NAB To FCC: Broadcasters Need Great Economies Of Scale

The National Association of Broadcasters said it is time for the FCC to recognize that broadcast competition—for both television and radio—has reached a new height and that actions must be taken to level the playing field.

TVTechnology.com reports this viewpoint comes from comments filed by the NAB to the 2020 Communications Marketplace Report. Specifically, it wants the FCC to adopt broad definitions of competitive markets and to reform local TV and radio ownership rules that are consistent with the current landscape.

It has been well reported that the trend for broadcast TV stations and traditional pay-TV providers has been the loss of viewers and subscribers to online, streaming options. From 2014-2019, NAB said that the number of OTT video services has increased 140%, and as of summer 2019, 74% of all U.S. households had either Netflix, Amazon Prime and/or Hulu. It said analysis shows that linear TV viewing has declined “in near-perfect correlation to Netflix’s rising penetration.”

The rise of digital devices that can display this content has also increased and exceeds the weekly reach of live + time-shifted television, per NAB.

This has also impacted the ad market, which has only been compounded by the current coronavirus pandemic, even as traditional TV has seen increased gains in audience during the pandemic.

“Given all these profound changes in the media and advertising markets, the FCC cannot maintain its woefully outdated view that broadcast radio stations compete only with other radio stations and that broadcast TV stations compete only with other TV stations,” the NAB said. “In a media landscape marked not by scarcity but by unprecedented abundance of platforms and content, all outlets—whether traditional or digital, audio or video—fight for consumers’ limited time and attention for advertisers’ limited dollars.”

NAB makes the case that for TV to remain meaningful in the digital marketplace, broadcasters must achieve greater economies of scale. To do so, NAB argues the FCC ownership restrictions and the Department of Justice merger review process should be modernized “to reflect competitive realities.”