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FCC Turns TV Off on Small Businesses

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Hey, what about us? Regular readers of my column know I get really irked at how small business is overlooked by the government. Legislation and regulation gets adopted hurting small companies, and nobody's looking out for our interest.

Here's the latest case: the Federal Communications Commission is about to make it easier for giant media companies to own more television stations and newspapers. Their new rules would:

  • Allow companies to own both a newspaper and a television station in all but the smallest markets. So it's quite likely that your only daily newspaper and a leading television station will have the same, national owner.

  • Allow media conglomerates to own more television stations in one community.

  • Allow a few media Goliaths to own more television stations nationally.

Okay, so why is this going to hurt your business?

1. Advertising rates will rise. There will be fewer media owners, and with less competition, prices go up. Itís going to cost more for a small company to get their message out.

Right now, excess advertising time on TV, especially cable TV, is sold relatively cheaply. But when those TV stations are owned by national media companies, excess time will be included in advertising packages sold to national chains. So instead of seeing commercials for your local steak house, youíll get ads for Denny's.

For a view of the future, look at what's happened to radio. The Telecommunications Act of 1996 made it easier for big conglomerates to own more radio stations. The result? According to the FCC, radio station advertising rates increased by 81%.

2. Less coverage of small businesses. To save money, national media companies produce content centrally. Local news budgets and locally-originated shows get slashed. That means it's going to be a heck of a lot harder to get coverage for the annual pet parade that your pet store sponsors.

Once again, radio provides us with a view of the future. Nationally-owned radio stations create much of their programming from one central location, even weather reports.

Weather reports may not be critical, but even vital news suffers. When a train carrying ammonia derailed in Minot, North Dakota, according to press reports, police called the radio stations -- all six of which are owned by Clear Channel Communications. Because Clear Channel, headquartered in San Antonio, Texas, had reduced its local staff, no one answered for more than an hour. If the police can't get a local emergency covered on nationally-owned media outlets, what chance do you have for your pet parade?

3. Less innovation. With fewer locally produced shows -- both news and features -- it will be much harder for new products or services to get attention. My friend just opened a new company, AuctionDrop, in San Carlos, California, where customers can drop off stuff and the company sells it for them on eBay. Local TV stations and newspapers did stories on this cool new concept. Without local coverage, new ideas won't find an audience.

When I speak of "media," most media companies control more than television or newspapers. They also own a big percentage of billboards, as well as film and television production companies. Look at some of the holdings of the biggest media outlet owners:

  • Clear Channel Communications: 1225 radio stations, 39 television stations, over 776,000 billboards, and advertising for malls, airports, and taxis.
  • Viacom: 185 radio stations (Infinity Broadcasting), 39 TV stations, over 100,000 billboards (US), transit system advertising, CBS, MTV, Black Entertainment, Paramount Pictures.
  • News Corporation (Fox): 35 TV stations, 175 newspapers (worldwide), Fox network, 20th Century Fox pictures, TV Guide.

And let's not leave out the company that distributes my column:

  • Gannett: 100 daily newspapers, 22 television stations, USA Today.

The FCC's Chairman, Michael Powell, says the proposed rule changes are justified because of new media options, such as cable and digital TV. But it's not the number of outlets that matters; it's the number of of OWNERS. They're the ones who set ad rates.

So tell your Congressperson and Senators you want them to protect small business's access to local media, or you may never see your pet parade on TV again.

Copyright, Rhonda Abrams, 2003


Rhonda Abrams is the author of The Successful Business Plan: Secrets & Strategies and The Successful Business Organizer. Register to receive Rhonda's free business tips newsletter at www.RhondaOnline.com.

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