Posted August 1, 2006 by Meredith McGehee

Fooled by the Fines?

A flash of a breast during the Super Bowl cost CBS $550,000.  A bachelor/bachelorette party featuring various pixilated scenes of sexual content cost FOX $1,183,000.  And a candid discussion of teen sexual behavior nearly cost every station broadcasting the Oprah Winfrey Show as much as $32,500.  The Federal Communications Commission (FCC), at the prodding of the U.S. Congress (which authorizes the Commission’s budget), has slapped selected broadcasters with steep fines for indecency.  But that has not changed the cozy relationship between broadcasters and the agency charged with regulating them. 

The fines imposed for indecency are just a drop in the bucket compared to what the government should be requiring of broadcasters for using our public airwaves.  The FCC’s quick response to broadcasts of indecent material stands in stark contrast to the agency’s refusal to act on defining broadcasters’ public interest obligations (PIOs) in the digital age, which is now quietly stretching into its sixth year! 

So how is it that the FCC can regulate indecency to the point of calculating down to a specific dollar figure varying amounts for exposed body parts, but shows signs of paralysis in spelling out broadcaster obligations?  And the FCC’s failure to act has huge consequences for the viewing public, as broadcasters pay nothing for the extremely valuable licenses they are granted by the government. 

The National Association of Broadcasters (NAB) has waged an intense public relations campaign to convince citizens and policy makers of their commitment to fulfilling their public interest obligations.  NAB’s so-called “commitment” to meet its public interest duties has been laughable.  The effort would actually be funny if it were not so indicative of how ineffective the FCC has been in regulating this powerful industry.    

The $10 billion figure that the NAB alleges to be the amount spent by broadcasters to meet their public interest obligation is a total fabrication.  The number is cut from whole cloth, based on what stations decide they want to report to the NAB.  With no guidance or meaningful rules from the FCC, the broadcasters get to decide for themselves what the dollar figures should be.  Since the FCC gives the broadcasters carte blanche to decide these amounts, and these numbers go unchecked, broadcasters feel free to liberally inflate their numbers using a variety of tricks of the trade.  

            Much of the absurdly inflated NAB total comes from so-called PSAs – public service announcements.  Broadcasters regularly game the PSA system in a variety of ways.  For example, many of the PSAs are in reality more about promoting the actors/stars in the entertainment programming that they run.  Noah Wylie of “ER” fame may be talking about his favorite teacher, but mostly viewers are reminded that he is a nice guy and a familiar, likeable face on television, so be sure to tune into ER and see him the next time it airs.  The local news anchor may care a lot about cancer victims (as most people do), but being identified with a worthy cause only helps that anchor build a profile in their viewing community.

            Another method of embellishment is to overvalue a PSA.  Here’s how it works.  Let’s say a station has a one-minute advertising slot on a January afternoon that it can’t sell, because advertisers have tightened their purse strings after the expensive holiday season.  But that same time slot in December right before the holidays was in great demand.  So the station runs a PSA in January in that slot and values that January PSA using the pricey pre-holiday rate.  Heck, it’s certainly better than showing a loss.

            One other new wrinkle has emerged of late with PSAs. Until recently, PSAs were generally assumed to be time donated by the station to a good cause.  Now, more and more stations are actually charging to run PSAs.  Viewers, of course, aren’t aware that the good cause coughed up money to put the ad on the air, but the station gets a two-fer – money in the bank and the appearance of promoting a good cause.

            As long as no one at the FCC calls broadcasters out on these and other fictions about fulfilling their public interest obligations, the broadcasters and NAB will have absolutely no incentive to change. 

This is all bad enough, but there is more.  Broadcasters are looking for another, and even bigger, handout from the government today; they want the FCC to force cable operators to carry as many streams of programming as the broadcasters can squeeze from the digital spectrum that the government gave them for nothing.  Not surprisingly, broadcasters are strong supporters of multi-casting must-carry and cable operators are vigorously opposed. 

FCC Chairman Kevin Martin has made no secret of the fact that he wants to push such a requirement through, but he has yet to muster the support of a sufficient number of his colleagues to make it happen.  Commissioners Michael Copps and Jonathan Adelstein have, to their credit, continued to push the FCC to articulate what the broadcasters’ public interest obligations should look like in the digital age.  Just where the two newest FCC Commissioners – Deborah Tate and Robert McDowell -- will come down on both PIOs and multi-casting must-carry is still unclear.   It remains to be seen whether the FCC’s deliberations over multi-casting must-carry will produce a discussion and an environment at the FCC where the much-needed and long overdue regulation of broadcaster’s public interest obligations can finally occur. 

Unless one of the new Commissioners comes down on the public’s side of the public interest obligation issue it will be business as usual at the FCC – broadcasters will continue to avoid actually paying a fair price for their use of the publicly owned airwaves, conservative Members of Congress will be placated by indecency penalties, and lawyers in Washington will continue making truly obscene amounts of money attaching a dollar figure to each body part exposed on the air.   

It’s long past time for the FCC to serve the public, and to stop making excuses for the broadcast industry.  Public interest obligations are just that, in the public interest.  The FCC needs to remember that and start collecting at least this token rent on the public’s airwaves.