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  FOR IMMEDIATE RELEASE:
  March 20, 2000
  
  
        PRESS STATEMENT OF COMMISSIONER GLORIA TRISTANI
                              
 Re:  Mass Media Bureau Approval of Radio License Transfers
    in Youngstown-Warren, Ohio and Lafayette, Louisiana
       
       These cases are a good illustration of how the Commission's current radio
  ownership policies are not only illogical, but are doing serious damage to the public
  interest.
  
       As an initial matter, these appear to be the latest in a series of transactions that
  should not have been approved under our rules limiting the number of stations an entity
  can own in a market.  In Youngstown, under the Commission's rules for counting the
  number of radio stations in a "market" (based on overlapping signal contours), Cumulus
  will own nine stations in two of the markets implicated by the deal.  That exceeds the
  eight-station ownership limit that applies even to the nation's largest markets (those with
  45 or more stations).  Similarly, in Lafayette, Citadel will own eleven stations in one of
  the markets, well over the eight-station limit. 
  
       As in all of these cases, the Bureau's approval is accomplished through a bit of
  regulatory sleight-of-hand.  After taking a broad definition of "market" to include all nine
  Cumulus stations in and around Youngstown, and all eleven Citadel stations in and
  around Lafayette (thus increasing the number of stations that Cumulus and Citadel can
  own in those markets), the Bureau then simply ignores some of those stations when
  counting how many stations Cumulus and Citadel will own towards the ownership cap. 
  Tellingly, this practice of shrinking the market has never been codified as a Commission
  rule.  And no wonder   there is no rational explanation for including some stations as
  being in the "market" for one purpose and not the other.
  
       But the Commission's policies have real-world effects that go beyond bad
  economics.  In Youngstown, if all proposed transactions are approved, the two largest
  competitors will control 95.8% of the revenue in the market; in Lafayette, the two largest
  competitors will control 71.2% of the revenue.  There are two Commission policies that
  permit this to happen.  First, we define radio markets by overlapping signal contours
  rather than economic reality.  In the television duopoly context, we recently changed our
  definition of a local television market from a contour-based definition to a DMA-based
  definition.  At the time, we stated that the DMAs "are a better measure of actual
  television viewing patterns, and thus serve as a good measure of the economic
  marketplace in which broadcasters, program suppliers and advertisers buy and sell their
  services and products."  The same reasoning could apply to radio Arbitron markets. 
  Arbitron markets reflect the number of stations that actually target listeners in a particular
  community because they are the listeners that advertisers pay to reach.  We ought to
  examine whether Arbitron markets would be a more accurate measure of marketplace
  reality.  Youngstown and Lafayette, for instance, are not among the largest markets in the
  nation, and our ownership limits should reflect that fact.
   
       Next, the Commission compounds the problem by taking its contour definition of
  radio markets and engaging in the definitional game-playing described above.  Thus, not
  only is the contour-based definition less realistic than Arbitron, but the Commission does
  not even apply a rational version of its less realistic choice.  The end result is a local
  ownership rule that makes little sense, other than to provide cover for a level of
  concentration that would otherwise be indefensible.
  
       We need to fix our local ownership rules or begin to meaningfully apply Section
  310(d)'s public interest standard to these license transfers.  We cannot continue to do
  neither.