Reply Comments Filed in AM Revitalization Initiative

In addition to gearing up to scrap with the FCC over its definition of journalism, I found the time last week to file some Reply Comments in the agency’s AM Revitalization proceeding.

I kept my comments confined to the FCC’s suggestion that AM stations might begin to adopt the all-digital version of HD Radio. The whole thing (10 pages) is worth a read, but the high points are:

Big decisions about digital radio should be made in the FCC’s ongoing digital radio proceeding. This is a procedural argument that asserts the proper venue for advancing HD-related policy is not the AM revitalization docket. In other proceedings tangential to digital radio where the issue has been raised, the FCC’s deferred all discussions to the digital radio docket, and should maintain that precedent here.

HD Radio is in the throes of market malaise. In its Comments to the AM revitalization proceeding, iBiquity Digital Corporation asserts that the commercial potential of HD Radio is "well established," and cites adoptive figures to make its case. These figures are inflationary at best, and since the agency made marketplace adoption the primary mechanism by which radio’s digital transition would evolve, the actual story is not that rosy.

The bottom line is you can’t make good policy on bad data, and I would argue that right now the FCC has no realistic idea what the marketplace really is for HD Radio.

There’s a growing hunger to explore alternatives to HD on the AM dial. I was surprised by the number of Comments filed in the AM proceeding that suggested exploring Digital Radio Mondiale—a system unencumbered by the software-like and extremely closed intellectual property model of HD Radio, which most broadcasters have rejected on principle. DRM is finding traction on the AM dial elsewhere, particularly in countries that are projected to drive global economic growth in the 21st century.

At this point in the U.S. digital radio transition, what is there to lose by learning a bit more about DRM? Perhaps even the threat of competition may inspire HD’s proponents to address the system’s fundamental detriments.

The hardest things about writing documents for policy purposes are keeping an even tone and buying into the marketplace paradigm that pervades modern policymaking. Now that I’m between books, I plan to devote more time to participating in stuff like this—it’s something communications scholars in general don’t often do, but should do a lot more of.

Preliminary AM Revitalization Comments Roundup

With the first round of public comment on the FCC’s AM revitalization initiative due next week, it’s not a bad time to sample the feedback that’s come in so far: just about 65 comments in total.

There are some general points of consensus across most commenters. The strongest involves the increase of interference across the entire AM dial. Much of this comes from improperly-shielded consumer electronics, lighting fixtures, and power lines, which can wreak absolute havoc on AM reception in localized areas. The FCC has the authority to require that all such devices meet standards to reduce harmful emissions—but the huge influx of cheap sh*t from overseas is far, far more than the FCC can handle without a substantial increase in enforcement resources.

Another point of consensus is that the FCC should require AM radio receivers to work at a certain level of quality. Another side-effect of the influx of cheap electronic componentry means that the sensitivity and fidelity of modern AM receivers (especially in automobiles) is actually worse than they were, say, two decades ago. There is regulatory precedent for the FCC to consider and adopt minimum AM receiver-standards, but the power of the consumer electronics industry in D.C. will strongly resist any such notion.

Unsurprisingly, there is also strong support for the FCC to open a special filing window for AM broadcasters to acquire "supplemental" FM translators: groups ranging from the National Religious Broadcasters to the Prometheus Radio Project support the concept. But how many FM translators might be made available, and who should be first in line to apply? These questions will most likely constitute the majority of the dialogue as the proceeding continues.

However, not all broadcasters feel that giving FM translators to AM stations is a panacea. Curtis W. Flick thinks further abuse of the translator rules is likely; there is already "a track record of certain licensees neglecting their AM facility maintenance in favor of their FM outlet. Some AM stations have been off the air for extended periods…while blissfully providing FM programming to their translator in blatant defiance of FCC rules….Whether these translators are permanently locked to an AM license is irrelevant. There is no good way to do a bad thing."

Several commenters have suggested that the FCC expand the FM dial down to 76 MHz and use that spectrum to site any new FM translators for AM stations. Mark Heller thinks the AM dial should be expanded, too—from 1700 to 1790 KHz—to encourage investment in new AM stations.

Sentiments run strong against the adoption of the all-digital AM-HD mode. Commenters note HD Radio’s penchant for causing interference to existing stations, its floundering in the receiver marketplace, and the "undue financial burden" that HD adoption would put on small AM broadcasters; Brian J. Henry notes that the cost of digital adoption "can in certain cases exceed the current market value of smaller market AM broadcast stations."

Although the Broadcast Warning Working Group suggests it is "time for an honest and rigorous revisiting of [HD] for AM," they are one of only a handful of commenters who advocate for the technology’s abandonment. Brian and Karla Winnekins, the owners of WRDN-AM in Durand, Wisconsin, think the time is ripe to experiment with other digital broadcast technologies, such as Digital Radio Mondiale. Meanwhile, Frederick R. Vobbe thinks putting HD-AM and -FM on spectrum adjacent to the current FM dial may be the most expedient way to inject life into radio’s digital malaise.

Out of all of the comments tendered so far, though, Nickolaus Leggett’s initial filing is my favorite: ambitious and pragmatic rolled into one. On the one hand, Leggett—one of the founding petitioners of the LPFM service—would like to see the FCC look into establishing an LPAM station-class, and is preparing to petition the FCC to consider a local shortwave broadcast service. On the other hand, he would also like the FCC to grant existing AM stations greater regulatory flexibility to customize their transmission and antenna infrastructures, and suggests that the federal government might subsidize AM stations as communicators of last-resort by hardening them against natural and man-made disasters.

It is customary for the big dogs in these proceedings (the NAB, NPR, and a variety of broadcast conglomerates and trade associations) to file on the last day of a comment-window, and these are the comments that the FCC will weigh most favorably as it sets the agenda for any concrete AM revitalization projects. Those filings will also mark the start of what is hopefully a more feisty reply-comment period, which closes on February 18.

AM Revitalization Initiative Unleashed: All Digital Transition On the Table

And sooner than expected: the FCC will soon open a comment window for a plethora of proposals to assist beleaguered broadcasters. Paul Riismandel at Radio Survivor has a decent breakdown of the agency’s primary suggestions, and also notes that there’s "nothing on the all-digital question." If only this were true.

Just because the all-digital idea is not sharply delineated in the FCC’s Notice of Proposed Rulemaking doesn’t mean the agency’s not interested in it. Policy studies necessitate close reading. For example, the agency notes its permissiveness with all-digital AM-HD experimentation as one of several "discrete changes" it’s made over the years "designed to further enhance the AM service" (p. 5).

Furthermore, the FCC acknowledges that an all-digital transition doesn’t fit the bill as a "concrete" proposal "that can be implemented expeditiously"; rather, it is a "complex" idea that "would require additional comment, research, and analysis. We therefore encourage parties to submit comments in this docket for the purpose of advancing…other specific proposals to revitalize the AM service," of which an all-digital transition is explicitly mentioned (p. 20).

That’s all the green-light action that HD Radio proponents need to start the regulatory campaign toward an all-digital transition.

Such behavior actually fits the policymaking trajectory that got HD this far. The 1990s were a decade of furtive development for the system, as two primary developers struggled to make the coexistence of analog and digital radio signals actually work. They spent a lot of their time not on research and development, but on jockeying with each other for the position of "frontrunner" in the digital radio space.

In 1998, one of them (USA Digital Radio, of which iBiquity Digital Corporation is a direct progeny) filed a Petition for Rulemaking with the FCC hoping it would declare its technology the formal digital radio standard for the United States. Even though neither technology actually worked as its developers claimed at the time, the FCC issued a Notice of Proposed Rulemaking based on the petition, and from that the HD Radio system was ultimately born and sanctioned for rollout, half-baked as it was.

A tired quote about the doomed repetition of history comes to mind here, but perhaps things might turn out differently. I take a (microscopic) smidgen of hope from freshly-installed FCC Chairman Tom Wheeler’s first official blog post, in which he emphasizes the necessity of taking risks and not being afraid to fail at them:

The first book I wrote was about leadership lessons from the Civil War. The first chapter of that book is entitled "Dare to Fail." It is a philosophy that has been at the heart of the venture capital business from which I come; the majority of a VC’s investments don’t work out as intended, but without taking those risks there can be no big rewards. The industries with which we work are always taking reasonable risks; I hope we won’t shy away from a similar approach….We cannot sit around and wait for others…to come up with ideas and alternatives.

Given Wheeler’s long history as Top Shill for the cable and wireless phone industries, his actions must speak louder than his words—but it does suggest that there may be the possibility of having a legitimate debate on the future of digital radio. The next three months (or so) will tell the tale.

Firming the Foundation for an All-Digital AM Mandate

The quiet collection of "evidence" on which to justify an all-digital HD Radio mandate for AM stations continues.

After some stealth experimentation on a CBS station in Charlotte, North Carolina late last year, there’s word of two other AM stations in the state conducting all-digital broadcast-tests this summer. The guinea pigs were WBT, a 50,000-watt station owned by Greater Media (also in Charlotte) and WNCT, a 50,000-watt (day)/10,000-watt (night) Beasley Broadcast-owned AM station in Greenville.

WBT secured experimental authorization from the FCC to conduct these tests just two weeks before they took place; WNCT also asked for fast-track authority less than a month before its all-digital broadcasts.

There is no hard data available from these tests, and I would not expect much to surface in the near future. The CBS tests last year produced a paltry 11-page report that spent more time describing the testing regimen than any concrete findings. An unnamed engineer quoted by the Clear Channel-owned Inside Radio (the only trade outlet to publish something akin to substantive story about the recent tests) says the all-digital broadcasts on WNCT were "very promising," though the article is more circumspect about the WBT trials:

Test results of WBT’s all-digital skywave signal are purely anecdotal. Based on feedback from NAB Radio Technology Committee members tuning in up and down the East Coast, it held its own against the analog signal.

In many respects, this testing was stimulated by Republican FCC Commissioner Ajit Pai‘s call for an "AM revitalization initiative" to open (hopefully) next year. This inquiry will consider a range of options to (hopefully) "improve" the overall sustainability of the AM dial. And you can tell a lot by the principals involved in these rounds of tests about what the industry’s revitalization "priorities" will be.

CBS and Greater Media are founding companies in the HD Radio cartel. The core research and development behind the HD system began as a project under Westinghouse, back when it owned CBS outright. This makes CBS and iBiquity Digital Corporation, the proprietor of HD Radio, kindred corporations; it’s easy to see how their priorities align.

In the IR piece, CBS Radio president/CEO Dan Mason advocates for an all-digital AM switchover. Glynn Walden, CBS Radio’s senior vice president of engineering, was the first to suggest this radical course of action at the NAB Radio Show last fall—just before the first round of all-digital tests. Walden is one of the fathers of the HD Radio system: he was at Westinghouse back when HD Radio was but a concept, holds several patents on the technology, and has split his career between CBS and iBiquity.

Not only does it look good for Walden to have his boss’ endorsement, but it signals that CBS will be doing much of the heavy lifting to push a digital AM transition campaign forward at the National Radio Systems Committee and FCC.

They’ll have great help from Greater Media. Its VP of radio engineering, Milford Smith, had very kind words about the latest all-digital AM tests. As he should: Smith was chairman of the NRSC’s digital radio task force during the tumultuous struggle to get the FCC to adopt HD at the turn of the century. The NRSC’s work at critical times was laughable—incomplete and highly qualified, yet presented to all as Holy Writ, which made regulators comfortable enough to bless the rollout HD despite its detriments.

The third player in the recent round of tests, Beasley Broadcasting, is also a long-time investor in and proponent of HD Radio. Mike Cooney, Beasley’s VP of engineering, currently chairs the NAB’s own Radio Technology Committee.

Now, I’m not trying to disparage any of these men—just pointing out the long-term historical connections between them, their companies, and the important roles they all played to get HD Radio as far as it has over the last two decades. This history has led their parent companies to pour tens of millions of dollars into HD; of course they would be the principals in any push to mandate its use. (A "source" at the NAB says they’re careful to call their push an "evolution" instead of a mandate. Of course they would.)

It’s the push itself that should worry us. It’s taking on the same shape as the campaign that led to HD Radio’s adoption by the FCC 15 years ago. Back then, a coalition of broadcast conglomerates (large and small), along with iBiquity and the NAB, worked hard to convince the FCC that the radio industry wholeheartedly supported the HD system. The pitched battle that subsequently occurred at the FCC belied this harmony, as does the abysmal state of HD uptake by broadcasters since then. That same coalition is crystallizing again, using the same opaque engineering and testing behaviors that tortured HD’s initial development.

The only constituent presently missing from the old mix is National Public Radio. NPR’s support of HD was key in convincing the FCC that a "true" commercial/noncommercial broadcaster consensus existed on the technology in the first place. But since then, NPR hasn’t been directly involved in the creation of facts on the ground to advance HD policy—today, NPR is a reluctant supporter of HD Radio, and you can expect the same in the push for a digital AM transition.

However, the stakes for this push are much higher this time. Mandating the adoption of HD Radio on the AM dial sets important policy precedent for requiring the same on the FM dial, where the technology at least has some semblance of functionality. HD’s proponents are going after the weakest prey first, and if they can get a transition mandate locked in on the band where HD works worst, all-digital FM is a foregone conclusion. It’s effectively a two-step strategy to move all stations to all-digital HD broadcasting.

Those in the trenches of corporate media policymaking play long-ball, biding their time and creating the optimum conditions to push through what would otherwise be questionable, or even irrational policies. When the FCC ultimately issues a Notice of Proposed Rulemaking to explore AM’s "revitalization," the groundwork for the band’s forced transition to HD will have already been done, leaving policymakers and the public with the erroneous perception that 1) such a transition is the best possible outcome for AM radio, and 2) the radio industry supports this move.

Were HD proponents more forthright and transparent with their campaign, perhaps it would have a semblance of actual legitimacy. But the signs are clear that legitimacy will (again) be tactically sacrificed toward a larger goal with implications that are too massive to be conducted by clique. Do we really have to go down this road again?

The Health of Radio: By the Numbers

With what seems like increasing frequency, media-pundits are dropping rhetorical bombs riffing on the notion that radio is dying. This inevitably sets off a tizzy within the radio industry itself. But there are still strong signs of life, especially if one steps back and looks at the big picture.

stationtotalssmEvery quarter, the Federal Communications Commission issues a report on the number of licensed broadcast radio stations in the United States. The graph at right compiles the last 21 years of these reports (from 1992 to 2013). Clicking on the graph will spawn a new window showing a larger, more detailed version.

These FCC reports are available here. I used the agency’s mid-year totals, released every June 30th, for year-to-year consistency. (2000 and 2007 are asterisked because there was no June 30th report archived for those years; these figures come from the FCC’s third quarter (September 30th) report.)

Although the oldest available report is from 1968, there are no archived totals covering 1971 to 1989. I started with 1992 because that’s the first year for which June 30th reports are available.

The numbers speak for themselves: more than 9,000 new radio stations took to the air over the last 21 years. This includes 1,923 new full-power commercial FM stations and 2,409 full-power noncommercial FM stations.

Only two classes of radio station exhibit any decline: AM and LPFM stations. On the AM side, there’s been a net loss of 237 AM stations (about 5%) over the last 21 years. Note that this has not been a consistently downward trend, either, with small upticks around the turn of the century, most likely due to the FCC’s expansion of the AM band in the 1990s.

Because the FCC’s broadcast station totals only count fully-licensed stations (not stations under construction), LPFM stations don’t appear on the books until 2005. The number of licensed LPFMs peaked at 864 in 2010 and has fallen to 797 this year (a decline of about 8%). With the coming of a new LPFM filing window this fall, there will be a surge in the number of these stations over the next few years.

What’s most remarkable is the growth of FM translator and booster stations. The majority of these stations are translators, and you can see how they exploded following the Great Translator Invasion a decade ago—nearly reaching numerical parity with commercial FM stations in the 2008-09 time frame. Although their numbers have dwindled (by about 100) since then, more than 1,000 new translator construction permits will be issued soon, so expect a positive swing in this trajectory as well.

It’s also quite illustrative of the extremely vibrant marketplace for FM translators that now exists. A cursory overview of just those transactions noted in Tom Taylor’s daily industry newsletter over the last month alone turns up some 20 translators that changed hands in 12 states for nearly $2 million—or an average of $99,914 per station. The actual sale price of stations ranged from $17,000 (for a 250-watt translator in Iowa) to $350,000 (for a 225-watt translator in Florida). Of the 17 transactions covering these translators, six of them were for more than $100,000, and all but five of them were for more than $50,000.

The fact that the net number of radio stations continues to rise—and in the case of FM translators, so much money is chasing so few watts—does seem to suggest that the demise of radio is grossly exaggerated. That said, it doesn’t mean that concerns about the medium’s future have no merit. In concrete terms, the inherent value of legacy radio broadcasting lies in the spectrum it occupies, and with a growing hunger for wireless broadband there is the possibility that in the future, radio might very well abdicate its exclusive patch of the airwaves.

In 2011, Radio World asked National Association of Broadcasters president Gordon Smith whether there was "any immediate threat" to the radio spectrum; he replied, "Not immediate, but if they can do it to your neighbor [broadcast TV], they can do it to you eventually." A straight-up cynic might see the growth of radio as claim-staking for this eventuality, but there’s still too much money to be made in the status quo…even if it may very well not be inherently sustainable.