Broadcasting: outline

• Radio and Television history• Broadcasting policy:

1) Spectrum– Roots of goverment intervention– Alternatives and trade-offs

2) Ownership concentration• Cable's rise

Broadcasting history (Radio)• 1881: The "musical telephone" was a major attraction at the

International Electrical Exhibition in Paris. The Compagnie du Théatrophone, was established in Paris, distributing music by telephone from various theatres to special coin-operated telephones installed in hotels, cafés etc., and to domestic subscribers. The service continued until 1932

• 1895 Guglielmo Marconi sends a radio signal more than a mile.• 1919: Radio Corporation of America formed

Pooled patents (Westinghouse, ATT, GE)• 1920: first US Commercial radio broadcast

No restrictions on who can broadcast• 1926: RCA forms NBC to encourage receiver sales (later forced

to divest "Blue Network", which became ABC)• 1927: CBS formed• 1927 Radio Act: Licensing

Broadcasting History (TV)

• 1930s: experiments with "radio with pictures" RCA

• 1940: National TV System Committee (NTSC)

• 1946: TV service starts in US 12 VHF channels licensed initially

• 1950s: TV overtakes radio• 1952: channel expansion – additional 70 UHF channels

(less desirable)• 1953: Color TV• 1980: 83% of households have color TVs • Since 1990: 98% of households have TVs, cable passes

90% of US homes

Ownership concentration rules• Radio station ownership limits

– 1940s: 7 AM and 7 FM stations – 1985: 12 AM and 12 FM stations – 1992: 18 AM and 18 FM– 1994: 20 AM & 20 FM stations – 1996: nationwide ownership limits for radio stations eliminated.

• TV station ownership limits– 1940s: 3 stations– 1953: 5 stations– 1984: 12 stations, max. reach of 25%– 1996: any number, max. reach of 35%

• Cross-ownership rules– 1975 ban of newspaper-broadcast cross-ownership– Limits on number of broadcast station in single market

1920's radio policy debate

• Fundamental tension: press freedom vs scarce spectrum

• Alternatives debated?• Relative merits?• Market for spectrum–Why not initially?– Primary vs secondary market

Spectrum and licenses• Channels: artificial structure on ethereal resource

AM radio: 10 kHz / channelFM radio: 200 kHz / channelTV: 6 MHz / channel

• Spectrum scarcity leads to government allocation of licenses• Who gets licenses? Typically powerful players

- existing radio stations received TV licenses- existing TV station receive HDTV spectrum- after initial allocation, secondary market

• License renewals: over 10,000 in the US since 1950s, only 50 contested, only 20 denied.

• Alternatives:- spectrum auctions (primary market)- unlicensed spectrum

• Trends: redefined basis for spectrum property rights

Spectrum policy trends

• Reallocation of spectrum from Federal government use to non-Federal government use

• Allocation of more spectrum for mobile as opposed to fixed applications

• Use of auctions to assign spectrum to particular users (started 94)

• Increased licensee flexibility in the use of assigned spectrum

• Continued support for unlicensed services• Increased competition in the provision of all

telecommunications services, including radio-based services

• Increased reliance on voluntary standards.