Entercom Wants Broadcast Disclosure Rules Junked; Many Likely to Agree
It’s time to kill a 1976 rule that radio and TV stations must disclose on-air all material terms of their contests when promoted during programming, the owner of 112 radio stations told the FCC. Entercom asked it to start a rulemaking to let any broadcaster -- and in particular radio stations -- instead disclose all contest terms on their websites. If the commission seeks feedback on the proposal, all radio stations filing comments are likely to back it, industry lawyers and an executive said. Calvary Chapel of Costa Mesa, owner of several radio stations, filed in support of Entercom’s petition, less than a day after it was posted online.
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Industry officials said a proposed fine of $22,000 to Clear Channel for telling listeners rules about a competition to win a free car only on its Los Angeles stations’ websites (CD Jan 23 p15) drew heightened concern about broadcast disclosure rules. But Entercom had been working on the petition for a year and sent it to the FCC before an Enforcement Bureau notice of apparent liability was released, its general counsel said. “It was actually gone and in the FedEx [letter] before the Clear Channel NAL was released -- I didn’t even know about it,” said General Counsel John Donlevie. Several broadcast executives had said they supported ending the disclosure rules, but he decided to file the petition without getting co-signers, he said.
"It’s a question of getting it started, and I figured the easiest way to do that is to file the petition,” Donlevie said: “Obviously filing a petition doesn’t get anything started until the FCC” acts to seek comment. “I felt it was something that was just easier for Entercom” to do solo “and try to build support for it because it doesn’t matter if you have one name or 20 names,” he said. Other companies are likely to file in support of the petition, Donlevie and lawyers representing various radio stations predicted. A Media Bureau spokeswoman declined to comment.
The petition asks the FCC to allow material terms to go on a station’s website, or that of the state broadcasters association if the outlet doesn’t have a site. Stations could still give the terms on-air, if they didn’t post them on the Internet. “The public is already accustomed to accessing these station websites at any time to obtain up to date information on subjects such as news, weather, traffic, song names, etc. instead of waiting for announcements on the broadcast station. It also makes sense for the public to expect to visit a station’s website to obtain detailed contest information,” the petition said (http://xrl.us/bmpwgu). “The Commission itself has recognized the prevalence and efficiency of internet usage in today’s world through its very own administration,” Entercom said.
The rule change ought to apply to all broadcasters, but radio needs the help more than TV, it said: Disclosures take up airtime on radio that can’t be otherwise used, while TV can insert the text at the bottom of the screen. The lengthier disclosures can take a minute or more, said Donlevie and other radio lawyers. FCC rules also duplicate state laws that already apply to the contests, said Scott Flick of Pillsbury.
All broadcasters are likely to back the petition, lawyers said. “I can’t imagine that any broadcaster would not support that -- it just makes so much sense” and reflects that other types of ads like those for financial services need to share fewer terms on-air, said David Oxenford of Davis Wright. “The issue of disclosure generally seems to have become a big issue in the last three or four years where the Enforcement Bureau seems to have become much more aggressive or assertive for fining people for not disclosing something on-air. ... To some degree it’s become a kind of gotcha.” The petition may not be ambitious enough, because it doesn’t seek to eliminate entirely the on-air disclosure rule, Flick said. “There are so many contests out there, it is sort of an anachronism that any contest, particularly one that is conducted online, is subject to these types of rules,” he said: But “since it would grant flexibility to radio stations that they don’t currently have, I don’t see any reason why a station wouldn’t support” the petition.