[Federal Register Volume 68, Number 150 (Tuesday, August 5, 2003)]
[Proposed Rules]
[Pages 46359-46362]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-19091]
Federal Register / Vol. 68, No. 150 / Tuesday, August 5, 2003 /
Proposed Rules
[[Page 46359]]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 73
[MB Docket No. 03-130; FCC 03-127]
Definition of Radio Markets for Areas Not Located in an Arbitron
Survey Area
AGENCY: Federal Communications Commission
ACTION: Notice of proposed rulemaking.
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SUMMARY: This document is designed to solicit comment on proposals to
define radio markets outside of the Arbitron defined areas. The
Commission replaced the current contour-overlap methodology for
defining radio markets with a geography-based market definition. For
areas of the country covered by Arbitron Metro markets, we adopted the
Metro market as the relevant radio market for purposes of determining
compliance with the local radio ownership rule. Metro markets, however,
do not cover a significant portion of the country. We initiate this
rulemaking proceeding to define radio markets for those areas.
DATES: Comments are due on or before September 4, 2003 and reply
comments are due September 19, 2003.
ADDRESSES: Office of the Secretary, Federal Communications Commission,
445 12th Street SW., Washington, DC 20554. See SUPPLEMENTARY
INFORMATION for filing instructions.
FOR FURTHER INFORMATION CONTACT: Amy Brett, Media Bureau at (202) 418-
2703.
SUPPLEMENTARY INFORMATION: 1. This is a summary of the Commission's
Notice of Proposed Rulemaking (NPRM) MB Docket No. 03-130, FCC 03-127,
adopted June 2, 2003, and released July 2, 2003. The complete text of
the NPRM and the Initial Regulatory Flexibility Analysis is available
on the Commission's Internet site, at http://www.fcc.gov., and is also
available for inspection and copying during normal business hours in
the FCC Reference Information Center, Courtyard Level, 445 12th Street,
SW., Washington, DC. The text may also be purchased from the
Commission's copy contractor, Qualex International, Portals II, 445
12th Street, SW., CY-B4202, Washington, DC 20554 (telephone 202-863-
2893).
2. In the Local Radio Section of the final rule in this proceeding
(published in the final rule section of this Federal Register), we
replaced our current contour-overlap methodology for defining radio
markets with a geography-based market definition. 47 CFR 73.3555(a)(2).
For areas of the country covered by Arbitron Metro markets, we adopted
the Metro market as the relevant radio market for purposes of
determining compliance with the local radio ownership rule. A
significant portion of the country, however, is not covered by Metro
markets. We initiate this rulemaking proceeding to define radio markets
for those areas.
3. We seek comment on how to draw specific market boundaries in
areas of the country not located in Arbitron Metros. What factors
should we consider in grouping radio stations into markets? We propose
that radio markets be county-based, as Arbitron Metros are. We seek
comment on that proposal. In the western United States, counties are
significantly larger. We seek comment on whether we should, like
Arbitron, divide counties into separate radio markets in certain
circumstances. We also propose that radio stations be assigned to radio
markets based on the location of their communities of license. We seek
comment on this proposal.
4. We seek comment on whether we should rely on any pre-existing
market definitions in delineating radio markets for non-Metro areas. As
indicated in the Local Radio Section, Arbitron traditionally has based
its Metro definitions on the Metropolitan Area (MA) definitions
developed by OMB. Should we also do the same for non-Metro areas? OMB
recently released new MA definitions based on the results of the 2000
Census.\1\ The 935 new MAs, moreover, cover a greater portion of the
country. Previously, MAs were defined only for urban areas with a
population of 50,000.\2\ The new MA definitions cover areas with a
population of 10,000 to 50,000 (known as Micropolitan Statistical
Areas), which should greatly increase the number of radio stations
located in MAs.\3\ If we rely on MAs, how should we address future
changes to MA definitions, and the creation of a new, or the deletion
of an existing, MA \4\ In addition, even with the expanded reach of the
new MAs, there will be areas that they do not cover. How should the
radio market be defined in those areas if MAs are used? One possible
method is to establish geographic markets based on the location,
distribution, and density of populated areas.\5\ Because population
clusters are likely to indicate areas of economic and social
interaction, the location and distribution of the centers of population
should give us a reasonable indicator of the boundaries of the relevant
geographic market in which radio stations compete. Because the
geographic areas involved generally will be low-density and rural areas
of the country, moreover, we believe that population data could provide
a fairly reliable and easily determinable market definition. We seek
comment on this and any other methods.
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\1\ See OMB Bulletin No. 03-04, http://www.whitehouse.gov/omb/omb/bulletins/b03-04.html. In 2000, OMB revised its procedures for
defining MAs. In addition, it adopted the more generic term Core
Based Statistical Area (CBSA) to cover both traditional Metropolitan
Areas and the new Micropolitan Statistical Areas. See generally
Standards for Defining Metropolitan and Micropolitan Statistical
Areas, 65 FR 82228 (2000). Although less accurate, we will use
former term--i.e., MAs--to avoid confusion.
\2\ See U.S. Census Bureau, Cartographic Boundary Files, http://www.census.gov/geo/www/cob/ ma--metadata.html (visited May 30,
2003).
\3\ See 65 FR 82236-37 for a detailed description of the
standards OMB uses to define MAs.
\4\ See id. at 82237 for the rules governing future updates to
MAs.
\5\ Population data is available over the Internet from the
Census Bureau.
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5. Another possibility is to treat Cellular Market Areas (CMAs) as
the relevant geographic market for radio. CMAs were developed in the
mid-1980s to be the geographic basis for licensing cellular spectrum.
CMAs consist of MAs (as they were defined after the 1980 census) and
Rural Service Areas (RSAs),\6\ which the Commission delineated for
areas of the country not located in MAs.\7\ Although CMAs were not
developed in the context of radio broadcasting, they were designed to
follow ``natural social and economic communities'' through ``multi-
county groupings drawn along county boundaries.'' \8\ Are CMAs a
reasonable proxy for radio markets in non-Metro areas of the country?
We seek comment on this issue.
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\6\ See Amendment of the Commission's Rules for Rural Cellular
Service, 1985 WL 260366, FCC 85-646, ]1 (rel. Dec. 17, 1985).
\7\ Amendment of the Commission's Rules for Rural Cellular
Service, 60 Radio Reg. (P&F) 1029, ]1 (1986).
\8\ Id. at ]11.
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6. For any market definition we establish, how should we address
situations in which that market overlaps an Arbitron Metro. If we use
MAs or CMAs, there will be existing areas of overlap. Even if we define
radio markets around existing Arbitron Metros, Metro boundaries may
change, or Arbitron may create or delete a Metro. We seek comment on
how to address the possibility of a market overlap (or in the case of a
deleted Metro, the possibility of an undefined market).
7. The goal of this rulemaking proceeding is to generate a map or a
list of markets for radio stations across the entire country, using
Arbitron Metros where available and a Commission-
[[Page 46360]]
endorsed market definition everywhere else. We therefore encourage
parties to use this opportunity to submit specific information that
would assist is in properly delineating the boundaries of the local
radio markets in which they are interested.
8. Comments and Reply Comments. Pursuant to applicable procedures
set forth in sections 1.415 and 1.419 of the Commission's rules,\9\
interested parties may file comments on the Notice of Proposed
Rulemaking on September 4, 2003 and reply comments are due September
19, 2003. Comments may be filed using the Commission's Electronic
Comment Filing System (ECFS) or by filing paper copies. See Electronic
Filing of Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
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\9\ 47 CFR 1.415 and 1.419.
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9. Comments filed through the ECFS can be sent as an electronic
file via the Internet to http://www.fcc.gov/e-file/ecfs.html.
Generally, only one copy of an electronic submission must be filed. In
completing the transmittal screen, commenters should include their full
name, U.S. Postal Service mailing address, and the applicable docket,
which in this instance is MB Docket No. 03-130. Parties may also submit
an electronic comment by Internet e-mail. To get filing instructions
for e-mail comments, commenters should send an e-mail to [email protected],
and should include the following words in the body of the message,
``get form .'' A sample form and
directions will be sent in reply. Parties who choose to file by paper
must file an original and four copies of each filing. Filings can be
sent by hand or messenger delivery, by commercial overnight courier, or
by first-class or overnight U.S. Postal Service mail (although we
continue to experience delays in receiving U.S. Postal Service mail).
The Commission's contractor, Vistronix, Inc., will receive hand-
delivered or messenger-delivered paper filings for the Commission's
Secretary at 236 Massachusetts Avenue, NE., Suite 110, Washington, DC
20002. The filing hours at this location are 8 a.m. to 7 p.m. All hand
deliveries must be held together with rubber bands or fasteners. Any
envelopes must be disposed of before entering the building. Commercial
overnight mail (other than U.S. Postal Service Express Mail and
Priority Mail) must be sent to 9300 East Hampton Drive, Capitol
Heights, MD 20743. U.S. Postal Service first-class mail, Express Mail,
and Priority Mail should be addressed to 445 12th Street, SW.,
Washington, DC 20554. All filings must be addressed to the Commission's
Secretary, Office of the Secretary, Federal Communications Commission.
10. Parties must also serve either one copy of each filing via e-
mail or two paper copies to Qualex International, Portals II, 445 12th
Street, SW., Room CY-B402, Washington, DC 20554, telephone (202) 863-
2893, facsimile (202) 863-2898, or e-mail at [email protected]. In
addition, parties should serve one copy of each filing via e-mail or
one paper copy to Amy Brett, Media Bureau, 445 12th Street, SW., 2-
C134, Washington, DC 20554. Parties should serve one copy of each
filing via e-mail or five paper copies to Linda Senecal, 445 12th
Street, SW., 2-C438, Washington, DC 20554.
11. Availability of Documents. Comments, reply comments, and ex
parte submissions will be available for public inspection during
regular business hours in the FCC Reference Center, Federal
Communications Commission, 445 12th Street, SW., CY-A257, Washington,
DC 20554. Persons with disabilities who need assistance in the FCC
Reference Center may contact Bill Cline at (202) 418-0267, (202) 418-
7365 TTY, or [email protected]. These documents also will be available
electronically at the Commission's Disabilities Issues Task Force Web
site: http://www.fcc.gov/dtf, and from the Commission's Electronic
Comment Filing System. Documents are available electronically in ASCII
text, Word 97, and Adobe Acrobat. Copies of filings in this proceeding
may be obtained from Qualex International, Portals II, 445 12th Street,
SW., Room, CY-B402, Washington, DC 20554, telephone (202) 863-2893,
facsimile (202) 863-2898, or via e-mail at [email protected]. To
request materials in accessible formats for people with disabilities
(Braille, large print, electronic files, audio format), send an e-mail
to [email protected] or call the Consumer and Governmental Affairs Bureau
at 202-418-0531 (voice), 202-418-7365 (TTY).
12. Ex Parte Rules. This proceeding will be treated as a ``permit-
but-disclose'' proceeding, subject to the ``permit-but-disclose''
requirements under section 1.1206(b) of the Commission's rules.\10\ Ex
parte presentations are permissible if disclosed in accordance with
Commission rules, except during the Sunshine Agenda period when
presentations, ex parte or otherwise, are generally prohibited. Persons
making oral ex parte presentations are reminded that a memorandum
summarizing a presentation must contain a summary of the substance and
not merely a listing of the subjects discussed. More than a one or two
sentence description of the views and arguments presented is generally
required.\11\ Additional rules pertaining to oral and written
presentations are set forth in section 1.1206(b) of the Commission's
rules. Parties submitting written ex parte presentations or summaries
of oral ex parte presentations are urged to use the ECFS in accordance
with the Commission rules discussed above. Parties filing paper ex
parte submissions must file an original and one copy of each submission
with the Commission's Secretary, Marlene H. Dortch, at the appropriate
address as shown above for filings sent by either U.S. mail, overnight
delivery, or hand or messenger delivery. Parties must also serve either
one copy of each ex parte filing via e-mail or two paper copies to
Qualex International, Portals II, 445 12th Street, SW., Room CY-B402,
Washington, DC 20554, telephone (202) 863-2893, facsimile (202) 863-
2898, or e-mail at [email protected]. In addition, parties should serve
one copy of each ex parte filing via email or one paper copy to Amy
Brett, Media Bureau, 445 12th Street, SW., 2-C134, Washington, DC
20554. Parties should serve one copy of each ex parte filing via email
or five paper copies to Linda Senecal, 445 12th Street, SW., 2-C438,
Washington, DC 20554.
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\10\ 47 CFR 1.1206(b).
\11\ See id. Sec. 1.1206(b)(2).
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13. Initial Regulatory Flexibility Analysis. As required by the
Regulatory Flexibility Act (RFA),\12\ the Commission has prepared this
present Initial Regulatory Flexibility Analysis (IRFA) of the possible
significant economic impact on small entities by the policies and rules
proposed in this Notice of Proposed Rulemaking (``NPRM''). Written
public comments are requested on this IRFA. Comments must be identified
as responses to the IRFA and must be filed by the deadlines for
comments on the NPRM.
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\12\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601 et seq., has
been amended by the Contract With America Advancement Act of 1996,
Pub. L. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA
is the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA).
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14. The Commission will send a copy of the NPRM, including this
IRFA to the Chief Counsel for Advocacy of the Small Business
Administration (SBA).
A. Need for, and Objectives of, the Proposed Rules
15. Section 202(h) of the Telecommunications Act of 1996 (1996 Act)
requires the Commission to review all of its broadcast ownership rules
[[Page 46361]]
every two years commencing in 1998 (``Biennial Review''), and to
determine whether any of these rules are necessary in the public
interest as the result of competition. The 1996 Act also requires the
Commission to repeal or modify any regulation it determines to be no
longer in the public interest. In the 2002 Biennial Report and Order,
the Commission concluded that the numerical limits in the local radio
ownership rule are necessary in the public interest to protect
competition in local radio markets. We also concluded that the rule in
its current form did not promote the public interest as it relates to
competition, in part, because the current methodology for defining
radio markets is conceptually flawed as a means to protect competition
in local radio markets. Thus, the Commission revised the present method
of determining the dimensions of radio markets and/or of counting the
stations available in those markets. The new geographic based approach
better serves the public interest, reflects true markets in which radio
stations compete, and better effectuates Congressional intent when it
adopted the radio ownership limits in 1996. In the 2002 Biennial Report
and Order, the Commission adopted a geography-based approach using
Arbitron-defined markets. However, the Commission found that the
current record provides insufficient information about appropriate
boundaries for areas located outside of Arbitron defined areas. This
NPRM is designed to solicit comment on proposals to define radio
markets outside of Arbitron defined areas.
B. Legal Basis
16. This NPRM is adopted pursuant to sections 1, 2(a), 4(i), 303,
307, 309, 310, of the Communications Act of 1934, as amended, 47 U.S.C.
151, 152(a), 154(i), 303, 307, 309, 310, and section 202(h) of the
Telecommunications Act of 1996.
C. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply
17. The RFA directs agencies to provide a description of, and,
where feasible, an estimate of the number of small entities that may be
affected by the proposed rules, if adopted.\13\ The RFA defines the
term ``small entity'' as having the same meaning as the terms ``small
business,'' ``small organization,'' and ``small governmental entity
under Section 3 of the Small Business Act.\14\ In addition, the term
``small business'' has the same meaning as the term ``small business
concern'' under the Small Business Act.\15\ A small business concern is
one which: (1) is independently owned and operated; (2) is not dominant
in its field of operation; and (3) satisfies any additional criteria
established by the SBA.\16\
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\13\ 5 U.S.C. 603(b)(3).
\14\ Id. section 601(3) (incorporating by reference the
definition of ``small business concern'' in 15 U.S.C. 632). Pursuant
to the RFA, the statutory definition of a small business applies,
``unless an agency, after consultation with the Office of Advocacy
of the SBA and after opportunity for public comment, establishes one
or more definitions of the term where appropriate to the activities
of the agency and publishes the definition(s) in the Federal
Register.''
\15\ Id.
\16\ 15 U.S.C. 632.
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18. In this context, the application of the statutory definition to
radio stations is of concern. An element of the definition of ``small
business'' is that the entity not be dominant in its field of
operation. We are unable at this time to define or quantify the
criteria that would establish whether a specific radio station is
dominant in its field of operation. Accordingly, the estimates that
follow of small businesses to which rules may apply do not exclude any
radio station from the definition of a small business on this basis and
are therefore over-inclusive to that extent. An additional element of
the definition of ``small business'' is that the entity must be
independently owned and operated. We note that it is difficult at times
to assess these criteria in the context of media entities and our
estimates of small businesses to which they apply may be over-inclusive
to this extent.
19. The SBA defines a radio broadcast entity that has $6 million or
less in annual receipts as a small business.\17\ Business concerns
included in this industry are those ``primarily engaged in broadcasting
aural programs by radio to the public.\18\ According to Commission
staff review of the BIA Publications, Inc., Master Access Radio
Analyzer Database, as of May 16, 2003, about 10,427 of the 10,945
commercial radio stations in the United States have revenue of $6
million or less. We note, however, that many radio stations are
affiliated with much larger corporations with much higher revenue, and
that in assessing whether a business concern qualifies as small under
the above definition, such business (control) affiliations \19\ are
included.\20\ Our estimate, therefore likely overstates the number of
small businesses that might be affected by any changes to the ownership
rules.
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\17\ See OMB, North American Industry Classification System:
United States, 1997, at 509 (1997) (Radio Stations) (NAICS code
513111, which was changed to code 515112 in October 2002).
\18\ Id.
\19\ ``Concerns are affiliates of each other when one concern
controls or has the power to control the other, or a third party or
parties controls or has the power to control both.'' 13 CFR
121.103(a)(1).
\20\ ``SBA counts the receipts or employees of the concern whose
size is at issue and those of all its domestic and foreign
affiliates, regardless of whether the affiliates are organized for
profit, in determining the concern's size.'' 13 CFR 121(a)(4).
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D. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements
20. The NPRM proposes to modify the definition of radio markets
outside of Arbitron defined areas. The action, depending on the
definition ultimately adopted, would modify the instructions and the
multiple ownership showing currently required for the following forms:
(1) FCC Form 315, Application for Consent to Transfer Control of Entity
Holding Broadcast Station Construction Permit or License; (2) FCC Form
314, Application for Consent to Assignment of Broadcast Station
Construction Permit or License; and (3) FCC Form 301, Application for
Construction Permit For Commercial Broadcast Stations. The impact of
these changes will be the same on all entities. Whether compliance will
take more, less, or the same amount of time and money, will depend on
the definition adopted.
E. Steps Taken To Minimize Significant Impact on Small Entities, and
Significant Alternatives Considered
21. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include the following four alternatives (among others): (1)
The establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance or reporting requirements under the rule for small entities;
(3) the use of performance, rather than design, standards; and (4) an
exemption from coverage of the rule, or any part thereof, for small
entities.\21\
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\21\ 5 U.S.C. 603(c).
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22. We are directed under law to consider alternative means to
achieve our stated objectives.\22\ In the 2002 Biennial Report and
Order, the Commission considered and rejected alternatives to defining
radio markets through the rulemaking process. Specifically, the
Commission found that
[[Page 46362]]
determining radio markets on a case-by-case basis would create
significant regulatory uncertainty and impose substantial burdens on
small-market radio broadcasters, many of which are small businesses.
The Commission concluded that the better course is to develop radio
market definitions for non-Metro areas through the rulemaking process.
The Commission found that this would be the most expeditious way to
define local radio market boundaries for the entire country. Defining
radio markets also would give all interested parties, including small
businesses, clear guidance about how the Commission will analyze a
proposed radio station combination in non-Arbitron areas.
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\22\ 5 U.S.C. 603(b).
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23. The NPRM invites comment on how to modify the current
methodology for determining radio markets for areas of the country
outside of Arbitron defined areas. The Commission has a number of
alternatives on which it invites comment. We particularly invite
comment on how the various alternatives might impact on small
businesses and on alternatives outside the NPRM which might minimize
any burden on small businesses.
24. The Commission seeks comments on how to draw specific market
boundaries in areas of the country not located in the Arbitron Metros
and on what factors should we consider in grouping radio stations into
markets. The Commission proposes that radio markets be county-based.
One alternative, if that proposal is adopted, would be to use a
different standard in the western United States where counties are
significantly larger. The Commission could also divide counties into
separate radio markets in certain circumstances. Small businesses
should benefit from a county-based system because county boundaries are
clear, stable, and well-known, and are commonly used for market
definition purposes (see next paragraph).
25. The Commission also seeks comment on whether to rely on any
pre-existing market definitions in delineating radio markets for non-
Metro areas. For example, the Commission could base its Metro
definitions on the Metropolitan Area (MA) definitions developed by OMB.
The Commission asks how the radio market should be define in areas that
MAs do not cover, and notes one possible alternative would be to
establish geographic markets based on the location, distribution, and
density of populated areas. The Commission could also treat Cellular
Market Areas as the relevant geographic market for radio. Both of these
potential market definitions are county-based. We do not believe that
the selection of one pre-defined market definition over another
generally will have an impact on small business. We invite comment on
this question.
26. The market definition we establish would result in small
business owners being subject to a market definition that is different
than the one to which they currently are subject. As a result, the
number of radio stations that they may own, and the number of radio
stations that their competitors may own, under the local radio
ownership rule may change. We encourage parties to use this opportunity
submit specific information that would the Commission in properly
delineating the boundaries of the local radio markets in which they are
interested.
F. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
27. None.
28. Authority. This Notice of Proposed Rulemaking is issued
pursuant to authority contained in Sections 4(i), 303, and 307 of the
Communications Act of 1934, as amended, 47 U.S.C. 154(i), 303, and 307,
and Section 202(h) of the Telecommunications Act of 1996.
29. Pursuant to the authority contained in sections 1, 2(a), 4(i),
303, 307, 309, and 310 of the Communications Act of 1934, as amended,
47 U.S.C. 151, 152(a), 154(i), 307, 309, and 310 and section 202(h) of
the Telecommunications Act of 1996, this Notice of Proposed Rulemaking
in MB Docket 03-130 is adopted.
30. The Commission's Consumer and Governmental Affairs Bureau,
Reference Information Center, shall send a copy of this Notice of
Proposed Rulemaking, including the Initial Regulatory Flexibility
Analysis, to the Chief Counsel for Advocacy of the Small Business
Administration.
Federal Communications Commission.
William F. Caton,
Deputy Secretary.
[FR Doc. 03-19091 Filed 7-29-03; 12:43 am]
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