Dearth of Black-Owned Radio Shows Need for Tax Credits, Bigger Ad Share: NABOB
The anemic number of Black-owned radio stations in the U.S. show a need for lawmakers to reinstate the FCC's long-defunct minority tax certificate program and for advertisers to better recognize best routes for reaching Black consumers, National Association of Black Owned Broadcasters President Jim Winston told us. NABOB put out its inaugural report on Black-owned station ownership and revenue Monday.
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The certificate program saw Black ownership of radio stations growing between 1978, when it was instituted, and 1995 when it ended, Winston said. Since then, ownership numbers have fallen off significantly even as the overall number of radio stations has increased, he said. The vast majority of comments in FCC quadrennial reviews are about relaxing ownership rules, but such relaxation is the opposite of what's needed, Winston said. He said Black ownership rates are hurt by the fact big media companies are increasingly free to buy the biggest stations in big markets.
The diversity tax certificate program "is a proven tool in providing meaningful opportunities for aspiring broadcasters to realize their dreams of owning broadcast radio and television stations," NAB said in a statement. It said it "strongly supports legislation that would reinstate the program and encourage investment in station ownership for women and people of color. NAB and the broadcast industry are committed to working with lawmakers to enact legislation re-establishing the tax certificate program and expand the diversity of voices in the media ecosystem.” FCC Chairwoman Jessica Rosenworcel's office didn't comment.
There are 220 Black-owned radio stations -- 117 FM and 13 AM, per NABOB. That's slightly more than 1% of the about 15,400 stations licensed by the FCC in March, per agency numbers. Of those Black-owned stations, 23.6% are in markets unranked by Nielsen, 19.6% are in Top 10 markets and 45.2% in markets ranked 51st or smaller, said NABOB. It said 28% generate revenue of $1 million to $10 million, with 2.4% generating revenues beyond that. About 46% of the stations program Urban formats, with 27.7% doing religious programming and the rest dispersed across numerous formats, per the study.
Beyond the tax certificate program, private equity and banks need to make more capital available for investment in Black-owned radio, Winston said. Ad agencies and advertisers often miss that connecting with a Black audience means engaging and speaking directly to that audience, which can be easier with Black-owned media than media just targeting Black people, he said. That Black-owned media outlet owners are often involved in their communities "makes a big difference" in getting ad messages through, he said. Broadcast radio overall has about $13 billion or so annual ad revenues, NABOB stations have a $200 million or so slice of that, he said.
The results of the NABOB study, done in conjunction with BIA Advisory Services, set the baseline of where ad dollars are being spent as numerous companies have made commitments in the past couple of ears to increase their diversity and future such studies should show increases, Winston said.