NPR wasn’t always in the HD radio camp. In fact, when iBiquity first made its push into the broadcast arena, many non-comms as well as commercial stations had serious misgivings about the idea, as reported in this 2002 Radio World post entitled “IBOC Fees Stir Reaction.” It stated, in part:
Many broadcasters are just realizing that to make the digital transition, they’ll need to pay Ibiquity Digital Corp. software licensing fees in addition to what they will pay manufacturers for new equipment. This comes as a shock for some executives who have been paying closer attention to day-to-day revenue and debt concerns during the economic downturn than to the likely costs of converting to digital radio. The fee issue is controversial. The median one-time licensing fee would be about $12,900. At the top end of the scale, a Class C FM could pay about $70,000. Ibiquity also plans to collect 3 percent of yearly station revenues from data services associated with IBOC. In addition to the costs involved, some radio stations would end up paying fees to Ibiquity, a company owned in part by their group owners — or their competitors.
But the original business plan of iBiquity tied in a number of players in the industry:
Part of the answer may lie in Ibiquity’s ownership and business partners. Company shareholders include most of the major broadcast groups. It has licensing agreements with transmitter manufacturers Broadcast Electronics, Harris and Nautel, and with receiver manufacturers Kenwood, Harmon Kardon and Visteon. Ford recently took an undisclosed equity position in Ibiquity. In addition to broadcast stockholders, Ibiquity also has Wall Street investors who presumably want a quick return on their investment.
But even before that, many big names were involved in the company, as noted on the iBiquity website:
The roots of the Company stretch back to 1991 when CBS, Gannett, and Westinghouse formed USA Digital Radio (USADR) to explore opportunities for digital AM and FM broadcasting. . . . By 1998, USADR had made such progress with the IBOC technology that it was spun out as a separate company, backed by investment from 13 of the nation’s leading radio broadcasters. iBiquity Digital was subsequently formed in 2000 with the merger of USADR and Lucent Digital Radio. The Company’s investors include 15 of the nation’s top radio broadcasters, including Clear Channel and CBS Radio; leading financial institutions, such as Grotech Capital Group, J.P. Morgan Partners, New Venture Partners, FirstMark Capital; and strategic partners Ford Motor Company, Harris, Texas Instruments and Visteon.
Resistance centered on the initial cost of hardware — an average of $150,000 per station — as well as iBiquity fees:
In comments submitted to the FCC about the National Radio Systems Committee report on Ibiquity’s FM IBOC system, the Rocky Mountain Corporation for Public Broadcasting wrote that its stations are “outraged at this unprecedented use fee plan.”
One unnamed manager wrote to the FCC, “I think it is unconscionable that they are asking the FCC to adopt their sole technology as the only system and then charge every station an annual use fee on top of the fees you will already pay to Harris etc. that will be built into their digital equipment if and when you decide to buy their transmitter.”
The company circulated “Memorandums of Understanding” discussing the fee plan with its investor broadcasters and other station owners, which one company lawyer termed “weasel wording that will be meaningless in negotiating.” A further sticking point was the iBiquity charge of 3 percent annually of station revenues generated from the IBOC data services (covered earlier here).
But as it turned out, iBiquity gained at least one accomplice down the line. Barry McLarnon, writing in this Radio World article, explains how NPR greased the skids on the acceptance of an IBOC power increase for its own ends:
The game-changer came several years after the system got FCC approval, when NPR, anxious to get more of their programming onto the airwaves, demonstrated the feasibility of carving up the 96 kilobits-per-second digital payload into multiple audio streams. The commercial folks quickly jumped on this concept, as it represented a means of stimulating interest in a public that up to that point had greeted “HD” radio with a collective yawn.
The advent of “HD2” and “HD3” audio streams represented a fundamental change in the system concept. It was certainly a step forward in terms of versatility, but a major shortcoming quickly became evident: Those dropouts that were easily smoothed over in the main audio channel became irritating muting events in the HD2/HD3 streams. Increasing digital power is the only way to reduce the incidence of these dropouts . . . so, here we are [emphasis added].
But that wasn’t the extent of it. As Barry noted:
The FCC order regarding the power increase represents a bit of a departure for the commission. Up to this point, they at least paid lip service to protecting the public interest by requesting comments at key junctures in IBOC deployment.
This time, however, they based their decision almost entirely on the contents of a report submitted after the close of the comment and reply comment periods. What also raises eyebrows is the fact that the order discusses a couple of ex parte filings submitted after comments were no longer invited.
So, in essence, a few privileged parties had their say at that point, and everyone else was left out in the cold.
And who was it that had their say? What was their conclusion?
[T]he most surprising aspect has been the about-face by NPR. In their 2008 report, they warned of dire consequences that would ensue from a blanket FM IBOC power increase. They had plenty of statistics to back this up, derived from studies of numerous stations, using sophisticated propagation prediction tools. According to these results, there were some significant interference problems even at the existing –20 dBc power level.
But then another study is hastily done, and now we’re told: Oops, our mistake, a blanket increase of 6 dB is actually just fine, and even a 10 dB increase will be okay in most cases.
Hard to fathom the reason for the change, Barry notes, unless “it is simply a means to a desired end.” But this did not sit well with those left out of the discussion — presumably those who were not partners in the flaky venture. It bears repeating this May post from the site All Access, wherein it was said:
Press Communications filed an Application for Review and Request for Stay, citing an “unalterably biased” outcome of the proceeding based on testing conducted by the parties who had a stake in the outcome, without a full technical review or independent verification. “NPR had already admitted to vast amounts of new interference,” wrote Press. “The NAB is somewhat tainted with a majority of its Executive Board and eight to 10 others on its Radio Board having invested money in the venture. Meanwhile, a member of its radio board with a heavy investment in HD equipment in its group largely conducted the ‘tests’ on its own stations working directly with iBiquity.
“What is particularly galling is the Commission, who has and continues to rigidly protect analog FM from analog to analog interference, has allowed NPR and its cohorts to essentially assume the role of the Commission in vetting the change, not only accepting their ‘engineering’ findings, but even largely adopting the language proposed by the group,” added Press, which also noted the disproportionate impact of interference on Class A stations in general and those in the Monmouth-Ocean market in particular. “Let’s call this Order for what it really is,” wrote Press, “an unparalleled assault on analog FM Radio listeners and to further reorder the competitive landscape to the favor of higher power large market broadcasters” [emphasis added].
And that, as we’ve seen, includes National Public Radio and its “commissary wing,” the Corporation for Public Broadcasting.
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