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FM Translators for AM: Just the Start

Opening of the first phase of the window brought a rush of applicants

WASHINGTON — The Federal Communications Commission received more than 450 applications in the first days of a window for AM stations looking to modify FM translators for rebroadcasting their AM signals.

Applicants come from a range of backgrounds and organizational types. They include Hi-Line Radio Fellowship, a religious ministry broadcaster; educators like the State University of New York; and individual entities like the Thomas Huth Revocable Living Trust.

Each application — required to be submitted in all-caps on a multipage, drab-gray application known as Form 349 — offers details like contour reach, field strength and antenna height, yet they also read like small diary entries, providing a glimpse of what these ventures foretell.

This first window will be open for months but several industry execs said they were not surprised that most of the applications arrived in the first few days, due in part to the wink-and-it-may-be-gone nature of the process. The FCC will grant applicants on a first-come-first-served basis; applicants who file for the same channel on the same day must resolve their mutual exclusivity through settlement or technical amendment processes.

One company in the trenches is Phoenix Media Group, a radio broadcast consulting firm that worked with a number of AM stations to submit recent license applications.

“This is a truly golden opportunity for many AM stations to add another platform for their content and, in many cases, a 24/7 platform at that,” said Steve Moravec, principal of Phoenix Media Group, which helped initiate translator applications for licensees in Iowa and Minnesota. His advice: “Go for it, now.”

While many jumped early, some good opportunities may yet appear months from now, said John Broomall, licensee of WPCG(LP) in Canton, Ga., and founder of Christian Community Broadcasters. “Translators will leave certain markets and holes [will be] left by defective or dismissed applications,” he said.

For Class C and Class D AM stations that have not yet engaged in efforts to obtain an FM translator, there is a sliding scale of opportunities this year and in the opportunity to apply in the planned 2017 FM auction filing window, said John Garziglia, a partner with Womble Carlyle Sandridge & Rice.

For stations in a spectrum-rich area with many available FM frequencies, waiting until the 2017 filing window may make sense, Garziglia said. But do your homework. “If there are only several prime FM frequencies remaining in an AM station’s area, waiting until the 2017 auction filing window could result in being left out or obtaining a less than optimal FM frequency,” he said.

“Therefore, if prices on translators [stay] substantially moderate in the next several months, and a translator becomes available in the low five figures, an AM station needs to balance the risk of waiting, with the fairly certain benefit and nominal cost of an immediate FM translator acquisition,” he said.

“At some FM translator price points, it will be imprudent for an AM station to wait for the ‘free’ translator that might or might not result from the 2017 auction filing window, as nothing with a future FCC auction filing window is absolutely certain.”

Price points for FM translators sold ahead of the opening window varied substantially. Q Media Group is purchasing K263AL in Madison, Minn., for $75,000; Custer County Broadcasting is buying K250AP in Pierre, S.D., from Radio 74 Internationale for $20,000.

“The prices were a bit of a surprise,” said Larry Langford, owner of WGTO (AM) and W266BS in Cassopolis, Mich., and a contributor to Radio World. He said at least one translator in Michigan sold for $3,000. “Some of us expected prices to soar, but it looks like demand did not exceed supply. Some of the deals allowed time payments, which was a great surprise and a help to cash-strapped AM operators who need all the help they can get.”

Langford has chosen to use this first window to move his frequency to a clearer channel that will help his rural station be heard in the nearest big city. “At first I thought [the 250-mile move rule] would drive prices up, but what it has done in reality is increased competition among owners to sell unused CPs or low-power translators, and that means some buyers have been able to negotiate some rather nice deals.”

Part of the success for translator sellers like Ronald Unkefer was the “realistic pricing” his group assigned to listed FM translators. Unkefer is founder and CEO of First Ventures Capital Partners, which conducted three private translator auctions before the opening of the FM translator window. Translator prices in the First Ventures auction ranged from $25,000 to $50,000.

“The only negative was that the last one was too close to the filing window for most broadcasters to make new plans in time for the start of the auction,” Unkefer said. “It has been a tremendous driver of sales, and in spite of the radio world being programmed to negotiate, we believe that the buyers actually enjoyed the transparency of posted prices with nonnegotiable terms.”

Others expressed surprised that more applications were not filed.

“We thought the number would be higher and found the quantity light by perhaps half of our own expectations,” Moravec said. “The lack of technical knowledge, coupled with the 2017 ‘free for all’ window, kept more than a few owners on the bench waiting for next year.”

A review of the data suggests that 15 or so engineering firms were responsible for about 50 percent of the applications.

Interested parties must also weigh the fact that they get one shot at this: Only one translator modification application will be accepted in any of the 250-mile relocation windows. The FCC has said that subsequent applications — for this window or any of the upcoming FM translator windows — will not be accepted.

There has also been frustration that some broadcasters have been left out of this process altogether. “Spectrum is limited and what helps one class of broadcasters — i.e., AMs getting an FM signal — will hurt and lessen the chance of LPFMs ever getting more power or there being a future LPFM Window,” Broomall said.

Low-power FM advocate REC Networks recently petitioned the FCC to include LPFM stations in one of the two FM translator filing windows for AM stations set for 2017.

It appears the FCC staff has a fair amount of work in front of them. As of mid-February the commission had begun to grant a few of the 250-mile window applications, such as one by Salem Media of Illinois, which plans to rebroadcast Class D station KCRO(AM) in Omaha, Neb., via the FM translator K229CG.

The commission has also begun the task of dismissing applications. The FCC dismissed one from Sacred Heart Radio in Kirkland, Wash., which proposed to rebroadcast Class B AM station KBLE in Seattle. The commission has said it would dismiss any application filed during the first modification window that proposed to rebroadcast either a Class A or Class B AM station.

Several sources told Radio World that in general, this translator window is being seen as a potential boon for AM stations.

“This is a truly golden opportunity for many AM stations to add another platform for their content and, in many cases, a 24/7 platform at that,” Moravec said.

“It’s hard to say what it means as far as industry health goes,” Langford said. “Almost any AM operator would love to have an FM signal or improve the translator being currently used. And with this being a one-time shot, I expected the rush regardless of what the AM industry as a whole looks like.”

But success of the FM translator window won’t necessarily solve the bigger problems facing AM radio, Moravec added.

“The urban noise floor [on AM] is now deplorable,” Moravec said. ”Every new device which creates more noise takes another chomp from AM’s dwindling pie.”

Others said that no matter what the FCC does on revitalization, it’s not going to mean as much to the public if other issues aren’t resolved, like introducing improved receivers. “The signal transmitted by an AM station is much better than what you hear on a typical radio … but [the FCC] has never mandated any response or distortion minimums for AM radio,” Langford said.