Radio Broadcasting Stations
SIC 4832
NAICS 515112
Radio broadcasters transmit radio programs to the public. Included in the discussion are radio networks and companies that provide pay-radio services.
Radio broadcasting began as a stable industry controlled in most parts of the world by national and regional governments. Before the collapse of the Soviet Union and other communist nations, those governments exercised complete state control over the airwaves. In Western Europe, state-owned or state-chartered corporations broadcast a limited amount of programming—much of it educational in nature—and commercial channels were almost nonexistent. Japan had a strong radio market, but the rest of Asia remained relatively undeveloped. In the United States, commercial stations dominated the market, but the industry was fragmented due to complex government regulations limiting the number of radio stations that could be owned by one company.
By the mid-1990s, however, rapid technological and political change had completely altered the rules of the global broadcasting industry. In former communist nations, fledgling commercial radio stations challenged state-run corporations, which struggled to change with the times. In Europe, commercial radio stations competed with state-sponsored broadcasters such as the British Broadcasting Corporation (BBC). In the United States, new ownership rules led to a major structural change in the radio industry, and options for mass communications and information technology continued to grow.
By the twenty-first century, technological advances made it possible for music lovers to get commercial-free music anywhere in the world. Online radio programming via the Internet, subscription-based satellite radio, and radio-on-demand services were just a few of the innovations coming to prominence, as traditional radio was seeing an increased slump in listeners. However, radio broadcasting was still strong. According to a study from Arbitron, about 228 million listeners over the age of 11 listened to traditional radio once a week or more.
One of the unifying features of broadcasting around the world is government regulation. Radio broadcasting is less than 100 years old and developed during a century of growing government control over industry. Airwaves are viewed in most countries as a scarce public resource. As such, nearly every radio market in the world has been tightly regulated or directly controlled from its inception by the government.
In Europe, public service broadcasting was the only game in town for many decades, as monolithic state-run institutions provided the programs they thought would educate and entertain. In communist countries, the state was the network, and radio existed to legitimize the government and inform people of its activities.
In the United States, commercial radio had dominated the airwaves for many years, although National Public Radio—a non-profit organization partly funded by the government—provided an alternative in many markets. However, the FCC tightly controlled many aspects of the radio business and was responsible for licensing radio stations and approving their ownership.
Some of those structures crumbled and others changed dramatically in the 1980s and 1990s. As communist governments collapsed in the USSR and Eastern Europe, private ownership of radio stations began to take hold. In Western Europe, more licenses for commercial radio stations were granted, providing competition for traditional state-owned radio stations. In Asia, new stations sprang up, and satellite broadcasts of radio signals became a reality. In the United States, new ownership structures substantially changed the business, as media conglomerates looked for ways to expand the advertising potential of their new holdings.
Large radio networks supplied the content for many radio stations, whether they were government-operated or privately owned. In this arrangement, a network produces programming such as news, music, or commentary, which is then broadcast by a large number of individual stations. The British Broadcasting Corporation is an example of a government-run network, and ABC Radio in the United States is an example of a private network.
Except for certain high-power operations, most AM radio stations regularly reach only a limited geographical area. As a result, there are literally thousands of individual stations in large countries such as the United States. Those AM stations that could reach distant households gave certain "jocks" (such as Tom Shannon of Buffalo, New York; Walter (Salty) Brine of Providence, Rhode Island; and Ed Dickinson of northern California) a semi-celebrity status.
Before World War I, inventors Guglielmo Marconi, Lee DeForest, Reginald Aubrey Fessenden, and Edwin Armstrong devised the technology needed to broadcast radio signals, but a wartime ban on nonmilitary broadcasting delayed the advent of radio broadcasts until the ban was lifted after the war ended in 1919.
The first AM radio station in the United States, KDKA in Pittsburgh, began operating in 1919. By 1922, there were 570 licensed AM stations in the United States. Commercial networks soon emerged to broadcast programs and advertising on different stations simultaneously. National Broadcasting Company (NBC) was founded in 1926 to operate two networks for its parent company, the Radio Corporation of America (RCA). Columbia Broadcasting Systems (CBS), a major competitor, established a network of 16 stations by 1928.
Radio broadcasting soon caught on in Europe and other regions with the capacity to support commercial or state-sponsored broadcasting. The British Broadcasting Corporation (BBC) was formed in 1922 as a private company and in 1927 was chartered by Parliament as the sole provider of British radio broadcasting. Though it operated under charter from the Crown, it was free of government oversight and functioned as an independent entity. Other European governments set up similar monopolies, though some were subject to more government control.
Frequency modulation (FM) radio, invented by Edwin Howard Armstrong in 1933, developed commercially in the 1940s. In the United States, FM was used as an alternative to AM and featured "highbrow" programs such as in-depth news analysis and classical music. FM receivers were more expensive than AM radios, and because of the higher radio frequencies that FM utilizes, coverage areas were severely limited. As a result, FM was slow to catch on in the 1960s and early 1970s despite its static-free sound quality. Then the cost of FM receivers dropped, and in the mid to late 1970s and 1980s, FM flourished as rock-and-roll stations proliferated in the United States.
In the Soviet Union, radio and television broadcasting was exclusively a propaganda arm of the government until the late 1980s when Communist party and state control over the media eased. In July 1990, Chairman Mikhail Gorbachev ordered major changes in the state-run broadcasting monopoly, allowing radio outlets to operate independently of political organizations and provide objective coverage of news events. The complete collapse of the communist government continued this trend, although restrictions on radio broadcasting remain.
In the 1980s and 1990s many Eastern European radio stations bloomed as governments eased their heavy grip on the airwaves. Major companies such as France's Europe Developpement and CLT Multi-Media of Luxembourg, along with many local firms, invested in commercial radio properties in Eastern Europe. In the 1990s, the Czech Republic, Slovakia, and Poland led the move to open radio licensing for foreign and domestic firms.
At the same time, there was some globalization of the radio industry, as countries loosened ownership rules for broadcast mediums. For example, in 1995 the U.S. Federal Communications Commission (FCC) relaxed its rules on foreign ownership of radio stations, which was expected to bring a number of well-heeled international investors into the U.S. market. Growing satellite transmission of radio programs has made it much easier to distribute programming across national borders.
In 1996, the FCC also eased its restrictions on the number of radio stations one company could own. That led to a frenzied market for radio stations, as major media conglomerates rushed to buy large numbers of stations with the idea of creating vast networks across the country. Radio emerged as perhaps the hottest media market in the United States, and prices paid for stations shot up dramatically. From the beginning of 1996 to early 1998, more than 25 percent of the nation's 10,000 stations changed hands.
Digital production and transmission of radio gained a foothold in the mid-1980s, with some ventures, such as Star Radio in Asia, taking advantage of the new technology by distributing radio via satellite. In the United States, talk radio gained in popularity as personalities like Rush Limbaugh used the medium to rally supporters of a particular political viewpoint, and "shock radio" hosts such as Howard Stern became popular using a format pioneered by still-active and intentionally obnoxious Joey Reynolds, later on the WOR Radio Network. Other formats, such as all-sports, took off as well, and a very few local sports broadcast...
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