Hastings Communications and Entertainment Law Journal Volume 8 | Number 3 Article 1 1-1-1986 Deregulation and the Market Failure in Minority Programming: The oS cioeconomic Dimensions of Broadcast Reform Kurt A. Wimmer Follow this and additional works at: https://repository.uchastings.edu/ hastings_comm_ent_law_journal Part of the Communications Law Commons, Entertainment, Arts, and Sports Law Commons, and the Intellectual Property Law Commons Recommended Citation Kurt A. Wimmer, Deregulation and the Market Failure in Minority Programming: The Socioeconomic Dimensions of Broadcast Reform, 8 Hastings Comm. & Ent. L.J. 329 (1986). Available at: https://repository.uchastings.edu/hastings_comm_ent_law_journal/vol8/iss3/1 This Article is brought to you for free and open access by the Law Journals at UC Hastings Scholarship Repository. It has been accepted for inclusion in Hastings Communications and Entertainment Law Journal by an authorized editor of UC Hastings Scholarship Repository. For more information, please contact [email protected]. Deregulation and the Market Failure in Minority Programming: The Socioeconomic Dimensions of Broadcast Reform by KURT A. WIMMER* You think your souls are saved because you can invent radio, but of what elevation to man is a method of broadcasting if you have only drivel to send out? -M.K Gandhi Table of Contents I. INTRODUCTION ......................................... 331 II. THE POSSIBILITY OF MINORITY INFLUENCE IN PRO- GRAMMING CHOICES ................................... 334 A. The Traditional Marketplace: Anatomy of a Market Failure .......................... 334 1. Minority Television Use ......... x........... 335 2. Minority Issues in the Broadcast Market ... 339 B. The New Marketplace: A Socioeconomic Bias in M arket Power ................................. 345 C. The Prospect for Minority Influence in Public Participation ...................................... 354 1. The Evolution of the Public's Right of Participation.................................. 355 2. The Petition to Deny and Minority Participation.................................. 360 3. EmpiricalData on Ability to Participate... 375 (a) Petitions to Deny ........................ 377 4. Complaints .................................... 382 5. D iscussion..................................... 386 D . Conclusion ........................................ 388 * Associate, Sidley & Austin, Washington, D.C.; J.D., Syracuse University Col- lege of Law, 1985; M.A., S.I. Newhouse School of Public Communications, 1985; B.J., University of Missouri-Columbia, 1982. COMM/ENT L. J. [Vol. 8 III. THE SOCIETAL IMPACT OF MINORITY MEDIA DISENFRANCHISEMENT ................................ 391 A. Principles of Stratification ....................... 393 1. Race Relations, the Free Market, and Mass Media .......................................... 399 2. The Significance of Legal Action or Inaction ....................................... 399 B. Societal Consequences of Legally Approved M edia Inequality ................................. 401 1. Production of Class-basedKnowledge Gaps . 401 2. Widening of the Social Distance Between R aces .......................................... 405 3. Increases in Race-associatedAnomie ........ 406 4. Negative Minority Self-concepts ............. 408 IV. THE LIMITS AND POSSIBILITIES OF BROADCAST REGULATION ........................................... 412 A. The First Amendment and Media Regulation.. 412 1. Scarcity and State Action .................... 415 2. Pervasiveness ................................. 416 B. The Commission's Use of its Authority ......... 419 C. Regulatory Mechanisms Designed to Further M inority Interests ................................ 421 1. Minority Ownership Regulations ............ 421 2. Equal Employment Opportunity Regulations ................................... 431 3. Public Participation.......................... 438 4. The FairnessDoctrine ........................ 439 V. DEREGULATION: ELEVATING THE MARKET OVER THE PUBLIC INTEREST ................................. 442 A. The Evolution of the Marketplace Regulation C oncept ........................................... 443 1. Deregulatory Rulemaking: Changing The- ory into Reality ............................... 450 2. JudicialReview of Deregulatory Rulem aking ................................... 455 B. The Economics of the Market: Programming for Profit .......................................... 460 VI. CONCLUSION AND POLICY RECOMMENDATIONS ....... 475 E PILOGUE ..................................................... 479 No. 3/4] DEREGULATION-MINORITY PROGRAMMING 331 I Introduction The sculpting of regulatory policy to meet societal reality is a governmental ambition that is crucial to a topic as pervasive in the national conscience as telecommunications. Yet, a contra- diction of striking proportions is developing between current regulatory treatment of minority issues and the reality of mi- nority media use. Although minorities are consuming televi- sion programming in unprecedented amounts, the medium is growing less responsive to minority needs; in the face of the broadcast market's failure to provide minority-oriented pro- gramming, the Federal Communications Commission (FCC or Commission) is implementing regulatory policy that relies en- tirely upon the market for programming choices. The contradiction inherent in this treatment of minority is- sues presents a social problem that is of greater magnitude than appears at first glance. Governmental decisions affecting allocation of access to the media marketplace carry with them strong symbolic messages of social priorities. It is common- place that "television absorbs extensive time daily, and is a me- dium from which children are acquiring their conceptions of social order."' Indeed, television brings with it the potential for racial accommodation or polarization. The United States Com- mission on Civil Rights has explained: To the extent that the viewers' beliefs, attitudes and behav- ior are affected by what they see on television, relations be- tween the races and the sexes may be affected by television's limited and often stereotyped portrayals of men and women, both white and non-white.2 Broadcasting shapes societal values and opinions to a degree unrivaled by other communications media, and has a pervasive influence on the lives of Americans.3 Moreover, its impact on racial stratification cannot be overlooked, as the social problem of inequality continues despite gains in the social position of minorities over the past decades.4 1. DeFleur, OccupationalRoles as Portrayedon Television, 28 PUB. OPINION Q. 257 (1964). 2. UNITED STATES COMM'N ON CIVIL RIGHTS, WINDOW DRESSING ON THE SET: WOMEN AND MINORITIES ON TELEVISION (1979). 3. See E. KRASNOW, L. LONGLEY & H. TERRY, THE POLITICS OF BROADCAST REG- ULATION (1982). / 4. See, e.g., R. FARLEY, BLACKS AND WHITES: NARROWING THE GAP? (1984); Rose, Postscript Twenty Years Later in AN AMERICAN DILEMMA (Myrdal ed. 1962). COMM/ENT L. J. [Vol. 8 The Commission is charged with regulating in the public in- terest, and this regulatory charter has traditionally included ensuring that minority views are heard 'and that minority ac- cess to ownership of broadcast outlets is facilitated. "It has long been an established policy of broadcasters themselves and the Commission that the American system of broadcasting must serve significant minorities among our population, and the less dominant needs and tastes [that] most listeners have from time to time."5 The Commission's policy extends to facili- tating minority ownership of broadcast facilities, because "mi- norities should be fairly represented in the broadcast industry of a society [that] mandates an unrestricted flow of diverse ideas and equal opportunity for all."6 Preserving access for mi- nority views, then, has been a traditional regulatory concern of the federal government. Unfortunately, this concern has been overshadowed by the recent trend toward communications deregulation. In particu- lar, the movement toward "marketplace regulation" advocated by the dominant forces within the Commission is allowing the strictures of the commercial market to determine allocation of broadcast media access, and would allow broadcast outlets to be purchased by the highest bidder without regard to tradi- tional concerns for minority opportunities.7 Supporters of de- regulation justify this laissez-faire approach by claiming that the major predicate for broadcast regulation, the "scarcity doc- trine" or "scarcity rationale," has lost its vitality in light of plentiful new communications technologies. While there may be a greater number of video outlets in the marketplace, scarcity and inaccessibility of media remain a con- tinuing economic reality for minority groups in the United States. Just as the lower economic status of many minority groups precludes meaningful ownership of electronic media, lack of economic power signifies an inability to partake of the new communications media. Services such as cable television, direct broadcast satellites, and microwave distribution systems are financially burdensome luxuries to families barely able to stay above the poverty line. If scarcity of media remains a fact 5. Federal Communications Comm'n, Public Service Responsibility of Broadcast Licensees (1974). 6. Federal Communications Comm'n, Report on Minority Ownership in Broad- casting (1978). 7. See Fowler & Brenner, A Marketplace Approach to Broadcast Regulation, 60 TEX. L. REV. 207 (1982). No. 3/4]