O’Rielly On Radio Subcab Rules: NAB Plan Good

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ORLANDO — With soon-to-depart Chief of Staff and Senior Legal Advisor for Media Brooke Ericson at his side, FCC Commissioner Mike O’Rielly survived a tricky trip from the Nation’s Capital to the 2018 Radio Show, being held just a stone’s throw away from Walt Disney World.


O’Rielly’s after-lunch keynote address was certainly worth hearing for radio station owners hoping for a loosening of the FCC’s subcap rules. He believes the NAB’s proposal has merit.

In a speech that outlined the efforts undertaken in the last year at the FCC, including being “incredibly aggressive” against pirate radio operators and “eliminating a host of outdated broadcast laws built for yesteryear,” O’Rielly signaled that he is open to fewer owners in a smaller market, giving a radio company the power to monopolize the media in an age when the competitor is the un-regulated digital media giant looking to grow its local ad dollar intake.

“I do believe the NAB’s proposal is worthy of the FCC’s consideration,” O’Rielly said.

It was a reiteration to a friendly crowd of comments he first made in early April, when he spoke at an invitation-only breakfast presented by Garvey Schubert Barer and co-sponsored by the RAB, held during the NAB Show in Las Vegas.

His No. 1 goal from six months ago: To open the 2018 quadrennial review of the Telecommunications Act of 1996 by launching a full review on the current AM/FM limits presented to one company in a given market. O’Rielly calls the current limits “harmful,” and with “significant challenges today” for radio against digital behemoths such as Facebook, Amazon, Google, Apple and Netflix in the quest for ad dollars, he believes allowing a company to own more stations in a market will help the industry.

Then came a proposal drafted in June by the NAB that would eliminate FCC-mandated subcaps in markets ranked higher than No. 75, and allow one company to own as many AM stations as they wish, regardless of market size.

As written, O’Rielly is a fan of the plan, and addressed skeptics who argue that eliminating these subcap rules would be harmful to the marketplace.

“I am not concerned that companies with profitable FM stations will sell off unprofitable AM stations and go ahead and buy more FM stations,” he said, pointing to how “AM revitalization” and the use of FM translators has led some owners to keep their kHz-based stations. In fact, he believes lifting an AM subcap could perhaps even be helpful for operators, giving the senior broadcast band added life.

O’Rielly also took a moment to ask radio broadcasting companies to participate in the FCC’s incubator program, as it “keeps with the radio industry’s long tradition of helping your fellow Americans.”

Among the choice quotes Tweeted by the NAB from O’Rielly: “There is no one more local than local radio,” and “You are the lifeblood of local information and local entertainment, but you ought not have burdens that no longer make sense.”

O’Rielly then sat and chatted with NAB President/CEO Gordon Smith, who interviewed him on several top topics — including the birth of his daughter, Tess, and his troubles of being able to fly to Orlando on time for his session (he flew through Cincinnati in order to make the 1:30pm session)

Smith talked of “the great change” taking place between the digital and terrestrial broadcaster. What is O’Rielly’s sense of the future?

“Digital will continue to grow. But, at the same time I don’t think terrestrial goes away,” he shared. O’Rielly, like many, listens to terrestrial radio “and a bunch of radio stations,” in addition to iHeartRadio. He noted that his wife listens to Country WMZQ-FM 98.7, an iHeart station in Washington.

That said, he notes that digital media “will continue to put a strain on the traditional media industry.”

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