NAB Proposes Market Definition Compromise

The NAB still believes the FCC’s contour-overlap method of defining a radio market is valid, and has told the FCC that changing the market definition radically could “result in significant disruption.”
Yet the NAB Radio Board says it knows other groups think some change is warranted; so it has submitted a proposal to the FCC it believes “addresses the problems that are perceived with the existing market definition but does not impose unintended penalties on companies which assembled their existing station complements in good faith,” states NAB President/CEO Eddie Fritts in a letter to FCC Chairman Powell.
The Radio Board suggests that the commission retain the contour overlap method of defining radio markets and determining whether a proposed combo falls within the local ownership limits, with two exceptions. It would exclude from the count any station whose transmitter is more than 58 miles from the area of common overlap of the stations being acquired. Also, stations owned by a proposed transferee that would not count toward that entity’s local ownership limits would be left out of the total count of stations making up that market.
Also proposed is grandfathering current station clusters as long as they remain under present ownership and permitting clusters that no longer comply with revised ownership limits to be sold freely. The board also has suggested that any new radio market definition be applied so that applicants would be evaluated based on the market definition that existed when the applications were filed.
“Every existing station cluster was formed in reliance on the commission’s existing rules and each transfer needed to create those clusters received commission approval,” wrote Fritts. “It would be strikingly unfair to now change the rules and require those stations to be divested or to limit their owners’ ability to transfer them for full market value. Indeed, limiting transferability could reduce station values and access to capital across the industry.”