a waiver request is denied, we
direct the Media Bureau to provide the licensee with additional time to
come into compliance, not to exceed six months from wavier denial. In
addition, we emphasize that the grace period and our guidance on
waivers for those FM stations currently duplicating in excess of the
25% duplication allowance, as described directly above, does not
preclude an FM station that later finds itself interested in pursuing a
waiver from seeking one. The general process for seeking a waiver of
the reinstated rule will continue to remain available beyond, and apart
from, the grace period and ninety-day recommendation for requesting a
waiver described in this paragraph.
21. In conclusion, we agree with Petitioners that the Commission
erred by enacting a permanent rule change for the FM service when the
existing duplication allowance and waiver option, adequately address
issues that may arise. The reinstated rule will function as a useful
guiderail promoting the public interest and will provide sufficient
flexibility to serve the particularized needs of FM stations. For the
reasons stated above, we find that any costs associated with
reinstating the rule for FM service are outweighed by the benefits
associated with the rule in furthering the public interest objectives
of competition, programming diversity, localism, and spectrum
efficiency. Accordingly, we grant the Petition and reinstate the radio
duplication rule as to FM stations.
Procedural Matters
22. Supplemental Final Regulatory Flexibility Act Analysis. In
compliance with the Regulatory Flexibility Act (RFA), this Supplemental
Final Regulatory Flexibility Analysis (Supplemental FRFA) supplements
the Final Regulatory Flexibility Analysis (FRFA) included in the Order,
to the extent that changes adopted on reconsideration require changes
to the information included and conclusions reached in the FRFA. As
required by the Regulatory Flexibility Act of 1980, as amended (RFA),
an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in
the NPRM that initiated this proceeding. The Commission sought written
public comment on the proposals in the NPRM, including comment on the
IRFA. The Commission received no comments in response to the IRFA. This
present Supplemental FRFA conforms to the RFA.
[[Page 55083]]
23. Paperwork Reduction Analysis. This document does not contain
new or revised information collection requirements subject to the
Paperwork Reduction Act of 1995, Public Law 104-13, (44 U.S.C. 3501
through 3520). In addition, therefore, it does not contain any new or
modified ``information burden for small business concerns with fewer
than 25 employees'' pursuant to the Small Business Paperwork Relief Act
of 2002, Public Law 107-198, 44 U.S.C. 3506(c)(4).
24. Congressional Review Act. The Commission has determined, and
the Administrator of the Office of Information and Regulatory Affairs,
Office of Management and Budget concurs, that this rule is ``non-
major'' under the Congressional Review Act, 5 U.S.C. 804(2). The
Commission will send a copy of the Order on Reconsideration to Congress
and the Government Accountability Office pursuant to 5 U.S.C.
801(a)(1)(A).
Supplemental Final Regulatory Flexibility Act Analysis
25. Supplemental Final Regulatory Flexibility Act Analysis. As
required by the Regulatory Flexibility Act of 1980, as amended (RFA),
an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in
the NPRM that initiated this proceeding. The Commission sought written
public comment on the proposals in the NPRM, including comment on the
IRFA. The Commission received no comments in response to the IRFA. This
present Supplemental FRFA conforms to the RFA.
A. Need For, and Objectives of, the Order on Reconsideration
26. The radio duplication rule prohibited any commercial AM or FM
radio station from devoting ``more than 25% of the total hours in its
average broadcast week to programs that duplicate those of any other
station in the same service (AM or FM) which is commonly owned or with
which it has a time brokerage agreement if the principal community
contours . . . of the stations overlap and the overlap constitutes more
than 50% of the total principal community contour service area of
either station.'' In this Order on Reconsideration, we restore the
radio duplication rule as applied to FM stations in order to better
serve the public interest.
27. We find that the record does not demonstrate that eliminating
the radio duplication rule as applied to the FM service serves the
public interest, as the FM service does not face the same persistent
challenges as the AM service that eliminating the rule for AM stations
was intended to mitigate. We find that there are likely benefits to
restoring the radio duplication rule for FM stations. The radio
duplication rule will act as a useful guiderail in the FM service--
where spectrum is especially scarce--to encourage the diversification
of programming on commonly owned FM stations. Accordingly, we restore
the radio duplication rule for FM stations, while recognizing the 25%
duplication allowance and the potential to seek a waiver to exceed that
allowance in the event of special circumstances will provide FM
licensees with flexibility where needed.
B. Summary of Significant Issues Raised by Public Comments in Response
to the IRFA
28. There were no comments to the IRFA or FRFA filed.
C. Response to Comments by the Chief Counsel for Advocacy of the Small
Business Administration
29. Pursuant to the Small Business Jobs Act of 2010, which amended
the RFA, the Commission is required to respond to any comments filed by
the Chief Counsel for Advocacy of the Small Business Administration
(SBA), and to provide a detailed statement of any change made to the
proposed rules as a result of those comments. The Chief Counsel did not
file any comments in response to the proposed rules in this proceeding.
D. Description and Estimate of the Number of Small Entities to Which
the Rules Apply
30. The RFA directs agencies to provide a description of and, where
feasible, an estimate of the number of small entities that may be
affected by the proposed rules, if adopted. The RFA generally defines
the term ``small entity'' as having the same meaning as the terms
``small business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A small business is one which: (1) is independently owned and
operated; (2) is not dominant in its field of operation; and (3)
satisfies any additional criteria established by the SBA. The rule
changes adopted herein will directly affect certain small radio
broadcast stations, specifically commercial FM radio stations. Below,
we provide a description of these small entities, as well as an
estimate of the number of such small entities, where feasible.
31. Radio Stations. This industry is comprised of ``establishments
primarily engaged in broadcasting aural programs by radio to the
public.'' Programming may originate in their own studio, from an
affiliated network, or from external sources. The SBA small business
size standard for this industry classifies firms having $41.5 million
or less in annual receipts as small. U.S. Census Bureau data for 2017
show that 2,963 firms operated in this industry during that year. Of
this number, 1,879 firms operated with revenue of less than $25 million
per year. Based on this data and the SBA's small business size
standard, we estimate a majority of such entities are small entities.
32. The Commission estimates that as of March 31, 2024, there were
4,427 licensed commercial AM radio stations and 6,663 licensed
commercial FM radio stations, for a combined total of 11,090 commercial
radio stations. Of this total, 11,088 stations (or 99.98%) had revenues
of $41.5 million or less in 2022, according to Commission staff review
of the BIA Kelsey Inc. Media Access Pro Database (BIA) on April 4,
2024, and therefore these licensees qualify as small entities under the
SBA definition. In addition, the Commission estimates that as of March
31, 2024, there were 4,320 licensed noncommercial (NCE) FM radio
stations, 1,960 low power FM (LPFM) stations, and 8,913 FM translators
and boosters. The Commission however does not compile, and otherwise
does not have access to financial information for these radio stations
that would permit it to determine how many of these stations qualify as
small entities under the SBA small business size standard.
Nevertheless, given the SBA's large annual receipts threshold for this
industry and the nature of radio station licensees, we presume that all
of these entities qualify as small entities under the above SBA small
business size standard.
33. We note, however, that in assessing whether a business concern
qualifies as ``small'' under the above definition, business (control)
affiliations must be included. Our estimate, therefore, likely
overstates the number of small entities that might be affected by our
action, because the revenue figure on which it is based does not
include or aggregate revenues from affiliated companies. In addition,
another element of the definition of ``small business'' requires that
an entity not be dominant in its field of operation. We are unable at
this time to define or quantify the criteria that would establish
whether a specific radio or television broadcast station is dominant in
its field of operation. Accordingly, the estimate of small businesses
to
[[Page 55084]]
which the rules may apply does not exclude any radio or television
station from the definition of a small business on this basis and is
therefore possibly over-inclusive. An additional element of the
definition of ``small business'' is that the entity must be
independently owned and operated. Because it is difficult to assess
these criteria in the context of media entities, the estimate of small
businesses to which the rules may apply does not exclude any radio or
television station from the definition of a small business on this
basis and similarly may be over-inclusive.
E. Description of Projected Reporting, Record Keeping and Other
Compliance Requirements
34. The Order on Reconsideration restores the radio duplication
rule as applied to FM stations. Accordingly, the Order on
Reconsideration reinstates prior reporting, recordkeeping, and
compliance requirements for small entities. Therefore, the Order on
Reconsideration will not impose additional obligations or expenditure
of resources on small businesses.
F. Steps Taken To Minimize Significant Impact on Small Entities, and
Significant Alternatives Considered
35. The RFA requires an agency to describe any significant,
specifically small business, alternatives that it has considered in
reaching its proposed approach, which may include the following four
alternatives (among others): (1) the establishment of differing
compliance or reporting requirements or timetables that take into
account the resources available to small entities; (2) the
clarification, consolidation, or simplification of compliance and
reporting requirements under the rule for such small entities; (3) the
use of performance, rather than design, standards; and (4) an exemption
from coverage of the rule, or any part thereof, for small entities.
36. In this proceeding, we reinstate the radio duplication rule for
FM stations. This action reinstates prior reporting, recordkeeping, and
compliance requirements for all commercial FM radio stations, including
small entities. We determined in this Order on Reconsideration that
reinstating the radio duplication rule for FM stations would better
serve the public interest and anticipate that reinstatement of the rule
will positively impact broadcasters, including small entities, and
avoid the potential harms described by Petitioners. We believe that the
reinstated rule for FM broadcasters affords small businesses sufficient
flexibility under the 25% duplication allowance. Because we do not
anticipate that a large number of broadcasters will exceed the
allowance, we find that the allowance by itself provides adequate
accommodation for small businesses. For those few cases in which FM
stations would surpass the duplication allowance, we permit stations to
submit waiver requests which specify the need for and special
circumstances justifying duplication beyond the allowance. For those FM
stations that duplicate programming in excess of the 25% duplication
allowance, we will provide a six-month grace period to come into
compliance with the reinstated rule. The period will begin when the
reinstated rule becomes effective thirty days after publication in the
Federal Register. In addition, we direct the Media Bureau to provide
the licensee with additional time to come into compliance, not to
exceed six months if a duplication waiver request is denied. We
conclude that extending such flexibility to FM stations, especially for
small entities, will mitigate some of the compliance burdens associated
with the rule change. Taken together, these provisions allow for all
stations, no matter their size and resources, to comply with the rule
without being unduly burdened.
G. Report to Congress
37. The Commission will send a copy of this Order on
Reconsideration, including this Supplemental FRFA, in a report to
Congress and the Government Accountability Office pursuant to the Small
Business Regulatory Enforcement Fairness Act of 1996. In addition, the
Commission will send a copy of the Order on Reconsideration, including
the Supplemental FRFA, to the Chief Counsel for Advocacy of the Small
Business Administration. A copy of the Order on Reconsideration and
Supplemental FRFA (or summaries thereof) will also be published in the
Federal Register.
H. Federal Rules That May Duplicate, Overlap, or Conflict With the Rule
38. None.
Ordering Clauses
39. Accordingly, it is ordered that, pursuant to the authority
found in sections 1, 4(i), 4(j), and 303(r) of the Communications Act
of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), and 303(r), this
Order on Reconsideration is adopted and will become effective thirty
days after publication in the Federal Register.
40. It is further ordered that the Petition for Reconsideration
filed by REC Networks, the musicFIRST Coalition, and the Future of
Music Coalition is granted.
41. It is further ordered that, pursuant to the authority found in
sections 1, 4(i), 4(j), and 303(r) of the Communications Act of 1934,
as amended, 47 U.S.C. 151, 154(i), 154(j), and 303(r), the Commission's
rules are amended as set forth in Appendix A and such rule amendment
will become effective thirty days after publication in the Federal
Register.
42. It is further ordered that the Commission's Office of the
Secretary, shall send a copy of this Order on Reconsideration,
including the Supplemental Final Regulatory Flexibility Analysis, to
the Chief Counsel for Advocacy of the Small Business Administration.
43. It is further ordered that, pursuant to section 801(a)(1)(A) of
the Congressional Review Act, 5 U.S.C. 801(a)(1)(A), the Commission's
Office of the Managing Director, Performance Program Management shall
send a copy of the Order on Reconsideration to Congress and to the
Government Accountability Office.
44. It is further ordered that, should no petitions for
reconsideration or petitions for judicial review be timely filed, MB
Docket No. 19-310 shall be terminated and its docket closed.
List of Subjects in 47 CFR Part 73
Radio, Reporting and recordkeeping requirements.
Federal Communications Commission.
Marlene Dortch,
Secretary.
Final Rule
For the reasons discussed in the preamble, the Federal
Communications Commission amends 47 CFR part 73 as follows:
PART 73--RADIO BROADCAST SERVICE
0
1. The authority citation for part 73 continues to read as follows:
Authority: 47 U.S.C. 154, 155, 301, 303, 307, 309, 310, 334,
336, 339.
0
2. Add Sec. 73.3556 to read as follows:
Sec. 73.3556 Sponsorship identification; list retention; related
requirements.
(a) No commercial FM radio station shall operate so as to devote
more than 25 percent of the total hours in its average broadcast week
to programs that duplicate those of any station in the same service
which is commonly owned or with which it has a time brokerage agreement
if the principal community contours (predicted 3.16 mV/m) of the
[[Page 55085]]
stations overlap and the overlap constitutes more than 50 percent of
the total principal community contour service area of either station.
(b) For purposes of this section, duplication means the
broadcasting of identical programs within any 24-hour period.
[FR Doc. 2024-14496 Filed 7-2-24; 8:45 am]
BILLING CODE 6712-01-P
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