|Federal Communications Commission
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Washington, D.C. 20554
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This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).
|January 13, 1999|
STATEMENT OF FCC CHAIRMAN WILLIAM E. KENNARD
Advertising is the lifeblood of the broadcasting industry. Without ad revenues, broadcasters cannot begin to fulfill their mandate to bring the American people a radio spectrum filled with stations that serve all the people and viewpoints of our nation. The FCC commissioned the study on advertising practices to investigate barriers to competition and service in the broadcast industry. The study, entitled "When Being Number One is Not Enough: The Impact of Advertising Practices on Minority-Owned and Minority-Formatted Broadcast Stations," demonstrates that minority-formatted stations find it difficult to attract ad revenue, a situation that jeopardizes their overall profitability, and ultimately, the communities they serve.
The study investigated the practices of "no Urban/Spanish dictates" whereby some advertisers exclude stations that target minority audiences from competition for ad placements, regardless of the station's rating. It also investigated "minority discounts" where stations are paid less - on average 63% less according to minority broadcasters surveyed. When they do have ads, the study found that these practices are widespread, and often motivated by stereotypes of minority consumers.
These practices are not only unfair. They do not make any business sense. Madison Avenue needs to understand today's Main Street. There is not only a diversity of people in America, but a diversity of types of people within each group - rich and poor, educated and unskilled, blue and white collar.
The examples offered in this study suggest that some advertisers are stuck in an out-dated mindset. They do not recognize the purchasing power of minority consumers and the ability of minority-formatted stations to reach them.
That is why I will send a copy of this report to the top advertising firms and ad-buyers in the country. I want them to study this report along with me so together we can work to identify the barriers to minority-formatted radio stations and find voluntary, pro-competitive ways to remove them. Together, we can ensure the long-term success of minority-formatted radio stations.