NAB Makes Its Case to Gomez Advisors

Why It Matters

If the FCC lifts ownership caps, it could reshape the economics of local radio, potentially rescuing struggling stations but also risking reduced editorial diversity. The decision will signal the regulator’s stance on media consolidation amid rapid digital competition.

Key Takeaways

• NAB argues radio caps unchanged since pre‑digital era.
• AM/FM share of listening time fell to 32% from 53% in 2014.
• Ad revenue projected $12.2 B in 2025, 30% down since 2007.
• NAB says common ownership could increase programming variety in small markets.
• Commissioner Gomez opposes further consolidation, warning of fewer local voices.

Pulse Analysis

The FCC’s market‑cap rules, first instituted in the 1990s, limit how many radio stations a single entity can own in a given market. Historically, those caps were intended to preserve competition and localism. Today, the regulatory landscape is polarized: Republican commissioners generally favor deregulation, while Democratic members like Commissioner Anna Gomez argue that caps protect diverse voices. The NAB’s recent ex‑parte meeting underscores how industry groups are lobbying to align the rules with a rapidly evolving audio ecosystem.

NAB’s data paints a stark picture of terrestrial radio’s decline. Edison Research’s latest Share of Ear report shows AM/FM’s share of total listening time has slipped to 32%, a 40% drop from its 2014 peak. Meanwhile, Borrell Associates estimates total broadcast advertising revenue will fall to about $12.2 billion in 2025, a 30% contraction from 2007 levels when adjusted for inflation. Small‑market stations, in particular, struggle to cover basic operating costs, let alone invest in talent or technology. The association argues that allowing common ownership would let broadcasters pool resources, upgrade equipment, and diversify formats, ultimately benefiting listeners.

The outcome of the pending Quadrennial Review will have far‑reaching implications. Easing caps could inject much‑needed capital into financially fragile stations, potentially stabilizing the sector amid competition from streaming services and podcasts. However, critics warn that consolidation often leads to homogenized content and fewer local perspectives, especially in underserved communities. As Gomez prepares to moderate a panel on media freedom at the NAB Show, the debate highlights a broader tension between economic viability and the public‑interest mandate that has long guided U.S. broadcast policy.