SONG: It's a beautiful morning...
RADIO BROADCASTER: Sports at :15 and :45 past every hour on KFWB News.
TERENCE SMITH: The new "new thing" in broadcasting is old... Radio.
RADIO BROADCASTER: KNX news time, 7:58.
TERENCE SMITH: With a strong economy, an influx of dot-com advertisers and more ads per hour, radio just completed its best decade ever. Total advertising sales in 1999: More than $17 billion.
AL PETERSON, Radio & Records: Radio has been said to be on its last legs when motion pictures came along. Then television was going to kill radio, then FM was going to kill AM radio, then the Internet's going to kill... You know, 50 years later, its still here, its still strong, its still the most listened to media by all Americans.
TERENCE SMITH: Radio's reach is nearly universal: 99% of the country. But the industry is not just growing, it's changing. The Telecommunications Act of 1996, loosened the rules on radio ownership and changed the landscape. Al Peterson writes for Radio and Records, the industry newspaper.
AL PETERSON: I think that generally speaking deregulation, in my opinion, is that overall it has made radio better. I'm probably going to get people to throw stuff at me for saying that.
TERENCE SMITH: The law set off a chain reaction of mega mergers within the world of radio. The mergers often strengthened weaker stations by introducing economies of scale, automation and syndication. Now radio is the cash cow of the entire entertainment industry.
RADIO BROADCASTER: The NASDAQ up 35...
TERENCE SMITH: But the revolution that has clearly been good for the radio investor, has had a problematic effect on the radio listener.
SEN. BYRON DORGAN (D-N.D.): What has happened with radio concentration is outrageous, just outrageous.
TERENCE SMITH: Byron Dorgan is the Democratic senator from North Dakota, a state of small radio markets. He says publicly owned airwaves should not be left to a few corporations.
SEN. BYRON DORGAN: Local ownership is gone, localism in the way a radio station operates is gone. I think what has happened is awful, just awful. And in fact it’s not stopping.
TERENCE SMITH: With deregulation, one company may own up to eight stations in some radio markets. The result has been a buying frenzy that has left a few huge companies dominating the airwaves. Last August for example, Clear Channel Communications bought AM FM, Inc., for a staggering $23 billion. Clear Channel now has 1,100 stations nationwide.
RADIO BROADCASTER: This is Buffalo's news, traffic and weather station...
TERENCE SMITH: In Buffalo, the nation's 45th radio market, deregulation set off musical chairs among station ownership.
ANTHONY VIOLANTI, The Buffalo News: WKBW, now it's called WWKB, WGR, WBEN. These are the 13 colonies of Buffalo radio, if you will. This is what started it all. In the past five years, since deregulation, these stations have been sold four times.
TERENCE SMITH: Anthony Violanti is the radio reporter for The Buffalo News. He says deregulation demolished competitive news radio in Buffalo.
ANTHONY VIOLANTI: New owners, new general managers keep coming in. And usually, the first way to cut costs, because, again, of the size of these deals, is to cut news.
TERENCE SMITH: Radio chains often use big-name, national talent to lure listeners.
DON IMUS, Radio Broadcaster: You said it looked like a someone bottle of Gatorade had exploded on her.
TERENCE SMITH: Syndicated talk shows, like Dr. Laura Schlessinger on 430 stations, and Rush Limbaugh on 560 stations, saturate the airwaves.
DR. LAURA SCHLESSINGER, Radio Broadcaster: The truth is, if you put on 40 pounds, it isn't as attractive.
TERENCE SMITH: National syndication has brought homogeneity to what was before a distinctly regional sound.
DR. LAURA SCHLESSINGER: 1-800-D-R-L-A-U-R-A.
AL PETERSON: Certainly, there are many who decry that deregulation has turned radio into a bland product-- same in every city-- and, to some extent, I think that criticism is probably valid.
TERENCE SMITH: But national brand names, Peterson argues, have kept many stations afloat.
AL PETERSON: Rush Limbaugh, in the late '80s and early '90s, when he first came on the air, single handedly virtually saved many AM radio stations across America.
TERENCE SMITH: During the first two weeks of the presidential election stalemate, news talk listeners were up an estimated 25 percent. But critics complain that the majority of syndicated talk shows have a distinctly conservative bias.
ANTHONY VIOLANTI: If you constantly hear right- wing conservative hosts extolling George W. Bush for example, or Rick Lazio, and criticizing Hillary Clinton and criticizing Al Gore, that's their right. That's fine, there's nothing wrong with it. But where are the other voices?
AL PETERSON: Rush Limbaugh was not a success because he was a political conservative. He was a success because he is a marvelous radio entertainer.
TERENCE SMITH: And commercial radio, in the current age, often aims to be entertaining first, informative second.
RADIO BROADCASTER: Hang on for band of gold and "Mony, Mony." Sing those call letters, lets start this thing.
TERENCE SMITH: Eighty percent of radio listeners tune in to the music- dominated FM dial. Short news summaries, a sort of "news lite" provided by services during "drive time," are often all the news that's heard.
AL PETERSON: I don't think that a news listener turns to his favorite music station because he says, "oh, gee, I want to hear the news now." It's not part of the brand.
RADIO BROADCASTER: Just ahead you get the Beatles' "love me do," Marcells with "Blue Moon"...
AL PETERSON: Radio, not unlike commercial television, it is a game of ratings. I think that all radio stations try to package their product in the most entertaining way they can.
RADIO BROADCASTER: It's official: Exercise is the key to living a longer, healthier life.
AL PETERSON: Does that mean that they don't report the real news? No, I don't think so. Do they package more lifestyle and lighter side news than perhaps they used to? Yes, I think that's probably true.
RADIO NEWSPERSON: Mandy would either like you to file a headline or can you tell her what the headline is?
TERENCE SMITH: The largest U.S. cities continue to support more than one commercial all news station.
RADIO NEWSPERSON: Go ahead and pull two cuts and just write them in audio.
TERENCE SMITH: Los Angeles, the nation's number two radio market, has two.
RADIO BROADCASTER: KFWB news time, 10:18.
RADIO BROADCASTER: Stay tuned, there's plenty ahead on KNX 1070, Los Angeles.
TERENCE SMITH: But they are both owned by radio giant, Infinity, which, along with CBS, is part of media colossus Viacom.
GEORGE NICHOLAW, KNX Radio: I don't think you have to force-feed people with news, because people that want news know where to go to get news.
TERENCE SMITH: George Nicholaw is vice president and general manager of KNX News Radio in Los Angeles.
GEORGE NICHOLAW: Our news departments are totally separate. There is nothing that is duplicated in any way. It's very costly, there's no question about it. But the success of both stations rests on the fact that they go out and do their job getting news, and getting news the way each individual station wants it.
TERENCE SMITH: KNX enjoys economic benefits from cross ownership.
RADIO BROADCASTER: CBS News...
TERENCE SMITH: They broadcast a CBS News feed on the hour, and their morning traffic reporter appears on KCBS Television, …
REPORTER: Out of the valley don’t get on Coldwater Canyon; it’s a bad signal …
TERENCE SMITH: …strengthening name recognition at both.
AL PETERSON: Branding is everything. If you don't have a brand, you're out of business.
TERENCE SMITH: Al Peterson argues that owners of multiple stations actually have more of an opportunity to be creative.
AL PETERSON: Operators can afford to take a chance with a format, rather than sticking with the tried and true. I think that it has allowed a number of operators to become a little more experimental.
TERENCE SMITH: And consolidation has made the remaining news outlets stronger.
RADIO NEWS PERSON: We're looking for the pesticide story...
TERENCE SMITH: WBEN, the all-news commercial station in Buffalo, has a bigger news staff than before. Kevin Keenan was, until recently, news director.
KEVIN KEENAN, Former News Director, WBEN Radio: We are in a position with a larger news staff to do a better job of covering the news, better job of enterprising stories, so we serve the WBEN listener better. But from a market wide standpoint, the listener is not served better, because there is one fewer news voice on the air.
TERENCE SMITH: But he says WBEN must compete with other media.
KEVIN KEENAN: You know, there's cable and there's newspapers, and there's magazines, and I mean, there are more and more options for people. So we have to make sure that we are on our game, every day.
TERENCE SMITH: But Anthony Violanti argues that the radio that we wake up to, listen to in our cars, in our kitchens, ought to reflect a variety of voices.
ANTHONY VIOLANTI: Is there a cultural elite? Do we have to go to Los Angeles or New York or Chicago to hear competitive commercial radio?
SEN. BYRON DORGAN: To suggest that the radio ownership in this country shall be concentrated under the umbrella of just a couple of corporations, will somehow be better for folks in local communities, that's nonsense. This didn't have anything to do with small markets, it had to do with big money.
TERENCE SMITH: Local ownership and programming, they argue, were the glue of some communities, an important part of the social fabric.
TERENCE SMITH: Senator Dorgan likens what is happening in radio to deregulation in the airline industry. As with the airlines, he says, consumers will ultimately notice the difference.
SEN. BYRON DORGAN: The airline industry began its massive concentration in the 1980s continuing into the '90s. The massive concentration in radio started after 1996, so this has only happened in three, four, five years. And it's happened very quickly, and with almost lightning speed. And the consequences of it, I think, have not been fully realized.
RADIO BROADCASTER: Today's best country...
RADIO BROADCASTER: Venus won the tie-breaker, 7- 3...
TERENCE SMITH: In other words, the new "new thing" keeps changing.