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In Re Application of Great Empire Broadcasting, Inc. and Journal Broadcast Corp. for Transfer of Control of Omaha Great Empire Broadcasting, Inc., Licensee of WOW(AM) and WOW(FM), Omaha, Nebraska File Nos. BTC-980831GH, BTCH-980831GI

I have written before about the Commission's illogical and indefensible rules for defining the relevant radio "market" when assessing compliance with our local ownership caps.(1) My previous statements have focused on two specific problems. First, our rules preclude a meaningful assessment of market concentration because they apply different definitions of the relevant "market" for purposes of counting the total number of stations in the market and for purposes of determining the number of stations that count toward the ownership cap. Second, and the problem highlighted by this case, our rules create unrealistic markets that do not exist anywhere but in the halls of the FCC.

Here, Journal proposes to acquire eight stations in the Omaha area. The composite principal community contour of two of those stations, WOW(AM) and KESY(AM), extends approximately 20-30 miles beyond the other stations in the proposed combination.(2) At the outermost edges of their contours, WOW(AM), and, to a lesser extent, KESY(AM), intersect with the principal community contours of approximately a dozen stations from distant communities. Many of these are small stations, like Denison, Iowa's KDSN(AM) that operates at 500 watts daytime and 13 watts nighttime some 60-70 miles from Omaha.(3) No listener survey, no advertiser, and no economist would consider KDSN(AM) to be a competitor in the Omaha market. Nevertheless, under the Commission's rules, KDSN(AM) and the other distant stations count as being in the same "market" as the eight Omaha stations in the proposed combination, simply because its signal overlaps with a sliver of the outermost reaches of WOW(AM)'s signal contour. Without these distant stations, there would be fewer than 45 stations in the market and Journal's eight-station combination could not be approved under the Commission's rules.

Indeed, the Order tacitly acknowledges that the Commission's market definition rules do not comport with reality when it turns to the competitive analysis. In that section, in which the Commission attempts to assess market concentration among stations that actually compete with one another, it completely abandons the fictional 53-station "market" created under our rules, and applies the 23-station Arbitron market that the industry relies upon in making day-to-day business decisions. Thus, as a matter of economic reality, there are closer to 23 stations in the market in which the stations at issue participate than the 53 postulated by the Commission's rules. In such a market, Journal could own only six stations, not the eight-station combination approved today.

The Order side-steps the illogic of our current rules by arguing that the rules should be changed only in a rulemaking proceeding, after all interested parties have had an opportunity to comment and the Commission has had the benefit of a "full and well-counseled record." Moreover, the Order asserts that such a process is already underway, stating that we "recently sought comment on the current methodology for determining a 'radio market.'" I fear, however, that these protestations are simply a smoke screen for inaction. First, the Commission sought comment on the issue in a Notice of Inquiry in its biennial review proceeding, not in a Notice of Proposed Rulemaking. There is a vast difference between the two: an NPRM can lead directly to rule changes; an NOI can only lead to proposed rule changes. Second, the NOI was not "recent"; it was issued over a year ago and the record has been closed for almost a year. Third, the market definition issue in the NOI was identified in only one sentence. Not surprisingly, few commenters addressed the issue. If the Commission were serious about resolving these market definition issues, it would issue an NPRM immediately.

In sum, our local ownership rules are clearly broken and in need of repair. What is lacking is not the need to act, nor the means to act, but the will. Until that day arrives, I must operate under our rules as they currently exist. I therefore reluctantly concur in today's result.

1. See, e.g., Applications of Pine Bluff Radio, Inc. and Seark Radio, Inc., FCC No. 99-67 (rel. April 15, 1999); KIXK, Inc., 13 FCC Rcd 15685 (1998).

2. See Figure 1.0, attached.

3. Fig. 1.1 and Table 1.1, attached.