Broadcasters should man up and compete

In a letter to the FCC Chairman Julius Genachowski, NAB President and CEO Gordon Smith wrote that the “issue could not be more timely in light of [June 29-30’s] catastrophic storms.” The NAB has tried the same tactic following previous weather crises, like hurricanes and wildfires. After failing so many times, you would think the NAB would take the hint: Consumers don’t want radio chips in their cell phones. If they did, you can bet that cell phone manufacturers would be churning them out.
 
The occasion that sparked Smith’s letter is a July 20 meeting at the FCC with wireless industry executives to discuss the issue of “voluntary inclusion” of radio chips in mobile devices. This tactic is slightly different than the federal mandate NAB has lobbied for in past years, but it’s still a bad idea. Since not a single Washington legislator supported a mandate – nor did the public – the NAB says a “voluntary inclusion” would be a market-based approach.
 
But inherent in the NAB’s seemingly innocent request is the possibility of coercion from the FCC. After all, that’s what the July 20 meeting is supposed to decide: Should mobile phone manufacturers consider it a public duty to equip their products with radio capabilities? To bolster that message, Mr. Smith’s letter points to the outstanding reporting done by local radio networks before and while the storms swept through the Washington Metro area.
 
To be sure, those networks did a fine job. But is it also the NAB’s position that every car should have a radio? Is it the NAB’s position that every house or apartment should have radio? Because in this day and age, with the advance of mobile technology, consumers don’t want a radio in their phones because they don’t need a radio in their phones. With text alerts, the Internet, and weather apps, the radio is a bygone way of disseminating weather reports at the speed and convenience users expect.
 
In any case, the NAB’s real motives are anything but pure on this issue. As broadcast radio networks continue to bleed listeners to other services, theNAB is doing what it always does: Travel to Washington hat-in-hand looking for a favor. Instead of attempting to boost declining ratings through government means, the NAB should start actually competing in the market.
 
First, do what real businesses do – businesses that don’t rely on the nanny state to keep their noses clean: Go cut a deal with a manufacturer and negotiate inclusion of a radio chip. After all, the stations own the valuable spectrum, radio time and lots of cash. I am sure if they put any of those assets on the table and started negotiating they can cut a deal.
 
Second, with a deal in place, try building demand. Just as every other company in America has to build up demand for its products through marketing, so too can radio stations. Sell the feature and people may start asking for it. Move the needle with a massive campaign on and off radio. If you believe in the power of radio – use it!
 
In the meantime, the NAB should stop trying to pull the manufacturers’ (and the FCC’s) heartstrings about their civic duty during times of crisis. It is nothing more than fraudulent attempt to invoke public safety to reverse free-market decisions. It is not government’s role to protect or assist declining means of communication like radio, print media, or town criers.
 
Shapiro is president and CEO of the Consumer Electronics Association (CEA)®, the U.S. trade association representing more than 2,000 consumer electronics companies, and author of the New York Times bestselling book, “The Comeback: How Innovation Will Restore the American Dream.”