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Incubator Program Has Its Supporters, Detractors

Deadline to summit reply comments is April 9

There’s both support and scorn for a Federal Communications Commission plan to rekindle an incubation program designed to boost minority ownership.

In November, the commission created a Notice of Proposed Rulemaking that proposed to create a broadcast incubator program that would promote ownership diversity. Since the structure of such a program requires further exploration, the FCC is seeking comments on how it should structure such a program so that minority owners, women and small business can become active entrants into the broadcast services industry.

In its comments on the issue, the National Association of Broadcasters supported the program, saying such a plan could help reduce barriers to entry — such as the lack of operational expertise and access to capital. The NAB laid out several recommendations, such as pairing established broadcasters with new entrants into the market.

Others say the FCC is not going far enough. Ravi Kapur, president of Major Market Broadcasting of North Dakota, purchased full-power television station KRDK in 2014 under the auspices of increasing diversity in broadcast ownership, Kapur said in a filing. But a territorial fight ensued as the station fought to secure its branding and cable carriage in the market against a larger broadcaster, Kapur said. This particular technique for diverse ownership incubation did not work, he said. “While our organization has been able to survive through sheer guile and willpower, the average minority broadcaster would not have survived this brutal test of wills,” Kapur wrote.

Yet it is wise for the FCC to try and incubate diverse ownership, Kapur said. “Under our ownership, KRDK now produces more local programming than every other television station in North Dakota combined,” Kapur said.

In his filing, Kapur suggests the FCC set up a viable system that will enable more voices to participate, such as granting low-power television stations must-carry and Class A status, and having full-power television stations set aside up to 2 Mbps of their 19.39 Mbps to independent and women and minority-led organizations who can use that spectrum to provide services others won’t venture into. “There are ways to increase minority participation without harming incumbents,” Kapur said.

[Read: MMTC Renews Push for FCC Incubator Program]

For Skip Finley, president WYOB(FM) in Oak Bluffs, Mass., the three most important factors driving broadcast ownership for minorities are experience, availability of station inventory for sale and access to capital. To address these issues, Finley a suggested a plan that would, as an example, encourage existing licensees to provide capital to new entrants in exchange for additional station ownership in a market. A program like this would not only provide financial assistance to new entrants, but provide mitigated risk to an established broadcaster, he said.

Other groups, however, oppose the commission’s proposal to adopt an incubator program.

A program like this one “will not fulfill the commission’s obligation to promote gender and racial diversity of media ownership,” said a group led by the United Church of Christ. The group’s concern is that such a program would end up creating a substantial loophole in the FCC’s ownership rules without having any significant impact on minority and female ownership.

The group opposes the adoption of any incubator program because, the group said, the FCC is not actually attempting to promote minority and female ownership.

“No incubator program, no matter how well intended and designed, will lead to diverse media ownership,” the group said. The group also includes the Media Alliance, the National Organization for Women Foundation, the Communications Workers for America, Common Cause, the Benton Foundation, the Media Council Hawaii, Prometheus Radio Project and the Media Mobilizing Project.

Plus, due to what the group calls the FCC’s “earlier failures” to collect sufficient ownership data, it makes it impossible to tailor a program that will improve ownership diversity or properly assess the impact of such a program, the group said.

The FCC has set a deadline of April 9 for reply comments. Comments can be submitted via the FCC’s ECFS database using Media Bureau Docket 17-289.

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