Remarks of Assistant Secretary Irving at the National Association of Black Owned Broadcasters' Annual Meeting

Consolidation and Discrimination: Responding to the Challenge
September 18, 1998
Remarks by Larry Irving
Assistant Secretary for Communications and Information
National Telecommunications and Information Administration
U.S. Department of Commerce
 
at the
 
National Association of Black Owned Broadcasters' Annual Meeting
 
"Consolidation and Discrimination: Responding to the Challenge"
 
September 18, 1998

 


NTIA is releasing today its 1998 Minority Commercial Broadcast Ownership Report, our eighth annual survey on minority media ownership. This year, we have found that "Consolidation and Discrimination" are indeed playing significant roles in minority ownership, as the title of NABOB's conference suggests.
 

Vice President Gore yesterday gave you a preview of the findings of the report. To recap, there has been a negligible increase in minority ownership since last year. Minorities now own 337 of the 11,524 commercial broadcast stations, or 2.9% of those stations, up from 2.8% last year.
 

The most significant gains were by Hispanic owners, who now own 20 more stations than last year. They now own 23 more radio stations (15 FM and 8 AM), offsetting a loss of 3 TV stations. On the other hand, Blacks own three fewer commercial broadcast stations than they did last year, resulting from the net loss of one AM station and two TV stations.
 

The 1998 data is troubling on a number of levels. First, minority ownership of radio and television stations remains at a disproportionately low level. While Blacks, Hispanics, Asians, and Native Americans collectively represent nearly 30% of the total U.S. population, they have never owned more than 3.1% of the nation's broadcast stations.
 

To look at this another way, over the last five years the broadcast industry as a whole has added 503 new stations. Minority owners, by comparison, have gained only 15 stations during the same period.
 

Equally distressing, there are still no minority broadcast owners in 17 states, such as West Virginia, Rhode Island, Washington, and Oregon.
 

Our 1998 data reflect other disturbing trends. Minority ownership of TV stations, already at a low level, has further declined. Minorities owned 38 television stations in 1997; this year, that figure fell roughly 15% to 32. The number of minority television station owners also decreased by almost one-half, from 22 owners last year to 13 owners this year.
 

As for radio, minorities now own 21 more radio stations than they did last year. Nevertheless, the vast majority of these stations are in smaller markets, which reach fewer people and attract lower advertising revenues. As in television, the number of owners has also decreased this past year. The total number dropped by 23: Blacks lost 11 owners, Hispanics lost 8, Asians lost one of their three owners, and Native Americans lost three of their existing broadcast owners.
 

These trends and figures are detailed in NTIA's report, which we have available for you here today.
 

What conclusions can we draw from these figures? The decrease in minority ownership appears to be due, in large part, to consolidation in the media industry. In the last year, three of the largest and most experienced minority television station owners sold their stations to majority-owned companies. The economic pressures in broadcasting are pushing many minority owners to sell to majority-owned companies or to minority group owners. The same trends occurring in the industry overall, resulting in fewer owners, are leading us away from our nation's historic commitment to diversity in broadcasting.
 

The loss of minority owners is particularly alarming because of its ramifications for programming. The decline in minority ownership means a decline in diverse voices and viewpoints. Such diversity is essential to a rich culture and a vibrant democracy. When I was in Memphis, for example, I was told that the Black-owned radio station called upon listeners to go to the polls, which helped get an African-American mayor elected. That radio station is now majority-owned and no longer makes such appeals. And how many stations will now run Native American programming or programs in Mandarin?

The reduction in minority ownership may also reduce employment opportunities for minorities in broadcasting. We know that minorities are more likely to find jobs with minority broadcast owners than majority-owned companies.
 

Now, more than ever, we need to find ways to raise minority ownership levels in the broadcast industry. A primary problem is lack of access to capital. NTIA found that minorities are less likely than their white counterparts to receive financing from traditional sources, such as banks, even where there were no differences in business experience, education, or other non-racial factors.
 

The FCC is now administering the Telecommunications Development Fund, which provides a source of loans and investment capital to small communications businesses. Funds were just made available this year. NTIA also administers ComTrain, a management training program for minority broadcast owners, through the Minority Telecommunications Development Program.
 

Clearly, however, we need to do more. We need to come up with new approaches for small and minority-owned businesses to access capital. We also need to encourage minorities to consider broadcasting as a viable career option.
 

One of my favorite organizations is Media Careers for Minorities, a group that provides internships to minority students in television and radio. This past summer, I talked to Lisa Setrini, a young woman from Miami, who learned how to design Websites while she was an intern at MSNBC in 1997. In 1998, Lisa has started her own Internet company and already has two partners and three employees. We need to create more internships like these so that minority students see that they too can join the broadcasting industry or even start their own ventures. There is also much to learn about the new industry: over 1,000 radio stations are now providing programming over the Internet.
 

I hope to work with NABOB in creating solutions in these areas. I've been asked by Vice President Gore to head an interagency task force to address diversity and ownership issues in the media, working in cooperation with the FCC and other agencies. I hope to work with all of you here in considering ways to address these problems.
 

Thank you.