Radio station market concentration and programming diversity: The effect of the Telecommunications act of 1996 on local radio markets.

Abstract

The enactment of the Telecommunications Act of 1996 fundamentally changed the basis of broadcast and communication media regulation. Touted by its proponents in media industry as a remedy for a regulatory regime viewed as non-competitive, the Telecommunications Act changed ownership restrictions. Enough time has transpired allowing for the assessment of the Act's effects on radio ownership patterns and effects on variety.

This dissertation examines two affected processes: 1) corporate radio acquisition and 2) radio programming. This dissertation assesses two sets of competing claims. The first set of claims centers on a debate about the effect of deregulation and its effects on media market structure before and after deregulation. Proponents of deregulation held that a relaxed regulatory environment enhances market variability, while opponents of deregulation held that the new regulatory environment favors oligopoly formation at the national level and monopoly control in local markets. This research examines evidence indicating how regulatory change affects the environment in which media owners buy and sell stations in media markets, focusing on regulatory, individual radio station, and media market characteristics and transaction decisions.

The second set of claims centers on the product of radio media markets, specifically radio station programming. Deregulation proponents held that the new environment enhances commercial programming variety; opponents held that deregulation decreases programming variety. Using industry ownership records of radio stations and programming over the period 1993-2001, I assess the validity of these two competing claims, using organizational institutional theory, ecological explanations, and political economy theory to examine the extent to which the organizational field characteristic of media organizations has changed over time due to a diminished number of station owners. Acquisition processes are characterized by new station acquisition in smaller markets, resulting in continued homogeneity in both variability of market formats and changes in variability in individual station programming over time. Both of these processes are affected by an increased market concentration shift to non-local, corporate ownership of individual stations. These research findings indicate support for the regulatory critique, which holds that the abolition or reduction of ownership caps dampens rather than enhances competition.