Stern Shocked, Hispanic Rocked Radio Landscape

By | December 19, 2004 at 12:00 AM

New York – The year began with the Super Bowl halftime show fiasco and ended with aftershocks from Howard Stern flipping his detractors the bird and taunting the Federal Communications Commission with a just-try-and-get-me-now move to satellite radio.

Between those two seismic events, the FCC levied a record number of indecency fines, responding to an avalanche of complaints carefully orchestrated by conservative zealots and election year political pressure.

The results from the government crackdown were widespread. Top-rated personalities were fired. Zero-tolerance edicts were issued. On-air delays and indecency tutorials became commonplace. Warhorses like Pink Floyd’s “Money,” Nine Inch Nails’ “Closer” and the Steve Miller Band’s “Jet Airliner” were edited or yanked off the air. Talent clammed up.

“They feel that any slip of the tongue could cost them their job,” talent agent Bob Eatman said, reflecting on 2004’s icy climate.

Not everyone agreed that the stepped-up enforcement had a chilling effect. “Any edgy air talent has had to take a second look at what they’re doing,” Cox Radio CEO Bob Neil told Billboard. “Good air talent is able to adjust to that.”

However, Neil said, “The bar continues to move with the FCC… (and) that makes it – generously, I guess you could say – confusing for people.”

Speaking at the National Assn. of Broadcasters Radio Show in October, Citadel COO Judy Ellis said the crackdown threatens free speech and implored the industry to come together and fight.

YEAR OF THE CONSENT DECREE

Wanting to avoid a costly, protracted legal battle, the industry instead chose to simply pay up and implement companywide compliance plans. Taking its cue from Mel Karmazin, who, as Infinity chief, signed a $1.7 million consent decree with the FCC in 1996, three companies forged similar settlements this year: Clear Channel ($1.75 million), Emmis ($300,000) and Karmazin’s former employer, Viacom ($3.5 million), which continues to fight the FCC over the Super Bowl fine.

Asked why Emmis, which specializes in edgy formats aimed at a young audience, would rather pay than fight, CEO Jeff Smulyan said: “Part of me believes we probably ought to adjudicate what the standards are. But it’s very hard to take that burden and place it on your people and shareholders.”

Democratic commissioner Jonathan Adelstein insisted that the FCC wasn’t trying to drive Stern and others off the air; it was just enforcing the indecency law.

“I don’t think it’s a necessary outcome that good content is driven away from the radio,” Adelstein said. “It’s possible to be proactive and interesting and not cross the bounds of indecency.”

Still, some suggested that the government’s clean-up-the-airwaves campaign was, in fact, driving popular talent to satellite radio. If that medium remains free of FCC scrutiny, Eatman warned, “free speech will be a province of people who can afford satellite radio. It will put terrestrial radio at a disadvantage.”

As of Dec. 15, the FCC maintained that since satellite radio is subscription-based, it is free of indecency scrutiny.

HISPANIC RADIO EXPLODES

Beyond indecency, Stern and satellite radio, Hispanic programming was big news for broadcasters.

While most of the industry was flat, Spanish-language stations posted double-digit growth, with revenue that has risen to about $800 million. While general-market radio attracts only 8% of the total media advertising pie, Spanish-language radio grabs 23% of Hispanic media dollars. Hispanic radio listening is up 37% during the past six years, and the number of stations programming the format grew from 302 in 1998 to 598 in 2003.

That is why Clear Channel and Infinity unveiled plans in the fall to tap into a market where specialists Spanish Broadcasting System, Univision and Entravision were already dominant. With fewer than 20 of its 1,200 stations programming a Hispanic format, the company’s plan is to convert 20-25 stations to various Hispanic formats during the next 18 months.

HD FRONTIER

The radio industry took giant steps toward its digital future this summer. After 10 years of technology, investment and politics, three of radio’s biggest owners began three-year high-definition radio rollouts.

Clear Channel plans to convert 1,000 of its 1,200 stations to HD within three years, while third-ranked Cox Radio and fourth-place Entercom promised 80% of their stations would be digital within four years. And in the first of a series of grants, the Corporation for Public Broadcasting funded digital transmission equipment for 76 of the 800 public radio stations it supports.

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