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January 20, 2000

         STATEMENT OF COMMISSIONER MICHAEL K. POWELL, 
                       DISSENTING IN PART

     Re:  Report and Order  - In the Matter of Creation of Low Power Radio Service 
          (MM Docket 99-25)

     This item's goal is to create a class of radio stations "designed to serve very localized
communities or underrepresented groups within communities." Notice of Proposed Rulemaking,
MM Docket No. 99-25, 14 FCC Rcd 2471, 2473 (1999).  Attempting to give greater voice to
narrower interests is generally laudable and I support the objective.  But, the question that gives
me pause is what the cost is to existing stations that provide equally valuable service to their
communities.  Because this Order fails to give credence to this concern, I respectfully dissent in
part.  

I do not quibble with the Commission's objectives.  Certainly, the extensive consolidation
of radio stations into large commercial groups and the financial challenges of operating full power
commercial stations have limited the broadcasting opportunities for highly localized interests.  The
introduction of a low power FM service may partially address this concern.  However, to borrow
from the teaching of the medical profession, when trying to treat a problem, we should "first do
no harm."  There presently exist many small and independent stations across the country that are
especially notable for their local focus.  This admirable group includes a fair number of stations
owned by minorities and women, as well as stations with smaller audiences and limited
advertising.  These stations have struggled to survive as independent voices against the rising tide
of consolidation brought on by the economic stress of small scale production.  It would be a
perverse result, indeed, if these stations were to fail or the quality of locally originated
programming suffer, because new LPFM stations diluted their already tenuous base of support.

     There are two interrelated, yet distinct, threats to these small stations that stem from the
new LPFM service: 1) signal interference and 2) erosion of economic viability.  The first has
garnered all the attention.   The Commission has endeavored to minimize the dangers of
interference in this item.  It wrongly has ignored the second concern.  I have met with a number
of small market broadcasters that tell me that when they raise concerns about the threat of LPFM
to their economic viability they are bluntly rebuked told that such considerations are of no
import, that we are only concerned with spectrum efficiency and that we do not pick winners and
losers.  I, too, heard this line during our internal deliberations.  I find the proposition absurd.  We
regularly consider the economic impacts of our actions on licensees.  Just one example is the
degree to which we have attempted to balance the need for consolidation to achieve economic
efficiency against our goal to foster myriad diverse voices.  Indeed, the Commission itself has
recognized that the industry's ability to function in the public interest, convenience and necessity is
fundamentally premised on the industry's economic viability.

     The introduction of the LPFM service is not simply a way to get greater use out of the
spectrum, regardless of who gets the benefits.   It is a policy choice to create stations that allow
very small communal and parochial interests to find a voice.  We are not agnostic as to whether
they proliferate and prosper.  Indeed, we have made special accommodations to suit our
conception of this service, like eliminating the third adjacency protections normally imposed on
FM broadcasters.  Indeed, for years small broadcasters have tried to expand their services to the
community by seeking more lenient interference restrictions, but to no avail.   Similarly, we are
minting a unique and distinct definition of "community" in order to facilitate the LPFM service. 
My view is to make such accommodations for this service, while putting our heads in the sand as
to the economic impacts on existing stations is in fact, contrary to the assumption of some,
picking winners and losers.

     The threat to small independent broadcasters by the introduction of LPFM service is not
trivial.  While the non-commercial educational LPFM stations will not be direct competitors for
advertising dollars to existing commercial stations, they can threaten the economic health of these
stations in meaningful ways.  LPFM stations might very well siphon financial support away from
small market stations.  Local support that is presently coming to existing stations in the form of
advertising might migrate to one or more LPFM stations in the form of underwriting.  Moreover,
the presence of one or more LPFM stations will certainly dilute audience share, on which securing
advertising dollars is based.  I note, for example, that many of the Order's protections exist only
within the "protected contour" of the existing FM station.  We know, however, that many FM
stations reach significant audience share outside that contour and garner significant financial
support from these areas.  Finally, market dilution may make it difficult to secure financial
support from lenders or investors.

     The proponents of LPFM retort that the number of new stations will be few in a given
market, and limited in their reach.  Perhaps, in some markets this is true.  But, the 41 new station
possibilities in Elko, Nevada and Springerville, Arizona, or the 25 new station possibilities in
Billings, Montana certainly are not trivial to the established stations in those small, rural markets. 
In all, the Bureau tells us that there is a possibility of 700 to 1000 new LP100 stations (more if
LP10 stations come into the market).  

     It is important to emphasize that an adverse impact on existing stations directly
compromises the public interest.  Locally originated programming that we favor is expensive to
produce compared to the scale efficiencies of syndicated programming.  The erosion of economic
return, even slight in small markets, may adversely impact the quantity and quality of local
programming, which is unlikely to be replaced by micro stations operating under even greater
economic constraints.  The link between local programming and economic efficiency is well-
established.  Former Commissioner Ervin S. Duggan stated it succinctly:

     Broadcast stations that can't stay above water economically can't serve their
     communities.  Broadcasters have always borne a fundamental obligation to provide
     service in the public interest.  Most have borne that obligation quite well, despite
     occasional adversity.  But the FCC and the nation cannot expect broadcasters to fulfill
     that obligation if the structure and economics of the industry don't permit it.

The threat of compromising this maxim of the public interest should have compelled the
Commission to fully consider the economic impact of its decision.
     
     Are these threats minimal or serious?  We are left to wonder, wait and see for the
Commission has refused to seriously consider what might be the economic consequences.  I fear
that many small and independent stations will find this to be the straw that broke the camels back,
or that last "wafer thin mint" forcing them to sell out or cut back it local programming.  The
result would be a further decrease in independent and perhaps in minority and female ownership
of full power stations that we so often bemoan.  The lost community value, furthermore, would
not simply be transferred to the new LPFM stations.  Those stations may serve a very small piece
of the overall community, but could not possibly make up for the greater service coverage of the
lost full power station, nor the lost opportunity for a minority or women to share in the fruits of
the broadcasting business.


Signal Interference

     I must confess that I have no clear idea as to whether or not existing broadcasters will
suffer intolerable interference.  The engineering studies on the record reach very different
conclusions.  When carefully examined, however, one finds that the basic methodologies and
analysis are consistent with each other.  Where these studies differ, is what the various proponents
believe is "acceptable" interference or degradation of service.  This I find to be a relatively
subjective judgment rather than an engineering one, colored by the self-interest of the various
proponents.  It is my practice in such a situation to defer to the conclusions of the Offices and
Bureaus when not clearly persuaded otherwise.  Thus, customarily, I would accept the staff's
conclusion that third adjacency protection is unnecessary.  I do have some hesitancy, however,
because I note that by doing so, we diverge from protections we have insisted on some say with
unbending resolve with respect to other FM services.  Nonetheless, to resolve this lingering
doubt I would have introduced the LPFM system another way than that we adopt here.


A Better Way
     
     On balance, I would have taken a different approach to introducing LPFM service.  I
believe in light of lingering concerns about signal interference and my pronounced concern about
the economic impact of the new service we should have introduced this service gradually.  It
might begin with some experimental licensing in certain communities to assess the real world
impact of signal interference.  Subsequently, we could have fully introduced the service with third
channel adjacency protections.  This would have two benefits.  First, it would minimize the risk of
interference in a manner consistent with existing services and second, it would introduce
substantially fewer stations into the market, thereby allowing us to evaluate the economic impacts
of these new stations in these markets.  Finally, if all went well, we could then move to full service
with less adjacency protection, as warranted by our experience.  Such an approach strikes me as
prudent and preferable to the shotgun introduction which we let loose today.


Conclusion

     For the foregoing reasons, I dissent in part.