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FCC Approves PRG’s Hawaii Five

After nine years Pacific Radio Group can book its new stations

The Pacific Radio Group, owner of Hawaii stations KLEO(FM), Kahaluu, KKBG(FM), Hilo and KHLO(AM), Hilo, can finally take control of five more “Big Island” stations now that the FCC has denied a Petition of Reconsideration filed by Hilo Broadcasting.

In October of 2003 PRG filed an application to take control of KPVS(FM), Hilo, KLUA(FM), Kailua Kona, KAPA(FM), Hilo, KAGB(FM), Waimea and KKON(AM), Kealakekua, Hawaii from Big Island Radio.

On Nov. 6, 2003 Hilo Broadcasting, licensee of KHBC(AM), filed a Petition to Deny, claiming that some of the stations, when combined with PRG’s holdings at the time, would overlap and an acquisition by PRG would violate local ownership limitations.

The FCC staff examination applied “interim contour-overlap methodology” to assess compliance with local ownership limits and found that since there was no official Arbitron defined market, two markets were in operation on the island, there was not a violation and that any other overlaps were over the water and thus no listeners were harmed. Summarily, the agency approved the transfer though it did admonish PRG for failure to properly notify it of and obtain a waiver concerning a time brokerage agreement it had had with Big Island Radio. The acquisition was settled for Sept. 15, 2005.

Hilo Broadcasting filed a Petition of Reconsideration on Sept. 12, 2005. It argued that PRG had an “anticompetitive advantage and an undue concentration of control” because it received a majority of the island’s radio ad revenue; the approval violated local ownership rules; the FCC staff made errors in its examination and that PRG misrepresented itself in applications. Hilo also provided additional market survey information from Eastlan Research to support its charges of an ad revenue imbalance.

The FCC countered each claim in its denial of the petition.