There are fewer radio group owners than there were right after passage of the 1996 Telecom Act; and radio listening continues to trend down. At the same time, ad rates have nearly doubled.
Those are some of the highlights for radio of the FCC’s media ownership studies out this week.
The number of radio owners declined by 39 percent during this eleven-year period, with most of the decline occurring during the first few years after the act, according to the FCC’s “Review of the Radio Industry, 2007,” written by George Williams, a senior economist in the FCC’s Media Bureau.
Over the same period, there has also been an increase in the size of the largest radio group owners. In 1996, the two largest radio group owners owned 62 and 53 stations, respectively. By March 2007, the leading radio group, Clear Channel Communications, owned over 1,100 radio stations. The second largest owner, Cumulus Broadcasting, had just over 300 stations.
Most of the consolidation occurred in the years immediately following the act in 1996. From 1996 to 2000, 18.5 percent of radio stations, on average, changed hands each year. However, from 2001 to 2006, this average annual percentage fell to 7.8 percent as consolidation slowed.
Yet ad rates increased. “Overall, it appears that the cost of radio advertising has nearly doubled since the 1996 Act was passed. By contrast, the CPI increased 29% during the same time period,” wrote Williams.
Radio listening continues to decline. From the fall of 1998 to the fall of 2006, Arbitron found that the average number of listeners per quarter hour fell 6.6%, from about 19.7 million to about 18.4 million, according to the study, which updates a previous radio review done in 2002.
