<html> Two items from US Senator Russ Feingold: Feingold Introduces "Competition in Radio and Concert Industries Act” http://feingold.senate.gov/~feingold/releases/03/01/2003128910.html   January 28, 2003 Washington, D.C.  U.S. Senator Russ Feingold today introduced the "Competition in Radio and Concert Industries Act," as the Senate Commerce Committee prepares to hold a hearing on the issue later this week. Senator Feingold will be the lead witness at the hearing. Feingold's legislation would help consumers and small and independent radio station owners and promoters by prohibiting anti-competitive practices in the radio and concert industries. Senator Zell Miller (D-GA) is an original co-sponsor of this legislation. "The time has come for Congress to address the issue of consolidation in the radio industry," Feingold said. "Since originally introducing this legislation in June of 2002, I have seen a groundswell of interest both in Congress and among artists, consumers, independent radio stations, and local promoters in restoring fairness to radio. My legislation will reduce concentration and crack down on anti-competitive practices, such as the new pay-to-play system." <a href="http://feingold.senate.gov/~feingold/speeches/03/01/2003130442.html" eudora="autourl">http://feingold.senate.gov/~feingold/speeches/03/01/2003130442.html</a> Statement of U.S. Senator Russ Feingold At the Senate Commerce Committee Hearing On Media Concentration and Ownership in Radio January 30, 2003 Thank you Mr. Chairman and ranking member Hollings for holding this hearing to examine the effects of radio station ownership consolidation. I also want to thank Senator Dorgan for his leadership on this issue. If Congress had heeded Senator Dorgan's warnings about the effects of consolidation on many of our communities, perhaps we wouldn't be here today. I'll start by saying that I love radio. It brought baseball play-by-play and Bob Dylan songs into my life, along with countless other enriching influences. I'm sure everyone in this room has his or her own version of that sentence, because radio always has been -- and continues to be, despite competition from assorted new technologies -- nothing less than the soundtrack of American life. Whatever our different experiences, we are all the beneficiaries of radio's basic, uncomplicated and utterly vital principle: Radio is a public medium that must serve the public good. But, over the last year, I have learned that the rapid consolidation in ownership of the radio and concert industry has made it difficult for individuals, artists, and organizations to find outlets to express their creativity and promote diversity. A groundswell of anger is building in Wisconsin and across the country about these changes. People are actually angry about this. I know, of course, because when people are angry they call their senators. I received my first contact about this more than a year ago. Owners of a local concert promotion company said they were being pushed out of business by the anti-competitive practices of a large radio station and promotion company. Then I heard from a local radio station owner. He said his station had, without warning and without compensation, lost syndicated programming -- after investing a lot of years and a big chunk of money into building an audience for that programming -- to a station across town, a station recently bought by a large radio station ownership group. Both of these small, local businesses cited the same company  the Clear Channel Corporation. I first asked the Administration to look into anti-competitive activities and allegations that Clear Channel and other companies were trying to evade the already minimal local ownership limits. I didn't hear back for quite a while. I did, however, get an earful from many others, especially after I spoke to a reporter from the Chicago Tribune. In the interview I expressed my concerns about these issues. I also mentioned that I was looking at possible legislation. The response to this was overwhelming and fervent. Songwriters, artists, promoters, managers, consumer groups, religious organizations, unions and radio station owners all called or wrote, asking "What can I do to support your efforts?" This legislation is not just about entertainment. More broadly, neither is this issue. I am here not just because I want to preserve radio as entertainment. I am here because we must preserve radio as a medium for democracy. There will likely be a number of conflicting views expressed about both the levels and effects of radio ownership consolidation during this hearing today. After all the market power can be measured in a number of different ways. Some may argue that owning a thousand stations is only a fraction of the total number of stations in the United States. While this statement is true, I think it is important to view any ownership numbers in recent historical perspective. When the 1996 Telecommunications Act became law there were approximately 5,100 owners of radio stations. Today, there are only about 3,800 owners, a reduction of about 25%. Minority ownership has also decreased  the number of African American owners of radio stations has fallen by 14%. Prior to 1996, one company couldn't own more than 20 AM stations and 20 FM stations. Now two companies control 42 percent of the content that reaches listeners and 45 percent of industry revenues. The concentration of ownership is perhaps most startling when we look at radio station ownership in local markets. Four radio station companies control nearly 80 percent of the New York market. Three of these same four companies own nearly 60 percent of the market share in Chicago. In my home state of Wisconsin, four companies own 86 percent of the market share in the Milwaukee radio market. At the same time that national and local markets have been consolidated, I have heard countless stories of how some of the large radio station ownership groups also wield increasing power through their ownership of a growing number of businesses related to the music industry. Take Clear Channel as an example. This corporation owns more than 1,200 radio companies, more than 700,000 billboards, and controls numerous venues across the United States. It also owns the largest concert promotion company in the United States. During the last year and a half, I have heard countless allegations about leveraging its cross ownership in an anti-competitive manner. I have heard from small businesses in Wisconsin  local promoters and local radio stations  who talk about large radio and promotion companies tying in radio and promotion services to push them out of business. These local businesses are happy to compete in a free marketplace, but when a company uses their cross ownership  especially using a public medium like radio  in an anti-competitive manner, it is simply unacceptable. Some will likely argue that consolidation benefits consumers. For example, they will often say that since 1996, there have been more formats, or type of radio stations, in almost every market. But what they won't tell you is that since many of these same "formats" are owned by the same out of state companies that play the same songs and share the same news  which actually reduces consumer choices. There are other disturbing ways in which the concentration of ownership is changing what we hear on the radio. Singers, musicians and managers have talked with my staff and with me about some new and very daunting challenges they face when trying to get their songs onto the airwaves. These people are very concerned that playlists are no longer based on quality -- subjective as that is -- but are sold to the highest bidder instead. They told me how, in the past, if you couldn't get a DJ in Cleveland to play your song, you could try to find one in Pittsburgh who would. And if the song was a hit in Pittsburgh, the Cleveland DJ would hear about it. I am told that doesn't happen any more. It can't. The same companies own stations in both markets. If they don't want to play a song, they don't - Anywhere. Opportunities for artists to try their music "somewhere else" just don't exist. I have been hearing about a shakedown system, where large radio stations allegedly require huge payments through independent promoters before they'll put a song on the air. If you don't have the money to play in this system, you are shut out. Is this "pay-for-play"? If it isn't, I'd like to know what is. Consider also how the rise in ticket prices coincided with the passage of the 1996 Telecom Act. More precisely, consider that ticket prices went through the roof. Before the Act was passed, ticket prices were increasing at a rate that was slightly higher than the Consumer Price Index. Since the Act became law, ticket prices have increased at a rate that's almost 50 percentage points higher than the Consumer Price Index. From 1996-2001, concert ticket prices rose by more than 61 percent, while the Consumer Price Index increased by just 13 percent. There are a number of factors behind this rise in ticket prices. But the fact is that the largest radio sation ownership group also is involved in over 60 percent of the concert industry, in terms of revenue, certainly begs the question  has consolidation within the radio and concert industry led to increased ticket prices? Because of these concerns, I have re-introduced legislation, the Competition in the Radio and Concert Industries Act, which would address the levels of concentration, curb some of the anti-competitive practices, and end the alleged new payola system. My legislation prohibits those who own radio stations and concert promotion services or venues from leveraging their cross-ownership to hinder competition in the industry. For example, if an owner of a radio station and a promotion service hinders access to the airwaves of a rival promoter or artist, then the owner would be subject to penalties. My legislation will also help to curb further concentration that leads to these anti-competitive practices. It would strengthen the FCC merger review process by requiring the FCC to scrutinize the mergers of any radio station ownership group that reaches more than 60% of the nation. My legislation would also curb consolidation on the local level by preventing any upward revision of the limitation on multiple ownership of radio stations in local markets. The bill would also prohibit the alleged new payola system, where the big radio corporations are said to leverage their market power to require payments from artists in exchange for playing their songs. These are not radical notions. All my legislation says is that first, let's get a handle on consolidation and crack down on alleged anti-competitive practices. Second, let's modernize our payola laws to make sure all forms of payola are banned. I hope many of you will join me in cosponsoring this legislation, but I also hope that this hearing will flush out other issues that are leading to many of the concerns I have been hearing. Americans should be able to hear new and different voices, and those voices deserve a place on the publicly-owned airwaves. Radio is one of the most vibrant mediums we have for the exchange of ideas and for artistic expression. This public medium has long served the public good, and we must ensure that it continues to do so. If we don't act now, further concentration in the industry will guarantee that the range of voices we listen for when we turn on the radio, the voices of democracy that make radio unique, will continue to fade away. Again, Mr. Chairman, thank you for holding this hearing and I look forward to working with you and the other members of this committee. </html>