Puerto Rico’s status as radio market under review


US Rep. Pedro R. Pierluisi (D-PR) fired off a letter to FCC Chairman Julius Genachowski (and by cc, the other four commissioners) questioning the application of the Arbitron market definition of radio markets and its application to the territory he represents. Genachowski said that the matter remains under review.

Pierluisi notes that Arbitron treats the island as one single market, but that very much in contrast, the Office of Management and Budget says the island contains eight separate and distinct “Metropolitan Statistical Areas.”

The problem for broadcasters is that unless granted a waiver, the Arbitron market definition currently used by the FCC in local cluster analysis limits the number of stations a single owner can have in a way that does not exist at most mainland locations.

“Simply put,” he wrote, “the geography and size of the island of Puerto Rico make it physically impossible to be one ‘market’ for purposes of a radio audience. A listener in San Juan cannot hear a station in Mayaquez and vice versa.”

He suggested putting the island under the contour definition. “Moreover, adoption of the OMB’s definition of “local radio market” for Puerto Rico would further the goal, articulated by then-Chairman Copps at the FCC Diversity Advisory Committee meeting on May 7, 2009, of increasing minority ownership of broadcast facilities. By enabling the minority-owned broadcasters in Puerto Rico to strengthen their business operations and achieve island-wide distribution of their programming, adoption of the OMB definition would facilitate these broadcasters’ continued survival in an extremely challenging economy. Alternatively, use of the contour overlap methodology, which allows ownership of a certain number of stations whose signals overlap, would solve the problem posed by the FCC’s current ownership rule. Absent implementation of one of these two approaches, there will likely be a decrease in minority ownership of radio stations as broadcasters will be forced to sell their stations.”

In response, Genachowski noted that a petition from Puerto Rican radio broadcaster Arso Radio is under consideration, and added that Pierluisi’s letter will be incorporated into the record as the FCC undertakes its quadrennial review of broadcast ownership rules this year.

RBR-TVBR observation: One of the problems with a blanket definition of radio markets is that each market is a snowflake, and that applies whether you’re talking market-based, contour-based or some other type of definition. And while one size may fit most, there are places that are difficult to shoehorn in, and Puerto Rico is definitely one of the latter.

The geography of Puerto Rico is different, as is Arbitron’s handling of the situation. Waivers on cluster size have routinely been granted, and it would save everybody a lot of time, trouble and expense to make the contour method the market definition of choice at this location.