NAB Goes to Bat for Removal of Ownership Caps
The National Association of Broadcasters is testifying on behalf of over-the-air broadcasters who would like to see the Federal Communications Commission’s radio and television station ownership caps eliminated. In lengthy testimony regarding the 2022 Quadrennial Regulatory Review – Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996, NAB says that, unlike those arguing to keep or even strengthen ownership caps, those asking for their removal are providing real-world testimony. The NAB writes, “They documented in detail the vast
competition local radio stations today face for audiences and vital advertising revenues from online and satellite content providers and digital ad platforms not subject to any comparable restrictions on their scale and scope; the dire negative effects that consumer and advertiser substitution of competing digital audio content and advertising for traditional radio has had on the listenership and advertising revenues garnered by local radio stations, including in mid-sized and small markets; and how the retention of asymmetric ownership restrictions has prevented radio broadcasters from gaining local scale to take advantage of important economic efficiencies, obtain investment capital, and better compete for audiences and advertising revenues, and thus enhance – or even maintain – their provision of news, emergency information, and valued entertainment and sports programming in local communities across the country at no cost to the public.” Responding to testimony from musicFirst Coalition and the Future of Music Coalition – referred to as the Coalitions – NAB writes, “First, the fact that the Coalitions continue to hold themselves out as protectors of small, local independent broadcasters not just borders on the absurd but crosses over into full-blown absurdity. The Coalitions represent the interests of the music industry, which is dominated by three consolidated international record labels. Compared to even the largest radio station groups, the giant record labels are the 800-pound gorillas of the music world. Those three labels earn billions more in revenue than the approximately 11,000 full-power commercial AM/FM stations combined. As NAB earlier reported, the three major music companies jointly generated about $2.9 million per hour in 2023. In remarkable contrast, in 2023 and 2024 the vast majority of radio stations garnered less – and often much less – than $2.9 million per year in advertising revenues. Needless to say, the Coalitions have never explained how local radio stations earning such low levels of revenue (and even lower, if any, profits) are supposed to keep talented employees and provide high quality programming, including popular music, sports, and informational programming, such as weather updates and emergency information, OTA and free to the public without achieving increased local scale, greater economic efficiencies, and more robust ad revenues. See the NAB’s complete testimony here.
“Operating loss, net loss and net loss per diluted share for the three months ended December 31, 2022 include $44.2 million of non-cash impairment losses related to FCC licenses, goodwill and franchise rights. Operating loss, net loss and net loss per diluted share for the 12 months ended December 31, 2022 include $54.7 million of non-cash impairment losses related to FCC licenses, goodwill and franchise rights.” Beasley CEO Caroline Beasley comments, “Beasley’s 2022 fourth quarter and full-year financial results reflect the ongoing success of our digital transformation and revenue diversification strategies, which drove year-over-year increases in revenue and SOI for both the three- and 12-month periods. Throughout the year, Beasley largely offset ongoing challenges related to the economy and softness in the national spot market, as we generated healthy growth across all of our digital, local audio, political and other revenue sources, as reflected by the 6.2% increase in full year net revenues to $256 million. This top-line growth was 
the primary factor contributing to a 2.8% year-over-year increase in full year SOI to $43.1 million. While economic uncertainty remains, Beasley initiated several actions throughout the year that we believe will strengthen the long-term position of our business. First, our digital strategy continues to deliver strong results with fourth quarter digital revenue growth of 13.2% year-over-year, representing nearly 17% of total fourth quarter revenue. Digital revenue has consistently outpaced national spot advertising revenue over the past several quarters due to a combination of organic growth and contributions from the second quarter acquisition of our white label digital agency business, Guarantee Digital. With accelerating demand from consumers and advertisers for our local content and multi-platform marketing solutions, we are solidly on the path for this revenue source to reach 20% of total revenue. Second, we remain focused on monetizing our premium audio and digital content through new local business development, revenue diversification and maximizing political revenue opportunities. As a result, in the fourth quarter, we delivered $5.1 million in net political revenue, with stronger than expected gains in Las Vegas, Philadelphia, and Detroit, as well as year-over-year total revenue increases across nearly all of our markets and in our esports business. Our radio brands remain dominant in Nielsen Audio ratings, where Beasley currently has the highest average cluster share when compared to the major radio broadcasters in PPM. Finally, we implemented a cost reduction program in the second half of 2022, with the majority of cost cuts occurring in October.” 
