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174

 Id., pages 15-16.

 

175

 Id., at 15-16.

median income is higher, higher number of people in the professions....In other words, they ask for higher

rates because they’re reaching White customers who the advertiser feels for a variety of reasons is a more

valuable customer. And if there are any Blacks thrown in there that’s a bonus. But that’s not the

issue. Now when the Black station on the other hand comes with its numbers and it tries to get equal

rates, there’s the perception by certain advertisers that the customer is not necessarily in numbers or in

quality equal to the White customer and, therefore, there’s a difference in the rates that the stations can

achieve. Now, all media is subject to negotiation. And I just don’t feel the Black stations have in most

cases the same leverage in order to maintain the rate that they ask.174

Although new developments in the marketplace favor minority-targeted advertising, some

conditions have remained the same. Factors such as product image and misperceptions about the

consumer potential of minorities constitute barriers that prevent minority media from closing the gap

between audience share and advertising revenues. Stereotypes and the desire to target White

consumers also play a role in lower advertising revenues for minority oriented stations. Mr. Lewis said:

Lewis: You don’t advertise to them[minorities]. Let me put it more succinctly. The truth about it is, I’ve been

told that the—let’s just take the Caribbean—Blacks are going to come anyway. We don’t turn anyone

away. But in the Wintertime, the people we want to reach are the upscale, European, Canadian,

American, White travelers. They come in the Wintertime. Now, Blacks come too. But you almost

have no advertising welcoming Blacks during that period. That is a stated reason for not advertising to

Blacks. That’s our core audience. Blacks will come anyway. But underneath it, we don’t want to

create an imbalance. 

Ofori: Are there any other product categories or services that exemplify what you have said ?

Lewis: No one will ever say that to you publicly.175

C. Black and Hispanic Consumer Spending Patterns - Now and the Future

Data on the racial/ethnic distribution of family income tend to reinforce the generally held

perception that Hispanics and Blacks have less disposable income. Chart B contains data on median

family income according to race and ethnic group. The chart shows that, based upon national averages,

Blacks and Hispanics are less economically affluent than Whites and Asians/Pacific Islanders.

Disparities in family income reinforce the perception that Blacks and Hispanics have less disposable

income for goods and products promoted by the electronic media. Such data is often used to justify
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176

 See, page 70.

 

177 ECONOMIC & STATISTICS ADMINISTRATION, U.S. CENSUS BUREAU, NEWS RELEASE - CB98-

127, JULY 30, 1998.

 

178 Target Market News Inc., The Buying Power of Black America (1997), page 14.

$46,356

$42,646

$25,970 $24,570

Asian, Pac. Isl White Black Hispanic

Chart B

Median Family Income by Race/Ethnic Group - 1995

business decisions not to buy advertisements on stations that have high levels of Black and Hispanic

listeners.176

However, the economic status of minorities is improving. In 1996, median family income for

Blacks increased 14 percent.177 Other trends mitigate the significance of family income disparities in

analyses of consumer data: 1) minority expenditures in certain consumer categories exceed that of the

average consumer; 2) the total magnitude of Black and Hispanic earnings places each community

among the top 20 economies of the world; and 3) Blacks and Hispanics will become increasingly

important to the economy as their proportion of the domestic population grows during the first half

of the next century.

Estimated household earnings for Blacks and Hispanics in 1996 were $367 billion and $280

billion respectively (Chart C). As noted, the U.S. Black market and the U.S. Hispanic market each have

spending power that would rank them, standing alone, among the top 20 economies of the world.178

Data: U.S. Bureau of Census, Current Population Reports, P60-197, Money Income in the United States: 1996, Table 724.
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Chart C

Black & Hispanic Household Earnings Estimates - 1996

Chart D

Average Annual Black Household Expenditures -1995

 With regard to specific products and services, U.S. Census data show that Blacks outspend the

average consumer in several categories: telephone service, utilities, apparel, major appliances, and certain

categories of groceries. For new cars and trucks, Blacks spend slightly less than the average consumer

(Chart D).

Data: Target Market News Inc., www.targetmarketnews.com/ web site accessed 9/12/98. The Arbitron Company, Hispanic Radio Today (1997) at 2. 

Data: U.S. Census Bureau, Statistical Abstract of the United States, 1997 edition, Table 712.
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179 Effective Buying Income (“EBI”) is after-tax disposable income. EBI data cited in BIA

MasterAccess are obtained from the Demographics USA County Edition published by Market Statistics

Bill Communications.

Chart E

Percentage of U.S. Population by Race/Ethnic Group 

1995 - 2050

By the middle of the next century there will be significant shifts in the racial/ethnic

composition of the U.S. population. By the year 2010, for example, the size of the Hispanic population

is projected to exceed that of Blacks and become, for the first time, the country’s second largest

racial/ethnic group. By the middle of the next century, Blacks will number 61 million—double their

1995 size. The proportion of Non-Hispanic Whites, on the other hand, will decline from 74% in 1995

to 53% in the year 2050. Beginning in 2030, Non-Hispanic Whites will not add to the nation’s

population growth because they are expected to decline in absolute numbers (Chart E).

. 

The Hispanic and Black populations are also significant in the country’s largest cities.

Hispanics and Blacks combined constituted 18- 57 percent of the population in 14 of the top 19

Arbitron markets. Chart F depicts the the size of the Hispanic and Black population and the Effective

Buying Income (EBI)179 of the total population in each of these markets. 

Data: Economics & Statistics Administration, U.S. Bureau of Census, Population Projections of the United States, (1996), Table J.
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180 Zate, Opening the Big Wallets, Hispanic Business (December 1997) at 60; Target Market News,

Dollars Spent Advertising to Black Consumers.

 

181 U.S. Census Bureau, Statistical Abstract of the United States, 1997 edition, Table 916.

 

182 In 1995, people of Hispanic origin (of all races) constituted 10.2 % of the American

population. Blacks of non-Hispanic origin constituted 12% of the population. Economics &

Statistics Administration, U.S. Bureau of Census, Population Projections of the United States

(1996), Table J.

Chart F

Data :

BIA MasterAccess, August 1997 edition.

Poised to capitalize upon these developments are some of the leading advertisers and large

group-owned broadcasters. While misperceptions about Hispanic and Black consumers may persist in

some quarters, many Fortune 500 companies are devoting greater portions of their advertising budgets

to these markets. During 1997, targeted advertising was estimated to be $1.4 billion dollars for

Hispanics and over a billion dollars for Blacks.180 For Hispanics this represents a 17 percent increase

over 1996. Ethnic targeted advertising is increasing, yet it still represents less than 2% of the $173.2

billion181 in total media expenditures projected for 1998—substantially less than the representation of

Hispanics and Blacks in the population.182

Contemporaneous with increased advertiser interest in the Hispanic and Black communities,

large majority broadcasters are venturing into Spanish and urban formats. At the time of this writing,

Clear Channel, a majority-owned, publicly traded corporation, owns 21 stations that air urban

programming. In the Spanish format, the largest chain is Heftel Broadcasting—a majority-owned,

publicly traded broadcaster that owns 39 Spanish-formatted stations. Heftel reported an 18% increase
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183 Heftel Broadcasting Company, 1997 Annual Report at 1.

Chart G

Minority-formatted Stations by Ethnic/Racial Ownership

in revenues based upon “sales and marketing efforts to take advantage of advertisers’ increasing

awareness of the importance of the U.S. Hispanic market.”183

Minority broadcasters, on the other hand, own a small percentage of the minority-formatted

stations. Less than one-third of the stations that target minority audiences are owned by minority

broadcasters (Chart G). Minority-formatted, majority-owned companies reporting financial revenue

performance data to BIA in 1997 owned 297 stations, compared to 116 such stations owned by

minorities (see Table 2, page 79). 

In summary, larger targeted marketing budgets signify increased advertiser awareness of the

Hispanic and urban markets. At the same time, majority broadcasters appear to be better positioned

than minority broadcasters to capitalize upon targeted marketing expenditures. Although perceptions

about the value of the Hispanic and Black consumer may have improved, majority broadcasters appear

to be enjoying the lion’s share of the financial benefits from this growing market.

C. Quantitative Analysis

The previous section identified several factors that influence ad agencies and advertisers to

engage in practices that adversely affect the revenue generating ability of stations that air programming

targeted to minority listeners. They were:

Data: BIA MasterAccess, August 1997
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184 Additional factors, such as the failure to obtain data about minority consumer behavior (e.g.

tracking systems) and lack of ethnic diversity in the workplace, were also cited as reasons for not

advertising to minorities. 

 

185 Average station revenues are based upon station gross revenues. The power ratio is a measure

of a station’s ability to convert its share of the listening audience into share of market revenue. The

higher the ratio the more efficient the station’s performance in this regard (See Glossary, Appendix

K).

 

186 Audience demographic data was obtained from the Spring 1997 edition of The Media Audit

prepared by International Demographics, Inc.. Station revenue and market data was obtained from

the August 1997 edition of BIA MasterAccess, prepared by BIA Research Inc.

 

187 The distribution of the merged data set averaged 22 stations per market for 64 markets in the

top 100 markets. An average of 14.3 stations was obtained per market for 8 markets in markets

above 100. Appendix D contains a frequency distribution table for the number of stations per

market included in the data set.

< racial/ethnic minority consumers are stereotyped as unlikely buyers of certain luxury products

or services;

< stations that program to minority listeners are excluded based on average listener income,

regardless of data about consumption patterns;

< the desire to disassociate a company’s image from minority consumers;

< language barriers, in the case of Hispanic consumers;

< unfounded fears that minority consumers pilfer;

< media buyers’ unfamiliarity with the consumer habits of minorities; 

< efforts by broadcasters and their national sales representatives to discourage advertisements on

minority-formatted stations; and

< belief that minorities can be reached through the general media.184

This section examines quantitative data to determine whether nationwide radio industry data

are consistent with the anecdotal findings. Several independent variables were examined in terms of

their impact on advertising performance. Section C-1 examines the relationship between audience

demographics and program format. Advertising performance disparities related to program format,

minority ownership and ownership size are examined in Section C-2. The effects of ownership size

are again examined in Section C-3. Section C-4 discusses advertising practices in the context of local

market consolidation and access to capital. Throughout these sections, two dependent variables are

employed to measure advertising performance: average station revenues and the power ratio.185

As fully explained in the methodology ( Section I-C), the following sections rely upon two

different data sets. In order to analyze program format and audience demographics, qualitative data

on radio audiences were paired with station performance data.186 Hence, Section C-1 relies upon

a merged data set consisting of 1,533 radio stations, including 98 minority-owned stations and a total

of 212 minority-formatted stations. Most of the stations in this data set are in the top 100 markets.187
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188 Stations were drawn from the August 1997 edition of the BIA MasterAccess database based

upon the following program query: “select stations with a power ratio greater than zero,” indicating

that revenue and listener data were reported. 

 

189 The five programming formats used for this study are based upon format categories

employed by BIA Research Inc. (see also Appendix K). Some formats include several subcategories

of programming. Urban, for example, includes rhythm and blues, urban adult contemporary, urban

gospel, and urban rap.

 

190 For the purpose of this analysis, general market format stations are all stations with formats

other than the urban, ethnic, Spanish, or black. 

 

191 Demographic data was obtained from The Media Audit (Spring 1997), prepared by

International Demographics, Inc. 

The analyses in Sections II- C-2 and II-C-3 did not require pairing data from separate

databases. A data set consisting of 3,745 stations was used for these sections.188 

 

These analyses suggest that minority-formatted programming is one of several factors that

affect station advertising performance. Other variables that may affect advertising performance

include audience income, audience ethnic/racial composition, minority ownership, market rank, and

ownership size. As simple data comparisons, however, these analyses do not constitute conclusions

about the causal relationship between the independent and dependent variables. They are merely

presented as preliminary findings concerning the extent to which nationwide data are consistent with

the anecdotal findings. The analyses are also intended to highlight areas for subsequent research.

1. The Relationship between Audience Demographics and Program Format

In order to gain a better understanding about the relationship between audience demographics

and program format, CRF compared the audience characteristics of minority and general market

formats. The analysis was undertaken because of the important role that program format plays in target

marketing (see Overview of Media Buying, Appendix A) and the desire to compare the success of

formats based upon their associated audiences.

Five categories of programming format were used for the analysis: black, Spanish, ethnic, urban

and general market. The first four are targeted to minority listeners.189 The fifth format, general

market,190 is aimed at a broader range of listeners.

As an initial step, the analysis sought to establish whether there are any discernable differences

between the audience demographics of general market and minority-formatted stations. These formats

were examined in terms of average household income and percentage of minority listeners.191

Minorities, for the purpose of the analysis, included the primary categories of racial and ethnic

minorities recognized by the U.S. Census (Asian/Pacific Islanders, African-American, Hispanic, NativeAmerican and Pacific Islanders). Chart H shows that stations that air programming with minority-
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Chart H

Chart I

oriented formats have the highest levels of minority listeners: black (90% minority listeners), Spanish

(90% minority listeners), ethnic (74% minority listeners), and urban (82% minority listeners). By

contrast, stations that air general market programming had 21% minority listenership.

 

Data: August 1997 edition of BIA MasterAccess

Formats with high levels of minority listeners (black, Spanish, ethnic and urban) also had 

average household incomes that were lower than the general market format. Income levels ranged from

$35,547 for Spanish to $41,461 for urban. The average audience household income for stations that air

general market programming was $50,125 (see Chart I). 

Data :

Augus t

1997 edition of BIA MasterAccess
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192 Note the discussion in Section II-B-3 concerning the unreliability of using household income

as a gauge for making advertising decisions.

 

193 The 1997 BIA database reports average station revenues and national revenues for 1996. The

national revenues of owners include the revenues of stations whose sale was pending during 1997.

Charts H and I support the generally held understanding that there is a discernable difference

between the audience demographics of minority-formatted and general market stations. First, the data

indicate that racial/ethnic minorities comprise a substantial portion of the listening audience of

minority-formatted stations. Second, the household income of minority-formatted station listeners

averages about $10,000 to $15,000 less than the income of general market station listeners.

To the extent that advertisers take audience demographics into consideration, the audience

characteristics that differentiate minority formats from general market formats are likely to have a

substantial bearing on media buy decisions. For example, a product that is targeted to consumers with

high disposable incomes is more likely to be advertised on a station with general market

programming.192 To the extent that market research determines that the race or ethnic background of

a consumer influences product demand, advertising decisions may be swayed by the racial or ethnic

identity of a format’s listeners.

Advertisers were reported to place a lower value on minority consumers due to stereotypical

perceptions of disposable income, the likelihood of pilferage, image control, etc. (see Section II-B-2).

The next section presents data concerning the advertising performance of program formats that appear

to support the claims of the anecdotal informants. However, these findings could also be explained by

justifiable business decisions to target audiences with higher incomes (i.e. market research justifies

targeting consumers who have higher incomes and listen to general market stations). 

Future research should control for audience income and other variables in order to determine

the extent to which “buys” are placed on general market stations, despite the fact that consumers who

are predisposed to purchase the product could have been approached via minority-formatted stations.

The findings discussed in the next section should not be considered conclusive. They are presented

only as preliminary results that support the anecdotal findings. As such, they may be confirmed or

disproved in subsequent research.

2. Disparities in Advertising Performance in Terms of Program Format and Minority

Ownership 

This section examines the relationship between program format, minority ownership and

advertising performance. This analysis is based upon a universe of 3,745 radio stations reporting

revenue and listener information in the August 1997 edition of the BIA MasterAccess. The data set

includes 155 stations owned by minorities and a total of 413 stations that air programming that is

minority-formatted.193 The results of the analysis are summarized in Table 2, (page 79). 
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194

 See, BIA Research, “Interpreting BIA’s Numbers in MEDIA Access Pro,” undated memo

from BIA (Appendix K). According to BIA, the power ratio is calculated in a two-step process,

(“The estimated revenue share for the station is determined by dividing the station revenues by the

market revenues times 100. Then this calculated revenue share figure is divided by the local

commercial share. A power ratio greater than 1 indicates the station is overselling its audience

share; while a ratio less than 1 indicates a station underselling its audience share.”). 

The data suggest that stations have disparate abilities to earn advertising dollars based upon

program format, minority ownership and ownership size. General market stations perform better

overall than do minority-formatted stations. Majority-owned stations generally outperform their

minority competitors, even when comparing broadcasters of similar sizes.

These differences are best illustrated by examining station power ratios. The power ratio

measures a station’s ability to convert its share of listeners into share of advertising dollars in the

market. Stations with power ratios less than 1.00 are “underselling” their audience—receiving a revenue

share of the market that is less than its audience share of the market. Conversely, those with power

ratios over 1.00 are “overselling” their audience—receiving a revenue share of the market that is greater

than its audience share of the market.194

The power ratio accounts for differences in station signal quality and reach to the extent that

it focuses on audience share, which may be affected by those technical characteristics. If a station’s

signal does not reach an entire market, it will be reflected in its audience share. However, further

research should examine the impact of a station’s technical characteristics on power ratios and

advertising performance.

a. Power Ratios by Program Format

The revenues generated by a station provide only a partial picture of a station’s advertising

performance. For example, a station may earn $20 million in annual revenues. However, if $20 million

represents 7 percent of the market’s total revenues and the station’s share of listeners in the market is

10 percent, the station is not earning revenues comparable with the number of people who listen to

the station. When these percentages are equivalent (i.e. percentage of market revenues equals percentage

of market listeners), a station has a power ratio of 1.00.

 If the power ratio is less than 1.00, a station is generating less revenue than what its audience

share alone might indicate. This is exemplified in Table 1 (see page 6) where two minority-formatted

stations that rank second and third in market ratings have power ratios of 0.59 and 0.79, respectively.

The revenues of these stations are far less than what their audience shares would suggest they may be

capable of earning.

On a nationwide basis minority-formatted stations averaged power ratios of 0.91 (“underselling”

their audience) and general market stations averaged 1.16 (“overselling” their audience) (Table 2). Chart

J provides more detail about the power ratio performance of minority and majority owned stations by
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195 The power ratio for minority broadcasters with ethnic programming is based upon data for 

only two stations. The revenues of these two stations were higher than their majority counterparts

that broadcast ethnic programming in part because one station is located in the New York metro

market where stations earn relatively high average revenes (see chart K).

 

196 The power ratio of Spanish formatted stations may be affected by undercounting of the

Hispanic audience by audience research services. If audience size is underestimated by rating

services, then revenue per listener (the power ratio)will be higher. Telephone interview with Tom

Castro, El Dorado Communications, December 14, 1998.

 

197 The power ratio for majority broadcasters with ethnic programming is based upon data for 

only thirteen stations.

Chart J

format. Power ratios are provided for four minority formats, as well as the general market format,

according to majority and minority ownership. 

The average power ratio for minority-owned stations in all five of the format categories was less

than one ( “underselling “ their audience)—0.78 for urban, 0.86 for Spanish, 0.95 for ethnic,195 0.51 for

black, and 0.85 for general market. Majority broadcasters had average power ratios that were greater

than one (“overselling” their audience) for three formats: Spanish (1.09),196 ethnic (1.82)197 and general

market (1.16). The average power ratio was less than one (“underselling” their audience) for majority

broadcasters in two formats: urban (0.77) and black (0.69). The number of stations in each program

category is enclosed in parenthesis in the chart.

.
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198 Duncan analyzed a sample of 1,474 stations. He explained, “The stations selected for

inclusion in this report are from almost all of the Arbitron standard markets — over 150 markets in

all...this report includes data for over 14% of all commercial stations in the United States. Almost

47% of all reported stations in the Arbitron standard markets are included.” Duncan’s Power Ratio

Analysis, Introduction, page 1. Regarding his sample selection he described his methodology, “To

be selected, a station had to meet two criteria. First of all, it had to be successful in its format. I

estimate that around 90% of the stations are the ratings leader in its [sic] format. The remaining

stations were also very successful stations, even though they were not the format leader in their

market. Secondly, I only used stations whose revenue figures are, in my judgment, reliable and

accurate.” Id. Duncan also adjusted local commercial share data to account for non-commercial

stations, out of market stations, and stations which do not have enough audience to qualify for a

listing in the Arbitron book. Id., page 3.

 

199 Urban/black includes black, urban, and black adult contemporary. See note 37, supra.

 

200 The general market formats Duncan examined were: News & News/Talk, Adult

Contemporary, Sports, Full Service, Country, Album Oriented Rock, Classic Rock, Oldies

(50s/60s), Oldies/Classic Hits, Talk & Talk/News, Contemporary Hit Records (CHR)/ Top 40,

Soft Adult Contemporary, Jazz, Classical and Standards/Nostalgia. Note 198, supra. 

 

201 BIA Research, Inc., Letter to William Kennard, Chairman, Federal Communications

Commission, from Thomas J. Buono, President/CEO, July 7, 1998 enclosing BIA Analysis of

Hispanic and urban Formatted Stations in the Top 50 Markets, BIA Research, Inc. (See Appendix

L). BIA searched its 1998 Media Access Pro software and database for all Spanish and urban

format stations in the Top 50 markets, and analyzed performance based on market size, local

commercial listening, revenue shares and power ratios. 

 

202

 Id., at 2.

Data: BIA MasterAccess, August 1997 edition.

The findings of CRF were consistent with those of other individuals that have done research

in this area. In his 1997 report on radio revenue and ratings, James H. Duncan, Jr. examined all of the

major programming formats.198 For 1996, he reported power ratios of 0.89 for Spanish -formatted

stations and 0.77 for urban/black 199 formatted stations. General market formats had a power ratio of

1.06.200 (See, Appendix M for a copy of the Duncan report).

BIA Research conducted an analysis at the request of Spanish Broadcasting Systems of the

performance of Hispanic and urban radio stations in the Top 50 radio markets.201 Most Spanish and

urban stations analyzed failed to generate a revenue share that equals or exceeds their local commercial

share. BIA reported that during 1997, “The mean power ratio for these stations was 0.70..., implying

a 30% average undersell for Hispanic and urban stations.”202 BIA commented, “In general, this data
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203

 Id.

 

204

 Id. 

 

205

 See, Duncan’s Power Ratio Analysis at 5-6. General market formats include those listed in

footnote 200, except for Oldies/Classic Hits which was not reported in Duncan’s historical table. 

Duncan noted that power ratio information was not available before 1994 for Sports formatted

stations, or before 1995 for Oldies (70's) stations, so the averages were used for the available years

in those formats. Id., at 5-6.

indicates that it has been very difficult for Hispanic and urban stations to obtain a significant share of

revenues, even with acceptable ratings.”203

Examples from the nation’s top markets substantiate these findings. BIA noted:

KLVE (FM), Heftel Broadcasting’s leading Spanish station, is the most listened to station in Los

Angeles by a wide margin. Yet, its estimated power ratio was just 62% [0.62] for 1997 and it ranked

8

th in terms of estimated revenues for the year. In New York, Emmis Broadcasting’s WQHT (FM)

offers an Urban/Rap format and its been the first or second highest rated station over the last couple

of years. However, its estimated power ratio was just 70% [0.70] during 1997 and it ranked just 10th

in terms of estimated revenues. Another example is WSKQ (FM), Spanish Broadcasting Systems’

leading Spanish station in New York. This station has been one of the top rated stations in New York

over the past year, but its estimated power ratio in 1997 was just 72% [0.72] and its estimated

revenues ranked 13th.

204

Duncan documented this pattern over time. Between 1991 and 1996, the power ratio averaged

0.96 for Spanish formats and 0.73 for urban/black formats, with a combined average of 0.85. For

general market formats, the average power ratio between 1991 and 1996 was 1.07.205 The historical data

indicate that it has been more difficult for urban and Spanish formats to convert audience listener share

into market dollars than general format stations, consistent with the anecdotal evidence in this study.

This time series analyses, however, did not control for other factors (e.g. ownership size and audience

income) that could affect format advertising performance. Further research should be undertaken in

this area.

b. Station Revenues by Program Format

CRF also compared the revenue performance of minority and general market formats according

to ethnic/racial ownership. Overall, general market stations averaged revenues that were 12% higher

than minority-formatted stations: $2.20 million compared to $1.96 million. Majority broadcasters

outperformed minority broadcasters in both program formats. Majority broadcasters averaged revenues

that were 79% higher than minority broadcasters in the general market format. Their revenues were

20% higher than minority broadcasters in the minority-format category (see Table 2). 
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206 Numbers in parenthesis in Chart K represent the number of stations in the data set with the

program format indicated.

 

207 Average revenues for minority broadcasters with ethnic programming is based upon data for 

only two stations. These two stations had power ratios that were less than their majority

counterparts. One of the stations, WNJR-AM is located in New York City where stations earn high

average revenues. The other minority-owned ethnic station is located in Corpus Chisti, Texas. The

market locations and presence of only two minority broadcasters in the ethnic format may account

for the high average revenues (see Chart J).

Chart K

Chart K206 provides more detail about the revenue performance of minority and majority

owned stations by format. With the exception of ethnic radio, the average revenues of minority owned

stations were less than the revenues of majority owned stations in each of the format categories: $1.9

million for minority-owned urban stations, compared to $2.3 million for majority-owned urban

stations; $1.6 million for minority-owned Spanish stations, compared to $1.8 million for majorityowned Spanish stations; $0.5 million for minority-owned black formatted stations, compared to $1.9

million majority-owned black formatted stations; and $1.2 million for minority-owned general market

stations compared to $2.2 million for majority-owned general market stations. The two minority-owned

ethnic radio207 stations in the data set exceeded their majority counterparts in terms of revenues.

Average station revenues were $1.2 million for minority broadcasters compared to $0.6 for majority

broadcasters in the ethnic format category.
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208

 The numbers in parenthesis in column one indicate the number of stations in that category,

(e.g. 116 minority-owned, minority-format stations).

 

209

 Also note discussion in Section II-C-3 regarding the relationship between ownership size

and advertising performance.

 

210

 According to the August 1997 edition of the BIA MasterAccess database Willis

Broadcasting, which is listed by NTIA’s Minority Broadcasting Report as minority-owned, owned

26 stations nationwide. Many of Willis’ stations are classified as “Religion” or “Gospel.” Some of

Willis’ programming may be minority-oriented, despite its formal classification. As noted earlier,

stations sometimes avoid “urban” or other minority-format classifications to escape “no Urban

Data: BIA MasterAccess, August, 1997 edition.

In the next section advertising performance is examined from the standpoint of program

format, minority ownership and ownership size. 

c. Advertising Performance by Minority Ownership and Ownership Size

Table 2 shows an analysis of the advertising performance of 3,745 stations yielded by a search

of BIA’s 1997 database. Column one indicates the category of broadcaster analyzed. The categories

for general format and minority-format broadcasters are: 1) all majority owners, 2) small majority

owners, and 3) minority owners.208 Column two indicates the average (mean) 1996 national revenues

for all stations owned by broadcasters in each category. Column three shows the average number of

stations owned nationally by broadcasters in each category, (e.g., minority-owned, minority-formatted

broadcasters owned an average of 4.4 stations nationally). Column four indicates the average 1996

revenues of stations owned by broadcasters in each category. Column five shows the average power

ratios for each category of broadcaster. 

Column 5 indicates that all general format stations outperform all minority-format stations in

terms of power ratios—1.16 versus 0.91. A comparison of minority and majority broadcasters within

the two categories of program formats (general market or minority format) indicates that stations

owned by majority broadcasters, regardless of ownership size, appear to have a greater ability to convert

their listener share into revenues. 

Majority broadcasters that owned minority-formatted stations averaged power ratios of 0.95,

compared to 0.82 for minority broadcasters. Controlling for ownership size,209 the pattern of disparities

favoring majority broadcasters appears to persist. 

Minority broadcasters were compared with majority broadcasters of comparable size in both

program format categories. For general market stations, minority broadcasters were compared with

majority broadcasters that owned 26 or fewer stations. This range of ownership is based upon the

maximum number of stations owned by a minority broadcaster in this format category.210 As column
Section II. Radio When Being No. 1 is Not Enough

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dictates.” Ben Carter telephone interview, August 5, 1998. Further research should investigate

the relationship between power ratios and other performance measures, and the racial/ethnic

composition of the audience.

 

211

 The lower power ratios of minority owners in general format may be accounted for, in part,

by the fact that many of those stations may still be minority-targeted, though they don’t use the

minority-format classification. In Barthwell Evan’s study of African-American broadcasters,

Carter Broadcasting described its stations in Kansas City, Missouri as “general market with Black

news.” “Radio Broadcasting,” 8 Yale Law & Policy Review 380, 405. Barthwell Evans observed

that “some African-American broadcasters may not want to characterize their stations as Black or

Urban-formatted because they feel station formats make it more difficult to attract advertising

revenue than general market or ‘disco’ stations, which nonetheless may be targeted toward

African-American audiences. This avoidance of a Black-format label is understandable since

analyses indicate that urban, news or general market stations are much more likely to earn

proportionately greater advertising revenues when compared to audience shares.” Id. at 405-406.

three of Table 2 indicates, both small majority owners and minority owners broadcasting to the general

market, owned an average of 7.4 stations nationally. Regarding power ratios, small majority

broadcasters (i.e. those with 26 or fewer stations) had an average power ratio of 1.16; minority

broadcasters had an average power ratio of 0.85.211
Section II. Radio When Being No. 1 is Not Enough

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212

 Minority-owned broadcaster, Z Spanish Radio, had the largest number of minority-formated

stations. See, NTIA Broadcast Ownership Report, 1997; BIA MasterAccess database, 1997.

Table 2

Data: BIA MasterAccess, August, 1997 edition.

 Minority-owned, minority-format broadcasters were compared with majority broadcasters that

air minority-format programming and that owned 17 or fewer stations, reflecting the maximum number

of stations owned by a minority broadcaster in this format category.212 Column three indicates that

small majority owners broadcasting in minority formats, owned an average of 4.9 stations nationally,

compared to an average of 4.4 stations nationally for minority owners broadcasting in minority formats.

In terms of power ratios, column five shows that small majority broadcasters outperformed minority
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213

 It is recommended that subsequent research compare stations with the same format

controlling for audience income and market rank. 

 

214

 The basis of the revenue comparison of broadcasters of comparable size was the same as

that for the power ratio comparison.

 

215

 Comparisons in Chart L are between all 3,745 stations in the data set (“All Broadcasters”),

majority-owned/minority-formatted stations with 17 or fewer stations (“Small Majority-Owned”),

and minority-owned/minority-formatted stations (“Minority Owned”).

broadcasters in the minority-format category.213 The average power ratio for small majority

broadcasters was 0.99, compared to 0.82 for minority broadcasters. 

In terms of station revenues (Table 2, column 4), general market stations averaged revenues that

were 12% greater than minority-formatted stations. Majority broadcasters, overall, outperformed

minority broadcasters within both format categories. Station revenues for majority broadcasters that

air general market programming were on average 79% greater than minority competitors within the

same format. Majority broadcasters that air minority-formatted programming averaged revenues that

were 20% higher than minority broadcaster in the same format category.

A revenue comparison of broadcasters of comparable size214 indicates that general market

majority-owned broadcasters averaged revenues that were 14% greater than minority-owned stations

within the same format category. Minority owned stations that air minority-formatted programming

averaged revenues that were 65% greater than small majority competitors in the same format category.

However, as noted above, minority owned stations are, on the whole, underperforming in terms

of power ratios, compared to majority broadcasters in either format group. In other words, given the

size of their audience share, one might expect that minority-owned, minority-formatted stations would

outperform their small majority-owned counterparts in terms of revenues by even greater margins. 

Additionally, the revenue comparisons presented in Table 2 may be affected by the fact that

minority broadcasters are more concentrated in markets where stations earn greater revenues. Stations

in the large urban markets (e.g. New York and Los Angeles) average higher revenues than stations in

the smaller metro markets. For example, average station revenues in market #1 (New York) are $15.57

million compared to $3 million in market #30 and $1.24 million in market #60. 

Significantly, there is a greater concentration of minority-owned broadcasters than small

majority-owned broadcasters in the large metro markets. Chart L215 indicates that 20% of the stations

owned by minorities are located in markets 1 - 11, compared to markets 1- 30 for small majority

broadcasters. Sixty percent of minority owned stations are located in markets 1- 65 compared to

markets 1-104 for small majority broadcasters. The differences in market rank distribution between

these two categories of owners affect station revenues. For this reason, future research should control

for market rank when making revenue comparisons. 
Section II. Radio When Being No. 1 is Not Enough

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Chart L

Data: BIA MasterAccess, August 1997 edition.

When the data presented in Table 2 is separated into markets 100 and below and markets above

100, the revenue comparisons indicate that minority broadcasters average 51% above their small

majority competitors in the top 100 markets, but earn on average slightly less than small majority

competitors in markets 101 through 265 (See Tables 3 and 4).
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Table 3 Markets: 1- 100

Data: BIA MasterAccess, August 1997 edition

Although the revenue comparisons differ for the top 100 markets and markets above 100, the

power ratios of small majority broadcasters in both market segments are superior to that of minority

broadcasters—1.01 versus 0.77 in the top 100 markets and 0.97 versus 0.94 in markets above 100 (see

Table 4). 
Section II. Radio When Being No. 1 is Not Enough

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216 NTIA, “Minority Commercial Broadcast Ownership in the United States,” August 1998,

page. 1.

 

217

 Id., at 5.

Table 4 Markets: 101 - 265

Data: BIA MasterAccess, August 1997 edition

Revenue performance may also be influenced by consolidation by a few minority owners.

NTIA found in its 1998 minority ownership report, that the number of stations owned by minorities

increased 0.1% in 1997-1998 from 2.8% of all U.S. commercial broadcast stations to 2.9%, reflecting

a net gain of 15 stations.216 However, the number of minority broadcasters decreased by 17. Gains

in stations owned were due to incumbent minorities acquiring additional properties, particularly growth

by a small number of Hispanic broadcasters.217

As a whole, the radio industry has undergone tremendous change. The FCC’s staff report,

“Review of the Radio Industry, 1997,” which examined data from March 1996 to November 1997, 
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218 Id., at 4, citing Federal Communications Commission, Staff Report, “Review of the Radio

Industry, 1997,” 13 FCC Rpt. 11276 (1998).

 

219 Metro market cost per point data for Table 8 was obtained from the Media Market Guide (3rd

Quarter 1997) published by Media Market Resources Inc. 1997 Black cost per point data was

provided by the Research Department of The Interep Store. Population data for the metro markets

was obtained from The Media Audit (January-December 1997) published by International

Demographics. Cost per thousand (CPM) was calculated by dividing the cost per point by one per

cent of the population size and multiplying the result by 1,000.

found that the number of owners of commercial radio stations declined by 11.7%, primarily due to

mergers between existing owners.218 As section II-C-3 indicates, consolidation affects average station

revenue, although its impact on power ratios is less direct. 

d. Cost Per Point as a Measure of Advertising Performance

In order to better understand the disparities in power ratio performance, CRF compared the

cost per rating point for general market and urban stations. As fully explained in the appendix, the cost

per point is the cost of advertising to one percent of the listening audience (see Overview of Media

Planning, Appendix A). A general market cost per point is based upon the cost of reaching one

percent of the entire metro audience. Black listeners are a subset of the metro audience. In terms of

general market cost per point, advertisers pay a lower rate to reach the smaller Black population

(compare Black CPP and Metro CPP of Table 8). However, an accurate analysis requires a comparison

of the cost to reach an equal number of people in both markets. To facilitate this, CRF converted the

cost per point to the cost per thousand (i.e. the cost to reach one thousand people) for several markets

in which large numbers of Blacks reside.

 The following table provides the size of the population for one percent of the Black population

and the total metro market population. For each market the table also provides the cost per rating

point (CPP) and the cost per thousand (CPM) for Blacks and the total metro market (CRF was not

able to obtain data for the Spanish market).219

CRF’s analysis of seven major markets indicates that the cost of an advertisement based upon

the urban cost per point is greater than the general market cost per point. In other words, advertisers

pay more to advertise to Blacks, if the Black cost per point is the basis of the calculation. For the New

York market, the metro and Black costs per point convert to $7 to reach one thousand Blacks and

$4.51 to reach one thousand listeners in the total metro market. The Los Angeles metro and Black

costs per point convert to $22.48 to reach one thousand Blacks and $8.50 to reach one thousand

people in the total metro market. The results of this analysis do not support the power ratio

comparisons presented in Table 2. 
Section II. Radio When Being No. 1 is Not Enough

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220 Interview with Sherman Kizart, The Interep Radio Store, October 1, 1998. 

 

221 Telephone interview with Judith Ellis, Emmis Broadcasting, October 5, 1998.

Adults

Age 25 - 54

(frequency = 1)

1% Black.

 Population

Black

CPP

Black

CPM

1% Metro 

Population

Metro

CPP

Metro

CPM

New York 13,993 100.2 7.16 78,880 356 4.51

Chicago 6,856 62.2 9.07 38,500 221 5.74

Wash. DC 5,582 68.0 12.18 21,660 208 9.60

Los Angeles 4,519 101.6 22.48 55,030 468 8.50

Atlanta 4,480 74.0 16.52 17,740 166 9.36

Detroit 4,226 54.6 12.92 20,130 147 7.30

Philadelphia 3,994 42.4 10.62 21,610 196 9.07

Data: The Media Audit, The Media Market Guide, The Interep Store

Table 5

Comparison of Costs to Reach One Thousand Listeners:

Black vs. General market Listeners

CRF discussed these inconsistencies with the Director of Urban Marketing for Interep,

Sherman Kizart. Spot advertisements based upon the Black cost per point, in his estimation, account

for only five to ten percent of the revenues of urban-formatted stations. In many cases urbanformatted stations are faced with dictates not to buy urban.220

CRF also discussed these matters with Judy Ellis, Senior Vice President of Emmis Radio and

General Manager of three Emmis Radio stations in the New York metro market. Advertisements based

upon the Black cost per point, according to Ms. Ellis, are very favorable for her urban formatted

station WRKS. However, such buys are only typical of advertisers that are interested in targeting their

products to the Black consumer (e.g. fast food companies). Other advertisers (i.e. firms that consider

the general market their primary focus and the minority consumer a secondary priority), pay less to

advertise on stations that target the minority listeners—even in cases where Blacks are avid consumers

of the products.221

As an example, Ms. Ellis compared costs per point offered to two Emmis Radio station

stations—one urban and the other jazz/new age. The offers were based upon the general market cost

per point and originated from the buying service of a well-known bedding and mattress retailer.
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222 Scarborough Qualitap Report, New York, March 1997- February 1988, on file with CFR. 

Jazz/new age radio station WQCD was offered $365 per point, while WRKS, which had a larger

audience share, was offered $330.

Qualitative data also showed that urban and Spanish station listeners led the market in terms

of bedding and mattress consumption. Specifically, WRKS listeners were 29% more concentrated in

the qualifying criteria—“planning to buy bedding or mattress within a year”—than the average adult

in the market. Other urban and Spanish formatted stations ranked 51% (WBLS), 32% (WQHT), and

24% (WSKQ) in terms of plans to buy a mattress or bedding. Jazz station WQCD which received an

offer of $360 ranked 7%.222

In summary, advertisements based upon the Black cost per point are more valuable than the

general market cost per point. It appears, however, that the inferior advertising performance of

minority-formatted stations can be explained by the fact that such rates are seldom obtained, as well

as the failure on the part of some advertisers to pay the same general market cost per point to both

general market and minority-formatted stations. 

Discounted general market costs per point appear to account for some of the performance

disparities between general market and minority-formatted stations. CRF attempted to obtain

documentation that such practices are systematic. However, the ad agencies and national rep firms

contacted were unwilling to permit access to records that indicate the cost per point that advertisers

pay on a per market basis. Research undertaken as a follow-up to this study should endeavor to obtain

such useful information by means of the subpoena powers of the federal government, if necessary. 

The factor of ownership size also appears to have a bearing on advertising performance. Table

7 indicates that majority-owned stations tend to be part of larger group operations. 1997 estimated

national revenues for the majority owners averaged $233.8 million for general market stations and

$196.5 million for minority-formatted stations. These figures dwarf the estimated average national

revenues of minority broadcasters—$9.9 million for general market stations and $13.6 million for

minority-formatted stations. 

The next section examines economic disparities between majority and minority broadcasters

that may be linked to the number of stations owned nationwide and locally. 

3. The Impact of Ownership Size on Advertising Performance. 
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223 All stations reporting revenue and listener information to the August 1997 edition of the BIA

MasterAccess were analyzed. See Section I-D for the methodology of selection. The stations were

divided into five groupings based upon the number of stations owned by the parent company in

the local and national markets. For the national market the groupings were 1-2, 3-5, 6-17, 18-66,

and 67-246 stations. The groupings for the local markets were 1-2, 3, 4-5, and 6-8 stations.

 

224

 Station revenue is gross station revenue for 1996 expressed in thousands. Power ratio is a

measure of a station’s ability to convert share of total market listeners into share of total market

revenues (calculated by dividing the market revenue share by the local commercial share, See

Glossary, Appendix K). 

Chart M

For this analysis CRF examined a universe of 3,745 radio stations.223 Charts M and N suggest

a positive correlation between station performance and the number of stations owned. An increase in

station ownership in both the national and local markets appears to translate into increased

performance for the individual stations owned by the parent company. Station performance was

measured by two variables: average station revenues and power ratio.224

Station revenue significantly improved with large national ownership. 1996 average station

revenue increased from less than one million dollars to $4.8 million dollars as company national
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225 For a similar analysis see BIA Research Inc., 1997 Radio State of the Industry Report.

Chart N

ownership increased from 1 to 2 stations to 67 to 246 stations.225 There was no appreciable change in

power ratio (1.13% to 1.14%).

An examination of local ownership also indicates a positive correlation between station

revenues and ownership in the local market. In 1996 as company local station ownership increased,

average station revenues increased from $1.4 million in the case of 1 to 2 locally owned stations to $3

million in the case of 5 local stations, then declined to $2 million in the case of 6 to 8 local stations

(Chart F). There was a slight decrease in average power ratio (1.18% to 1.13%).

The fact that owners with large number of stations are able to generate higher station revenues

despite no corresponding change in the power ratio suggests a linkage between large company size and

increased ability to obtain purchases and/or higher prices from advertisers. Further investigation is

warranted to determine whether large firms condition the purchase of commercial time on one station

upon additional purchases on other stations owned nationally or locally. Another area of inquiry is to

determine whether large firms leverage their control of market share to raise advertising prices.
Section II. Radio When Being No. 1 is Not Enough

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226 The vast majority of minority-owned broadcasters are not market consolidators, defined in

this study as companies who owned four or more stations in a local market. The few exceptions

are Radio One, Inc., which owns four stations in both Washington, D.C. and Baltimore and

accounted for 10% and 17% of the market revenues, respectively, in those two markets. The other

exception is Spanish Broadcasting System, which owned six stations in Miami and accounted for

11% of that market’s revenues. The market revenue shares of these companies were significantly

less than the leading consolidators in these three markets— Infinity with 34% of the Baltimore

market revenues, Clear Channel with 26% of the market revenues in Miami, and Chancellor with

30% of the market revenues in Washington, D.C. (Source: Who Owns What? Inside Radio, Inc.,

October 19, 1998.) Only nine percent of the respondents to the survey undertaken for this study

reported the presence in their market of a minority broadcaster that qualified as a local market

consolidator (see next footnote for definition).

 

227 For the purpose of the survey questionnaire, a market consolidator was defined as a

broadcaster that owns four or more stations in the local market and that controls 30% or more of

the local market sales revenues.

This analysis implies that small firms are at a competitive disadvantage. Stations with large

parent companies have greater revenue streams with which to hire the best on-air talent, to invest in

program production and to spend on sales promotion. These competitive advantages ultimately work

to the disadvantage of small and minority-owned firms.226 

 4. Market Consolidation, Advertising Practices and Access to Capital

In their responses to the survey questionnaire, minority broadcasters reported that local market

consolidators enjoy strategic advantages that substantially impact on the advertising revenues of

minority firms.227 Survey participants were asked whether they were facing competition from a local

market consolidator. Ninety- three percent of the respondents reported facing competition from an

average of three local market consolidators. Sixty percent of the respondents indicated that they were

facing direct competition from majority-owned consolidators that air minority-formatted programming.

The sizes of the three local market consolidators were reported to be five local stations for the

first consolidation group, four for the second, and four for the third. These duopolies (or

superduopolies), on average, are more than twice the size of duopolies owned by minority broadcasters.

In terms of competitive advantages associated with local market consolidation, minority

broadcasters responded as follows (#1 denoted the highest level of importance):
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Question: Please describe any competitive advantages that

local market consolidators have over your station in terms of

their ability to solicit spot sales.

Average Response

on a scale of 1 to 10 

(1 denotes the highest

level of importance)

Able to offer advertisers a wider range of demographics than your

station.

2

Able to afford undercutting the price of your spot sales. 4

 None 8

Question: What impact have local market

consolidators had upon your station?

Average Response

on a scale of 1 to 10 

(1 denotes the highest level

of importance)

Taken sales away such that station revenues have

significantly declined.

5

Taken away audience share such that listenership has

significantly declined.

5

No impact 6

The practice of price undercutting involves offering ad agencies a price that is deliberately intended to

undercut a competitors price. This practice may be employed by a consolidator that seeks to compete

directly with the format of a minority broadcaster. By airing minority-formatted programming and

undercutting the price of spot sales, a consolidator has a strategic advantage.

Consolidators generally offer a wide range of formats (e.g. news, country, urban, easy listening)

on their local radio stations in order to reach a diverse set of demographics. This enables consolidator

sales representatives to offer media buyers the ability to reach any consumer they wish to target with

a media buy. Media buyers may find it convenient to negotiate a price with one sales person in order

to reach all of their targeted audiences.

The survey participants were also asked to describe the impact, if any, that local market

consolidators are having upon their station.

and,
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Question: Do such practices interfere with the ability to

raise capital to acquire minority-formatted stations?

(check only one)

Distribution of

Responses

Very much so. 44%

Moderately. 33%

Minimally. 18%

Not at all. 5%

Question: Do such practices detract from the market value

of a minority-formatted station when it is being sold?

(check only one)

Distribution of

Responses

By a substantial amount. 44%

Moderately. 29%

Minimally. 25%

Not at all. 2%

The responses to the last two questions suggest that although minority broadcasters face direct

competition from local market consolidators, they are experiencing only a moderate adverse impact

in terms of listeners and revenues. Based upon the perception of the survey respondents, local market

competition has less adverse impact than the effect of advertising practices involving “discounts” and

“dictates.”

The survey respondents were also asked to estimate the impact of “minority discounts” and “no

Urban/Hispanic dictates” upon access to capital and station valuation.

Forty-four percent of the minority entrepreneurs responding to the survey believed that

advertising practices detract by a substantial amount from their ability to raise capital to acquire new

stations that will be used to air programming to the minority population. This is due, in part, to the

anticipated adverse impact that advertising practices have upon the ability of such stations to attract

advertising revenues. An equal number of survey respondents expressed their view that when a
Section II. Radio When Being No. 1 is Not Enough

Page 84

minority-owned station is sold, advertising practices regarding “no Urban/Spanish dictates” and

“minority discounts,” detract from the station’s sales price by a substantial amount. This results, in

part, from the adverse effects of advertising practices upon the revenues of stations that air

programming targeted to the minority population.

D. Recommendations for Further Research

It is recommended that further statistical analysis be undertaken that is beyond the scope of

this study. This study suggests that minority ownership, ownership size, and the racial/ethnic

composition of the listening audience can be linked to the advertising performance of program formats.

The relative impact of other variables has not been determined. Further analysis should attempt to

isolate and quantify the effect of additional factors. Such factors should include: 

< audience age, income and education;

< the market rank of the station;

< national revenues; and

< Station sales budgets, particularly the amount of expenditures for qualitative data used to

overcome “no Urban dictates” and “minority discounts.”

This study examined data averages for one year. However, the marketplace involves dynamic

relationships that should be studied over time. Hence a time series analysis of the variables mentioned

above should be undertaken. 

Another important area warranting further investigation is whether there are substantial

variances in the general market cost per point, paid to minority-formatted and general market

stations. Such an analysis is necessary in order to determine whether advertisers, in general market ad

campaigns, pay discounted rates to minority-formatted and/or minority-owned stations. The data

necessary to perform such an analysis is generally proprietary, and CRF was not able to obtain it. A

federal agency with jurisdiction over advertisers and ad agencies may have to use its subpoena powers

to obtain such information. 

On the basis of questions raised by this study concerning the impact of advertising practices

on minority-owned and minority-formatted stations, CRF also recommends the following research

initiative:

< A broader study, funded with sufficient resources, should be undertaken to analyze the impact

of various factors on broadcasters’ performance. Such an analysis will help the FCC identify

whether there are impediments to entry and growth in the broadcast industry that warrant

Commission action, and the reasons for those obstacles. 

< The analysis should examine factors such as: the impact of ownership size on revenue and

power ratios; advertising pricing variances (including cost per point variances) by format; the
Section II. Radio When Being No. 1 is Not Enough

Page 85

racial/ethnic classification of the owner, and owner size; differences in quantity of advertising

time made available by stations; consumer responsiveness to advertising on minority-targeted

media compared to general market media; the extent to which a broad variety of formats are

subjected to systematic “discounts,” or “dictates” based on the audience served; the relationship

between “dictates” or “discounts” and the range of formats on a broadcaster’s stations; the

extent to which “discounts” are based on audience income levels for various formats; the

quantity of discounts experienced by minority-formatted stations and other formats, and their

pervasiveness; the extent to which discounts may be related to station classifications of power

and reach (i.e. AM or FM, Class A or Class C); the extent and pervasiveness of “no

Urban/Spanish dictates,” and the use of dictates for other formats. 

< Additionally, the analysis should consider the impact of the race/gender of station, ad agency,

advertiser and representative firm personnel; the practices of broadcast owners in competing

against minority-formatted or minority-owned stations based upon misrepresentations and

improper disparagements; the ownership of radio and television stations by women; whether

stations targeting programming at women are subjected to similar practices in the advertising

industry, and the influence of such factors. 

< The analysis should also probe the use of media ratings services in advertising decisions,

particularly unaccredited services. It should examine the effect of audience undercounting by

media ratings services on the advertising performance of minority-owned and minorityformatted broadcasters. It should investigate the impact of advertising practices on viewers and

listeners, i.e. whether they affect the availability of format, diversity of viewpoints on the

airwaves, and broadcasters’ service to the American public. Finally, the analysis should

investigate whether minority or women owners encounter barriers based on race or gender, and

whether any such findings justify remedial measures or incentives to remove barriers to market

entry, growth and competition for small, minority and women-owned radio stations.