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The Great Unregulator

When Ronald Reagan took office in January 1981, Clear Channel owned three AM stations and two FMs. Today, it owns 378 AMs, 835 FMs, and 38 TV stations. It was the Reagan deregulatory revolution that opened the floodgates to consolidated media ownership.

In that alone, his impact on the media industry arguably outstrips any of his predecessors, and what he set in motion is still being felt today.

Under Reagan's first FCC chairman, Mark Fowler, "unregulation" became the new guiding principle, one that, as Fowler put it himself, would "unleash new forces that are not contemplated within the current structure of the industry."

First, in April 1984, the Reagan FCC allowed owners to cluster geographically, eliminating the regional-concentration rule that prevented owners from buying more than two stations within a hundred miles of each other. Then, in 1986, the FCC expanded ownership limits from 21 stations to 36 (12 AM, 12 FM, 12 TV), with plans to sunset all the rules in 1990. It actually took until 1996 for all the numerical limits to head off into the sunset. But the spadework had been done a decade earlier.

On the cable side, with a stroke of the president's pen, the 1984 Cable Act deregulated basic rates and limited state and municipal control over cable franchises. "The asset value of every system in the land will jump," B&C
correctly predicted back then.

Under his second chairman, Dennis Patrick, Reagan helped overturn the Fairness Doctrine, which had put the affirmative obligation on broadcasters to counter any controversial opinion they expressed with an opposing viewpoint. Such mandated balance often discouraged broadcasters from expressing any opinions at all and clearly chilled free speech. Conversely, eliminating the Fairness Doctrine spawned Rush Limbaugh and a phalanx of conservative radio talk hosts whose popularity could be directly tied to their ability to espouse the viewpoints of the president who emancipated them.

While the benefits of that deregulatory legacy continue to be debated, and not all of its fruits were distributed perfectly, what is undeniable is the late president's unmatched command of the media stage.

President Reagan was the first broadcaster president. He began as an announcer at WOC(AM), then went to WHO(AM) Des Moines, Iowa, and later starred in movies and TV before taking the national stage. No president knew better how to give a TV speech: the just-folks delivery, the gentle cock of the head, the paternal, uplifting tone. He never entered a room without knowing where all the cameras were, said one aide. No one knew better how to leverage that knowledge into political advantage. We weren't always in agreement on his overall policies, but we marveled at his ability to sell them.

TV also helped develop the future president's political message. It was on speaking trips for GE Theater
that Reagan traveled the country combining a pro-business message with an actor's skill for holding and winning over an audience.

If the TV presidency was forged under Kennedy, TV as an indispensable presidential tool for command and control was honed to a sharp edge under Reagan. His orchestrated use of image and symbol to touch just the right chord have also helped burnish his image. It is the endearing images, the Berlin Wall speech, the "I paid for this microphone" rant, the shuttle eulogy that remain to fill the spaces once occupied by questions and criticisms.

He was the "Original American Idol" read a T-shirt for sale in Washington last week for the tourists who came to say goodbye. That seemed apt, if that means he could win over a crowd or much of a country through his media performance. Reagan turned every speech into a TV version of Roosevelt's fireside chats, connecting with the rank and file in a way some of his policies did not. That fire is now banked, but the memories continue to burn brightly.

Clear Capitulation

Clear Channel raised high its white flag and even went beyond that to help the FCC open up a new front in the war on indecency. Last week, the nation's largest station owner agreed to pay the FCC $1.75 million to settle a raft of indecency complaints against it. It was the largest such fine in history, topping Viacom's $1.7 million in tribute in the mid '90s. The big difference there was that Mel Karmazin may have been paying off the FCC but he wasn't selling out Howard Stern. Clear Channel is doing both.

But the money is hardly the worst of it. Beyond paying the extortion, Clear Channel agreed:

  1. To suspend or fire its employees if FCC staffers conclude they have been indecent.
  2. To delay its broadcasts so that they can be scrubbed of words and ideas that might be offensive to Washington.
  3. To require indecency-sensitivity training sessions for its workers.

Clear Channel decided it's better to curry favor with regulators and hang employees out to dry than to serve listeners or free speech. This settlement isn't about principle, unless you're talking about the kind you earn interest on.

If repairing its image means giving up control over its own content and making it harder for broadcasters to fight the current indecency crackdown, well, that's just tough.

Officially, Clear Channel says the FCC agreements are easy because the newly chastened radio chain is already doing all of that as part of its "zero-tolerance" policy. It is an easy next step to give that self-censorship the force of FCC rules for the next three years, as the settlement does.

FCC Chairman Michael Powell said as much in praising Clear Channel for doing the commission's dirty work. "The government's involvement in content regulation can be a dangerous game," he said. "Even where well intended, in our desire, for instance, to protect children from indecent broadcasts, encroachments on content can have adverse affects on the public interest. By its very nature, government action, or even mere threats, to quell protected speech can have the unintended consequence of depriving the public of a speaker's artistic, literary, scientific, or political viewpoint."

That, of course, is just what the FCC has done in this deal. "This task is made easier when our licensees wrestle the difficult decisions away from the government," Powell said.

Exactly. Don't think that the next broadcaster hit with a big fine won't be encouraged
to follow suit. And if it doesn't play along, well, its licenses will be coming up for renewal someday, too.