Remarks by Assistant Secretary Rohde at the National Association of Broadcasters State Leadership Conference

"Analog" Values for the Digital Age: Localism, Diversity, Public Obligation
Washington, DC
February 14, 2000

Assistant Secretary Gregory Rohde
Text as prepared for delivery
February 14, 2000
National Association of Broadcasters State Leadership Conference
Washington, D.C.

"Analog" Values for the Digital Age: Localism, Diversity, Public Obligation

Introduction

I wanted to begin by saying a few words about some friends of mine at NAB. First, I want to publicly express my deep gratitude to Eddie Fritts and Jim May for their long standing friendship. I have had the privilege of working closely with them over the last few years when I worked in the Senate and I have truly enjoyed working with them and I value their friendship and professionalism. In addition, I want to acknowledge Pat Spurlock and Paul Redifer who I have also come to know at the NAB. One of the main reasons why I find the NAB a good organization to work with is because of the fine staff in NAB's Washington office.

I am resentful, however, of one thing. The NAB took Roanne Robinson away from NTIA. Roanne was the very capable and delightful Chief of Staff at NTIA for the 6 years prior to my arrival. I had hoped that she would stay on, but NAB caught a good one in Roanne. You are very fortunate to have her.

The National Telecommunications and Information Administration (NTIA) serves as the principle voice of the Administration on all areas related to telecommunications and information policy. We are distinct from the Federal Communications Commission (FCC) in several respects. The FCC is an independent regulatory body that, among other things, licenses broadcasters and regulates telecommunications services at the federal level. NTIA is the principle voice of the Administration and advisor to the President, Vice President, and Secretary of Commerce. i.e., NTIA is primarily a policy shop. We advocate, on behalf of the Administration, before the FCC. We also administer more than $40 million in grants to extend access to public telecommunications facilities and services through the Public Telecommunications Facilities Program (PTFP) and the Technology Opportunities Program (TOP). We are trying through PTFP to help public broadcasters make the transition to digital technologies.

I am new to NTIA. Prior to taking this post last November, I served in the Senate as an advisor to Senator Dorgan of North Dakota - which is my home. Growing up in a place like North Dakota taught me something very significant about local broadcasting - television and radio are not simply about entertainment. Living in a rural state with harsh weather taught me that local broadcasting is a matter of life and death.

Living in a climate where winter storms can arise very quickly with blinding blizzards and temperatures commonly reaching -20 to -80 degrees wind chill it was a way of life that we would always check the TV weather before traveling. My family needed to keep the radio on in the car to keep track of the weather and know when to take shelter.

My home state is largely agricultural. This time of year, farmers and ranchers will watch for livestock warnings running across the screens of their television sets and listen to the grain reports on the radio in the early mornings. The livelihood of many farmers and ranchers - like my brother-in-law who farms outside of Grand Forks, North Dakota - relies heavily on local broadcasting as the source of weather to protect their business, their cattle and their lives.
 

Challenges Facing the Future of Local Broadcasting

If I were a broadcaster in a small local market in a rural area such as North Dakota, I would be a little bit concerned about what I see on the horizon. I think there are a number of challenges that are facing you. I say this out of a deep, strong commitment that we have to do whatever it takes in this country to make sure that local broadcasting prevails. There are a number of challenges that make the future look a little frightening.


Digital conversion is necessary, but we have to find a way to make sure that all stations - including the smallest - can afford to convert. I am committed to working with you to find the way. The deadline is fast approaching and we need to begin working together to ensure that nobody is left behind.

As the Administrator of NTIA, I do not say to you: "find a way." Rather, I say: "work with me to find a way. I am committed to preserving local broadcasting and we need to work together to ensure your future."
 

  • Consolidation. In the last 4 years, the television and radio broadcast industries has experienced a dramatic consolidation. There have been 257 media mergers since the passage of the Telecommunications Act of 1996.
  • Television. Between 1995 and 1998, the number of commercial television owners dropped 42%. The top 10 television station groups in 1998 controlled almost 20% of all the commercial TV stations - and today, the top 25 groups control more than one-third of all the TV stations in the country.
  • Radio. There has been a 12% drop in the number of radio owners since 1996. Prior to the Telecommunications Act, the top 10 owners owned a total of 194 stations. Today, the top 10 groups own about 1,400 stations. The top 25 group control more than 2,000. The two largest groups are seeking to merge and if that occurs, one company will control more than 800 radio stations. There are 12 commercial radio stations in Billings, Montana. All but 2 religious stations are owned by out-of-state entities. And, there are many more local markets that have the same experience. One has to ask: what does this mean for localism?
  • Conversion to Digital Transmission. I know that all of you are mindful of the requirement to convert to digital television transmission by the year 2003. While the conversion to digital is critical and I believe that we must advance this conversion. I realize that it will be costly. Especially for broadcasters in smaller markets. To many broadcasters, the costs of converting to digital will exceed the total value of the stations. Those operating in sparsely-populated large geographic areas will also have to deal with translator stations - further complicating the transition.
  • Access to the Transport Systems of the Future. I was sworn in as the Administrator of NTIA the very night that the Senate was debating a unanimous consent agreement to consider legislation that would help small and rural markets get local-into-local over satellite systems. The irony of that debate was not lost on me. I told Secretary Daley that night that in 1993 when my predecessor was sworn into office, there was no such thing as Direct Broadcast Satellite offering multichannel video services. Nobody would have conceived a debate in the Congress at that time to occurred just 6 years later about how small rural markets would get local broadcast signals over satellite systems. It is amazing how quickly technology changes things. One of the blessings of that change is new policy challenges - such as the challenge as to how small and rural markets will get local-into-local over the "new" DBS technology.

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We cannot walk away from our commitment that local broadcasting has access to the transport systems of the future - satellite or other means.

To this end, NTIA is conducting a public inquiry as to how to promote local-into-local in small and rural markets. This week, NTIA will publish a Federal Register Notice soliciting public comment and suggestions on how small and rural markets will receive local-into-local through satellite systems or other technologies. We will post all the comments on our web site: "www.ntia.doc.gov." In addition, on March 2, 2000, I will host a roundtable discussion with consumers, industry representatives, policy makers, and technology experts on this subject. My intent is to complement the Congressional debate on legislation to establish a loan guarantee program for local-into-local in small and rural markets as well as the FCC consideration of this matter.

Ensuring local-into-local in the era of satellite and other emerging technologies is essential to the preservation of local broadcasting and I am determined to find ways in which consumers in small and rural markets can receive their local broadcast programming through as many means as possible.
 

"Analog" Values for the Digital Era

There are certain values our Nation has acquired in communications policy which has served us well the past several decades. As we move into the digital era, some of these values appear fundamental and therefore must apply in the future as new technologies emerge. Those values are:

  • Localism. In an era of consolidation, satellite transmission, and video streaming on the geographically insensitive Internet, we need to preserve localism in broadcasting. Our appetites for entertainment and being connected with the national culture should not resort to a minimization of local news and programing that serves the unique needs of a local community.

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  • Access to Communications Transport Systems. A couple of decades ago, it was cable. Today it is satellite. And tomorrow, it will be, what? Whatever the technology, we cannot afford to walk away from our commitment to ensure that local broadcasters have access to communications transport systems - cable, satellite, or whatever.

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  • Public Interest Obligation. Broadcasters - who utilize a public resource, spectrum, to deliver their programming - have always operated "in the public interest." As broadcasting transitions from analog to digital, this obligation to the public interest must follow.

I heard a station manager recently describe to me a dilemma he faced. He chose not to broadcast a political debate between some local candidates. When the other stations covered the debate, he got hammered in the ratings and so decided it was good business to cover the next debates. He explained how covering political debates was "good business sense" and therefore he would cover them in the future. Something troubled me about his reasoning - not his conclusion. Why should the coverage of political debates be reduced to an economic or business decision as opposed to a decision in the public interest?

To the ancient Greeks - the birthplace of democracy - participation in democracy was considered an obligation. It was mandatory. In fact, among the articles of condemnation against Socrates was the charge that little evidence was found that he actually participated in the democratic debates of Athens. Socrates was not simply condemned to drink hemlock because he "corrupted the minds of the youth" but also because he did not do what was expected of all Greek men at the time - actively participate in the governing of their society.

It is unfortunate that our society, at large, has grown to view democracy as merely a "privilege" and less a responsibility. Those who operate in the public interest - such as those who hold licenses to broadcast using the public resource of the radio spectrum - ought to adopt and maintain a sense of responsibility in our democracy. Therefore, as the broadcast industry transitions into the digital era, it ought to take with it a commitment to enhance the political debate in this country. The question about the public interest obligation of broadcasters should not devolve into a matter of whether or not there is one. Rather, the question should be how is their public interest obligation manifested. And, the answer should transcend economics or financial self interest. It should reflect a public duty.

Embracing the Future

Despite the fact that there indeed are many challenges facing the future of local broadcasting: consolidation, expensive conversion to digital, or video streaming over the Internet, broadcasters should embrace the future and use it. Belo Interactive, Inc. Of Dallas, Texas has offered a free home on the Internet for local community service organizations. Belo Interactive is a subsidiary of Belo, owner of the Dallas Morning News and Texas Cable News. This is an example of how local broadcasters are using new technologies - such as Internet access - to serve their local community.

Those are the challenges I see before you. Let me close by asking you again, to work with me to see how together we can meet them to preserve the best of your industry. Thank you.