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May 01

Minorities Face Extinction in Broadcast Ownership, Will FCC Turn A Blind Eye or Level The Playing Field?

jam_headshot 2013As Latinos in Information Sciences and Technology Association (LISTA) continues to combat injustice in the telecom and media space, we have seen that these industries do not represent the nation’s demographics, nor have there been meaningful discussions about how the Latinos’ lack of representation in these industries is undemocratic and morally wrong.

Currently, there are over 51 million Latinos in the U.S. (both native and foreign born). Latinos are the nation’s largest minority group, representing 16.4% of the U.S. population (http://www.pewLatino .org/2012/06/27/the-10-largest-Latino -origin-groups-characteristics-rankings-top-counties/). Yet minority radio, television and cable ownership continue to spiral toward zero. LISTA research shows that as of 2009, only approximately 7.24% of commercial radio stations were minority-owned, and that only about 3% and 5% of full power television stations are owned by minorities and women, respectively.

Moreover, Spanish language broadcasters are continuing to exit broadcasting due to a lack of capital investment. Thus many markets with high Latino  populations have no Latino -owned stations. And that has consequences:  many Spanish-only-speaking consumers could be deprived of emergency information regarding natural disasters, catastrophic events, virulent diseases and epidemics–putting the public safety, health and welfare at risk.

The paucity of women and minority owned broadcast stations is not an issue of first impression. Historically, as the FCC well knows, women and minorities faced many obstacles that impeded their ability to compete in broadcasting. It was not uncommon for banks to reject loan applications by minority broadcast owners due to racial discrimination. As such, in 1996 Congress required the FCC to report on its comprehensive efforts to identify and eliminate market entry barriers for small businesses, particularly including those owned by minorities and women.

As we know, it is exceedingly difficult for minority broadcasters to access domestic capital. While several barriers to entry have been identified, the “most significant impediment to minority ownership” is lack of access to capital. Struggling broadcasters need greater access to capital which is scarce in the U.S. but often plentiful in Central and South American nations and in Spain.

Thus, access to overseas capital, and reciprocal access to overseas markets, are likely to be highly effective means of fostering minority broadcast ownership. This would provide an opportunity for other broadcasters to expand overseas and for their nationals to invest in U.S. broadcasting.

Yet the FCC continues to rely on restrictions dating back to 1912 which, presently, limit foreign investment in U.S. broadcast stations to 25% of the nonvoting stock or 20% of the voting stock.  Advocacy groups have been vocal that the FCC could easily exercise its discretion under the Communications Act to entertain applications for indirect foreign investment in broadcasters above the these benchmarks and to evaluate such applications on a case-by-case basis; after all, the FCC already does this in every industry it regulates except broadcasting.

LISTA and fifty-six other national minority organizations have been vocal in asking the FCC to relax and update its foreign investment policies and, thus, begin to have an impact on the persistently low numbers of minority owners in the broadcast industry. The solution is in the palm of their hands.

To read Comments to the FCC from, LISTA,  MMTC and other organizations. Click here.

 

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