Export Compliance Daily is a service of Warren Communications News.
Court-Spurred Release?

FCC Finds Hispanic-Owned Stations May Show More Local News, May Aid Ownership Review

The FCC may have bolstered a forthcoming media ownership draft order and chances of not further angering three appellate judges by issuing a study that found a possible linkage between Hispanic ownership of TV stations and local programming, public interest lawyers told us Friday. The study, which was a long time in the making and was revealed Thursday, was mentioned April 19 at oral argument in broadcaster and public interest group challenges to media ownership rules at the 3rd U.S. Circuit Court of Appeals. Judges were skeptical of FCC delays in acting on media ownership and diversity after two previous losses for the commission in related cases before the 3rd Circuit (see 1604190041). Now, a peer review by FCC Wireline Bureau economist/industrial organization expert Octavian Carare of the study will be completed by Thursday, interviews and agency documents show. Then, the agency will accept public comments, it said in a news release.

Sign up for a free preview to unlock the rest of this article

Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.

The results bolstered public interest advocates' stance that minority ownership is associated with an increased emphasis on local content, the advocates and others said. "The results suggest that local Spanish-language [programming] and local Spanish-language news programming are more likely to be associated with Hispanic ownership than other types of programming," said the report. "There is some evidence that Hispanic ownership is associated with higher Hispanic viewing and the effect is more pronounced in the case of local programming, though sample size issues may impact these results."

Professors who have studied this area, including for the commission, said the research methodology seemed sound, though there are limitations because of sample size and other issues. The study itself acknowledged that. It was done by the Media Bureau Industry Analysis Division and Office of Strategic Policy. The report also said it wasn't able to find a causal effect of Hispanic TV station ownership on what it studied. Media studies professors and others said such limitations are typical in this type of research. FCC staff studied 23 Hispanic-owned TV stations, in any of 39 markets that have most Hispanic TV-owning households and almost half of all U.S. households with sets. The report said Hispanics are the largest minority group in the country, comprising 12 percent of all TV-owning households.

The FCC news release termed the findings "interesting." It said the study's goal "was to examine the nexus between ownership, programming, and viewing in order to expand the discussion and understanding of these interrelationships, particularly among Hispanic television station owners and Hispanic audiences." The commission said researchers used "improved" data from the Form 323 broadcast ownership records that broadcasters fill out. Though time is tight, public interest advocates said they expect the FCC could use the study and comments on it to inform an order that the commission has told the 3rd Circuit and others that Chairman Tom Wheeler would circulate by June 30 for a vote by FCC members. The four commissioners other than Wheeler had no comment for this story.

Those who attended oral argument on the case against the commission, termed Prometheus III, said they thought the argument might have helped spur the report's release. "I think [the release] was directed at the court," said Georgetown Institute for Public Representation (IPR) co-Director Angela Campbell, who argued at the 3rd Circuit for Prometheus Radio Project. "The FCC has said, and Chairman Wheeler has said again and again, which they said in court, that he is going to circulate a draft order in June," said public interest lawyer Cheryl Leanza, representing the United Church of Christ. "We have been waiting for the study for a while, and I am glad it is out, so that we can comment on it before" the quadrennial review media ownership order circulates, she said. "It’s the only new analysis that has been attempted for the current quadrennial." Leanza and others including IPR senior counselor Andrew Schwartzman said the order may combine the quadrennial review proceedings that were due in 2010 and 2014 under the Communications Act, since those weren't substantively completed.

Academics and others deemed the report solid if overdue, and despite data limitations. The results square with what the National Hispanic Media Coalition has observed among Hispanic TV stations, said NHMC Vice President-Policy Michael Scurato. "This type of research should have been prioritized by the FCC years ago," he said. "Much more needs to be done." While it's a start, the study doesn't seem to fully satisfy the 3rd Circuit's previous requirements for diversity research, he and others said.

Once peer review is done, the study's authors will make any changes and the final study will be released at www.fcc.gov/media/peer_review/peerreview, a Media Bureau spokeswoman said Friday. Staff continue reviewing "the extensive record in the proceeding to formulate its recommendations" for the commission, she said. "The present record is extensive, including, for instance, eleven other economic studies commissioned by the FCC, as well as other data, studies, and information contributed by the Commission and third parties," the bureau spokeswoman emailed. "As a result of proceedings in the Third Circuit, the most recent quadrennial review also consolidates the Commission’s work with the pending diversity docket. Additionally, as noted when it was initiated in Oct. 2013, the Hispanic Television Study is part of the Commission’s long-standing examination of broadcast diversity issues."

Researchers shouldn't have focused so much on Spanish-language programming, since many Hispanics are multilingual and/or speak English, said Scurato. "By focusing on Spanish language, you are missing a slice of programming." Nonetheless, the research "demonstrates the importance of injecting more diversity into the system," he added. The study said "one can easily imagine English-language content aimed at this community" and there isn't a very "precise way" to deem something Hispanic programming. Another shortfall is that the study looked at viewership levels, which may not help in setting policy since popularity has limited import, said Multicultural Media, Telecom and Internet Council General Counsel David Honig. "The FCC doesn’t promote minority ownership so stations can get higher ratings."

But Honig and others said the FCC did the best it could given the data sample available and methods used. Academics agreed. "It seems [the] study was conducted with scientific rigor and that the conclusions that the authors draw are consistent with the methodology that they used," said Danilo Yanich, director of the University of Delaware's master's program in urban affairs and public policy. "They are correct to point out the limitations of the data." Another associate professor agreed. "It's clearly a solid report," said George Washington University School of Media & Public Affairs' Matthew Hindman, who has done previous ownership research for the FCC. "The big issue is that we only get one universe and we cannot re-run the same experiment by changing ownership of stations, so it's necessarily correlational" instead of showing cause and effect, he said of results. The report adds to the "broad literature" connecting ownership and programming, he said. "That probably strengthens the case, all else being equal, for paying attention to ownership in broadcasting."