Fiscal "Threat" Posed By NY Pirates Belied By Broadcasters' Own Data

As a part of the campaign now underway to bring the (nonexistent) hammer down on unlicensed broadcasting in the New York metropolitan area, licensed broadcasters are alleging a variety of “harms” caused by pirate stations. Many of them are vastly overblown, such as the threat of interference they pose to a variety of communications networks, dangers from uncontrolled radiation — and, in the newest charge, economic hardships they cause to licensed stations.
The contention that pirate radio stations infringe on the radio industry’s right to make mad profits was first floated in an April 2015 blog post by Republican FCC Commissioner Mike O’Rielly; he claimed unlicensed broadcasting “causes unacceptable economic harm to legitimate and licensed American broadcasters by stealing listeners.”
This was echoed in a July 2015 letter from the National Association of Broadcasters to FCC Chairman Tom Wheeler. NAB lobbyist Rick Kaplan, among other things, accused pirate stations of eroding “the advertising and membership base of legitimate broadcast stations.”
Around the same time, nearly every member of New York and New Jersey’s Congressional delegation wrote to Chairman Wheeler, worrying that unlicensed broadcasters “undermine investment in legitimate minority broadcasters.”
In a follow-up “policy statement” that September, Commissioner O’Rielly first suggested that efforts be directed to the money-side of unlicensed broadcasting, hoping to starve them out of existence (an idea that is apparently being mulled over by Congress).
Then, in a speech earlier this year to the Country Radio Seminar, O’Rielly suggested that while pirates haven’t yet put a dent in the revenues of country-format stations, “you can be sure that there is already an impact on some stations in our nation’s largest markets.”
That sentiment was codified as quasi-policy language by the full Commission a month later in correspondence to a variety of local government and industry trade associations: pirates apparently now “cause harmful interference to licensed radio broadcasters serving their communities, thereby starving stations of their ability to reach their listening audiences and obtain necessary advertising revenues” (emphasis mine).
This June, speaking to the New Jersey Broadcasters’ Association, Commissioner O’Rielly again made the claim that unlicensed broadcasters are “stealing listeners” from licensed stations, leading to a weakened “financial situation” for them.
Repeat a strong belief enough and it becomes fact, right? This is how federal communication politics works in America 2016 — get enough mouths that matter singing from the same hymnal, and voilà, consensus! Not so fast: licensed broadcasters themselves have just provided some data that seems to quash this line of anti-pirate propaganda.
It comes in the form of the second-quarter 2016 “state of the market” report from New York Market Radio — the marketing-advocacy arm of the metropolitan area’s licensed broadcasters. The report touts the fact that the area’s stations saw “some positive growth in the first half of 2016,” as 450 advertisers “increased their spending by double-digit percentages,” and more than 60 of them “paying more than $100K for airwaves.” Of note are increases in spending among advertisers in the entertainment, telecommunications, automotive, and political campaign categories.
According to NYMRAD Chair Marc Rayfield, whose day job is a senior vice presidency at CBS Radio, the takeaway is that “year over year [advertising revenue] growth through Q2” is solid, and with an election still forthcoming “we are optimistic about a positive finish for 2016.”
Thus the yearlong construction of a narrative that pirate stations in the New York metropolitan area represent a material financial threat to licensed stations is utterly debunked by the licensed stations themselves. However, this won’t stop industry lobbyists and their compatriots at the FCC from advancing such foolishness. When media policymaking takes place in a fact-free environment — or one in which market-centric ideologies are massaged to resemble “facts” — the resulting policies are inherently weakened and assume an anti-democratic tilt.
Again, it’s not a question of whether one agrees that unlicensed broadcasting has potentially detrimental characteristics — that risk exists — but whether lying about pirate stations’ actual effects brings us any closer to dealing with this “threat.” The ostensibly smart people behind this particular smear really should know better, especially when the industry itself definitively contradicts them.