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The author is CEO and vice chair of the Consumer Technology Association.
The National Association of Broadcasters is pushing Congress to mandate AM radios in all new cars. At first glance, that might seem like a win for local broadcasters and their listeners — but don’t be fooled. Raising the issue has prompted a reckoning in Congress, with lawmakers recognizing that forcing consumers to buy a product they may not want simply to protect a broadcasters’ business model should not come for free.
Despite the old saying, “there’s no such thing as a free lunch,” U.S. radio broadcasters have gotten uniquely close by using copyrighted music without paying record companies or performers, from pop stars to up-and-coming artists. Technology companies, car manufacturers and the music industry believe that must change. My organization and others have urged leaders in Congress to tie any AM radio mandate to closing the loophole to require AM and FM radio stations pay royalties to artists and other creators for their music.
You probably didn’t hear this from NAB, but that means moving forward with an AM radio mandate would have huge consequences for your broadcast operations and the entire business model of broadcast radio. In fact, the AM radio mandate legislation died in the last Congress because legislators insisted the two causes be tied together.
NAB’s desperate and expensive attempts to mandate AM radio are unnecessary and unproductive. Most car makers have no immediate plans to phase out AM radios in the cars models they produce. Car manufacturers respond to market demand. With continued demand, especially in rural areas, consumers should have no trouble buying new cars with AM radios. At the same time, the mandate comes at a high cost for those who don’t need or want AM radio, beyond the specific cost of the components.
AM radio signals face interference from electric vehicle systems. Requiring AM radios in every car, especially when so many Americans have already started tuning in to radio using newer technologies, simply makes no sense. It also reinforces the growing perception that AM radio is so weak it needs a mandate to survive and affects big broadcast groups trying to change the law to create anti-competitive monopolies.
In pushing for an AM radio mandate, NAB is also swimming unsuccessfully against the tide of business deregulation designed to help American companies grow, create jobs and compete globally. NAB got clobbered in Congress a decade ago when it pushed for a FM chip in every phone. Nor is the AM radio mandate the only anti-competitive demand NAB has in Washington. NAB is also insisting the government require a new broadcast tuner in every TV set, with a plan to make many current models — in all likelihood including the TVs you own — obsolete in just a few years.
Broadcasters, is NAB really the organization you want representing your interests?
I’m a passionate advocate for less regulation when it comes to technology innovation, but even if you’re not, these campaigns for heavy-handed government interference should leave you concerned. Who knows where it will end? If broadcasters intend to keep using regulation to secure listeners, then perhaps it’s time to start charging them for the spectrum they are using.
In other countries, AM radio broadcasters pay artists and record companies. In some, the AM broadcast spectrum has been reduced or entirely removed from commercial use and returned to the government.
If you’re a NAB member, or just a member of the broadcaster community, I urge you to consider: Do you want mandates and new royalties? Do you want to be part of an industry that presents itself as so weak its association’s big strategy is requiring consumers to buy products?
Is NAB acting in your best interest? Or might other priorities like embracing and promoting new technologies to attract and expand new audiences be a better use of NAB’s money, time and reputation? I know that associations pay attention to their members’ views, and it makes me proud to see my industry lean into innovation to prosper. I encourage you to contact NAB or its board members and tell them how you feel.
