FCC cracks down on noncommercial “commercials”

Mar 1, 2009 12:00 PM, By Harry Martin

In recent enforcement actions the FCC has fined three noncommercial radio stations for running what the agency said were commercials.

What precisely constitutes a commercial is not easily determined. Generally NCE stations cannot accept payment in return for the on-air promotion of commercial activities. But they may accept underwriting contributions and may, in turn, acknowledge the generosity of the contributing underwriter by providing on-air mentions of the business. The question is: When does such an announcement cross the line from being a mere acknowledgement to becoming a promotional announcement?

Acknowledgement Standards

As in past cases, the announcements that got the three licensees in trouble included qualitative statements, price-related information and/or prohibited calls to action. Phrases like “flexible financing” (price-related), “Bud and Bud Lite are discounted” (price related), “our aim is excellence and our goal is perfection” (qualitative), and “let me suggest a visit…” (call to action), all go over the line according to the FCC. Thus, a reference to a 10 percent discount cannot be included in acknowledgement announcements. Information such as “longest continuous builder in Northeast Florida” is similarly banned. While it is OK for stations to mention the year a business was founded, a statement comparing the age of one business to the age of others is considered a qualitative comparison of businesses and is out.

Length of Announcements

The FCC pointed to the 60-second length of the underwriting announcements. It did not explicitly prohibit 60-second announcements, but suggested that the longer the announcement, the more likely it is that prohibited content will creep into the copy.

Airing Free Program Material

Another point was that the mere furnishing of a program to a station constitutes consideration. In one of the three cases, the offending commercial matter was aired in the course of a program that was produced by an independent person who provided the programming at no charge. The licensee pointed out that, even if the program producer had received consideration in return for including the announcements in his show, the licensee had not received any such consideration.

The FCC did not credit that argument. The fact that the independent producer received consideration for promotion of a commercial product or service was enough to trigger the FCC’s enforcement process. A $5,000 fine was assessed.

The Other Cases

The other two licensees got off easier, each with a $2,500 fine. One involved a number of “commercial” announcements which were made during the course of play-by-play coverage of a local non-profit baseball team. The other involved a total of 12 announcements for two local businesses which, in the Commission’s view, crossed the line into commercial territory.

Dateline

April 1 is the deadline for submission of biennial ownership reports by radio stations in Texas.

April 1 is the deadline for radio stations in Texas with more than 10 full-time employees to electronically file their Broadcast EEO Mid-Term Reports (Form 397) with the FCC.

April 1 is the deadline for radio stations licensed in the following states to place their annual EEO Reports in their public files: Delaware, Indiana, Kentucky, Pennsylvania, Tennessee and Texas.

Martin is a member of Fletcher, Heald & Hildreth, PLC, Arlington, Virginia. E-mail:[email protected]